A copy of this amended and restated preliminary base PREP prospectus has been filed with the securities regulatory authority in each of the provinces and territories of Canada but has not yet become final for the purpose of the sale of securities. Information contained in this amended and restated preliminary base PREP prospectus may not be complete and may have to be amended. The securities may not be sold until a receipt for the base PREP prospectus is obtained from the securities regulatory authorities.

No securities regulatory authority has expressed an opinion about these securities and it is an offence to claim otherwise. This prospectus constitutes a public offering of the securities only in those jurisdictions where they may be lawfully offered for sale and, in such jurisdictions, only by persons permitted to sell such securities.

This prospectus has been filed under the procedures of each of the provinces and territories of Canada that permit certain information about these securities to be determined after the prospectus has become final and that permit the omission of that information from this prospectus. The procedures require the delivery to purchasers of a supplemented PREP prospectus containing the omitted information within a specified period of time after agreeing to purchase any of these securities. All of the information contained in the supplemented PREP prospectus that is not contained in this base PREP prospectus will be incorporated by reference into this base PREP prospectus as of the date of the supplemented PREP prospectus.

These securities have not been and will not be registered under the United States Securities Act of 1933, as amended (the "U.S. Securities Act") or any state securities legislation and may not be offered or sold in the United States except in compliance with the registration requirements of the U.S. Securities Act and applicable state securities legislation or pursuant to an exemption therefrom. This preliminary prospectus does not constitute an offer to sell or a solicitation of an offer to buy any of the securities offered hereby within the United States. See "Plan of Distribution".

AMENDED AND RESTATED PRELIMINARY BASE PREP PROSPECTUS

(amending and restating the preliminary base PREP prospectus dated February 12, 2021)

Initial Public Offering and Secondary Offering February 17, 2021

BOAT ROCKER MEDIA INC.

\$175,000,000

([●] Subordinate Voting Shares)

This amended and restated preliminary prospectus (the "Prospectus") qualifies the distribution to the public (the "Offering") of an aggregate of [●] subordinate voting shares (the "Subordinate Voting Shares") of Boat Rocker Media Inc. (the "Company" or "Boat Rocker"), a company organized under, and governed by, the laws of Ontario, at a price of \$[●] per Subordinate Voting Share (the "Offering Price"). It is anticipated that the Offering Price will be between \$12.00 and \$14.00 per Subordinate Voting Share. The Offering consists of an initial public offering of [●] Subordinate Voting Shares by the Company (the "Treasury Offering") and a secondary offering of 459,097 Subordinate Voting Shares (the "Secondary Offering") by DF BRM Holdco Inc. (which is controlled by David Fortier), IS BRM Holdco Inc. (which is controlled by Ivan Schneeberg) and John Young (the "Selling Shareholders"). See "Principal and Selling Shareholders" and "Plan of Distribution". The Company will use the net proceeds from the Treasury Offering as described in this Prospectus. See "Use of Proceeds". The Company will not receive any proceeds from the Secondary Offering. The Subordinate Voting Shares being offered pursuant to this Offering are collectively referred to in this Prospectus as the "Offered Shares".

The Subordinate Voting Shares are "restricted securities" within the meaning of such term under applicable Canadian securities laws. The Company is exempt from the requirements of Section 12.3 of National Instrument 41- 101 – General Prospectus Requirements on the basis that the Company was a private issuer immediately before filing the Prospectus.

Upon completion of the Offering, the Company will have two classes of issued and outstanding shares: Subordinate Voting Shares and multiple voting shares (the "Multiple Voting Shares", and together with the Subordinate Voting Shares, the "Shares"). The Multiple Voting Shares will be held by Fairfax Financial Holdings Limited and/or its affiliates ("Fairfax"), David Fortier, Ivan Schneeberg and John Young and/or their respective controlled subsidiaries, including family trusts (collectively, "IDJ" and, together with Fairfax, the "Principal Shareholders"), either directly or indirectly. The Subordinate Voting Shares and the Multiple Voting Shares are substantially identical with the exception of the voting and conversion rights attached to the Multiple Voting Shares. Each Subordinate Voting Share is entitled to one vote and each Multiple Voting Share is entitled to up to 10 votes. The number of votes to which a holder of Multiple Voting Shares is entitled to will be determined by whether such holder is a Canadian Person or Non-Canadian Person (each, as defined below). In the event such holder is a Non-Canadian Person, such holder will be entitled to a variable number of votes, not less than one and not exceeding 10 (and which may be a fraction) per Multiple Voting Share. In determining the variable number of votes, such holder will have their voting rights per Multiple Voting Share held automatically proportionately reduced if and to the extent necessary to enable the Company to maintain its eligibility and qualification under the Canadian Status Rules. See "Authorized Share Capital Upon Closing – Multiple Voting Shares and Subordinate Voting Shares". The Multiple Voting Shares are convertible into Subordinate Voting Shares on a one-for-one basis at any time at the option of the holders thereof and automatically in certain other circumstances. The holders of Subordinate Voting Shares benefit from "coat-tail" provisions that give them certain rights in the event of certain take-over bids for the Multiple Voting Shares. See "Principal and Selling Shareholders – Take-over Bid Protection – Coat-tail Agreement". Upon completion of the Offering and assuming no exercise of the Over-Allotment Option (as defined below), the Company will have [●] Subordinate Voting Shares and 23,553,050 Multiple Voting Shares issued and outstanding. See "Issued Share Capital Upon Closing" and "Principal and Selling Shareholders".

Upon completion of the Offering, the Principal Shareholders will collectively hold 100% of the Company's issued and outstanding Multiple Voting Shares. After giving effect to the Offering, the Principal Shareholders will hold approximately [●]% of the Company's total issued and outstanding Shares and will hold approximately [●]% of the voting power attached to all of the Shares (approximately [●]% and [●]%, respectively, if the Over-Allotment Option is exercised in full). As a result, the Principal Shareholders will following Closing, in the aggregate, have over 90% of the voting power over all corporate actions requiring shareholder approval. See "Principal and Selling Shareholders" and "Risk Factors". All of the Multiple Voting Shares held after completion of the Offering by the Principal Shareholders will be subject to contractual lock-up arrangements with the Underwriters (as defined below). See "Plan of Distribution – Lock-up Arrangements".

Price: \$[⚫] per Subordinate Voting Share

	Price to the Public(1)	Underwriters' Fee	Net Proceeds to the Company(2)	Net Proceeds to the Selling Shareholders(3)
Per Subordinate Voting Share	\$[●]	\$[●]	\$[●]	\$[●]
Total Offering(4) (5)	\$[●]	\$[●]	\$[●]	\$[●]

Notes:

____________

(1) The Offering Price has been determined by negotiation among the Company, the Selling Shareholders and the Underwriters.

(2) After deducting the Underwriters' commissions payable by the Company but before deducting the Company's expenses of the Offering, estimated to be approximately \$[●] million, which expenses will be paid by the Company from the proceeds of the Offering.

The following table sets out the number of Subordinate Voting Shares that may be issued by the Company to the Underwriters pursuant to the exercise of the Over-Allotment Option:

Underwriters' Position	Maximum Size or Number of Securities Available	Exercise Period	Exercise Price
Over-Allotment Option	Up to an additional 15% of the aggregate number of Subordinate Voting Shares issued under the Offering, being [●] Subordinate Voting Shares	For a period of 30 days after the Closing Date	\$[●] per Subordinate Voting Share

RBC Dominion Securities Inc. ("RBC") and TD Securities Inc. ("TD", and, together with RBC, the "Joint Bookrunners"), J.P. Morgan Securities Canada Inc., as co-lead manager ("JP Morgan"), BMO Nesbitt Burns Inc. ("BMO"), Scotia Capital Inc., Cormark Securities Inc., and Canaccord Genuity Corp. (collectively, and together with the Joint Bookrunners, the "Underwriters"), as principals, conditionally offer the Subordinate Voting Shares qualified under this Prospectus, subject to prior sale, if, as and when issued or transferred by the Company and the Selling Shareholders and accepted by the Underwriters in accordance with the conditions contained in the underwriting agreement between the Company, the Selling Shareholders and the Underwriters referred to under "Plan of Distribution" and subject to the approval of certain legal matters on behalf of the Company and the Selling Shareholders by Stikeman Elliott LLP and on behalf of the Underwriters by Goodmans LLP.

In connection with this distribution, the Underwriters have been granted the Over-Allotment Option and may, subject to applicable law, over-allocate or effect transactions which stabilize or maintain the market price of the Subordinate Voting Shares at levels other than those which otherwise might prevail on the open market. The

⁽³⁾ The Selling Shareholders will be responsible for the payment of the Underwriters' commissions payable in respect of Offered Shares sold by the Selling Shareholders, however, as the incremental expenses of the Secondary Offering are not anticipated to be material, the Company has agreed to pay the expenses associated with the Secondary Offering and the Selling Shareholders will not be responsible for any further fees or expenses in connection with the Offering. See "Plan of Distribution".

⁽⁴⁾ Assumes no exercise of the Over-Allotment Option.

⁽⁵⁾ The Company has granted to the Underwriters an option (the "Over-Allotment Option"), exercisable in whole or in part at any time for a period of 30 days after the Closing Date (as defined below), to purchase up to an additional 15% of the aggregate number of Subordinate Voting Shares issued under the Offering, being [●] Subordinate Voting Shares, at a price of \$[●] per Subordinate Voting Share, solely to cover over-allotments, if any, and for market stabilization purposes. If the Over-Allotment Option is exercised in full, the total "Price to the Public", "Underwriters' Fee" and "Net Proceeds to the Company" will be \$[●], \$[●] and \$[●], respectively. This Prospectus also qualifies the grant of the Over-Allotment Option and distribution of the Subordinate Voting Shares issuable upon the exercise of the Over-Allotment Option. A purchaser who acquires Subordinate Voting Shares forming part of the Underwriters' over-allocation position acquires such Subordinate Voting Shares under this Prospectus, regardless of whether the Underwriters' over-allocation position is ultimately filled through the exercise of the Over-Allotment Option or secondary market purchases. See "Plan of Distribution".

Underwriters may offer the Subordinate Voting Shares at a price lower than that stated above and, in such case, the compensation realized by the Underwriters will be decreased by the amount that the aggregate price paid by the purchasers for the Subordinate Voting Shares is less than the gross proceeds paid by the Underwriters to the Company and the Selling Shareholders. See "Plan of Distribution".

BMO is an affiliate of a Canadian chartered bank which has made the Corporate Credit Facility and certain interim production financing facilities available to the Company. The estimated net proceeds of the Treasury Offering will be used, in part, to, directly or indirectly, repay all of the term debt outstanding under the Corporate Credit Facility. In addition, an affiliate of JP Morgan is a lender under the US Scripted Production Facility made available to the Company. Consequently, Boat Rocker may be considered a "connected issuer" of BMO and JP Morgan under applicable Canadian securities laws. See "Description of Material Indebtedness" and "Plan of Distribution - Relationship Between the Company and Certain of the Underwriters".

Subscriptions will be received subject to rejection or allocation in whole or in part, and the Underwriters reserve the right to close the subscription books at any time without notice. The closing of the Offering (the "Closing") is expected to occur on or about [●], 2021, or such other date as the Company, the Selling Shareholders and the Underwriters may agree, but in any event no later than [●], 2021 (the "Closing Date"). The Subordinate Voting Shares offered under this Prospectus are to be taken up by the Underwriters, if at all, on or before [●], 2021. The Subordinate Voting Shares will be deposited with CDS Clearing and Depository Services Inc. ("CDS") in electronic form on the Closing Date through the non-certificated inventory system administered by CDS. A purchaser of Offered Shares will receive only a client confirmation from the registered dealer from or through which the Offered Shares are purchased.

The Company has applied to have the Subordinate Voting Shares listed on the Toronto Stock Exchange ("TSX") under the trading symbol "BRMI". Listing is subject to the approval of the TSX in accordance with its original listing requirements. The TSX has not conditionally approved the listing of the Subordinate Voting Shares and there is no assurance that the TSX will approve the Company's listing application.

There is currently no market through which the Subordinate Voting Shares may be sold and purchasers may not be able to resell the Subordinate Voting Shares purchased under this Prospectus. This may affect the pricing of the Subordinate Voting Shares in the secondary market, the transparency and availability of trading prices, the liquidity of the Subordinate Voting Shares, and the extent of issuer regulation. See "Risk Factors".

An investment in the Subordinate Voting Shares involves a high degree of risk. Prospective purchasers should carefully consider the risk factors described under "Risk Factors" before purchasing Subordinate Voting Shares.

ABOUT THIS PROSPECTUS1
MEANING OF CERTAIN REFERENCES1
NON-IFRS MEASURES 1
EXCHANGE RATE DATA3
CAUTION REGARDING FORWARD LOOKING STATEMENTS4
MARKET AND INDUSTRY DATA 7
TRADEMARKS AND TRADE NAMES8
MARKETING MATERIALS 8
ELIGIBILITY FOR INVESTMENT 8
DISCLAIMER9
PROSPECTUS SUMMARY11
THE OFFERING28
CORPORATE STRUCTURE OF BOAT ROCKER33
INDUSTRY AND MARKET OPPORTUNITY34
LETTER FROM THE FOUNDERS 43
THE HISTORY OF THE COMPANY 44
THE BUSINESS OF THE COMPANY47
OUTLOOK 67
SELECTED ANNUAL AND INTERIM FINANCIAL INFORMATION OF BOAT ROCKER70
BOAT ROCKER PRO FORMA CONSOLIDATED FINANCIAL INFORMATION 74
MANAGEMENT'S DISCUSSION AND ANALYSIS OF BOAT ROCKER 75
REGULATORY MATTERS 76
USE OF PROCEEDS77
AUTHORIZED SHARE CAPITAL UPON CLOSING 79
PRE-CLOSING CAPITAL CHANGES84
ISSUED SHARE CAPITAL UPON CLOSING 85
RIGHTS TO ACQUIRE SHARES 85
DIVIDEND POLICY 88
PRINCIPAL AND SELLING SHAREHOLDERS 88

PRINCIPAL SHAREHOLDERS AGREEMENT 91
REGISTRATION RIGHTS 94
DESCRIPTION OF MATERIAL INDEBTEDNESS 95
CONSOLIDATED CAPITALIZATION 98
OPTIONS TO PURCHASE SECURITIES 100
PRIOR ISSUANCES 101
DIRECTORS AND EXECUTIVE OFFICERS 102
CORPORATE GOVERNANCE 106
EXECUTIVE COMPENSATION 112
DIRECTOR COMPENSATION 124
INDEBTEDNESS OF DIRECTORS AND EXECUTIVE OFFICERS 124
RISK FACTORS 124
PLAN OF DISTRIBUTION 151
LEGAL PROCEEDINGS 154
LEGAL MATTERS 155
INTERESTS OF MANAGEMENT AND OTHERS IN MATERIAL TRANSACTIONS 155
ENFORCEMENT OF JUDGMENTS AGAINST FOREIGN PERSONS OR COMPANIES 155
AUDITORS, TRANSFER AGENT AND REGISTRAR 155
CERTAIN CANADIAN FEDERAL INCOME TAX CONSIDERATIONS 156
MATERIAL CONTRACTS 158
EXEMPTIVE RELIEF 159
PURCHASERS' STATUTORY RIGHTS 160
GLOSSARY OF TERMS 160
INDEX TO FINANCIAL STATEMENTS AND MANAGEMENT'S DISCUSSION AND ANALYSES F-(i)
APPENDIX A - AUDIT AND RISK COMMITTEE CHARTER A-1
CERTIFICATE OF THE COMPANY C-1
CERTIFICATE OF THE UNDERWRITERS C-2

ABOUT THIS PROSPECTUS

An investor should rely only on the information contained in this Prospectus and should not rely on parts of the information contained in this Prospectus to the exclusion of others. The Company and the Selling Shareholders have not, and the Underwriters have not, authorized anyone to provide investors with additional or different information. The information contained on www.boatrocker.com and any other website referenced in this Prospectus is not intended to be included in or incorporated by reference into this Prospectus and prospective investors should not rely on such information when deciding whether or not to invest in the Offered Shares.

The Company is not, the Selling Shareholders are not, and the Underwriters are not, offering to sell the Subordinate Voting Shares in any jurisdiction where the offer or sale of such securities is not permitted. The information contained in this Prospectus is accurate only as of the date of this Prospectus or the date indicated, regardless of the time of delivery of this Prospectus or of any sale of the Offered Shares.

For investors outside Canada, none of the Company, the Selling Shareholders or any of the Underwriters has done anything that would permit the Offering or possession or distribution of this Prospectus in any jurisdiction where action for that purpose is required, other than in Canada. Investors are required to inform themselves about, and to observe any restrictions relating to, the Offering and the possession or distribution of this Prospectus.

This Prospectus includes a summary description of certain material agreements of the Company. See "Material Contracts". The summary description is not complete and is qualified by reference to the terms of the material agreements, which will be filed with the Canadian securities regulatory authorities and available on SEDAR. Investors are encouraged to read the full text of such material agreements.

Any graphs, tables or other information demonstrating the historical performance of the Company or of any other entity contained in this Prospectus are intended only to illustrate past performance of such entities and are not necessarily indicative of future performance of the Company or such entities.

MEANING OF CERTAIN REFERENCES

Unless otherwise noted or the context otherwise requires: (i) the "Company" or "Boat Rocker" refers to Boat Rocker Media Inc. together with one or more of its subsidiaries, as applicable; and (ii) the disclosure contained in this Prospectus assumes that the Over-Allotment Option has not been exercised. Certain capitalized terms and phrases used in this Prospectus are defined in the "Glossary of Terms". Words importing the singular number include the plural, and vice versa, and words importing any gender include all genders.

Unless otherwise noted, information contained in this Prospectus: (i) relating to the Company's issued and outstanding share capital is calculated on a non-diluted basis, (ii) gives effect to the Pre-Closing Capital Changes (as defined below) and (iii) assumes the Offering Price is \$13.00, being the midpoint of the estimated price range set forth on the cover page of this Prospectus.

NON-IFRS MEASURES

This Prospectus makes reference to certain non-IFRS measures. These measures are not recognized measures under International Financial Reporting Standards ("IFRS"), do not have a standardized meaning prescribed by IFRS and are therefore unlikely to be comparable to similar measures presented by other companies. Rather, these measures are provided as additional information to complement those IFRS measures by providing further understanding of the Company's results of operations from management's perspective. Accordingly, they should not be considered in isolation nor as a substitute for analysis of the Company's financial information reported under IFRS.

This Prospectus includes non-IFRS measures, including "Adjusted EBITDA", "Adjusted EBITDA Margin", "Cash Available for Use", "Cash Required for Use in Productions", "Free Cash Flow" and "Net Debt". Boat Rocker believes that these non-IFRS measures provide investors with supplemental measures of its operating performance and thus highlights trends in its core business that may not otherwise be apparent when relying solely

on IFRS financial measures. Management also believes that securities analysts, investors and other interested parties frequently use non-IFRS measures in the evaluation of issuers. Management also uses non-IFRS measures in order to facilitate operating performance comparisons from period to period, to prepare annual operating budgets, and to determine components of management compensation. See "Selected Annual and Interim Financial Information of Boat Rocker – Reconciliation of Non-IFRS Measures" for a reconciliation to IFRS measures.

Investors should review this information in conjunction with the Boat Rocker Financial Statements, the Boat Rocker Interim Financial Statements, the Boat Rocker MD&A and the Boat Rocker Pro Forma Financial Statements, which are included elsewhere in this Prospectus.

Non-IFRS Measures (see "Selected Annual and Interim Financial Information of Boat Rocker – Reconciliation of Non-IFRS Measures" for a reconciliation to IFRS measures)

"Adjusted EBITDA" is defined as earnings before interest, taxes, depreciation and amortization ("EBITDA") adjusted for amortization of non-cash program intangibles, change in fair value of financial liabilities, change in fair value of contingent consideration, share-based compensation, transaction and reorganization costs, goodwill impairment, loss on debt modifications and gain or loss on sale of assets. Adjusted EBITDA is used by management as a measure of the Company's profitability. This measure does not have a standardized meaning and as such may not be comparable to other companies.

"Adjusted EBITDA Margin" is defined as Adjusted EBITDA divided by revenue, expressed as a percentage.

"Cash Available for Use" is defined as the total cash and cash equivalents of the Company less Cash Required for Use in Productions. Cash Available for Use funds ongoing working capital requirements, principal and interest payments on corporate demand loans as well as ongoing development and growth efforts and thus is an important liquidity measure that management uses to monitor the business on an ongoing basis. This measure does not have a standardized meaning and as such may not be comparable to other companies. For further details please refer to the "Liquidity and Capital Resources – Cash" section of the Boat Rocker MD&A.

"Cash Required for Use in Productions" represents cash required for the funding of productions in progress that is not considered by the Company to be available for other uses. The cash is not legally restricted and has not been classified as restricted cash on the Company's consolidated statement of financial position. This cash has been provided by buyers and third-party IP owners that have engaged the Company to provide services, as well as banks with whom Boat Rocker has contracted to provide interim production financing. Management uses the amount of Cash Required for Use in Productions to determine the Company's Cash Available for Use. This measure does not have a standardized meaning and as such may not be comparable to other companies. For further details please refer to the "Liquidity and Capital Resources – Cash" section of the Boat Rocker MD&A.

"Free Cash Flow" is defined as cash flow provided by operations adjusted for changes in interim production financing, payment of lease liabilities and distributions to non-controlling interests. Where these types of cash flows are excluded from cash provided by operations, management believes they add value to evaluating the ability of the business to generate cash flow. In particular, interim production financing is crucial to the funding of productions and thus has been included in the calculation of Free Cash Flow. Similarly, repayment of lease liabilities and distributions made to non-controlling shareholders have also been included as management considers these to be operating cash flows.

"Net Debt" is defined as the carrying value of loans and borrowings (excluding interim production financing and convertible debentures) adjusted for the loss on loan modification and loan fees, plus lease liabilities less Cash Available for Use. Net Debt represents obligations the Company has to fund from its earnings and is viewed by management as a consistent measure of the Company's liquidity position. In contrast, interim production financing is drawn to bridge the timing between cash inflows from the license fees and production service fees of the buyer, the film and television tax credits earned on eligible production expenses, and cash outflows of the production expenses. Interim production financing for a particular production is expected to be repaid from the license fees and film and television tax credits of that same production in the ordinary course. As such, interim production financing is excluded from management's calculation of Net Debt. The Company does not include other liabilities in the Net Debt calculation such as: other financial liabilities that are based on estimates and probabilities, rather than specific amounts owing and which may not be payable in cash.

EXCHANGE RATE DATA

In this Prospectus, unless otherwise indicated, all dollar amounts are expressed in Canadian dollars. The U.S. dollar and the U.K. pound sterling have been converted into Canadian dollars based on a nine month average exchange rate of US\$1.00 = C\$1.3541 and £1 = C\$1.7198 for the period ended September 30, 2020. The following table sets out (a) the high and low rate of exchange for one Canadian dollar in U.S. dollars and UK pounds sterling during the indicated periods, (b) the average rate of exchange for those periods, and (c) the rate of exchange in effect as at the end of each of those periods, each based on the Bank of Canada daily average exchange rate.

U.S. Dollar (\$)	Low	Average	End of Period
Three Month Periods ending September 30,
2020 1.3616	1.3042	1.3321	1.3339
2019 1.3343	1.3038	1.3204	1.3243
Nine Month Periods ending September 30,
2020 1.4496	1.2970	1.3541	1.3387
2019 1.3600	1.3038	1.3289	1.3243
Fiscal Years Ended
December 31, 20191.3600	1.2988	1.3266	1.3027
December 31, 20181.3642	1.2288	1.2957	1.3612
December 31, 20171.3743	1.2128	1.2986	1.2545

On February 16, 2021, the Bank of Canada's daily average exchange rate for Canadian dollars was C\$1.00 = US\$0.7884 (US\$1.00 = C\$1.2684).

Pound Sterling (£)	Low	Average	End of Period
Three Month Periods ending September 30,
2020 1.7591	1.6874	1.7208	1.7199
2019 1.6576	1.5955	1.6979	1.6290
Nine Month Periods ending September 30,
2020 1.7835	1.6733	1.7189	1.7182
2019 1.7743	1.5955	1.6921	1.6294
Fiscal Years Ended
December 31, 20191.7743	1.5955	1.6939	1.7159
December 31, 20181.8371	1.6633	1.7299	1.7400
December 31, 20171.7767	1.5865	1.6720	1.6961

On February 16, 2021, the Bank of Canada's daily average exchange rate for Canadian dollars was C\$1.00 = £0.5671 (£1.00 = C\$1.7635).

No representation is made that Canadian dollars could be converted into U.S. dollars or U.K. pound sterling at the specified rates or any other rate.

CAUTION REGARDING FORWARD-LOOKING STATEMENTS

Certain statements in this Prospectus that are prospective in nature constitute forward-looking information and/or forward-looking statements within the meaning of applicable securities laws (collectively, "forward-looking statements"). Forward-looking statements are provided for the purposes of assisting the reader in understanding Boat Rocker's financial performance, financial position and cash flows as at and for the periods ended on certain dates and to present information about management's current expectations and plans relating to the future, and readers are cautioned that such statements may not be appropriate for other purposes. Forward-looking statements generally, but not always, can be identified by the use of forward-looking terminology such as "anticipate", "be achieved", "believes", "budget", "continue", "could", "expect", "estimate", "forecasts", "has an opportunity", "intend", "likely", "may", "objective", "outlook", "plans", "potential", "predict", "project", "prospect", "scheduled", "seek", "should", "strategy", "would", or "will", or variations of such words and phrases or similar expressions suggesting future outcomes or events, and the negative of any of these terms.

Discussions containing forward-looking statements may be found, among other places, under "Prospectus Summary", "The Business of the Company", "Outlook", "Boat Rocker Pro Forma Consolidated Financial Information", "Management's Discussion and Analysis of Boat Rocker", "Regulatory Matters", "Use of Proceeds", "Authorized Share Capital Upon Closing", "Pre-Closing Capital Changes", "Issued Share Capital Upon Closing", "Dividend Policy", "Principal and Selling Shareholders", "Principal Shareholders Agreement", "Registration Rights", "Consolidated Capitalization", "Directors and Executive Officers", "Corporate Governance", "Executive Compensation", "Director Compensation" and "Risk Factors".

These forward-looking statements include, but are not limited to, statements concerning: the Offering Price, the completion, size, expenses and timing of the Offering and Closing; matters relating to the expected operations, financial results and condition of the Company; the future impact of the COVID-19 pandemic, including the impact on the timing of production and delivery of greenlit programming, programming in-production, and programming in development which is anticipated to be greenlit; expectations regarding industry trends, overall market growth rates and the Company's growth rates and growth strategies; Boat Rocker's future objectives and strategies to achieve those objectives, including, without limitation, the exploration of individual acquisition opportunities; the competitive position in the industry in which Boat Rocker operates; regulatory changes and potential impacts on Boat Rocker and the markets and industry in which it operates in; Boat Rocker's production pipeline; expectations regarding ability of the Company to source, assess and monetize its IP; expectations regarding availability of future partnerships, expectations regarding the Company's revenue, profitability, cash flows, Adjusted EBITDA and Adjusted EBITDA Margin, acquisitions and investments; and the market price of the Subordinate Voting Shares. In addition, the Company's near-term financial outlook is considered forward-looking information. See "Outlook" for additional information concerning the Company's outlook and related assumptions and risks.

These forward-looking statements reflect management's current opinions, beliefs, estimates, expectations and assumptions and are based on information currently available to management, which includes assumptions about continued revenues based on historical past performance, management's historical experience, perception of trends and current business conditions, expected future developments, and other factors which management considers appropriate and reasonable in the circumstances. As they are forward-looking in nature, they are subject to change and are thus inherently incapable of being verified by PricewaterhouseCoopers LLP, the Company's auditors. With respect to the forward-looking statements included in this Prospectus, Boat Rocker has made certain assumptions with respect to, among other things, Boat Rocker's growth outlook, the performance of the Company's business and operations, the Company's ability to maintain, expand and protect its IP portfolio, that Boat Rocker will meet its future objectives and strategies, that its future projects and plans are achievable and will proceed as anticipated, as well as assumptions concerning the expected emergence from the restrictions associated with the COVID-19 pandemic, general economic and industry growth rates, currency exchange and interest rates, competitive intensity and consumer preferences which are material factors made in preparing forward-looking statements and management's expectations. Despite a careful process to prepare and review the forward-looking statements, there can be no assurance that the underlying opinions, beliefs, expectations, estimates and assumptions will prove to be correct.

Readers are cautioned not to place undue reliance on forward-looking statements, as there can be no assurance that the future circumstances, outcomes, or results anticipated or implied by such forward-looking statements will occur or that plans, intentions or expectations upon which the forward-looking statements are based will occur. By their nature, forward-looking statements involve known and unknown risks and uncertainties and other factors that could cause actual results to differ materially from those contemplated by such statements, including but not limited to the following risk factors described in greater detail under the heading "Risk Factors":

the competitive industry within which the Company operates;
changes in public and consumer tastes and preferences and industry trends;
the Company's ability to source IP and creative talent who can develop IP;
a limited number of buyers for the Company's original programming;
a limited pool of owned assets;
developments in technology and industry trends;
the potential impact of COVID-19 on the Company's business, financial condition and results of operations;
dependence on external factors;
business interruptions;
reliance on key personnel;
reliance by Untitled Entertainment on its ability to identify, recruit and retain qualified and experienced managers;
reliance by Untitled Entertainment on managers to build and maintain relationships with key talent clients;
potential labour shortages;
potential labour strikes or other forms of labour unrest affecting guilds or unions in the television and film industries;
lack of output agreements with buyers and dependence on key relationships with buyers;
budget overruns;
the potential inability to accurately project revenues and results of operations;
the Company's substantial capital requirements and financial risks, including liquidity needs;
the potential inability of the Company to recoup acquisition, production, marketing and distribution costs incurred in production and distribution of video content;
the potential inability to accurately estimate production tax credits and other subsidies;
the potential inability to realize the Company's acquisition strategy or effective execution of the Company's acquisition strategy following Closing;
changes in the Company's business strategy;
potential difficulty raising additional capital;
risks related to doing business internationally;
fluctuation in foreign currency exchange rates;
litigation or regulatory or arbitral action;
protection and defense against intellectual property claims;
dependence on the Company's information technology ecosystem;
cybersecurity incidents or issues;
inadequate investment in information technology infrastructure and slow integration of acquired businesses;
unauthorized disclosure of proprietary and confidential information;
adverse publicity;
internal conflicts of interest;
compliance with laws and regulations;
the Company's dependence on tax credits to fund productions;
potential loss of Canadian status;
risks related to indebtedness;
potential failure to design, test and maintain effective processes and controls;
potential exposure to credit risk;
potential failure to secure studio space within estimated costs;
termination of material buyer and customer agreements;
tax-related risks;
investment eligibility;
outstanding registration rights and the effect on the Subordinate Voting Shares;
outstanding rights to purchase shares in the Company's partially-owned subsidiaries;
risks related to forward-looking information contained in this Prospectus;
absence of a prior public market;
potential loss of investment;
volatility in the market price of the Subordinate Voting Shares;
financial reporting and other public company regulatory obligations and potential errors therein;
possible future dilution of the Subordinate Voting Shares;
future offerings of debt and equity;
indemnification claims by the Company's directors and officers;
limited public company experience;
management's discretion in the use of the proceeds of the Treasury Offering;
significant ownership by the Principal Shareholders; and
limited voting rights of the Subordinate Voting Shares.

If any of these risks or uncertainties materialize, or if the opinions, beliefs, estimates, expectations or assumptions underlying the forward-looking statements prove incorrect, actual results or future events might vary materially from those anticipated in the forward-looking statements. For a further description of these and other factors that could cause actual results to differ materially from the forward-looking statements included in this Prospectus, see the risk factors described under "Risk Factors" in this Prospectus. This list is not exhaustive of the factors that may impact the forward-looking statements. Although the Company has attempted to identify important risk factors that could cause actual results to differ materially from those contained in the forward-looking statements, there may be other risk factors not presently known to the Company or that the Company presently believes are not material that could also cause actual results or future events to differ materially from those expressed in such forward-looking statements. There can be no assurance that such information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such information.

All forward-looking statements included in this Prospectus are expressly qualified by these cautionary statements. Unless otherwise indicated, the forward-looking statements contained herein are made as of the date of this Prospectus and, except as expressly required by applicable law, Boat Rocker undertakes no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events, or otherwise. Investors should read this entire Prospectus and consult their own professional advisors to ascertain and assess the income tax, legal, risk factors and other aspects of their investment in Subordinate Voting Shares.

MARKET AND INDUSTRY DATA

Unless otherwise stated, market and industry data presented throughout this Prospectus was obtained from third-party sources, industry reports and publications, websites and other publicly available information, or are based on estimates derived from such sources and management's knowledge of, and experience in, the industry. Boat Rocker believes that the respective market and economic data is accurate and that its respective estimates and assumptions are reasonable, but there can be no assurance as to the accuracy or completeness thereof. The accuracy and completeness of the market and economic data presented throughout this Prospectus are not guaranteed and neither the Company, the Selling Shareholders nor any of the Underwriters make any representation as to the accuracy of such information. Actual outcomes may vary materially from those forecast in such reports or publications, and the prospect for material variation can be expected to increase as the length of the forecast period increases. Although Boat Rocker believes it to be reliable, neither the Company, the Selling Shareholders nor the Underwriters has independently verified any of the data from third-party sources referred to in this Prospectus, analyzed or verified the underlying studies or surveys relied upon or referred to by such sources, or ascertained the underlying economic and other assumptions relied upon by such sources.

TRADEMARKS AND TRADE NAMES

This Prospectus includes trademarks, including "Boat Rocker", "Platform One", "Dino Ranch", "Danger Mouse", "Orphan Black", and "The Next Step", among others, which are protected under applicable intellectual property laws and are the property of the Company. Solely for convenience, the Company's trademarks and trade names referred to in this Prospectus may appear without the ® or ™ symbol, but such references are not intended to indicate, in any way, that the Company will not assert, to the fullest extent under applicable law, its rights to these trademarks and trade names. All other trademarks used in this Prospectus are the property of their respective owners. For greater certainty, the use or display of other party's trademarks or trade names is not intended to and does not imply a relationship with, or endorsement or sponsorship of the Company by the owner of any such trademark or trade name.

MARKETING MATERIALS

A "template version" of the following "marketing materials" (each as defined in National Instrument 41- 101 – General Prospectus Requirements) filed with the securities commission or similar authority in each of the provinces and territories of Canada is specifically incorporated by reference into this Prospectus:

1. the term sheet dated [⚫], 2021 (the "Term Sheet"); and
1. the investor presentation filed on SEDAR on [⚫], 2021 (the "Investor Presentation").

The Term Sheet and the Investor Presentation are available under the Company's profile on SEDAR at www.sedar.com.

In addition, any template version of any other marketing materials filed with the securities commission or similar authority in each of the provinces and territories of Canada in connection with the Offering, after the date hereof but prior to the termination of the distribution of the Subordinate Voting Shares under this Prospectus (including any amendments to, or an amended version of, any template version of any marketing materials), is deemed to be incorporated by reference herein. Any template version of any marketing materials that are utilized by the Underwriters in connection with the Offering are not part of this Prospectus to the extent that the contents of the template version of the marketing materials have been modified or superseded by a statement contained in this Prospectus.

ELIGIBILITY FOR INVESTMENT

In the opinion of Stikeman Elliott LLP, counsel to the Company, and Goodmans LLP, counsel to the Underwriters, based on the current provisions of the Tax Act in force as of the date hereof, the Subordinate Voting Shares will be qualified investments at the time of the acquisition thereof by a trust governed by a registered retirement savings plan ("RRSP"), registered retirement income fund ("RRIF"), deferred profit sharing plan, registered education savings plan ("RESP"), registered disability savings plan ("RDSP") and tax-free savings account ("TFSA"), provided that at such time the Subordinate Voting Shares are listed on a designated stock exchange for the purposes of the Tax Act (which currently includes the TSX).

Notwithstanding that the Subordinate Voting Shares may be qualified investments for a trust governed by a RRSP, RRIF, TFSA, RESP or RDSP (a "Registered Plan"), the holder of such TFSA or RDSP, the annuitant under such RRSP or RRIF, or the subscriber under such RESP, as the case may be (each such person referred to herein as a "Plan Holder"), will be subject to a penalty tax in respect of the Subordinate Voting Shares if such shares are a "prohibited investment" for the Registered Plan for purposes of the Tax Act. The Subordinate Voting Shares will generally be a "prohibited investment" if the Plan Holder (i) does not deal at arm's length with the Company for purposes of the Tax Act or (ii) has a "significant interest" (within the meaning of the Tax Act) in the Company. In addition, the Subordinate Voting Shares will not be a prohibited investment if such shares are "excluded property" (as defined in the Tax Act for purposes of the prohibited investment rules) for a Registered Plan. Individuals who hold or intend to hold Subordinate Voting Shares in a Registered Plan should consult their own tax advisors as to whether such Subordinate Voting Shares will be a "prohibited investment" in their particular circumstances.

DISCLAIMER

None of the Company's buyers, clients, or customers, nor any persons related to them, including their affiliates (collectively, the "Customers"), are selling, offering for sale or underwriting all or any part of the Offering. The Customers are not receiving any of the proceeds of the Offering and do not endorse or make any recommendations with respect to the Offering or the Subordinate Voting Shares offered hereby. Neither the Offering nor the contents of this Prospectus (including any financial data or any analysis of any tax consequences contained herein) have been approved or endorsed by the Customers and neither of them assumes any obligation whatsoever to any purchaser, Underwriter or Selling Shareholder in connection with the Offering or with respect to the accuracy, adequacy and completeness of this Prospectus or any portion of this Prospectus. The Customers further disclaim any liability arising out of or in connection with the Offering, including without limitation, any liability whatsoever as a seller or promoter or in any other capacity whatsoever. The Customers do not hold any interest in the Company and are not lenders to the Company. The relationship of the Customers with the Company is strictly limited to their contractual relationship as customers. The Customers expressly reserve all of their rights under their respective license agreements with the Company. The Customers have not participated in or commented upon the preparation or presentation of any of the financial information of the Company contained herein, nor have they approved or endorsed such information. The display of trade-marks and designs owned and marketed by the Customers should not be construed as any approval by the Customers of the contents of this Prospectus or the merits of the Subordinate Voting Shares offered hereby. Notice of the above disclaimer is hereby given. Purchasers who acquire any of the Subordinate Voting Shares are deemed to be bound by the foregoing.

LETTER FROM THE FOUNDERS

In 2003, we decided to leave our jobs as entertainment lawyers to become television producers. We had no idea how little we knew about producing, but we knew we wanted to tell stories and we believed in each other. For us, that was enough to take the leap. We set up shop in a former carpet factory on the outskirts of Toronto, and we quickly found out that producing requires a set of skills that goes far beyond an understanding of financing plans, talent contracts and production agreements. Producing also demands an innate creative sensibility, the self-confidence to trust your instincts and place unwavering faith in the vision of a creator, the ability to sell something that does not yet exist, the wherewithal to deliver on the expectations of buyers without compromising your story, the discipline to make the most of your budgets and the leadership skills to get the best out of your crews. And then some. It's fair to say the learning curve was steep.

We decided early on to dedicate ourselves to becoming the best producers we could be. We made some unremarkable shows along the way, but we also made some pretty great ones that ultimately ran for multiple seasons and sold around the world. Before we knew it, we weren't just making television shows, we were building a company, and the lessons we learned as producers guide Boat Rocker to this day:

1. Partner with the best storytellers and do everything you can to support their vision. Challenge the vision, test its soundness, but always protect it.
1. Embrace all forms of storytelling, because remarkable stories exist in every genre. Don't be defined by the type of content you make. Define yourself by the quality of the content you make.
1. Great stories can transcend television. When they do, capitalize on the opportunity to engage audiences in as many ways as possible.
1. Excel at the business of your business. Making compelling content is only half the battle. Financial success is the other half.
1. Hire and work with the best people you can find. Never settle for mediocrity.
1. Treat people with integrity and respect.

These principles were foundational as we focused on organic growth in the early years of the company. We challenged ourselves to team up with the best storytellers we could find and to produce entertaining and compelling content, regardless of genre. We also surrounded ourselves with exceptional creative and business executives, all of whom we consider friends and many of whom remain senior leaders in the company today. Our partnership with John Young, Boat Rocker's Chief Executive Officer, who joined us at a critical stage and has led the company alongside us ever since, remains one of our greatest successes.

These principles also formed the starting point for conversations with our primary supporter and investor, Fairfax and, crucially, with potential partners and acquisitions as the company set its sights on growing from a successful television producer into a global entertainment company. All of the businesses that have joined the Boat Rocker family were built by founders who believed deeply in similar ideals. This is our common ground. It has fostered cooperation amongst Boat Rocker's companies and divisions, it has allowed for enhanced levels of integration, and it will form the basis for the company's future growth, both organic and acquisitive.

It is with the greatest thanks to our employees, creative partners and investors that we forge ahead. We cherish the trust they have placed in us and in the company, and we are forever mindful of how their contributions have built Boat Rocker into the company it is today.

So, what's next? We believe that Boat Rocker is well-positioned for success. We have a multi-genre content creation engine, the means and experience to build and manage entertainment franchises, as well as direct access to A-list talent, whose creativity and celebrity are expected to add significant value when creating and monetizing content. We also have a proven ability to target, acquire and integrate complementary businesses and partnerships as a means to achieving strategic growth, while remaining lean and nimble and unburdened by any of the declining legacy businesses with which many of our competitors are saddled.

Boat Rocker has constructed the platform for a next generation entertainment company, not out of bricks and mortar, but imagination, creativity and integrity. We believe in the power of that combination, and we hope you do, too.

Yours sincerely,

Ivan and David

PROSPECTUS SUMMARY

This summary highlights principal features of the Offering and certain information contained elsewhere in this Prospectus. This summary does not contain all of the information you should consider before investing in the Offered Shares. You should read this entire Prospectus carefully, especially the "Risk Factors" section of this Prospectus and the consolidated financial statements and related notes appearing elsewhere in this Prospectus, before making an investment decision. Capitalized terms used but not defined in this summary are defined elsewhere in this Prospectus.

THE HISTORY OF THE COMPANY

Established in 2003 by former entertainment lawyers Ivan Schneeberg and David Fortier, the Company began by developing and producing television series, including the teen comedy, Darcy's Wild Life, the Canadian format version of America's Next Top Model, How Do You Solve a Problem Like Maria?, the Canadian format version of the popular BBC reality television talent show featuring Andrew Lloyd Webber, and Billable Hours, a half hour comedy parodying the lives of corporate lawyers. In its early years, the Company focused on building up production and development expertise, fostering key industry relationships and diversifying by creating television series across genres for a multitude of buyers.

In 2008, the Company produced its first real hit: the drama, Being Erica, which premiered in 2009 and aired for four seasons and was sold around the world. Being Erica continues to generate recurring revenue to this day, is still lauded by the press and a remake is currently in development. After acquiring distribution rights to Being Erica, BBC Worldwide completed a minority equity investment in the Company in late 2008, providing additional capital for investing in creative development and infrastructure.

In the subsequent years, the Company underwent a period of significant growth, building out its slate of productions, focusing on its core competencies in producing scripted, unscripted and kids and family television series and bolstering its core management team, which included hiring current Chief Executive Officer, John Young in 2009. Two of the Company's most notable brands emerged during the period: The Next Step (produced 2012-present) and Orphan Black (produced 2012- 2017). Both brands laid the foundation for the Company's current business model around sourcing great IP and monetizing it to its full potential, with a focus on producing content with the ability to become franchisable brands that transcend television and generate long-term, recurring revenues.

In 2015, the Company embarked on the build-out of a full-service content studio, with leading creative teams developing and producing shows, supported by a corporate infrastructure capable of marketing, branding and selling its content around the world. The Company re-purchased the minority equity interest held by BBC Worldwide and subsequently sold a majority equity interest in the Company to Fairfax. Equipped with fresh capital, Boat Rocker executed a carefully designed strategy to solidify and develop its existing business, establish a meaningful presence in new entertainment verticals, expand the Company's geographic footprint and further diversify its buyer base worldwide. As a critical part of this growth plan, the Company successfully targeted, acquired and, where wholly-owned, integrated, nine companies, and acquired minority interests in several others. These acquisitions expanded the Company's geographic footprint in the kids and family genre and the scripted and unscripted genres and provided entry points into the animated content and talent management space.

THE BUSINESS OF THE COMPANY

Overview

Boat Rocker is an independent, integrated global entertainment company that harnesses the power of creativity and commerce to tell stories and build iconic brands for audiences around the world.

The Company creates and produces television and film content across all major genres, distributes thousands of hours of content worldwide (both its own and a represented third-party library), and represents leading on-screen talent and celebrities. Boat Rocker leverages its IP to create global entertainment brands that transcend television, resulting in multiple points of audience engagement. Examples include Being Erica, The Next Step, Danger Mouse and Orphan Black, all of which are worldwide brands, generating significant recurring revenue for the Company. Over the course of its 17-year history, the Company has developed and assembled what management believes is a unique set of creative and commercial capabilities. These include creation and development, production, animation, distribution, franchise and brand management, and talent management. Boat Rocker continues to add to, improve, and expand its capabilities to ensure that it meets the needs of its partners, creators, and stakeholders in an ever-evolving entertainment landscape.

Boat Rocker reports the financial results of its business in three segments: "Television" (including live action scripted and unscripted content production and owned IP distribution, but excluding kids and family content), "Kids and Family" (including kids and family live action scripted and unscripted content, all animated content, owned IP distribution, and brand and merchandising), and "Representation" (including brand and management services to talent and IP representation and distribution services to third-party IP owners). See "The Business of the Company – Overview".

COVID-19

In light of the COVID-19 pandemic, the content production industry experienced a temporary pause on live action production, which impacted Boat Rocker's Television segment in both the scripted and unscripted production groups. As a result, the expected delivery dates of several Boat Rocker series have been delayed, shifting a substantial portion of expected revenue from 2020 into 2021. For example, production on the Company's drama, Invasion, for Apple TV+ was suspended for several months in the spring of 2020, and then restarted, with expected delivery pushed into 2021. Similarly, production on the drama, Rust, for Showtime was suspended just days before it was scheduled to commence in the spring of 2020, and now has a new production start date set for the first quarter of 2021. Production of the second season of the teen drama, Get Even, was also pushed into 2021 to avoid pandemic-related challenges and costs. Talent clients in the Representation segment were also negatively impacted by the pandemic-related temporary shutdowns and restrictions imposed in 2020. However, production of the Company's animated content remained stable as Boat Rocker effectively and quickly transitioned its animation teams to work-from-home. In a two-week time frame, the Company moved all of its employees to work-fromhome, including 425 employees in its animation department. Since March 2020, the Company has remotely hired and onboarded over 200 additional employees to support its on-going animation productions.

The Company has worked with its buyers to push production start dates, re-work and re-budget projects to mitigate pandemic-related costs, and restart projects as soon as practicable. The Company has also made claims under insurance policies for COVID-19 related costs in the aggregate amount of approximately \$29 million (subject to deductibles), but there is no assurance that it will receive any proceeds from such claims and in many cases, even if those claims are successful, the Company's buyers are entitled to the insurance claim proceeds. In respect of the Company's live action productions, Boat Rocker was able to continue to edit and post-produce video content that was shot pre-shutdown by moving post-production crews to work-from-home and, in doing so, Boat Rocker succeeded in delivering its programming to its buyers on pre-COVID-19 schedules throughout the spring and summer of 2020. The Company also continued development activities on live action productions, such as writing and casting, through virtual writers rooms and casting sessions. As jurisdictions began to ease restrictions, Boat Rocker's scripted and unscripted teams worked diligently to pioneer what management believes are leading COVID-19 protocols, which allowed several of the Company's series to resume production once local restrictions were eased. In addition, Boat Rocker stood alongside the buyers of its premium dramas, Invasion and Rust, by underwriting a portion of the additional costs associated with delaying and remounting the production of those series in a more expensive pandemic environment, thereby confirming the Company as a reliable partner to its buyers. By fall 2020, a majority of Boat Rocker's delayed shows had resumed production, including Invasion. Rust is scheduled to commence production in the first quarter of 2021. See "Risk Factors – Risks Related to External Factors Which Boat Rocker Cannot Control, Including COVID-19".

The Company has also received the Canada Emergency Wage Subsidy ("CEWS") for salaries paid to corporate staff, cast and crew of content productions, and the animation services teams at Jam Filled Entertainment. In the nine months ended September 30, 2020, the Company applied for \$8.6 million of CEWS, the majority of which was received prior to September 30, 2020. In the three months ended December 31, 2020, the Company applied for a further \$5.3 million of CEWS, the majority of which was received prior to December 31, 2020. Subsequent to the first period of the CEWS, certain executive bonuses based on performance targets set in 2019 were earned and paid to executives in July 2020. While the subsidy is received upfront as cash and used to reduce personnel costs (service costs in the case of Jam Filled Entertainment), it reduces other assistance that productions would have received in the future in the form of federal and provincial film and television tax credits. The impact of the reduced tax credits will be recognized on the statement of operations as the related revenue and costs are recognized. In addition, the Ministry of Heritage provided an Emergency Relief Fund through the Canada Media Fund ("CMF") that was based on the level of CMF funds that had been accessed by the Company's content productions in the past three years. These funds were accessed by Boat Rocker in the amount of \$0.6 million during the second quarter of 2020.

Management expects the demand for content to be sustained, post-COVID-19, based on both industry analysts' expectations and its own experience with content buyers. In the midst of the pandemic, Boat Rocker secured development financing and production financing commitments on multiple new series from its content buyers. Representation has clients that have resumed work on projects across the industry. In light of increasing viewing trends during the pandemic, demand has remained steady for the third-party video content the Company distributes. Looking ahead, Boat Rocker has a slate of projects scheduled for delivery in 2021 and onwards, consisting of series that are in-production, greenlit, or in development (either internally or with a third-party financier), across each of its segments and management anticipates that in 2021 the Company will have approximately 40 shows in-production or greenlit, including:

• Television is currently in-production or greenlit on a number of shows including Invasion for Apple TV+, Rust for Showtime, Beacon 23 for Spectrum and AMC Networks, Dear….Season 2 for Apple TV+ and Big Brother Canada Season 9 for Corus; and

• Kids and Family is currently in-production or greenlit on a number of shows, most notably Dino Ranch, Get Even (season 2), Bubble Guppies (season 5), and Daniel Spellbound.

Creative and Commercial Capabilities

Over the past 17 years, Boat Rocker has assembled a set of creative and commercial capabilities that management believes enables it to shorten the distance between each of the three steps in the Company's value creation process: Source the IP, Assess the IP and Monetize the IP. The Company has added to, improved and expanded this capability set over time, through both organic growth and acquisitions and it continues to do so by allocating its resources accordingly. Boat Rocker's current set of creative and commercial capabilities includes:

Creation and Development: Boat Rocker, independently and in partnership with award-winning creators, writers, producers and global buyers, creates and develops the underlying creative materials, based on existing and original IP, necessary to produce premium video content across all major genres. The Company's development process is designed to determine the best route to monetization and seeks to ensure complete exploration of the commercial and creative potential of a project. For example, the Company, through its partnership with Industrial Brothers, has provided the development funding and support to allow Industrial Brothers to produce sizzle reels for four concepts, Kingdom Force, Remy and Boo, Dino Ranch and Daniel Spellbound, all of which were used to successfully pitch and sell those projects to greenlight.
Production: Boat Rocker produces live action content across all major genres in countries around the world. Boat Rocker has produced over 300 series to date. Examples of Boat Rocker-produced content include hit series such as Orphan Black, Lip Sync Battle, The Next Step, The Amazing Race Canada, Big Brother Canada, MasterChef Canada, Top Chef Canada and The Great Canadian Baking Show. Boat Rocker's production expertise and capabilities span development to delivery, covering every step of production required to physically produce content and deliver such content to a buyer for viewing by consumers. Boat Rocker's full suite of live-action production and animation capabilities (see below) is designed to ensure that the Company has an opportunity to earn production fees on projects it produces, regardless of the Company's IP ownership position in any such project.
Animation: Management believes that Boat Rocker has one of North America's largest independent 2D and 3D computer graphic animation studios focused on production of television series. Located in Ottawa and Toronto, Ontario, and Halifax, Nova Scotia, Boat Rocker's animation studios have infrastructure capacity for nine concurrent animation productions and the ability to scale. The animation studio has produced over 20 different series for many of the world's top-tier animation buyers and production companies, including Netflix, Nickelodeon (owned by ViacomCBS), Universal Kids (owned by NBCUniversal) and Disney. Boat Rocker's animation expertise and capabilities span development to delivery; its creative and technical teams can develop, produce and package animation productions for the screen, or be engaged by third-party IP owners, buyers and other customers for one or more parts of the production lifecycle. Examples of content produced by Boat Rocker's animation studio include Dino Ranch and Kingdom Force (both in partnership with Industrial Brothers) and third-party animation productions including Thomas and Friends, Bubble Guppies, The Loud House, DC Super Hero Girls, and Rusty Rivets.

• Distribution: Boat Rocker distributes and sells both its own content and carefully selected third-party content to buyers around the world, including to Netflix, Disney, ViacomCBS, BBC, Bell Media, ProSieben, Vivendi, Corus Entertainment and CBC. The content Boat Rocker distributes varies from time to time. The Company's current distribution library spans all major genres; while currently a minority of the library is comprised of premium scripted content, the Company intends to manage the distribution rights with respect to several of its premium dramas that are in development or have been greenlit. The Company's deeply experienced distribution team has an international presence, with offices in Canada, the U.S., U.K., and Hong Kong. The Company's distribution capabilities have been assembled to be relevant for the current sales market, where larger buyers are increasingly buying rights concurrently for multiple geographic jurisdictions, thereby reducing the number of remaining territories available for sale.

Examples of Boat Rocker's internationally distributed content include The Next Step, Kingdom Force, Dino Ranch and Mary's Kitchen Crush. Third-party IP represented by the Company includes Lionsgate Television's unscripted catalogue. In addition to the distribution of new content, Boat Rocker's distribution team also manages its existing library of over 9,000 half-hours of content.

• Franchise and Brand Management: The franchise and brand management team is responsible for developing, building and monetizing the Company's key franchises and brands. The team assesses the Company's development slates in all genres and identifies IP with franchise and brand potential. By engaging at the earliest stages, the franchise and brand management team seeks to ensure that the IP is developed to ultimately transcend television and offer consumers multiple points of engagement. Once a franchise or brand is established, the team is responsible for managing and maximizing monetization opportunities.

For example, the franchise and brand management team identified Dino Ranch at the concept stage as a property with strong franchise potential and worked closely with the show's creators to set the foundation for a successful pre-school franchise. The team also negotiated an overall toy pact for the series with the market leading toy company, JazWares, and a book publishing deal with international kids publisher, Scholastic.

• Talent Management: Boat Rocker owns a majority interest in one of Hollywood's leading talent management companies, Untitled Entertainment, whose managers represent many A-list stars and personalities. Such clients include: Connie Britton, Penelope Cruz, Laura Dern, Matt Dillon, Minnie Driver, Jane Fonda, Max Greenfield, Naomie Harris, Neil Patrick Harris, Katie Holmes, Kate Hudson, Geremy Jasper, Dakota Johnson, Zoe Kravitz, Ashton Kutcher, Jessica Lange, Jennifer Jason Leigh, Melissa Leo, Zachary Levi, Mike Myers, Leslie Odom. Jr., Chris O'Donnell, Zachary Quinto, Kelly Ripa, Chris Rock, Sam Rockwell, Liev Schreiber, John Slattery, Jean Smart, Uma Thurman, Marisa Tomei, Naomi Watts, Olivia Wilde, Ruth Wilson, and Benh Zeitlin. Boat Rocker works closely with the managers at Untitled Entertainment to identify opportunities to attach clients to Boat Rocker projects already in development or by partnering with Untitled Entertainment's clients on their own creative ideas and endeavors. An example of early progress in attaching Untitled Entertainment's clients to Boat Rocker projects already in development is partnering with Allison Williams to star in and executive produce a remake of Boat Rocker's Being Erica. The Company is also developing numerous as-yet unannounced projects which Untitled Entertainment clients are attached to (as on-screen talent and/or producers) or which have been sourced and are being developed by Untitled Entertainment clients.

See "The Business of the Company – Creative and Commercial Capabilities."

How Boat Rocker Shortens the Distance

Boat Rocker uses its creative and commercial capabilities to seek to shorten the distance between each of the three steps in the Company's value creation process: Source the IP, Assess the IP and Monetize the IP, resulting in greater value for the Company and its partners. For some examples of successful executions, please see "The Business of the Company – How Boat Rocker Shortens the Distance – Shortening the Distance Case Studies".

Source the IP

Boat Rocker uses its creative and commercial capabilities to source IP from three primary channels: acquiring and licensing existing IP, co-developing IP with creative and brand partners, and originating IP in-house.

Acquiring and/or Licensing IP: Across all of its divisions, Boat Rocker acquires rights to underlying IP from third-party sources, including books, articles, comics, stage plays, formats, original pitch concepts and speculative scripts. For example, the Company acquired the production rights to the acclaimed novel American Rust and developed it as a scripted drama. The series, entitled Rust, is scheduled to begin production in the first quarter of 2021 for Showtime.
Partnerships: Boat Rocker enters into various types of arrangements with content creators, talent and third-party brands in order to source new ideas/IP and develop content. For example, the Company's firstlook deal with TeaTime Productions, founded by actor/producer (and Untitled Entertainment client) Dakota Johnson and executive producer Ro Donnelly, has created a pipeline of premium scripted dramas, including Rodeo Queens which is in development with Amazon Prime Video.
In-house Origination: Boat Rocker's internal development teams create original ideas for new projects. For example, the original concept for Being Erica was co-created in-house, together with writer and coshowrunner Jana Sinyor.

Assess the IP

Once IP has been sourced, Boat Rocker's teams initiate a collaborative assessment process to determine how to best creatively develop and monetize the IP. As part of this process, Boat Rocker determines how to best allocate its resources aiming to maximize the Company's long term revenue potential while minimizing risk. The Company strives to achieve a strategic balance, across all genres of owned-IP, between projects that have higher risk, hit-based, recurring revenue potential, and lower risk fee-for-service projects. After assessing the IP, the Company may elect to pursue a production services model for a project, selling the IP to a buyer who agrees to fully fund the cost of production and hire the Company, for a fee, to produce the programming. Alternatively, the Company may decide to pursue a studio position and commit its own capital to the funding of the project, allowing Boat Rocker to retain the copyright in the video content (or a portion thereof) and the ability to directly exploit the content, generate and retain profits from that exploitation, and, ideally, turn the property into a successful worldwide brand. With pre-school animated property Dino Ranch, for example, Boat Rocker, after identifying the property as having high franchise potential, decided to invest in the series in order to retain and manage distribution, merchandising and licensing rights.

Monetize the IP

Once the IP assessment is complete, Boat Rocker leverages its creative and commercial capabilities to monetize the IP, seeking to maximize available revenues and engage consumers in as many ways as possible. In most instances, Boat Rocker's primary monetization strategy involves the conversion of IP into a television series, giving the IP the opportunity to reach audiences around the world. Initially, revenues are generated from the production of the series (i.e., upfront production fees that are included in the budget and paid to the Company). Additional revenues can then be generated from selling or licensing the right to broadcast those series to buyers and to third-party distributors and licensees and exploiting associated rights (e.g., merchandising, licensing, format rights, etc.).

COMPETITIVE STRENGTHS

Differentiated Creative and Commercial Capabilities Already Assembled

Boat Rocker's creative and commercial capabilities include: creation and development, production, animation, distribution, franchise and brand management, and talent management. Boat Rocker routinely seeks opportunities to continue to add to, improve and expand its creative and commercial capabilities, and allocates its resources accordingly.

The Company believes that it has assembled a broader, deeper and more diversified set of creative and commercial capabilities than most of its competitors of similar size and scale. Moreover, the Company believes that its particular set of creative and commercial capabilities are distinct amongst independent media companies worldwide irrespective of size and scale. Boat Rocker further believes that its model of applying its commercial and creative capabilities to shorten the distance between the three steps in the Company's value creation process results in greater and more effective value creation potential for both the Company and its partners compared to its peers. See "The Business of the Company – Competitive Strengths – Differentiated Creative and Commercial Capabilities Already Assembled".

Independent Company of Scale Unaffiliated with Any Major Studio or Buyer

Boat Rocker is differentiated from its competitors because it is an integrated and diversified entertainment company of scale while also being independent from, and unaffiliated with, any major Hollywood studio or buyer. Boat Rocker's independence affords the Company flexibility and optionality in how it sources and produces IP and, importantly, how it monetizes IP and manages risk. Remaining unaffiliated with any individual buyer allows the Company to retain control and flexibility when determining where to sell its IP (ensuring the Company can sell each project to its optimal buyer, often in competitive situations), what level of risk to take on each project (e.g., production services or invest and own rights), and to seek to ensure the Company has a diversified list of buyers. These dynamics are often attractive to creators who are looking to partner with entertainment companies of scale (like Boat Rocker) but who do not wish to be tied to one consumer viewing platform for all of their projects.

Diversified Business Model

Boat Rocker is a diversified entertainment company in four distinct ways:

Across Genres: Boat Rocker sources, creates and distributes content across all major genres, including scripted, unscripted and kids and family, both live action and animated.
Across Business Units: Boat Rocker has business units (such as its animation studio and Untitled Entertainment) that generate regular and predictable revenue in lower risk sectors while still delivering significant margins. The Company also has business units that make investments in programming in order to secure or retain ownership rights and larger potential revenues (e.g., the Company's scripted division's planned investment in Beacon 23, and the kids and family division's investment in shows like Dino Ranch).
How it Generates Revenues From IP: As described above, the Company assesses how to best allocate its resources to the IP it sources and produces so as to maximize potential revenue while minimizing risk. This allows the Company to take project-specific capital risk and pursue rights retention on select projects and to take a service fee without any project-specific capital risk on others.
Across Buyers: Boat Rocker is platform agnostic and sells its video content to a global set of programming buyers, consisting of both linear channels and OTT platforms. In its process of assessing the IP, Boat Rocker is able to consider multiple potential buyers for its video content to ensure the optimal partner for the new project. Boat Rocker has capitalized on the significant growth in buyers, cultivating relationships with new buyers and, as a result, no one buyer contributed more than 10% of consolidated revenue in 2019. The Company intends to continue to manage buyer concentration in the future although buyer

concentration may be higher in certain periods if the Company is delivering one or more big-budget programs to a given buyer. See "The Business of the Company – Buyers" for a sample of Boat Rocker's buyers.

By diversifying across genres, business units, how it generates revenues, and across buyers, Boat Rocker is better positioned to manage volatility and risk. For example, by producing in all major genres, management believes the Company is less affected by shifts in demand or oversupply that may occur from time to time. Additionally, the more reliable revenues generated by the Company's business units operating in lower risk sectors help mitigate the volatility associated with higher risk/reward business units. See "The Business of the Company – Competitive Strengths – Diversified Business Model".

Well-Positioned to Benefit from Industry Tailwinds with No Legacy Businesses

Boat Rocker engages in a variety of entertainment businesses in the global consumer video content market, with a focus on creating, producing, and monetizing on-screen content and IP. The consumption of media continues to grow each year, driven by advances in consumer technology and internet-connected devices. The average individual in the U.S. is estimated to spend two hours and one minute per day consuming video content across digital devices (including smartphones, desktop and laptop computers, and other internet-connected devices) in 2020, representing a 236% increase as compared to the 36 minutes on average in 2012.¹ Specifically, the significant increase in consuming video content has been largely driven by the proliferation of OTT platforms.

As the media industry continues to evolve, the demand for high-quality programming has increased as buyers compete to differentiate their product offering and grow their subscriber base. As a result, the value of video content has continued to grow at a rapid pace, with the annual expenditure growth by linear channels and OTT platforms to purchase video content outstripping the revenue growth they are experiencing. In aggregate, annual content programming spend for select traditional entertainment companies and OTT platform operators has grown from approximately US\$36 billion in 2014 to approximately US\$80 billion in 2019 (representing an 18% CAGR over the period)² and is being anticipated to continue to grow at a 9% CAGR from 2019 to 2023³ , across all major genres including scripted, unscripted and kids and family.

In order to compete with traditional entertainment companies' linear channels and proprietary OTT platforms (such as Disney+, Peacock, HBO Max, STARZ and Paramount+), standalone OTT platforms (such as Netflix, Amazon Prime Video and Apple TV+) have continued to invest substantially in original programming to differentiate their offerings, which is viewed as paramount in establishing a competitive moat. As such, five of the leading OTT platforms have increased their combined total content programming spend allocated to original programming from 6% in 2014 to approximately 25% in 2019, forecasted to further increase to approximately 37% by 2023. 4

Management believes Boat Rocker is well-positioned to benefit from these trends given its diversified business model across genres, business units, buyers, and IP exploitation. The Company has strong relationships with the largest buyers of video content, and produces and exploits in-demand, high quality programming for audiences around the world. Boat Rocker does not operate any legacy entertainment businesses undergoing significant disruption (e.g. theatrical film exhibition, linear television channels or print media). This has enabled the Company to build and evolve, in a forwardlooking manner, a business that is strategically positioned to succeed in the continuously evolving entertainment landscape. See "The Business of the Company – Competitive Strengths – Well-Positioned to Benefit from Industry Tailwinds with No Legacy Businesses" and "Industry and Market Opportunity".

¹ eMarketer, US Time Spent With Media 2020, April 2020. Represents ages 18+ and includes digital (desktop/laptop and mobile nonvoice), print (magazines and newspapers), radio, TV and other; includes all time spent with each medium, regardless of multitasking. ² MoffettNathanson LLC, Code Media 2019 presentation, November 2019; Next TV, Original Programming Costs Raise Concern, https://www.nexttv.com/news/original-programming-costs-raise-concern-128593, January 2014; Discovery figure for 2014 is shown including Scripps Networks Interactive, which was acquired by Discovery in 2018; Vox, Comcast Is Now an Internet Company, https://www.vox.com/2015/5/4/11562278/this-is-the-quarter-comcast-becomes-an-internet-company, May 2015; 2014 and 2019 Amazon Prime Video and Hulu programming expenses from Kagan (a media research group within S&P Global Market Intelligence). Netflix 2014

figures are estimates from Kagan as of September 2020.

³ Represents the CAGR for the aggregate content programming amortization for The Walt Disney Company, WarnerMedia (AT&T) and Netflix between 2019 and 2023. Sourced from MoffettNathanson LLC, Code Media 2019 presentation, November 2019.

⁴ Kagan, a media research group within S&P Global Market Intelligence. Represents the aggregate estimated amortized programming costs for original programming and acquired programming, for Netflix (Kagan estimates as of September 2020), Amazon Prime Video (Kagan estimates as of July 2020), Apple TV+ (estimates as of January 2020), Disney+ (estimates as of November 2019) and Hulu (estimates as of May 2020).

Significant Acquisition and Investment Expertise

Boat Rocker has a proven track record of targeting, assessing, acquiring and integrating companies and assets across a wide range of corporate transactions, which has enabled the Company to enhance its capabilities in all three reporting segments and expand into new businesses. Since 2015, Boat Rocker has successfully completed and integrated nine acquisitions including Jam Filled Entertainment, Matador Content, Platform One Media, and Untitled Entertainment, and acquired minority interests in several other companies, including Industrial Brothers. Such acquisitions and investments have enhanced the Company's creative and commercial capabilities across all three of its reporting segments.

Management believes Boat Rocker is a partner of choice for entrepreneurs attracted to the power of Boat Rocker's independence from major Hollywood companies (including major studios and content buyers), its entrepreneurial culture, and the Company's appreciation and understanding of the creative process. As a result, Boat Rocker benefits from inbound, and often proprietary, opportunities generated by its relationships and reputation. Management believes that as a result of the temporary market disruption brought about by the COVID-19 global pandemic, attractive acquisition opportunities are likely to emerge. See "The Business of the Company – Competitive Strengths – Significant Acquisition and Investment Expertise".

Experienced and Aligned Management Team

In addition, the majority of Boat Rocker's business unit leads are proven entrepreneurs themselves who have stayed on as a part of the Boat Rocker family after their businesses have been acquired. This consistent, entrepreneurial leadership team has effectively executed Boat Rocker's strategy, expanded Boat Rocker's scope, and consistently delivered strong financial results.

Boat Rocker also benefits from a strategically aligned management team. The three most senior executives at Boat Rocker, Co-Founders and Co-Executive Chairmen, David Fortier and Ivan Schneeberg, and Chief Executive Officer, John Young, will collectively own approximately 19.2% of the Company's Shares upon Closing (assuming no exercise of the Over-Allotment Option). Furthermore, David Fortier, Ivan Schneeberg and John Young have worked together for over a decade building the Company into the business that it is today and will remain in their roles going forward. Management believes that this combination of economic alignment with public shareholders and executive leadership continuity further differentiates Boat Rocker from its peers. See "The Business of the Company – Competitive Strengths – Experienced and Aligned Management Team".

Strong Financial Profile Enhanced by Strategic Long-Term Shareholder

Boat Rocker has consistently proven its ability to add scale and drive long term shareholder value with increased revenue and profitability over time. In the five year period from 2014 to 2019, the Company grew revenue at a 55% CAGR and Adjusted EBITDA at a 73% CAGR driven by secular industry tailwinds, strategic acquisitions and organic growth. In 2019, the Company generated revenue of \$244 million, a net loss of \$19.5 million, and Adjusted EBITDA of \$32.5 million. The Adjusted EBITDA Margin in 2019 was 13%. See "Non-IFRS Measures".

Notes:

(1) Represents the last 12 months ended September 30, 2020.
(2) Adjusted EBITDA is a non-IFRS measure and may not be comparable to similar measures used by other companies. The most directly comparable IFRS measure to Adjusted EBITDA is net (loss) income, which for the 12 months ended September 30, 2020 was approximately \$(49.7) million, and for the years ended December 31, 2019, 2018 and 2017 was approximately \$(19.5) million, \$9.8 million and \$14.2 million, respectively. See "Selected Annual and Interim Financial Information of Boat Rocker – Reconciliation of Non-IFRS Measures" for a reconciliation to IFRS measures.

Boat Rocker believes that its financial profile provides a strong foundation for continued growth. The Company has strategically deployed capital into growth initiatives with a disciplined financial management and capital allocation strategy. After using the proceeds from the Treasury Offering to repay all of its term debt under the Corporate Credit Facility (which is the Company's principal corporate credit arrangement), Boat Rocker will have a strong balance sheet and significant financial flexibility to invest in its business and to pursue acquisitions to drive shareholder value.

Fairfax has been an investor in and majority shareholder of Boat Rocker since 2015. Fairfax is a leading Canadian institutional investor with an outstanding track record of partnering with successful entrepreneurs in a variety of business lines. Since Fairfax became an investor in the Company, Boat Rocker has benefited from its strategic support, mergers and acquisitions and capital markets expertise and planning support, which has helped the Company take advantage of the ongoing transition in the entertainment industry. Following Closing, Fairfax will continue to be a major shareholder of Boat Rocker, providing continuity to the Company's capital structure. Fairfax has advised the Company that it believes that there continue to be additional opportunities to drive shareholder value at Boat Rocker through organic growth as well as acquisition-led growth and industry consolidation. See "The Business of the Company – Competitive Strengths – Strong Financial Profile Enhanced by Strategic Long-Term Shareholder".

GROWTH STRATEGIES AND GOALS

Expanding Creative and Commercial Capabilities

Boat Rocker intends to continue to add to, improve, and expand its creative and commercial capabilities via acquisitions and organic growth by enhancing collaboration among its groups and seeking out strategic new hires where appropriate. Doing so is expected by management to strengthen Boat Rocker's competitive position in the market and propel the Company's revenues, and, whenever possible, the Company's recurring revenue profiles. Furthermore, Boat Rocker's efforts in this area are expected to enable continued access to differentiated new IP and additional avenues and capabilities to monetize IP. Boat Rocker expects to continue to add to and expand its capabilities through build (strategic hires), buy (acquisitions) and partnership (minority investments and venture capital) activities, in key sectors of interest. This may include, but is not limited to: branding and marketing, live events, local production (live action and animation) in high growth international markets, merchandising and licensing, podcast production and distribution, talent management expansion (e.g., literary, sports, music, behind-the-scenes talent), publishing and toys. See "The Business of the Company – Growth Strategies and Goals – Expanding Creative and Commercial Capabilities".

Capitalizing on Operating Leverage

As outlined in the "History of the Company", a number of Boat Rocker's key strategic capabilities have only recently been fully integrated into the Company's diversified business model. Specifically, the Company expanded its U.S. and international scripted series production via the acquisition of Platform One Media and entered into talent management via the acquisition of Untitled Entertainment, both of which occurred in 2019. The expansion into new markets and entrance into new verticals, which serve as key growth drivers, have positioned Boat Rocker to leverage its investments in personnel and infrastructure going forward, as their deployment was delayed due to COVID-19 restrictions. With live action production having largely resumed, management believes that the Company is well-positioned to take advantage of its fully integrated infrastructure and upfront investments to increase the number of series in-production, further monetize IP (including through investments in the Company's franchise and brand management capability), continue to partner with Untitled Entertainment's A-list clients, and, ultimately, expedite the growth of Boat Rocker's overall revenue and profitability. Management believes that, as currently constructed, the Company can produce more IP across all genres and generate new recurring revenue streams through the monetization of said IP without material increases in corporate overhead. Boat Rocker's operating leverage is at an inflection point, and management intends to capitalize on the available opportunities, thereby seeking to increase its Adjusted EBITDA margin in the process, as outlined in "Management's Discussion and Analysis of Boat Rocker".

Increasing Sources of IP

Boat Rocker intends to continue to add to, improve, and expand its sources of IP in order to gain access to a larger and richer volume of diverse ideas for projects that the Company can develop and then monetize. In order to effectively execute this strategy, Boat Rocker intends to seek opportunities to increase its sources of IP via:

Acquiring and Licensing: With a strong track record of acquiring and licensing IP, Boat Rocker intends to pursue more and higher profile IP by purchasing IP libraries or brands, and acquiring or licensing wellknown IP from third-party sources including books, articles, comics, stage plays, formats and original pitch concepts and speculative scripts.
Partnerships: Boat Rocker intends to increase its IP sourcing from partnerships with content creators, talent and third-party brands across a variety of structures in order to source new ideas and develop content. Boat Rocker believes that it can continue to attract and retain creative and brand partners as a result of its differentiated creative and commercial capabilities, its strong talent management relationships, and its independence from Hollywood studios and consumer video buyers.
In-House Origination: Boat Rocker's internal creation and development teams create and co-create original ideas for new projects (e.g., Being Erica, History in the Making, Go-Big Show, Recipe to Riches, and Late Nite Eats). Boat Rocker intends to increase its in-house IP origination efforts by continuing to attract and retain top tier creative executive talent as well as expanding into new areas such as comic book publishing and podcasting where Boat Rocker can work with creators to finance, develop and monetize their work.

See "The Business of the Company – Growth Strategies and Goals – Increasing Sources of IP".

Building and Monetizing Global Entertainment Brands

Boat Rocker understands that compelling storytelling and leading talent are both essential to creating global entertainment brands that transcend television. The Company has invested in and built a team of experts, who have developed, produced, and monetized global brand franchises, including the Company's Orphan Black, The Next Step, Love Monster and Danger Mouse, as well as other companies' brands (in prior executive roles) including SpongeBob SquarePants and Thomas and Friends. Boat Rocker is well positioned to continue to seek to optimize value across the IP monetization spectrum (e.g., television, gaming, publishing, toys) for both current and new projects and will continue to apply a holistic brand portfolio approach to improve the outcomes for its prospective global entertainment brands.

Boat Rocker intends to continue fostering stronger, more direct relationships with audiences and consumers. Specific examples of this initiative could include:

Leveraging social media and AVOD platforms to enhance audience reach and engagement;
Deepening relationships with linear channels and OTT platforms in a broad range of markets; and

• Developing and enhancing strategic partnerships in key non-television monetization channels (e.g., live events, podcasts, and toys).

The Company will also aim to maximize monetization by selectively investing capital to retain rights in IP with high potential to earn recurring revenues, while offering an attractive risk reward profile. See "The Business of the Company – Growth Strategies and Goals – Building and Monetizing Global Entertainment Brands".

Pursuing Strategic Acquisitions and Investments

Since 2015, Boat Rocker has successfully completed and integrated nine acquisitions, including Jam Filled Entertainment, Matador Content, Platform One Media, and Untitled Entertainment, and acquired minority interests in several other companies, including Industrial Brothers. In doing so, Boat Rocker has established strong merger and acquisition expertise and is well placed to use its resources to enhance its competitive position through acquisitions within its Television, Kids and Family, and Representation segments. Leveraging its capabilities, Boat Rocker intends to source, pursue and integrate acquisition and investment opportunities in its existing businesses as well as in new, adjacent business verticals (although no letters of intent or binding agreements have been entered into in respect of any contemplated or potential acquisitions in process at this time). Additionally, Boat Rocker intends to utilize its ventures arm (Boat Rocker Ventures) to work with leading companies at the intersection of media, technology and consumer retail through joint ventures, minority investments and strategic partnerships. Finally, Boat Rocker intends to focus its strategic investment and acquisition efforts on expanding the Company's geographic footprint to capitalize on the global growth of content spend. Management believes that as a result of the temporary market disruption brought about by the COVID-19 global pandemic, attractive acquisition opportunities are likely to emerge. Boat Rocker's investments and acquisitions are expected to continue to augment Boat Rocker's ability to deliver significant growth and attractive financial returns. See "The Business of the Company – Growth Strategies and Goals – Pursuing Strategic Acquisitions and Investments".

OUTLOOK

In August 2019, in order to grow the Company's U.S. and international scripted businesses, Boat Rocker acquired Los Angeles-based Platform One Media, a producer of premium scripted television video content. At the time of the acquisition, Platform One Media was contracted to deliver two premium scripted series which were originally scheduled to deliver in 2020. Following its acquisition of Platform One Media (now rebranded as Boat Rocker Studios, Scripted), Boat Rocker invested considerable additional working capital in the business, and will continue to do so in 2021 in support of the completion of these two premium dramas, which, after delays due to COVID-19, are now both expected to be delivered in the second half of 2021. Boat Rocker also has a number of additional scripted projects in paid development with third parties or greenlit for production which are expected by the Company to be delivered in 2021 or 2022. The Company expects 2021 to be a year of significant investment in content, funded in part by a portion of the net proceeds from the Treasury Offering. Combined with the Company's other capabilities, acquisitions and organic initiatives, the acquisition of Platform One Media has established Boat Rocker as a content-creation platform capable of producing, delivering and monetizing content across all major genres at scale.

Boat Rocker expects revenues in 2021 to be approximately \$700 million (assuming an average 2021 foreign exchange rate of US\$1.00 = C\$1.30), of which an estimated \$475 million is already confirmed and is expected to be delivered in 2021. The Company anticipates that the balance of the expected revenue in 2021 will come from the delivery of an additional premium scripted series which is not yet greenlit, anticipated revenue generation growth from its Representation segment, the delivery of unscripted television productions in the U.S. and Canada which are also not yet confirmed, as well as estimated revenue from Boat Rocker's merchandise and licensing efforts.

The above \$475 million estimate is based on the following key assumptions, among others:

(a) approximately 85% of revenue that is expected to be recognized in respect of video content that is already inproduction and for which binding contracts have been entered into, a substantial portion of which relates to two premium scripted dramas for which production is being undertaken in accordance with COVID-19 guidelines;
(b) approximately 10% of revenue is comprised of projects that have either been contracted or greenlit, and which are expected to be produced and delivered in 2021 but are not yet in-production; and
(c) approximately 5% of revenue is comprised of: (i) minimum guarantees from toy licensing partners that are guaranteed to be earned as a result of specific contractual objectives (e.g., toy sales commencing at retailers, television shows premiering on certain networks in certain markets) that the Company expects to meet in 2021; and (ii) distribution revenue from already completed sales but in respect of which the revenue cannot be recognized until either the license period and/or airdate occurs or the distribution report is received by the Issuer, which is expected to occur in 2021.

The remaining \$225 million estimate is based on the following key assumptions, among others:

(a) approximately 65% is comprised of expected revenue to be derived from the delivery of unscripted television productions and kids and family series that are either expected to be renewed in 2021 due to historical success or are in advanced stages of development and/or negotiations with buyers and expected to move forward in 2021;
(b) approximately 20% is comprised of expected revenue to be derived from the delivery of an additional premium scripted series that was pitched to potential buyers in a competitive sales process and was ultimately set-up with a major buyer, which is expected to be produced and delivered in 2021; and
(c) approximately 15% is comprised of expected revenue derived from the Representation segment which is expected to continue to recover in 2021 considering additions to the third-party IP library the Company represents in recent years and a return to historical results for revenue growth for talent management, particularly in light of an increase in the number of clients on Untitled Entertainment's roster in recent years.

Management believes that, in light of the projected significant growth in the demand for content by buyers worldwide, the Company is well-positioned to continue to grow its revenue, profitability and cash flows by capitalizing on its competitive strengths and implementing its growth strategies.

While the premium series that the Company is now producing are expected to generate significant revenues and have a large absolute dollar contribution, they will likely deliver a lower overall Adjusted EBITDA margin percentage compared to historical levels. As a result, while Boat Rocker's 2019 Adjusted EBITDA margin was in excess of 13%, management anticipates that the Company's Adjusted EBITDA margin in 2020 and 2021 will be in the low to mid-single digits due to increased COVID-19 related costs and actual and anticipated delays, and investments in organic growth initiatives in those years. The anticipated 2021 Adjusted EBITDA margin (based on an assumed average foreign exchange rate of US\$1.00 = C\$1.30) is based on the following key assumptions, among others:

that the Company will receive approximately \$700 million in revenue in 2021;
that the segment profit as a percentage of segment revenue in the Television segment in 2021 will be lower than the reported 6% achieved in 2019 due to larger overall production budgets and incremental COVID-19 related production costs; and
that the Representation and Kids and Family segments will have an increase in revenue and segment profit in 2021 as compared to revenue and segment profit achieved in 2019.

For 2022, management anticipates Adjusted EBITDA margins will increase to the high-single digits to low doubledigits as the Company's business mix is further diversified into higher margin activities, and the Company continues to take advantage of operating leverage, based on the following key assumptions, among others:

an assumed average 2022 foreign exchange rate of US\$1.00 = C\$1.35;
delivery of certain premium scripted series, including some currently in paid development with third-party buyers;
delivery of certain scripted series that are based on previously produced successful series that ran for several seasons;
delivery of a number of the Company's U.S. and Canadian unscripted titles and formats, including subsequent seasons of series already produced;
growth of the Company's Representation segment as demand for existing and new video content continues to grow, offering opportunities for Untitled Entertainment's clients and propelling sales of third-party titles being distributed by the Company;
delivery of certain kids and family programs, including subsequent seasons of series already produced, and revenue growth from merchandise and licensing monetization;
the Kids and Family segment will recognize a growth in segment profit as compared to the Company's other segments, primarily driven by the launch of merchandise and licensing productions for key brands; and
the segment profit as a percentage of segment revenue in the Television segment will return to pre-COVID-19 historical levels, with the expectation that Boat Rocker's 2022 projects will not be burdened with extra COVID-19 production costs.

Upon Closing, Boat Rocker will repay all of its term debt under the Corporate Credit Facility. The Company expects 2021 to be a year of significant investment in content, funded in part by a portion of the net proceeds from the Treasury Offering. Over the next few years, Boat Rocker expects to generate Free Cash Flow to fund any additional investments in content as well as smaller acquisitions without the need to undertake additional indebtedness. In certain circumstances, the Company may choose to increase its Net Debt ratio to 1.0x to 2.0x Adjusted EBITDA to fund strategic investments in content and/or larger acquisitions. For further detail regarding the Company's financial guidance, see "Outlook".

These projections are subject to various assumptions and risk factors. See also "Caution Regarding Forward-Looking Statements" and "Risk Factors".

The prospective financial information included above has been prepared by management of the Company. Due to its forward-looking nature, PricewaterhouseCoopers LLP, the Company's auditor, has not performed any audit, review or compilation procedures with respect to the prospective information included above.

SUMMARY OF SELECTED ANNUAL AND INTERIM FINANCIAL INFORMATION OF BOAT ROCKER

The following sets forth a summary of Boat Rocker's selected historical consolidated financial data as at the dates and for the periods indicated below. The information should be read together with the Boat Rocker Financial Statements and Boat Rocker Interim Financial Statements appearing elsewhere in this Prospectus. The historical financial information as at and for the years ended December 31, 2019, 2018 and 2017 summarized below is derived from the Boat Rocker Financial Statements. The historical financial interim information as at and for the three and nine months ended September 30, 2020 and 2019 summarized below is derived from the Boat Rocker Interim Financial Statements. Historical financial and operating information may not be indicative of future performance.

Selected Financial Information for Boat Rocker

(in thousands of Canadian dollars)		As at and for the Three Months Ended September 30,	As at and for the Nine Months Ended September 30,		As at and for the 12 Months Ended December 31,
	2020	2019	2020	2019	2019	2018	2017
Revenue \$78,009		\$51,001	\$171,189	\$184,730	\$244,165	\$164,845	\$129,050
Net (loss) income \$( 22,990)		\$(9,613)	\$(43,544)	\$(13,279)	\$(19,483)	\$9,757	\$14,235
Net (loss) income attributable to non controlling interests \$1,387		\$654	\$2,978	\$3,322	\$4,224	\$397	\$106
Net (loss) income attributable to Shareholders \$(24,377)		\$(10,267)	\$(46,522)	\$(16,601)	\$(23,707)	\$9,360	\$14,129
Adjusted EBITDA(1) \$6,0 34		\$2,454	\$6,019	\$25,371	\$32,469	\$32,014	\$26,581
Total cash and cash equivalents –		–	\$75,553	–	\$59,268	\$55,416	–
Total assets –		–	\$615,950	–	\$516,143	\$395,529	–
Loans and borrowings, excluding interim production financing and convertible debentures–		–	\$99,481	–	\$87,869	\$47,432	–
Lease liabilities –		–	\$33,844	–	\$29,626	\$27,583	–
Total non-current liabilities –		–	\$114,375	–	\$94,328	\$59,316	–
– Net Debt(2)		–	\$103,791	–	\$85,297	\$57,732	–

Notes:

_________________

(2) Net Debt is defined as the carrying value of loans and borrowings (excluding interim production financing and convertible debentures) adjusted for the loss on loan modification and loan fees, plus lease liabilities less Cash Available for Use. Net Debt is a non-IFRS measure and may not be comparable to similar measures used by other companies. See "Selected Annual and Interim Financial Information of Boat Rocker – Reconciliation of Non-IFRS Measures" for a reconciliation to IFRS measures.

Included elsewhere in this Prospectus are the additional audited consolidated financial statements of: (a) Insight Production Company Ltd. for the year ended December 31, 2017 and for the period from January 1, 2018 to May 17, 2018; (b) Platform One Media for the years ended December 31, 2018 and 2017 and for the period from January 1 to August 30, 2019; and (c) Untitled Entertainment for the year ended December 31, 2018. The Boat Rocker Financial Statements and the Boat Rocker Interim Financial Statements should be read in conjunction with such audited financial statements.

⁽¹⁾ Adjusted EBITDA is defined as EBITDA adjusted for amortization of non-cash program intangibles, change in fair value of financial liabilities, change in fair value of contingent consideration, share-based compensation, transaction and reorganization costs, goodwill impairment, loss on debt modifications and gain or loss on sale of assets. Adjusted EBITDA is used by management as a measure of the Company's profitability. Adjusted EBITDA is a non-IFRS measure and may not be comparable to similar measures used by other companies. See "Selected Annual and Interim Financial Information of Boat Rocker – Reconciliation of Non-IFRS Measures" for a reconciliation to IFRS measures.

Summary of Pro Forma Consolidated Financial Information

The pro forma income statement for the year ended December 31, 2019, includes the effect of the acquisition of Platform One Media as though it was completed on January 1, 2019. This summary pro forma financial information should be read in conjunction with the Boat Rocker Pro Forma Financial Statements, together with the notes thereto, which are included elsewhere in this Prospectus.

The summary pro forma financial information has been prepared for illustrative purposes only, and does not purport to project the results of operations or financial position for any future period or as of any future date. See the Boat Rocker Pro Forma Financial Statements included elsewhere in this Prospectus for a discussion of pro forma adjustments.

(in thousands of Canadian dollars)	Actual For the Year Ended December 31, 2019	Pro Forma For the Year Ended December 31, 2019(1)
Revenue	\$244,165	\$244,165
Expenses
Production, distribution and service costs	\$157,576	\$158,746
General and administrative costs	\$69,820	\$75,366
Amortization of property and equipment, right-of-use assets and intangible assets	\$18,989	\$19,245
Gain on sale of property and equipment	\$(3,079)	\$(3,079)
Finance costs (income), net	\$8,415	\$8,341
Foreign exchange gain	\$(307)	\$(307)
Loss on loan modification	\$4,317	\$4,317
Share of income of equity accounted investees	\$(360)	\$(360)
Change in the fair value of financial instruments	\$(1,868)	\$(1,868)
Change in the fair value of other financial liabilities	\$8,710	\$8,710
Change in the fair value of contingent consideration	\$368	\$368
Loss before income taxes	\$(18,416)	\$(25,314)
Current income taxes	\$8,984	\$8,984
Deferred income tax recoveries	\$(7,917)	\$(7,917)
Net loss for the year	\$(19,483)	\$(26,381)

Notes:

_________________

(1) On August 31, 2019, the Company acquired 100% of the outstanding membership interests of Platform One Media. The Boat Rocker Pro Forma Financial Statements have been prepared to reflect the acquisition of Platform One Media as if the acquisition had occurred on January 1, 2019 and related pro forma adjustments as described in the Boat Rocker Pro Forma Financial Statements.

Boat Rocker Consolidated Capitalization

The following table sets forth the consolidated capitalization of Boat Rocker as at September 30, 2020 adjusted to give effect to: (a) the Offering, (b) the Pre-Closing Capital Changes (including the conversion of the A&R Debenture on January 1, 2021 and the conversion of the 2020 Debenture upon Closing), (c) the repayment of the term debt under the Corporate Credit Facility in its entirety, and (d) the settlement on January 1, 2021 of the non-interest bearing notes owed to the Company by the Principal Shareholders in connection with the sale of certain real estate investments, but without giving effect to the exercise of the Over-Allotment Option.

(in thousands of Canadian dollars)	As at September 30, 2020	As at September 30, 2020, adjusted for Pro Forma Adjustments(2)
Total Cash	\$75,553	\$172,064
Debt(1)
Loans and borrowings, excluding interim production financing and convertible debentures	\$99,481	–
Lease Liabilities	\$33,844	\$33,844
A&R Debenture	\$22,429	–
Corporate debt(1)	\$155,754	\$33,844
Shareholders' Equity
Equity attributable to Shareholders	\$23,187	\$256,978
Equity attributable to non-controlling interests	\$29,001	\$29,001
Total Equity	\$52,188	\$285,979
Total Capitalization(1)	\$207,942	\$319,823

________________ Notes:

(1) Excludes interim production financing. Interim production financing is drawn to bridge the timing between cash inflows from the license fees and production service fees of the buyer, the film and television tax credits earned on eligible production expenses, and cash outflows of the production expenses. Interim production financing for a particular production is expected to be repaid from the license fees and film and television tax credits of that same production in the ordinary course and is not considered part of the Company's capitalization.

(2) Assumes an Offering of \$175,000,000 and an Offering Price of \$13.00 per Subordinate Voting Share, the midpoint of the estimated price range set forth on the cover page of this Prospectus.

Other than (a) the conversion of the A&R Debenture into Subordinate Voting Shares on January 1, 2021, (b) the issuance of certain non-interest bearing notes by the Company to the Principal Shareholders in connection with the sale of certain real estate investments, which were settled on January 1, 2021, (c) the issuance of \$25 million of convertible debentures on December 1, 2020 under the 2020 Debenture, (d) the issuance of an additional \$15 million of convertible debentures on February 1, 2021 under the 2020 Debenture, (e) the conversion of the 2020 Debenture into Subordinate Voting Shares on Closing, and (f) in the normal course of business, there has been no material change in the equity and debt capital of Boat Rocker since September 30, 2020, on a consolidated basis. The table above should be read in conjunction with the Boat Rocker Financial Statements and the Boat Rocker Interim Financial Statements included elsewhere in this Prospectus.

THE OFFERING

Issuer:	Boat Rocker Media Inc.
Selling Shareholders:	DF BRM Holdco Inc., IS BRM Holdco Inc. and John Young
Offering:	[●] Subordinate Voting Shares ([●] assuming the Over-Allotment Option is exercised in full)
Offering Price:	It is anticipated that the Offering Price will be between \$12.00 and \$14.00 per Subordinate Voting Share.
Offering Size:	\$175,000,000 (\$201,250,000 assuming the Over-Allotment Option is exercised in full)
Over-Allotment Option:	The Company has granted to the Underwriters an option, exercisable in whole or in part at any time for a period of 30 days after the Closing Date, to purchase up to an additional 15% of the aggregate number of Subordinate Voting Shares issued under the Offering, being [●] Subordinate Voting Shares, at the Offering Price, solely to cover over-allotments, if any, and for market stabilization purposes. See "Plan of Distribution – Over-Allotment Option".
Shares Outstanding:	Upon completion of the Offering and assuming no exercise of the Over-Allotment Option, 26,698,960 Subordinate Voting Shares and 23,553,050 Multiple Voting Shares will be issued and outstanding. If the Over-Allotment Option is exercised in full, 28,718,191 Subordinate Voting Shares and 23,553,050 Multiple Voting Shares will be issued and outstanding upon completion of the Offering (based on the assumptions set forth under the heading "Meaning of Certain References").
	Upon completion of the Offering, no preferred shares will be issued and outstanding.
Use of Proceeds:	The net proceeds to be received by the Company from the Treasury Offering are estimated to be \$[●] (or \$[●] if the Over-Allotment Option is exercised in full), after deducting the Underwriters' Fee of \$[●] (or \$[●] if the Over-Allotment Option is exercised in full) and the expenses of the Offering, which are estimated to be \$[●]. The Company will not receive any of the proceeds from the sale of Subordinate Voting Shares by the Selling Shareholders.
	The Company expects to use the estimated net proceeds from the Treasury Offering (assuming no exercise of the Over-Allotment Option) as follows: (i) approximately 63% of the net proceeds are expected to be used to repay all of its term debt under the Corporate Credit Facility (which is the Company's principal corporate credit arrangement); (ii) approximately 13% of the net proceeds are expected to be used as short-term funding for scripted productions; (iii) approximately 15% are expected to be used to support the business plans of the scripted and the franchise and brand management teams; (iv) approximately 4% are expected to be used to fund acquisitions of capital assets; and (v) approximately 5% are expected to be used to secure and develop IP, as well as potential future acquisitions and/or strategic investments. However, the Company will retain the discretion to allocate the net proceeds of the Treasury Offering, and reserves the right to change the allocation of the net proceeds from time to time. See "Use of Proceeds".
Authorized Share Capital and Share Attributes:	Upon Closing, the Company's authorized share capital will consist of an unlimited number of Multiple Voting Shares, an unlimited number of Subordinate Voting Shares and an unlimited number of preferred shares, issuable in series. Holders of Multiple Voting Shares and Subordinate Voting Shares will be entitled to receive notice of any meeting of Shareholders and may attend and vote at such meetings, except those meetings where only the holders of shares of another class or of a particular series are entitled to vote. Except as provided in any special rights or restrictions attaching to any series of preferred shares issued from time to time, or as expressly required by law, the holders of preferred shares will not be entitled to receive notice of, attend or vote at any meeting of Shareholders.

	The Subordinate Voting Shares and the Multiple Voting Shares are substantially identical with the exception of the voting and conversion rights attached to the Multiple Voting Shares. Each Subordinate Voting Share is entitled to one vote and each Multiple Voting Share is entitled to up to 10 votes. The number of votes to which a holder of Multiple Voting Shares is entitled to will be determined by whether such holder is a Canadian Person or Non-Canadian Person. In the event such holder is a Non-Canadian Person, such holder will be entitled to a variable number of votes, not less than one and not exceeding 10 (and which may be a fraction) per Multiple Voting Share. In determining the variable number of votes, such holder will have their voting rights per Multiple Voting Share held automatically proportionately reduced if and to the extent necessary to enable the Company to maintain its eligibility and qualification under the Canadian Status Rules. The Multiple Voting Shares are convertible into Subordinate Voting Shares on a one-for-one basis at any time at the option of the holders thereof and automatically in certain other circumstances. The holders of Subordinate Voting Shares benefit from "coat-tail" provisions that give them certain rights in the event of certain take-over bids for the Multiple Voting Shares. See "Authorized Share Capital Upon Closing" and "Principal and Selling Shareholders – Take-over Bid Protection – Coat-tail Agreement".
Dividend Policy:	Holders of Multiple Voting Shares and Subordinate Voting Shares will be entitled to receive dividends out of the assets of the Company legally available for the payment of dividends at such times and in such amount and form as the Board may determine. The Company will pay dividends thereon on a pari passu basis, if, as and when declared by the Board.
	Initially, the Company intends to focus on growth and does not anticipate paying dividends. The amount and timing of the payment of any dividends are subject to the discretion of the Board. See "Dividend Policy".
Principal Shareholders:	Upon completion of the Offering, the Principal Shareholders will collectively hold 100% of the Company's issued and outstanding Multiple Voting Shares.
	After giving effect to the Offering, Fairfax will hold approximately 43.6% of the Company's total issued and outstanding Shares and will hold approximately 56.1% of the voting power attached to all of the Shares (approximately 41.9% and 55.7%, respectively, if the Over Allotment Option is exercised in full) (based on the assumptions set forth under the heading "Meaning of Certain References").
	After giving effect to the Offering, IDJ in aggregate will hold approximately 19.2% of the Company's total issued and outstanding Shares and will hold approximately 36.8% of the voting power attached to all of the Shares (approximately 18.5% and 36.5%, respectively, if the Over-Allotment Option is exercised in full) (based on the assumptions set forth under the heading "Meaning of Certain References").
	As a result, the Principal Shareholders will following Closing, in the aggregate, have over 90% of the voting power over all corporate actions requiring shareholder approval. See "Principal and Selling Shareholders" and "Risk Factors". All of the Multiple Voting Shares held after the Offering by the Principal Shareholders will be subject to contractual lock-up arrangements with the Underwriters. See "Plan of Distribution – Lock-up Arrangements".
Lock-Up Arrangements:	The Company, the Selling Shareholders, and each security holder of the Company holding, directly or indirectly (together with such security holder's associates and affiliates), securities of the Company outstanding prior to the Closing of the Offering have agreed that, without the prior written consent of the Joint Bookrunners, not to be unreasonably withheld, they will not, during the period ending 180 days after the Closing Date: (i) offer, sell, issue, contract to sell, pledge or otherwise dispose of, directly or indirectly, any equity securities of the Company, rights to purchase any equity securities of the Company or any securities convertible into or exercisable or exchangeable for equity securities of the Company; (ii) enter into any swap, hedge or any other agreement that transfers, in whole or in part, the economic consequences of ownership of equity securities of the Company; or (iii) agree or announce any intention to do any of the foregoing, other than the Subordinate Voting Shares subject to the Over Allotment Option and certain other exceptions. Holders of 100% of the Company's issued and

outstanding shares immediately prior to the completion of the Offering will be subject to these lock-up agreements.

Take-over Bid Protection: In accordance with applicable regulatory requirements designed to ensure that, in the event of a take-over bid, the holders of Subordinate Voting Shares will be entitled to participate on an equal footing with holders of Multiple Voting Shares, the Principal Shareholders, as the owners of all the outstanding Multiple Voting Shares will enter into the Coat-tail Agreement. The Coat-tail Agreement will contain provisions customary for dual class, TSX-listed corporations designed to prevent transactions that otherwise would deprive the holders of Subordinate Voting Shares of rights under Ontario provincial take-over bid legislation to which they would be entitled if the Multiple Voting Shares had been Subordinate Voting Shares. See "Principal and Selling Shareholders – Take-over Bid Protection – Coat-tail Agreement".

Risk Factors: An investment in Subordinate Voting Shares is subject to a number of risk factors that should be carefully considered by prospective investors. These risks include, but are not limited to:

the competitive industry within which the Company operates;
changes in public and consumer tastes and preferences and industry trends;
the Company's ability to source IP and creative talent who can develop IP;
a limited number of buyers for the Company's original programming;
a limited pool of owned assets;
developments in technology and industry trends;
the potential impact of COVID-19 on the Company's business, financial condition and results of operations;
dependence on external factors;
business interruptions;
reliance on key personnel;
reliance by Untitled Entertainment on its ability to identify, recruit and retain qualified and experienced managers;
reliance by Untitled Entertainment on managers to build and maintain relationships with key talent clients;
potential labour shortages;
potential labour strikes or other forms of labour unrest affecting guilds or unions in the television and film industries;
lack of output agreements with buyers and dependence on key relationships with buyers;
budget overruns;
the potential inability to accurately project revenues and results of operations;
the Company's substantial capital requirements and financial risks, including

liquidity needs;

the potential inability of the Company to recoup acquisition, production, marketing and distribution costs incurred in production and distribution of video content;
the potential inability to accurately estimate production tax credits and other subsidies;
the potential inability to realize the Company's acquisition strategy or effective execution of the Company's acquisition strategy following Closing;
changes in the Company's business strategy;
potential difficulty raising additional capital;
risks related to doing business internationally;
fluctuation in foreign currency exchange rates;
litigation or regulatory or arbitral action;
protection and defense against intellectual property claims;
dependence on the Company's information technology ecosystem;
cybersecurity incidents or issues;
inadequate investment in information technology infrastructure and slow integration of acquired businesses;
unauthorized disclosure of proprietary and confidential information;
adverse publicity;
internal conflicts of interest;
compliance with laws and regulations;
the Company's dependence on tax credits to fund productions;
potential loss of Canadian status;
risks related to indebtedness;
potential failure to design, test and maintain effective processes and controls;
potential exposure to credit risk;
potential failure to secure studio space within estimated costs;
termination of material buyer and customer agreements;
tax-related risks;
investment eligibility;
outstanding registration rights and the effect on the Subordinate Voting Shares;
outstanding rights to purchase shares in the Company's partially-owned subsidiaries;
risks related to forward-looking information contained in this Prospectus;
absence of a prior public market;
potential loss of investment;
volatility in the market price of the Subordinate Voting Shares;
financial reporting and other public company regulatory obligations and potential errors therein;
possible future dilution of the Subordinate Voting Shares;
future offerings of debt and equity;
indemnification claims by the Company's directors and officers;
limited public company experience;
management's discretion in the use of the proceeds of the Treasury Offering;
significant ownership by the Principal Shareholders; and
limited voting rights of the Subordinate Voting Shares.

See "Risk Factors" and the other information included in this Prospectus for a discussion of the risks that an investor should carefully consider before deciding to invest in Subordinate Voting Shares.

CORPORATE STRUCTURE OF BOAT ROCKER

Boat Rocker was incorporated under the Corporations Act on January 29, 2003 under the name Fake City Films Corp. On February 27, 2007, the Company filed articles of amendment to change its name to Temple Street Productions Incorporated and on April 14, 2016, the Company filed articles of amendment to change its name to Boat Rocker Media Inc. On December 30, 2020, the Company amalgamated Jam Filled Entertainment into Boat Rocker. On or prior to the Closing Date, Boat Rocker will file articles of amendment to increase its authorized capital by creating an unlimited number of Multiple Voting Shares, Subordinate Voting Shares, and preferred shares issuable in series and to implement certain of the pre-closing share capital changes as appropriate. See "Pre-Closing Capital Changes". Boat Rocker's head office and registered office is located at 310 King Street East, Toronto, Ontario, Canada.

The organizational chart below illustrates the inter-corporate relationships of Boat Rocker and its material subsidiaries (including jurisdiction of formation or incorporation of the various entities):

INDUSTRY AND MARKET OPPORTUNITY

Boat Rocker engages in a variety of entertainment businesses in the global consumer video content market, with a focus on creating, producing and monetizing on-screen content and IP. The demand for such content and IP continues to experience robust growth around the world, and has resulted in a competitive marketplace for both new and pre-existing content.

Over the last decade, changes in the global market for viewing consumer video content ("video content" or "programming"), including television series and films, have been profound, fueled in large part by the emergence of OTT platforms, such as Netflix, rather than through a traditional over-the-air antenna or a cable or satellite provider. OTT platforms have unlocked new ways for users to view video content by making it available on demand and not according to the traditional fixed airing schedules of linear channels. The proliferation of OTT platforms has increased the demand for new and existing video content, with programming amortization expenses ("programming spend") (excluding sports) having grown at an 18% CAGR between 2014 and 2019⁵ and being anticipated to continue to grow at a 9% CAGR from 2019 to 2023⁶ as outlined further below.

Media Consumption

Advances in consumer technology have led to the widespread proliferation of internet-connected devices (e.g., smartphones, tablets, smart TVs – and streaming boxes – like Apple TV, Roku and Amazon's Fire Stick) that enable consumers to instantaneously access video content from any location, at any time, on any device. This trend has driven users to view more video content than ever before, and has significantly shifted a greater share of video content consumption away from linear channels to OTT platforms.

According to eMarketer⁷ , in 2020, the average time spent by U.S. consumers with media (including time spent on social networks, audio listening and viewing video content on digital devices, and viewing of content on linear channels) is expected to rise by more than one hour per day (11% growth over 2019), the largest increase in such media consumption in the last five years. The average individual in the U.S. is estimated to spend two hours and one minute per day consuming video content across digital devices (including smartphones, desktop and laptop computers, and other internet-connected devices) in 2020, representing a 236% increase as compared to the 36 minutes on average in 2012. The rise of digital video consumption can be attributed in large part by the increasing availability of OTT platforms (where digital video consumption has grown from an average of 19 minutes per day in 2014 to one hour and two minutes in 2020). In the coming years, the total time spent consuming video content is anticipated to experience robust growth, underpinned by the continued adoption by users of OTT platforms.⁸ Management expects the aforementioned media consumption trends to be comparable in Canada and across other developed markets around the world.

⁵ Represents the CAGR for the aggregate content programming amortization for The Walt Disney Company, NBCUniversal (Comcast), WarnerMedia (AT&T), Netflix, ViacomCBS, Amazon Prime Video, Hulu, Discovery, Apple and AMC Networks between 2014 and 2019. Sourced from MoffettNathanson LLC, Code Media 2019 presentation, November 2019; and Next TV, Original Programming Costs Raise Concern, https://www.nexttv.com/news/original-programming-costs-raise-concern-128593, January 2014. Discovery figure for 2014 is shown including Scripps Networks Interactive, which was acquired by Discovery in 2018; Vox, Comcast Is Now an Internet Company, https://www.vox.com/2015/5/4/11562278/this-is-the-quarter-comcastbecomes-an-internet-company, May 2015; 2014 and 2019 Amazon Prime Video and Hulu programming expenses from Kagan (a media research group within S&P Global Market Intelligence); Netflix 2014 figures are estimates from Kagan as of September 2020.

⁶ Represents the CAGR for the aggregate content programming amortization for The Walt Disney Company, WarnerMedia (AT&T) and Netflix between 2019 and 2023. Sourced from MoffettNathanson LLC, Code Media 2019 presentation, November 2019.

⁷ eMarketer, US Time Spent With Media 2020, April 2020. Represents ages 18+ and includes digital (desktop/laptop and mobile nonvoice), print (magazines and newspapers), radio, TV and other; includes all time spent with each medium, regardless of multitasking.

⁸ Ibid.

Average Time Spent with Media in the U.S. (hours: minutes) 9

Pre-pandemic, certain media consumption trends, including the rise in consumer use of OTT platforms, were expected to increase in 2020, specifically the total daily time spent by about 15 to 20 minutes.¹⁰ Management believes that the widespread lockdowns resulting from the COVID-19 pandemic have both accelerated the rate of digital video adoption and increased the time spent consuming video content on digital devices.

Global Growth of OTT Platforms

OTT platforms operate in a variety of business models. Some, like Netflix, Amazon Prime Video and Apple TV+, use a subscription video on demand ("SVOD") model, which allows users to view unlimited video content for a flat monthly fee. Others, like Apple iTunes or Google Play, have adopted a transactional video on demand ("TVOD") model, whereby a fee is charged to digitally rent or buy video content (such as a particular movie or television series). A third model, advertising-based video on demand ("AVOD"), allows users to view video content for free, but inserts advertisements before, during and/or after the video content is viewed (e.g., YouTube, or the ad-supported tier of Hulu).

Following large-scale consolidation in the media and entertainment industry (including the acquisition of Time Warner by AT&T, the acquisition of 21st Century Fox by The Walt Disney Company, the combination of Discovery Communications and Scripps Networks Interactive, and the combination of Viacom and CBS), there has been a new wave of OTT platforms (such as Disney+, Peacock, HBO Max, STARZ and Paramount+) launched by traditional entertainment companies who own linear channels and large video content libraries. These newer OTT platforms compete with original global competitors (such as Netflix and Amazon Prime Video), new entrants (such as Apple TV+), and regional players (such as Crave in Canada and Stan in Australia).

As OTT platforms have proliferated around the world, the total market for consumers to view video content has grown significantly, and this trend is expected to continue. The global market for viewing video content, comprised of traditional television (e.g., linear channels) and OTT platforms, is estimated in 2020 to be US\$270 billion, and is projected to grow to US\$288 billion by 2025. ¹¹ This growth is expected to be led by a 10% CAGR in global OTT platform revenue over the period (growing from US\$63 billion in 2020 to US\$100 billion in 2025), as

⁹ Ibid.

¹⁰ Ibid.

¹¹ Digital TV Research, SVOD to Generate \$100 billion, October 2020. OTT Video revenue represented by SVOD revenue; Traditional Television Video revenue represented by Traditional Multichannel Video revenue from Kagan (a media research group within S&PGlobal Market Intelligence), estimates as of December 2020.

consumer viewing habits continue to evolve and high-speed internet streaming becomes increasingly accessible around the world. 12

The strong growth trend for video content viewing can be attributed to a confluence of factors including the proliferation of OTT platforms (as described above), deep-pocketed operators of both OTT platforms and linear channels, and increased competition for original programming. Management expects the aforementioned trends of OTT viewership and growth to continue into the foreseeable future.

Video Content Purchasing Trends

As the media industry continues to evolve, the demand for high-quality programming has increased as buyers compete to differentiate their product offering and grow their subscriber base. As a result, the value of video content has continued to grow at a rapid pace, with the annual expenditure growth by linear channels and OTT platforms to purchase video content outstripping the revenue growth they are experiencing. The elevated competition has resulted in substantial price inflation, as buyers compete for premium content, with Netflix acknowledging that the cost to develop premium content increased approximately 30% between from 2018 to 2019, with no expectation that the pace will subside.¹³

The chart below illustrates the significant growth in annual content programming spend by select traditional entertainment companies (which own linear channels) such as Disney and Warner Media, and OTT platform operators such as Netflix and Amazon, between 2014 and 2019. In the aggregate, annual content programming spend for the peer group has grown from approximately US\$36 billion in 2014 to approximately US\$80 billion in 2019 (representing an 18% CAGR over the period).¹⁴ In addition, Disney, WarnerMedia and Netflix, which are representative of the broader group of buyers (outlined in the chart below), achieved a combined US\$40 billion of content programming spend in 2019 (excluding sports) and are expected to increase their content programming spend to over US\$56 billion in 2023, representing a 9% CAGR over the period.¹⁵

¹² Ibid.

¹³ Morningstar, Netflix Reports Mixed Subscriber Growth, January 2020.

¹⁴ MoffettNathanson LLC, Code Media 2019 presentation, November 2019; Next TV, Original Programming Costs Raise Concern, https://www.nexttv.com/news/original-programming-costs-raise-concern-128593, January 2014; Discovery figure for 2014 is shown including Scripps Networks Interactive, which was acquired by Discovery in 2018; Vox, Comcast Is Now an Internet Company, https://www.vox.com/2015/5/4/11562278/this-is-the-quarter-comcast-becomes-an-internet-company, May 2015; 2014 and 2019 Amazon Prime Video and Hulu programming expenses from Kagan (a media research group within S&P Global Market Intelligence). Netflix 2014 figures are estimates from Kagan as of September 2020. ¹⁵ Ibid.

Annual Content Programming Spend, Excluding Sports (US\$ billions)¹⁶

The predominance of deep-pocketed technology companies and traditional entertainment companies, each operating its own OTT platform, such as The Walt Disney Company, NBCUniversal (owned by Comcast), WarnerMedia (owned by AT&T), ViacomCBS, Apple and Amazon, has accelerated the already increasing video content spend. Many of these OTT platforms are viewed as ancillary services that add to the overall product offering of their respective parent companies, generating new recurring revenue streams and creating additional brand awareness to help drive sales in their primary businesses.

In order to compete, standalone OTT platforms have continued to invest substantially in original programming to differentiate their offerings, which is viewed as paramount in establishing a competitive moat, and justifies a higher priority than delivering profits in the near-term.¹⁷ In 2013, Netflix became the first OTT platform to make a major foray into original programming when it licensed the global rights to House of Cards, and, soon after, Orange Is the New Black, both of which achieved critical praise and commercial success. Netflix's achievement drove other OTT platforms (such as Amazon Prime Video) to also begin investing in their own original programming. This focus on original programming by OTT platforms like Netflix and Amazon Prime Video is also driven in part by recent trends in which traditional entertainment companies with large programming libraries (such as Disney, NBCUniversal and WarnerMedia) have begun to retain and/or reclaim the rights to their new and existing programming for use on their own proprietary OTT platforms, rather than their previous practice of licensing the programming to an OTT platform competitor. Following the launch of Disney+ in November 2019, Disney has been actively repatriating content back to its own platform from rival OTT platforms on a global basis. Other examples include WarnerMedia ending its license of Friends to Netflix in 2020 and moving the entire series onto its own OTT platform, HBO Max, and NBCUniversal ending its license of The Office to Netflix in 2021 and moving the entire series onto its own OTT platform, Peacock.

As traditional entertainment companies began launching proprietary OTT platforms, they also started to commission new, original programming exclusively for viewing on their OTT platforms, including Star Trek: Discovery on CBS All Access, The Mandalorian on Disney+ and a reboot of Saved by the Bell on Peacock. Emerging OTT platforms have also dedicated large programming budgets accordingly, including Apple TV+, which is estimated to have allocated approximately US\$6 billion over the next few years to build its own consumer video

¹⁶ Ibid.

¹⁷ Variety, Netflix Spent \$12 Billion on Content in 2018. Analysts Expect That to Grow to \$15 Billion This Year, https://variety.com/2019/digital/news/netflix-content-spending-2019-15-billion-1203112090/ , January 2019.

content library.¹⁸ The vast majority of this original programming distributed by OTT platforms has been produced by outside production partners, as OTT platforms generally do not have in-house studios to create their own original programming or require more content than their in-house studios can produce. As a result, management believes that the competition between OTT platforms for original content has created an attractive financial opportunity for companies like Boat Rocker which have the creative and commercial capabilities to originate and produce sought after programming.

Based on data from Kagan, five of the leading OTT platforms (i.e., Netflix, Amazon Prime Video, Apple TV+, Disney+ and Hulu) have increased their combined total content programming spend allocated to original programming from 6% in 2014 to approximately 25% in 2019, and they are forecasted to further increase their original content programming spend to approximately 37% of their total content programming spend by 2023. 19 Management believes that for the foreseeable future, the majority of the original content produced by these OTT platforms will not be produced internally, but will continue to be produced by third-party producers.

Relevant Content Genre Trends

Scripted

As a result of the increasing demand for high quality original programming, the number of new original scripted series has grown dramatically in recent years. Most notably, the production of new scripted series in the U.S. has doubled from 266 individual titles in 2011²¹ to 532 titles in 2019.²² This growth has been largely driven by the number of new scripted series commissioned by OTT platforms, which has increased more than tenfold from 15

¹⁸ Financial Times, Apple splashes \$6bn on new shows in streaming wars, https://www.ft.com/content/4f7f4326-c2bf-11e9-a8e9- 296ca66511c9, August 2019.

¹⁹ Kagan, a media research group within S&P Global Market Intelligence. Represents the aggregate estimated amortized programming costs for original programming and acquired programming, for Netflix (Kagan estimates as of September 2020), Amazon Prime Video (Kagan estimates as of July 2020), Apple TV+ (estimates as of January 2020), Disney+ (estimates as of November 2019) and Hulu (estimates as of May 2020).

²⁰ Ibid.

²¹ The Hollywood Reporter, Scripted Originals Hit Record 455 in 2016, FX Study Finds, https://www.hollywoodreporter.com/live-feed/scripted-originals-hit-record-455-2016-fx-study-finds-958337, December 2016. ²² The Hollywood Reporter, Peak TV Update: Scripted Originals Top 500 in 2019, FX Says, https://www.hollywoodreporter.com/live-feed/peak-tv-update-scripted-originals-set-record-2019-1266256, January 2020; The Hollywood Reporter, Peak TV Update: Scripted Originals Hit Yet Another High in 2018, https://www.hollywoodreporter.com/live-feed/peak-tv-update-scripted-originals-hit-high-2018-1169047, December 2018.

individual titles in 2012 to over 160 by the end of 2019. ²³ Also notable are the larger budgets for higher quality scripted programming, with recent examples such as The Morning Show and See for Apple TV+, The Mandalorian for Disney+ and the final season of Game of Thrones for HBO each having a budget of approximately US\$15 million per episode, as compared to the cost of a one hour drama series on a linear channel of approximately US\$3 million to US\$4 million, and US\$1.0 million to US\$1.5 million for a half-hour sitcom.²⁴ These higher budget productions typically result in much higher production values (bigger casts, more locations, better special effects, etc.) and have, in turn, attracted many prominent film talent (actors, writers and directors) over to "small screen" television productions.

Number of Scripted Original Series in the U.S.²⁵

Unscripted

Unscripted (non-fiction) programming, such as reality television, lifestyle programs, docu-series and game shows, has also benefited from rising competition between exhibitors to keep viewers engaged, with both linear channels and OTT platforms increasing their spend in recent years. In the 2019 to 2020 U.S. broadcast television season, unscripted series represented three of the top seven shows, and eight of the top 30 shows, in the key 18 to 49 year old demographic.²⁶ Unscripted programming represents an attractive and cost-effective way to achieve viewership on par with scripted series but at a lower risk profile, which is largely attributed to its flexibility (talk and reality shows are rarely serialized so they are easier to fit into programming schedules), more agile production schedules and lower production costs. For example, Discovery Inc., the owner of a number of linear channels (such as HGTV, TLC, Discovery Channel, OWN and DIY Network), pays an average of US\$400,000 per hour for

²³ Ibid.

²⁴ Variety, TV Series Budgets Hit the Breaking Point as Costs Skyrocket in Peak TV Era, https://variety.com/2017/tv/news/tv series-budgets-costs-rising-peak-tv-1202570158/, September 2017; The Washington Post, 'The Mandalorian' is the first TV show that actually looks like a movie. That might be a problem, https://www.washingtonpost.com/arts entertainment/2019/11/14/mandalorian-is-first-tv-show-that-actually-looks-like-movie-that-might-be-problem/, November 2019; The Verge, Apple TV Plus' See reportedly costs almost \$15 million per episode, https://www.theverge.com/2019/7/12/20691667/apple-tv-plus-see-shows-episodes-cost-report-streaming-disney-plus-hbo-max, July 2019.

²⁵ The Hollywood Reporter, Peak TV Update: Scripted Originals Top 500 in 2019, FX Says, https://www.hollywoodreporter.com/live-feed/peak-tv-update-scripted-originals-set-record-2019-1266256, January 2020; The Hollywood Reporter, Peak TV Update: Scripted Originals Hit Yet Another High in 2018, https://www.hollywoodreporter.com/live-feed/peak-tv-update-scripted-originals-hit-high-2018-1169047, December 2018. Data in 2019 is no longer segmented between sources.

²⁶ Variety, 100 Most-Watched TV Shows of 2019-20: Winners and Losers, https://variety.com/2020/tv/news/most-popular-tv shows-highest-rated-2019-2020-season-masked-singer-last-dance-1234612885/, May 2020.

unscripted programming, which is significantly less expensive than the average cost paid by linear channels for an hour of scripted programming (as referenced above, US\$3 million to US\$4 million per hour).²⁷ In addition, unscripted programming's risk profile is often mitigated by successfully leveraging proven formats and IP from other international markets, such as Boat Rocker's Big Brother Canada, The Amazing Race Canada, and MasterChef Canada, which are based on respective international formats, or leveraging hit shows like The Bachelor to launch spin-off formats such as The Bachelorette, The Bachelor Pad and Bachelor in Paradise.

Unscripted programming remains a staple for linear channels. As a result, several linear channels, including TLC (owned by Discovery), MTV (owned by ViacomCBS), and Bravo (owned by NBCUniversal), focus predominantly on unscripted programming, while others such as TNT and TBS (both owned by WarnerMedia) have indicated that they will increasingly focus on unscripted content going forward, as evidenced by TBS commissioning Boat Rocker's Go-Big Show (a variety show which premiered in January 2021). ²⁸ As OTT platforms continue to diversify their content libraries and broaden their reach, they have also increased their focus on original unscripted programming. In early 2018, Netflix had only four original unscripted titles available. By year-end 2019, this number had grown eightfold to 32 titles, including the dating show Love Is Blind and the docu-series Tiger King, both of which were among Netflix's top-performing shows in the first quarter of 2020.²⁹ Netflix has also recently renewed its focus on unscripted programming after the success of original programming such as Too Hot To Handle, Nailed It! and Queer Eye, including further expansion into talent competitions (such as the September 2020 debut of the karaoke singing competition Sing On!) and game shows (such as the June 2020 debut of Floor Is Lava).³⁰ The increased variety and quality of unscripted programming being produced has also attracted celebrities to attach themselves as both on-screen talent and executive producers, driving viewership and marketability.

Both the scripted and unscripted content genres at Boat Rocker are managed under the Television segment.

Kids and Family

In order to fully serve their diverse subscriber bases, linear channels and OTT platforms have continued to invest in kids and family programming, consisting of both live action, and, more predominantly, animated content. While linear channels have maintained strong spending levels, OTT platforms have been increasing their investment in kids and family video content, and in original animated programming in particular, due to the popularity of this genre of content (e.g., 60% of Netflix's subscribers consumed kids and family programming each month in 2018).³¹ In 2018, it was estimated that Netflix and Amazon Prime Video spent 11% and 10%, respectively, of their overall original programming budgets on animation. By 2022, this proportion of original programming spend on animation is expected to grow to 15% for Netflix and 14% for Amazon Prime Video.³² Kids and family programming represents a unique opportunity for OTT platforms to increase subscriber retention, as households that consume kids and family programming are incentivized to keep their subscriptions. 33

Kids and family video content also represents an attractive opportunity to develop an IP brand with global appeal that can drive consumer engagement both in terms of viewership and monetization via retail merchandise and other licensing opportunities. The global kids and family entertainment market is US\$110 billion per year for toys

²⁷ The Hollywood Reporter, Welcome to Peak Food TV: Inside Hollywood's Growing Hunger for Culinary Shows, https://www.hollywoodreporter.com/features/gordon-ramsay-more-hollywoods-growing-hunger-food-tv-shows-1225214,July 2019; Ibid.

²⁸ Deadline, AT&T Says TBS, TNT To Add Unscripted Content; CEO Calls HBO Max "Critical" To Success, https://deadline.com/2020/01/att-says-tbs-tnt-to-add-unscripted-content-hbo-max-critical-to-success-1202845224/, January 2020. ²⁹ Media Play News, Research: SVOD Wakes Up to Reality, https://www.mediaplaynews.com/research-svod-wakes-up-to-

reality/, April 2020. Business Insider, Netflix's unscripted hits 'Love Is Blind' and 'Tiger King' helped drive a huge spike in subscribers. Meet the exec behind these breakthroughs., https://www.businessinsider.com/netflix-unscripted-boss-reality-tv strategy-cheer-love-is-blind-2020-3, April 2020.

³⁰ Deadline, Netflix Lays Bare Non-Scripted Strategy With Renewed Push Into Talent Formats & Game Shows, https://deadline.com/2020/08/netflix-non-scripted-strategy-talent-formats-gameshows-1203017624/, August 2020.

³¹ Los Angeles Times, Netflix and Amazon spark animation revival, spending heavily in quest for binge-worthy shows, https://www.latimes.com/business/hollywood/la-fi-ct-animation-streaming-20181118-story.html, November 2018.

³² Ibid.

³³ Ibid.

and games. ³⁴ The kids and family entertainment market also includes sectors such as apparel, live tours and publishing, all of which can enhance brand awareness and foster evergreen entertainment opportunities for owners of underlying IP. Over the last decade, many existing kids and family brands have re-emerged on linear channels and OTT platforms, such as HBO (and its HBO Max OTT platform) announcing a deal in 2015 to air new episodes of Sesame Street. Competition has continued to accelerate with the launch of Disney+ and its extensive library of kids and family programming, and Netflix's multi-year deal with Nickelodeon to produce new, original animated programming.³⁵

An example of global monetization of kids and family IP is the Peppa Pig brand (now owned by Hasbro), which recognized its 16th anniversary in 2020. In 2019, 264 new episodes of Peppa Pig aired in 180 countries. The vast global success of Peppa Pig delivered US\$1.35 billion in retail sales of consumer branded products in 2019. 36 Peppa Pig World of Play theme park centres have also been developed in the U.S. and China through a partnership with Merlin Entertainments and Paultons Park, further enhancing Peppa Pig's brand awareness and increasing ancillary revenue opportunities.

The rapid growth of kids and family IP is further underpinned by leveraging AVOD platforms, such as YouTube, as a key distribution channel to increase brand exposure, cultivate viewer engagement and ultimately drive consumer affinity (i.e., purchase toys and merchandise). YouTube represents a valuable platform to gain realtime insight into evolving kids and family video content trends and grow brand awareness for popular IP via selected full episodes and YouTube-specific short form video content and ancillary content. In addition, media companies producing kids' YouTube content have seen a dramatic increase in viewership on YouTube of 79% in the first half of 2020 as compared to the first half of 2019.³⁷ Successful kids brands such as Peppa Pig, Paw Patrol, Masha and the Bear, and Barbie have effectively leveraged the YouTube audience to cultivate a dedicated franchise following, with Peppa Pig generating approximately 1.9 billion YouTube views in the U.S. in the first half of 2020, more than triple its viewership in 2018.³⁸

The results of operations within kids and family programming as well as the monetization of kids and family brands and franchise IP are reported in Boat Rocker's Kids and Family segment.

Talent and Celebrities

The convergence of talent and celebrity and video content production has solidified an ecosystem of talent representation, consisting of both talent management companies (managers) and talent agencies (agents). With demand for video content rising and buyers of programming increasing their investment to remain competitive, onscreen and production talent (i.e., actors, showrunners, writers, directors) have become key differentiators for video content producers. Popular celebrities have increasingly become essential for selling prospective programming to video content buyers and for ensuring the success of that content with viewers. As a result, talent is in high demand and these individuals are able to negotiate both upfront fees for their services in respect of these projects (for onscreen services and executive producer fees) and a share of profits. The proliferation of video content across multiple genres and viewing platforms, coupled with the ability for celebrities to engage with consumers on social media platforms, makes access to talent crucial for video content creators.

Talent managers have always played an important role in the entertainment industry but, with the increased buying activity, largely driven by the shift from film to television and new OTT platforms (as mentioned above), their role has become more important. Additionally, on-screen talent and celebrities have recently gained access to a growing variety of revenue opportunities in addition to traditional on-screen fees, including executive producer fees, brand endorsements and sponsorships. Increasingly, talent and celebrities are using their high-profile personal

³⁴ Technavio, Toys and Games Market by Product, Distribution Channel, and Geography – Forecast and Analysis 2020-2024, February 2020.

³⁵ Variety, Nickelodeon and Netflix Ink New Multi-Year Output Deal for Original Animated Features, Shows, https://variety.com/2019/tv/news/nickelodeon-and-netflix-ink-new-multi-year-output-deal-for-original-animated-features-shows-1203403430/, November 2019.

³⁶ Entertainment One Ltd.'s 2019 Annual Report.

³⁷ Tubefilter Inc., Made-For-Kids YouTube Content Seeing Big Year-Over-Year Growth, https://www.tubefilter.com/2020/09/03/made-for-kids-youtube-content-seeing-big-year-over-year-growth/, September 2020. ³⁸ Ibid.

brands as leverage to participate (as founders, partners, investors and/or spokespersons) in a range of new businesses (e.g., Ryan Reynolds' Aviation American Gin and George Clooney's Casamigos Tequila). As the influence of celebrities has increased in the popular culture, talent managers have expanded the scope of their role and value in guiding the careers of their clients. For example, Anonymous Content, a talent management company, leveraged the influence of its talent clients to package, sell, produce and license acclaimed video content such as True Detective, Mr. Robot, and Spotlight. In recent years, the talent representation sector has become an attractive target for external capital investments, predominately from private equity firms (e.g., Silver Lake Partners investing in Endeavor, and TPG Capital investing in Creative Artists Agency) and strategic investors (e.g., content producers such as Lionsgate acquiring a majority interest in 3 Arts Entertainment, Boat Rocker acquiring a 51% interest in Untitled Entertainment, and Media Rights Capital forming joint initiatives with United Talent Agency and Management 360).

Boat Rocker manages the talent and celebrity relationships of Untitled Entertainment within its Representation segment.

LETTER FROM THE FOUNDERS

1. Partner with the best storytellers and do everything you can to support their vision. Challenge the vision, test its soundness, but always protect it.
1. Embrace all forms of storytelling, because remarkable stories exist in every genre. Don't be defined by the type of content you make. Define yourself by the quality of the content you make.
1. Great stories can transcend television. When they do, capitalize on the opportunity to engage audiences in as many ways as possible.
1. Excel at the business of your business. Making compelling content is only half the battle. Financial success is the other half.
1. Hire and work with the best people you can find. Never settle for mediocrity.
1. Treat people with integrity and respect.

Yours sincerely,

Ivan and David

THE HISTORY OF THE COMPANY

Established in 2003 by former entertainment lawyers Ivan Schneeberg and David Fortier, the Company began by developing and producing television series across multiple genres, including the teen comedy, Darcy's Wild Life (produced 2004-2006), the Canadian format version of America's Next Top Model (produced 2006-2009), How Do You Solve a Problem Like Maria? (produced in 2008), the Canadian format version of the popular BBC reality television talent show featuring Andrew Lloyd Webber, and Billable Hours, a half hour comedy parodying the lives of corporate lawyers. The Company found stability through diversification. By producing television series in multiple genres, for a multitude of buyers, the Company built up development and production expertise and fostered industry relationships that were instrumental during this early period.

In 2007, the Company (then called Temple Street Productions Inc.) began to bring on key staff, many of whom are now senior leaders within the Company. Current Chief Corporate Officer and General Counsel, Samantha Traub, was employee number one. In the years that followed, the Company produced its first real hit: the drama, Being Erica (produced 2008-2011), about a woman who gets the chance to relive her life's biggest regrets. Being Erica aired for four seasons and was sold by international distributor, BBC Worldwide, around the world in over 150 countries, making it one of BBC Worldwide's most-distributed scripted dramas.³⁹ Although the series hasn't been in-production for years, it continues to generate recurring revenues for the Company and its creative partners, and continues to be lauded by the press. A remake of Being Erica is currently in development, with Untitled Entertainment client Allison Williams attached to star and executive produce.

In late 2008, after acquiring distribution rights to Being Erica, BBC Worldwide completed a minority equity investment in the Company. The Company had decided to delay any aspirations regarding distribution, believing it essential to focus first on becoming the best creative and physical producers possible. A partnership with BBC Worldwide offered an interim solution for distribution plus additional capital for investing in creative development and infrastructure. Following the closing of the BBC Worldwide deal, John Young, then a Managing Director at OMERS Private Equity in Toronto, joined the Company's board. John quickly proved to be invaluable, adding much needed strategic and financial advice, and, in 2009, John agreed to join the Company full-time. John assumed control of the Company's day-to-day business operations, while David and Ivan focused on the creative agenda. Major strategic and directional decisions were made by the three of them together. This model for senior level management has been used successfully to this day by Ivan and David, as Co-Executive Chairmen, and John, as Chief Executive Officer.

The Company then underwent a period of significant growth, focusing on its core competencies of creation, development and production of television series in the genres of scripted, unscripted and kids and family. What resulted was a boom in production in all three genres, with the Company concurrently producing, among other shows, three premium scripted dramas, Orphan Black, Killjoys and X-Company, as well as the Company's tween drama/comedy hit The Next Step. The Next Step (produced 2012-present), a mockumentary-style series about elite dance troupes has become a worldwide hit, with over 200 episodes airing in over 120 countries, triggering a spin-off series, merchandise, multiple live world tours and a significant YouTube channel with over half a million subscribers. Management is optimistic that Season 8 will be greenlit in 2021. The Next Step taught the Company the long-term value that can be generated from a brandable hit. This lesson was re-enforced with the success of the drama, Orphan Black (produced 2012-2017), which ran for five seasons. As ardent viewers from around the world joined the show's popular online fan club, #CloneClub, the series spawned everything from after-shows, to collector figurines, to a clothing line, to comic book series, and generated over \$125 million to date in worldwide sales.⁴⁰

Being Erica, The Next Step and Orphan Black gave the Company an understanding of the value of major franchisable brands. They also laid the foundation for the Company's current business model around sourcing great IP and monetizing it to its full potential by producing content that has the ability to transcend television and generate long-term, recurring revenues.

³⁹Globe and Mail, A CBC success: Erica without borders, https://www.theglobeandmail.com/arts/television/a-cbc-success-erica without-borders/article559506/, October 2011.

⁴⁰ The New York Times, Forget Ratings, 'Orphan Black' Had the #Clone Club, https://www.nytimes.com/2017/08/10/business/media/orphan-black-cloneclub.html, August 10, 2017.

In 2015, the Company embarked on the build-out of a full-service content studio, with leading creative teams developing and producing shows across all genres, supported by a corporate infrastructure capable of marketing, branding and selling its content around the world. With the development of an in-house, global distribution sales platform, the Company re-purchased the minority equity interest held by BBC Worldwide and subsequently sold a majority equity interest in the Company to Fairfax, the insurance and investment management firm led by investor Prem Watsa. Inspired by the idiom "If you build it, [they] will come" from the movie Field of Dreams, and seeing it as a mandate to build a studio that would attract the best storytellers from around the world, David, Ivan and John renamed the company Boat Rocker, which was the name of the fictitious novel written by the character Terrance Mann (played by James Earl Jones) in the film. The new name also seemed appropriate for the iconoclastic business the Company aspired to be.

Over the ensuing four years, equipped with fresh capital, Boat Rocker executed a carefully designed strategy to solidify and build out its existing business, establish a meaningful presence in new entertainment verticals, expand the Company's geographic footprint and further diversify its buyer base worldwide. This included securing key hires to develop and improve capabilities, notably to grow and expand the Company's distribution team and franchise and brand management team. Additionally, as a critical part of this growth plan, the Company successfully targeted, acquired and, where wholly-owned, integrated, nine companies, often in competitive situations, from 2016 to 2019. It also acquired minority interests in several other companies. The Company's acquisitions and minority investments were spearheaded by current Boat Rocker President and General Manager of Boat Rocker Studios, Michel Pratte (hired originally as an intern in the Company's early years), together with senior management, and span the Company's Television, Kids and Family and Representation reporting segments:

• Television: To expand its presence in the unscripted genre in Canada, the Company acquired the key production and distribution assets of Proper Television and its distribution arm Proper Rights (September 2017) and acquired a 70% stake in veteran unscripted producer Insight Productions (May 2018), thereby becoming a leader in the Canadian reality series business with productions such as The Amazing Race Canada, Big Brother Canada, Battle of the Blades, MasterChef Canada, Iron Chef Canada, Top Chef Canada and The Great Canadian Baking Show. In October 2018, the Company expanded into the United States and acquired a leading unscripted producer, Matador Content, which is based out of New York City and Los Angeles and has a marquee buyer base, including ViacomCBS, Disney, Vice, Netflix, Discovery and WarnerMedia. Matador series and feature length documentaries include Dear…, Lip Sync Battle, Going From Broke, What Would Diplo Do, The Impossible Row, Go-Big Show and the widely anticipated Billie Eilish: The World's a Little Blurry.

In August 2019, in order to grow the Company's U.S. and international scripted businesses, Boat Rocker acquired Los Angeles-based, Platform One Media, a producer of premium scripted television series. In addition to having three major series currently in-production or greenlit, Invasion, Rust and Beacon 23, Platform One Media has a deep slate of development projects, seeded by its first-look deals with talent such as Dakota Johnson and Lena Headey.

• Kids and Family: Boat Rocker's initial entry into the animated content space occurred in December 2015 through its acquisition of a 30% minority interest in the prolific creative production company, Industrial Brothers. In addition to acquiring a significant minority interest in Industrial Brothers, Boat Rocker entered into an exclusive development, first-look and co-production agreement with Industrial Brothers. This partnership has resulted in some of Boat Rocker's most exciting kids and family series to date, including Kingdom Force, Remy and Boo, Dino Ranch and the upcoming Daniel Spellbound. The Industrial Brothers deal was followed quickly by the acquisition of the award-winning animated content producer, Radical Sheep Productions, in March 2016. The Company took a further step into 2D animation production with the August 2016 acquisition of Jam Filled Entertainment, a leading animation provider, with a roster of shows including The Loud House, The Casagrandes, Bubble Guppies and DC Super Hero Girls.

The expansion into animation was quickly followed the same month by the Company's acquisition of certain assets of Arc, a 3D animation company which fell into receivership in August 2016. See "The Business of the Company – Competitive Strengths – Significant Acquisition and Investment Expertise". The January 2018 acquisition by the Company of Fremantle's kids and family business (the "International Kids and Family Acquisition") further bolstered the Company's kids and family division by adding

valuable owned-IP and in-production series, including the Danger Mouse franchise and the right to coproduce and distribute the teen series, Get Even, with CBBC. The acquisition also added to the Company a number of experienced development, production and sales executives in New York City, London and Hong Kong, who joined the Company's kids and family, franchise and brand management, and distribution teams and are tasked with developing, producing, distributing and exploiting the Company's kids and family content around the world.

• Representation: In February 2019, the Company acquired a 51% majority interest in one of Hollywood's leading talent management firms, Untitled Entertainment. Untitled Entertainment continues to be led by its founders out of New York City and Los Angeles. Untitled Entertainment has utilized Boat Rocker's investment to expand its capabilities in content development and production as well as celebrity brand endorsements. Boat Rocker has already successfully established multiple projects and ventures with Untitled Entertainment and its clients, and the Company continues to develop a strong pipeline of future opportunities. Additionally, the sales and brand management executives that joined Boat Rocker through the International Kids and Family Acquisition have meaningfully enhanced the Company's ability to represent third-party IP, including the shows in the Fremantle catalogue that the Company distributes to buyers around the world.

THE BUSINESS OF THE COMPANY

Overview

Boat Rocker is an independent, integrated global entertainment company that harnesses the power of creativity and commerce to tell stories and build iconic brands for audiences around the world.

The Company creates and produces television and film content across all major genres, distributes thousands of hours of content worldwide (both its own and a represented third-party library), and represents leading on-screen talent and celebrities. Boat Rocker also leverages its IP to create global entertainment brands that transcend television, resulting in multiple points of audience engagement. Examples include Being Erica, The Next Step, Danger Mouse and Orphan Black, all of which are worldwide brands, generating significant recurring revenue for the Company. Over the course of its 17-year history, in order to achieve its goals of telling stories and building global brands, the Company has developed and assembled what management believes is a unique set of creative and commercial capabilities. These include creation and development, production, animation, distribution, franchise and brand management, and talent management. As it has done since its inception, Boat Rocker continues to add to, improve, and expand its capabilities to ensure that it meets the needs of its partners, creators, and stakeholders in an ever-evolving entertainment landscape. See "The Business of the Company – Growth Strategies and Goals – Expanding Creative and Commercial Capabilities".

Management believes that Boat Rocker is differentiated as a result of how its creative and commercial capabilities are applied to shorten the distance between each of the three steps in the Company's value creation process: Source the IP, Assess the IP and Monetize the IP. See "The Business of the Company – How Boat Rocker Shortens the Distance".

Boat Rocker has consistently proven its ability to scale and drive long term shareholder value with increased revenue and profitability over time. In the five year period from 2014 to 2019, the Company grew revenue at a 55% CAGR and Adjusted EBITDA at a 73% CAGR driven by secular industry tailwinds, strategic acquisitions and organic growth. See "The History of the Company" for details. In 2019, the Company generated revenue of \$244 million, a net loss of \$19.5 million and Adjusted EBITDA of \$32.5 million. The Adjusted EBITDA Margin in 2019 was 13%. See "Non-IFRS Measures".

Notes:

In light of the COVID-19 pandemic, which resulted in regional shutdowns, social distancing protocols and limitations on group gatherings, the content production industry experienced a temporary pause on live action production, which impacted Boat Rocker's Television segment in both the scripted and unscripted production groups. As a result, the expected delivery dates of several Boat Rocker series have been delayed, shifting a substantial portion of expected revenue from 2020 into 2021. For example, production on the Company's drama, Invasion, for Apple TV+, was suspended for several months in the spring of 2020, and then restarted, with expected delivery pushed into 2021. Similarly, production on the drama, Rust, for Showtime, was suspended just days before it was scheduled to commence in the spring of 2020, and now has a new production start date set for the first quarter of 2021. Production of the second season of the teen drama, Get Even, was also pushed into 2021 to avoid pandemic-related challenges and costs. Talent clients in the Representation segment were also negatively impacted by the pandemic-related temporary shutdowns and restrictions imposed in 2020. However, production of the Company's animated content remained stable as Boat Rocker effectively and quickly transitioned its animation teams to work-from-home. In a two-week time frame, the Company moved all of its employees to work-from-home, including 425 employees in its animation department. Since March 2020, the Company has remotely hired and onboarded over 200 additional employees to support its on-going animation productions.

The Company has worked with buyers of its content to push production start dates, re-work and re-budget projects in order to mitigate pandemic-related costs, and restart projects as soon as reasonably practicable. The Company has also made claims under insurance policies for COVID-19 related costs in the aggregate amount of approximately \$29 million (subject to deductibles), but there is no assurance that it will receive any proceeds from such claims and in many cases, even if those claims are successful, the Company's buyers are entitled to the insurance claim proceeds. In respect of the Company's live action productions, Boat Rocker was able to continue to edit and post-produce video content that was shot pre-shutdown by moving post-production crews to work-fromhome and, in doing so, Boat Rocker succeeded in delivering its programming to its buyers on pre-COVID-19 schedules throughout the spring and summer of 2020. The Company also continued development activities on live action productions, such as writing and casting, through virtual writers rooms and casting sessions. As jurisdictions began to lift restrictions on large gatherings in the summer of 2020, Boat Rocker's scripted and unscripted teams worked diligently to pioneer what management believes are leading COVID-19 protocols, which allowed several of the Company's series to resume production once local restrictions were eased. In addition, Boat Rocker stood alongside the buyers of its premium dramas, Invasion and Rust, by underwriting a portion of the additional costs associated with delaying and remounting the production of those series in a more expensive pandemic environment, thereby confirming the Company as a reliable partner to its buyers. By fall 2020, a majority of Boat Rocker's delayed shows had resumed production, including Invasion. Rust is scheduled to commence production in the first

⁽¹⁾ Represents the last 12 months ended September 30, 2020.

⁽²⁾ Adjusted EBITDA is a non-IFRS measure and may not be comparable to similar measures used by other companies. The most directly comparable IFRS measure to Adjusted EBITDA is net (loss) income, which for the 12 months ended September 30, 2020 was approximately \$(49.7) million, and for the years ended December 31, 2019, 2018 and 2017 was approximately \$(19.5) million, \$9.8 million and \$14.2 million, respectively. See "Selected Annual and Interim Financial Information of Boat Rocker – Reconciliation of Non-IFRS Measures" for a reconciliation to IFRS measures.

quarter of 2021. See "Management's Discussion and Analysis of Boat Rocker" for greater detail on the COVID-19 pandemic's impact on Boat Rocker and see "Risk Factors – Risks Related to External Factors Which Boat Rocker Cannot Control, Including COVID-19".

Management expects the demand for content to be sustained, post-COVID-19, based on both industry analysts' expectations and its own experience with content buyers. In the midst of the pandemic, Boat Rocker secured from its content buyers development financing and production financing commitments on multiple new series from its content buyers. Representation has clients that have resumed work on projects across the industry. In light of increasing viewing trends during the pandemic, demand has remained steady for the third-party video content the Company distributes. Looking ahead, Boat Rocker has a slate of projects scheduled for delivery in 2021 and onwards, consisting of series that are in-production, greenlit or in development (either internally or with a thirdparty financier), across each of its segments and management anticipates that in 2021 the Company will have approximately 40 shows in-production or greenlit, including:

Television is currently in-production or greenlit on a number of shows including Invasion for Apple TV+, Rust for Showtime, Beacon 23 for Spectrum and AMC Networks, Dear….Season 2 for Apple TV+ and Big Brother Canada Season 9 for Corus; and
Kids and Family is currently in-production or greenlit on a number of shows, most notably Dino Ranch, Get Even (season 2), Bubble Guppies (season 5), and Daniel Spellbound.

In addition to the foregoing, Boat Rocker has over 100 shows in development. Collectively, Boat Rocker's 2021 production and development slate includes:

Creative and Commercial Capabilities

Over the past 17 years, Boat Rocker has assembled a set of creative and commercial capabilities that management believes enables it to shorten the distance between each of the three steps in the Company's value creation process: Source the IP, Assess the IP and Monetize the IP. See "The Business of the Company – How Boat Rocker Shortens the Distance". The Company has added to, improved and expanded this capability set over time, through both organic growth and acquisitions and it continues to do so by allocating its resources (both human and capital) accordingly. See "The History of the Company".

Boat Rocker's current set of creative and commercial capabilities includes:

Creation and Development

Boat Rocker, independently and in partnership with award-winning creators, writers, producers and global buyers, creates and develops the underlying creative materials (e.g., show concepts, pitches, scripts, existing international formats, etc.) necessary to produce premium video content across all major genres. These underlying creative materials are based on existing and original IP. See "The Business of the Company – Creative and Commercial Capabilities – Source the IP".

Boat Rocker's creative development teams in all of its divisions seek to ensure that each project is developed, to its full potential, using in-house expertise in all areas of content creation, distribution and monetization, in order to determine the best route to monetization. The Company's development process is designed to seek to ensure complete exploration of the commercial and creative potential of a project. During the development period, the Company also looks to identify the best type and level of development materials needed to help sell the project to prospective buyers. For example, Boat Rocker is developing a remake of the Company's existing hit comedy-drama Being Erica, partnering with Untitled Entertainment client Allison Williams to star and executive produce, and engaging showrunners Julia Rottenberg and Elisa Zuritsky to reimagine the concept. For the animated series Dino Ranch, Kingdom Force, Remy and Boo and Daniel Spellbound, the Company worked with its partner, Industrial Brothers, to develop animated teasers to help sell the original concepts to buyers. Finally, after hearing the pitch for the teen series, The Next Step (a faux-reality series based on an elite teen dance troupe featuring dancers as opposed to actors), the Company commissioned a sample episode as a proof of concept, which helped secure the order of an initial season of the series from the Canadian buyer. The series went on to achieve global success with seven seasons produced (the most recent season airing over the summer of 2020), comprised of over 200 episodes airing in over 120 countries worldwide, and management is optimistic that the eighth season will be greenlit in 2021.

Boat Rocker's creation and development teams are led by veteran executives who, collectively among the top five executives, have over 100 years of experience working at Boat Rocker and other industry-leading

companies, including ViacomCBS, NBCUniversal, and DreamWorks, where they developed shows such as Hannibal, The Biggest Loser, and Ben 10.

Production

Boat Rocker produces live action content across all major genres in countries around the world. Boat Rocker has produced over 300 series to date. Examples of Boat Rocker-produced content include hits such as Orphan Black, Lip Sync Battle, The Next Step, and The Amazing Race Canada. Boat Rocker-produced series have won numerous industry awards, including: Emmy, Peabody, BAFTA, Canadian Screen Awards and Critics' Choice Television Awards.

Boat Rocker's production expertise and capabilities span development to delivery, covering every step of production that is required to physically produce content and deliver such content to a buyer for viewing by consumers. These production capabilities include, but are not limited to, securing underlying rights, negotiating presale licenses, budgeting, scheduling, location scouting and management, hiring and management of production office staff, hiring and management of writers and directors, hiring and management of production crews (e.g., camera, lighting, construction, etc.), casting of actors and on-screen talent and negotiating talent deals, providing legal clearances, hiring and management of editors and post-production resources (i.e., staff and edit suites), and executive production (i.e., creative oversight).

Boat Rocker's production teams are led by seasoned executives with over 100 years of collective experience (among the top five executives) at Boat Rocker and other entertainment companies, including ViacomCBS and Endemol.

Boat Rocker's full suite of live-action production and animation (mentioned below) capabilities is designed to ensure that the Company has an opportunity to earn production fees on projects it produces, regardless of the Company's IP ownership position in any such project.

Animation

Management believes that Boat Rocker has one of North America's largest independent 2D and 3D computer graphic animation studios focused on production of television series. Located in Ottawa and Toronto, Ontario, and Halifax, Nova Scotia, Boat Rocker's animation studios have infrastructure capacity for nine concurrent animation productions and the ability to scale. The animation studio has produced over 20 different series for many of the world's top-tier animation buyers and production companies, including Netflix, Nickelodeon (owned by ViacomCBS), Universal Kids (owned by NBCUniversal) and Disney. Boat Rocker also supports the end-to-end infrastructure for many of the Company's owned IP animation productions (e.g., Dino Ranch, Kingdom Force in partnership with Industrial Brothers). Examples of content produced by Boat Rocker's animation studio for third parties include Thomas and Friends, Bubble Guppies, The Loud House, DC Super Hero Girls, and Rusty Rivets. The series produced by Boat Rocker's animation studio have collectively won numerous industry awards, including several Daytime Emmy Awards and Canadian Screen Awards.

Like Boat Rocker's expertise in live-action production, Boat Rocker's animation expertise and capabilities span development to delivery; its creative and technical teams can develop, produce and package animation productions for the screen, or be engaged by third-party IP owners, buyers and other customers for one or more parts of the production lifecycle.

Boat Rocker's animation studio is led by seasoned executives with over 75 years of collective experience (among the top three executives) at Boat Rocker and other entertainment companies.

Distribution

Boat Rocker distributes and sells both its own content and carefully selected third-party content to buyers around the world, including to Netflix, Disney, ViacomCBS, BBC, Bell Media, ProSieben, Vivendi, Corus Entertainment and CBC. The content Boat Rocker distributes varies from time to time. The Company's current distribution library spans all major genres; while currently a minority of the library is comprised of premium scripted content, the Company intends to manage the distribution rights with respect to several of its premium dramas that are in development or have been greenlit. The Company's deeply experienced distribution team has an international presence, with offices in Canada, the United States, United Kingdom and Hong Kong. The Company's distribution capabilities have been assembled to be relevant for the current sales market, where larger buyers are increasingly buying rights for multiple geographic jurisdictions at the same time, thereby reducing the number of remaining territories available for sale. Examples of Boat Rocker content that the Company distributes internationally include The Next Step, Kingdom Force and Dino Ranch in kids and family and Mary's Kitchen Crush in unscripted. Third-party IP represented by the Company includes Lionsgate Television's unscripted catalogue. In addition to new content, Boat Rocker's distribution team also manages its existing library of over 9,000 half-hours of content. Boat Rocker's distribution team is led by seasoned executives with over 100 years of collective experience (among the top four executives) at Boat Rocker and other industry leading entertainment companies, including Hallmark Entertainment, American Greetings and Entertainment One.

Franchise and Brand Management

The franchise and brand management team is responsible for developing, building and monetizing the Company's key franchises and brands. The team is tasked with assessing the Company's development slates in all genres and identifying IP with franchise and brand potential. The franchise and brand management team then works with the content creators and Boat Rocker's creative teams from the earliest stages to seek to ensure that the IP is developed to ultimately transcend television and offer consumers multiple points of engagement. Once a franchise or brand is established, the team is responsible for managing and expanding these points of engagement, including via brand marketing and digital advertising efforts, while continuously assessing additional opportunities to monetize the IP in order to ensure the highest possible quality of fan and consumer experience.

By way of example, the franchise and brand management team identified Dino Ranch at the concept stage as a property with strong franchise potential. Since then, the team has worked closely with the show's creators at Boat Rocker's partner company, Industrial Brothers, and with the Company's kids and family division to set the foundation for a successful pre-school franchise. The team built sophisticated brand guidelines for licensing partners and used these tools to collaborate with animators to ensure that characters and buildings in the series were "toyetic" (i.e., specifically designed to be easily adaptable as toys and figures) in order to maximize future brand potential. The team then negotiated an overall toy pact for the series with the market leading toy company, JazWares, and a book publishing deal with international kids publisher, Scholastic, as well as several other licensing deals in multiple territories globally.

Boat Rocker's franchise and brand management team has successfully built brands around many other Boat Rocker-owned properties, including the drama, Orphan Black, and the kids and family series, Love Monster and The Next Step. Points of engagement on these brands include apparel, music, merchandise, toys, collectibles, publishing, live tours and short-form video content on YouTube.

The team is led by veteran executives with over 75 years of collective experience (among the top four executives) at Boat Rocker and other industry-leading entertainment companies, including Mattel, Nickelodeon, ViacomCBS, and WarnerMedia.

Talent Management

Boat Rocker owns a majority interest in one of Hollywood's leading talent management companies, Untitled Entertainment, whose 32 managers, collectively, currently represent many A-list stars and personalities. Untitled Entertainment's prolific client base has been a part of many critically acclaimed and commercially successful television series and feature films winning numerous Emmy Awards and Academy Awards in the process. Untitled Entertainment's client base includes: Connie Britton, Penelope Cruz, Laura Dern, Matt Dillon, Minnie Driver, Jane Fonda, Max Greenfield, Naomie Harris, Neil Patrick Harris, Katie Holmes, Kate Hudson, Geremy Jasper, Dakota Johnson, Zoe Kravitz, Ashton Kutcher, Jessica Lange, Jennifer Jason Leigh, Melissa Leo, Zachary Levi, Mike Myers, Leslie Odom. Jr., Chris O'Donnell, Zachary Quinto, Kelly Ripa, Chris Rock, Sam Rockwell, Liev Schreiber, John Slattery, Jean Smart, Uma Thurman, Marisa Tomei, Naomi Watts, Olivia Wilde, Ruth Wilson, and Benh Zeitlin. Untitled Entertainment generates commission revenue from talent and brand representation, and it serves as an executive producer on television shows and films from which it receives executive producer fees and back-end participations.

Boat Rocker works closely with the managers at Untitled Entertainment to identify opportunities to partner with clients on new projects in all genres, whether by attaching clients to Boat Rocker projects already in development (thereby making those projects more attractive to prospective buyers) or by partnering with Untitled Entertainment's clients on their own creative ideas and endeavors (thereby creating new and innovative pipelines for desirable and marketable series). An example of early progress in attaching Untitled Entertainment's clients to Boat Rocker projects already in development is partnering with Allison Williams to star in and executive produce a remake of Boat Rocker's Being Erica. The Company is also developing numerous as-yet unannounced projects which Untitled Entertainment clients are attached to (as on-screen talent and/or producers) or which have been sourced and are being developed by Untitled Entertainment clients.

Untitled Entertainment's stable of talent managers has over 100 years of collective experience managing world-class talent across all major genres. That collective experience, and accompanying reputation, results in the group being among Hollywood's most influential business leaders.⁴¹

How Boat Rocker Shortens the Distance

Source the IP

Acquiring and/or Licensing IP: The Company, across all of its divisions, acquires rights to underlying IP from third-party sources, including books, articles, comics, stage plays, formats and original pitch concepts and speculative scripts. For example, the Company optioned (i.e., acquired the production rights to) the acclaimed novel American Rust by Philipp Meyer and developed it as a scripted drama with writer/showrunner Daniel Futterman and actor/executive producer Jeff Daniels. The series, entitled Rust, is scheduled to begin production in the first quarter of 2021 for Showtime (and is scheduled for delivery in 2021). The Company's series Orphan Black was based on a draft speculative script written by Graeme Manson and an original concept by Manson and director/executive producer John Fawcett, which the Company optioned in 2010. Other examples include Boat Rocker's reality series The Amazing Race Canada, Big Brother Canada and MasterChef Canada, which are all based on original U.S. or international formats.

⁴¹ Variety 500, Untitled Entertainment – Jason Weinberg, https://variety.com/exec/jason-weinberg, 2019.

Partnerships: Boat Rocker enters into various types of partnership arrangements with content creators, talent and third-party brands (e.g., individual, multi-project, overall exclusive, etc.) in order to source new ideas and IP and develop content. Boat Rocker's long-term partnership with Industrial Brothers (which includes an equity investment and a partnership on development, production and distribution) has yielded multiple original kids and family series, including Dino Ranch, Remy and Boo, Kingdom Force and Daniel Spellbound. Similarly, the Company's first-look deal with TeaTime Productions, founded by actor/producer (and Untitled Entertainment client) Dakota Johnson and executive producer Ro Donnelly, has created a pipeline of premium scripted dramas, including Rodeo Queens, which was set-up in development with Amazon Prime Video in 2020. Boat Rocker has a number of as-yet unannounced projects in development with Untitled Entertainment and continues to seek out additional opportunities to partner with them on video content and other projects. The Company also recently entered into a first-look agreement with Game of Thrones star Lena Headey's production company, Peephole Productions. Finally, the Company works with third-party brands to source programming concepts inspired by the brands' existing IP.

In-house Origination: Boat Rocker's internal development teams create original ideas for new projects. For example, the original concept for the drama Being Erica was co-created in-house, together with writer and coshowrunner Jana Sinyor. Boat Rocker also created or co-created, in-house, the original reality competition series Recipe to Riches, the docu-series History in the Making, the food series Late Nite Eats, and the extreme talent series Go-Big Show.

Assess the IP

Once IP has been sourced, Boat Rocker's key leadership teams initiate a collaborative and iterative assessment process to determine how to best creatively develop and monetize the IP. As part of this process, Boat Rocker determines how to best allocate its resources (both human and capital) in order to seek to maximize the Company's ultimate long term revenue potential while also minimizing risk.

At any given point in time, the Company's portfolio of projects in each genre, its available capital for investment in IP and its overall tolerance for risk, varies. The Company works to manage each of these variables in order to maintain a prudent balance. Boat Rocker recognizes that every project is distinct, offering different avenues to monetization and different risk profiles. In order to manage capital demands, cash flow, and risk, the Company strives to achieve a strategic balance, across all genres of owned-IP, between projects that have higher risk, hitbased, recurring revenue potential, and lower risk fee-for-service projects. To achieve this balance, the Company carefully assesses each piece of potential IP, evaluating it against the Company's existing portfolio of projects and overall risk profile and taking into account the Company's current creative and commercial capabilities. After assessing the IP, the Company may elect to pursue a production services model for a project, selling the IP to a buyer who agrees to fully fund the cost of production and hire the Company, for a fee, to produce the programming. Alternatively, the Company may decide to pursue a studio position on the project and commit its own capital to the funding of the project. This allows the Company to retain the copyright in the video content (or a portion thereof) and the ability to directly exploit the content, generate and retain profits from that exploitation, and, ideally, turn the property into a successful worldwide brand.

For example, on Dino Ranch, Boat Rocker identified a property with high franchise potential. The Company was also looking for a pre-school animated property to anchor its kids and family distribution and brands businesses. The Company therefore decided to invest in the series in order to retain and manage distribution, merchandising and licensing rights, as opposed to selling ownership of the series to a potential buyer or licensing those rights to a third-party distributor. By taking this strategic risk, the Company retained the opportunity to build Dino Ranch into a profitable brand and to access the associated recurring revenues from monetization of the series for itself and its creative partners. Conversely, on two other kids and family projects in paid development with third parties, Boat Rocker determined that, given the nature of the projects and Boat Rocker's other investment commitments on kids and family projects already in-production, the best route to success for the projects and the Company was to structure the arrangements such that the buyers, if they ordered the projects, would own 100% of the IP and be responsible for 100% of the costs. Outcomes may also fall in the middle of this spectrum. For example, on Boat Rocker's initial drama series, Being Erica, the Company licensed the distribution rights to BBC Worldwide, thereby securing the necessary funding to produce the series without taking on the risk of making a significant additional financial investment in the series. While the Company did not have an in-house distribution team at the time, even on future projects Boat Rocker may choose to license international rights to a third-party distributor in order to balance risk and manage cash flow demands.

Boat Rocker's IP assessment process maintains IP retention flexibility and seeks to optimize both capital allocation and the risk-return profiles of its individual projects and its overall show portfolio across all genres. Furthermore, this flexible assessment approach enables the Company to capture a high volume of fee-generating opportunities. Additionally, where Boat Rocker is able to, it seeks to cover a portion of its production costs and reduce its investment (if any) by producing video content in jurisdictions (like Canada) that offer meaningful tax credit incentives or other subsidies that reduce expenses.

Monetize the IP

Once the IP assessment is complete, Boat Rocker leverages its creative and commercial capabilities accordingly to monetize the IP, seeking to maximize available revenues and engage consumers in as many ways as possible. In most instances, Boat Rocker's primary monetization strategy involves the conversion of IP into a television series, giving the IP the opportunity to reach audiences around the world. Initially, revenues are generated from the production of the series (i.e., upfront production fees that are included in the budget and paid to the Company). Additional revenues can then be generated from selling or licensing the right to broadcast those series to buyers and to third-party distributors and licensees and exploiting associated rights (e.g., merchandising, licensing, format rights, etc.). In certain targeted circumstances, where the Company identifies the opportunity and has available capital and risk tolerance, the Company works to transform a series into a franchise that transcends television by extending the IP across as many brand extensions as possible, including, for example, toys, apparel, publishing and live events.

The Company's monetization strategy for each project is not static and is regularly reviewed. If the Company identifies an unexpected level of audience engagement with a particular property, or international sales exceed forecasts, Boat Rocker may decide to allocate more resources to that property as part of its broader portfolio management strategy. For example, when the first season of Love Monster, an animated co-production with BBC and UYoung, was greenlit, the initial monetization plan for the series focused on television distribution with limited potential for additional revenue streams (e.g., merchandising and publishing). However, since its launch, the show has performed above expectations, particularly in the U.K. where it has ranked among the Top 5 shows on CBeebies (BBC-owned children focused channel), and retailers have become increasingly excited about prospective merchandising sales. Consequently, in its planning for the second season of the series which is anticipated to be delivered in 2022, Boat Rocker intends to allocate additional internal franchise and brand management support to Love Monster, and to increase marketing and spending on production of additional original YouTube content to drive the sale of toys and merchandise created through Boat Rocker's partnership with Golden Bear, a leading U.K. based plush toy manufacturer. Love Monster toys are currently sold at select retailers in the U.K., including Argos and Sainsbury, with a plan to launch in other markets 2021.

Shortening the Distance Case Studies

Boat Rocker has a proven track record of shortening the distance between creation of a story, bringing that story to life and being able to bring in revenues from the monetization of the IP at the heart of the story. Some examples of successful executions include Orphan Black, The Next Step, and Dino Ranch.

THE NEXT STEP

DINO RANCH

Competitive Strengths

The Company believes that its combination of competitive strengths, as summarized below, differentiate it from its competitors worldwide.

Differentiated Creative and Commercial Capabilities Already Assembled

As described in "The Business of the Company – Creative and Commercial Capabilities" above, Boat Rocker's creative and commercial capabilities include: creation and development, production, animation, distribution, franchise and brand management, and talent management. Boat Rocker routinely seeks opportunities to continue to add to, improve and expand its creative and commercial capabilities, and allocates its resources (both human and capital) accordingly.

The Company believes that it has assembled a broader, deeper and more diversified set of creative and commercial capabilities than most of its competitors of similar size and scale. Moreover, the Company believes that its particular set of creative and commercial capabilities are distinct amongst independent media companies worldwide irrespective of size and scale. Boat Rocker further believes that its model of applying its commercial and creative capabilities to shorten the distance between the three steps in the Company's value creation process (as outlined in "The Business of the Company – How Boat Rocker Shortens the Distance" above) results in greater and more effective value creation potential for both the Company and its partners compared to its peers.

Independent Company of Scale Unaffiliated with Any Major Studio or Buyer

Boat Rocker is differentiated from its competitors because it is an integrated and diversified entertainment company of scale while also being independent from, and unaffiliated with, any major Hollywood studio or buyer. Boat Rocker's independence affords the Company flexibility and optionality in how it sources and produces IP and, importantly, how it monetizes IP and manages risk. For example, remaining unaffiliated with any individual buyer allows the Company to retain control and flexibility when determining where to sell its IP (ensuring the Company can sell each project to its optimal buyer, often in competitive situations), what level of risk to take on each project (e.g., production services or invest and own rights), and to seek to ensure the Company has a diversified list of buyers with no material concentration with any single buyer. These dynamics are often attractive to creators who are looking to partner with entertainment companies of scale (like Boat Rocker) but who do not wish to be tied to one consumer viewing platform for all of their projects.

The Company's scale allows Boat Rocker to invest in its own IP as a studio, thereby providing an opportunity, when appropriate, to retain ownership rights and the potential for brand building and future recurring revenue. Boat Rocker also has the diversified capabilities needed to assess and monetize those rights. Moreover, the Company has sufficient scale and expertise to fulfill all of its obligations as a studio and partner on projects. For example, during the COVID-19 pandemic, Boat Rocker was able to stand alongside the buyers on its large-scale dramas Invasion, for Apple TV+, and Rust, for Showtime, by underwriting a portion of the additional costs associated with delaying and remounting the production of those series in the more expensive pandemic environment, thereby confirming the Company as a reliable partner to its buyers.

Diversified Business Model

Boat Rocker is a diversified entertainment company in four distinct ways:

Across Genres: Boat Rocker sources, creates and distributes content across all major genres, including scripted, unscripted and kids and family, both live action and animated.
Across Business Units: Boat Rocker has business units that generate regular and predictable revenue in lower risk sectors while still delivering significant margins (e.g., the Company's animation studio and Untitled Entertainment in talent management). The Company also has business units that make investments in programming in order to secure or retain ownership rights and larger potential revenues (e.g., the Company's scripted division's planned investment in Beacon 23, and the kids and family division's investment in shows like Dino Ranch).
How it Generates Revenues From IP: As described above in "How Boat Rocker Shortens the Distance", the Company assesses how to best allocate its resources (both human and capital) to the IP it sources and produces so as to maximize potential revenue while minimizing risk. This allows the Company to take project-specific capital risk and pursue rights retention on select projects (in exchange for higher potential recurring revenues in the future) and to take a service fee without any project-specific capital risk on others.
Across Buyers: Boat Rocker is platform agnostic and sells its video content to a global set of programming buyers, consisting of both linear channels and OTT platforms. In its process of assessing the IP, Boat Rocker is able to consider multiple potential buyers for its video content to ensure the optimal partner for the new project. Boat Rocker has capitalized on the significant growth in buyers, cultivating relationships with new buyers and, as a result, no one buyer contributed more than 10% of consolidated revenue in 2019. The Company intends to continue to manage buyer concentration in the future although buyer concentration may be higher in certain periods if the Company is delivering one or more big-budget programs to a given buyer. See "The Business of the Company – Buyers" for a sample of Boat Rocker's buyers.

By diversifying across genres, business units, how it generates revenues, and buyers Boat Rocker is better positioned to manage volatility and risk. For example, by producing in all major genres, management believes the Company is less affected by shifts in demand or oversupply that may occur from time to time. Additionally, the more reliable revenues generated by the Company's business units operating in lower risk sectors help mitigate the volatility associated with the Company's higher risk/reward business units. Similarly, the Company's diversified approach to generating revenue allows for further risk mitigation across its portfolio of projects.

Well-Positioned to Benefit from Industry Tailwinds with No Legacy Businesses

Boat Rocker engages in a variety of entertainment businesses in the global consumer video content market, with a focus on creating, producing and monetizing on-screen content and IP. As outlined above in "Industry and Market Opportunity", the consumption of media continues to grow each year, driven by advances in consumer technology and internet-connected devices. Specifically, the significant increase in consuming video content has been largely driven by the proliferation of OTT platforms (including from new entrants such as Netflix, Amazon Prime Video and Apple TV+, as well as new OTT platforms launched by traditional entertainment companies such as Disney+, Peacock, HBO Max, STARZ and Paramount+). As buyers compete to differentiate their product offering with new, original programming, the value of content has continued to climb, and buyers are spending more annually to purchase or license content than ever before.

Management believes Boat Rocker is well-positioned to benefit from these trends given its diversified business model across genres, business units, buyers, and IP exploitation. The Company has strong relationships with the largest buyers of video content, and produces and exploits in-demand, high quality programming for audiences around the world. Boat Rocker does not operate any legacy entertainment businesses undergoing significant disruption (e.g. theatrical film exhibition, linear television channels or print media). This has enabled the Company to build and evolve, in a forward-looking manner, a business that is strategically positioned to succeed in the continuously evolving entertainment landscape.

Significant Acquisition and Investment Expertise

Boat Rocker has a proven track record of targeting, assessing, acquiring and integrating companies and assets across a wide range of corporate transactions, ranging from competitive auctions to distressed asset sales, in multiple jurisdictions, which has enabled the Company to enhance its capabilities in all three reporting segments and expand into new businesses. Since 2015, Boat Rocker has successfully completed and integrated nine acquisitions including Jam Filled Entertainment, Matador Content, Platform One Media, and Untitled Entertainment, and acquired minority interests in several other companies, including Industrial Brothers. Such acquisitions and investments have enhanced the Company's creative and commercial capabilities across all three of its reporting segments.

Boat Rocker continually evaluates how to best allocate its resources (both human and capital) to enhance and expand its creative and commercial capabilities. When the Company identifies a capability that it wants to add to the business, or an area that requires enhancing or expansion, the Company assesses whether that growth is most efficiently and effectively achieved organically or through strategic acquisitions. If the Company determines that acquisitive growth is the most appropriate approach, Boat Rocker quickly engages its experienced executive team to target, assess and, ultimately, acquire the needed company or asset. Once a target area is identified for an acquisition or investment, Boat Rocker takes a disciplined approach in assessing leads, evaluating risk, modeling the opportunity, determining the appropriate purchase price, executing the transaction, and integrating the business, all while seeking to identify and realize available operating efficiencies.

Boat Rocker's strategic approach to acquisitions and investments is exemplified by Boat Rocker's entry into kids and family entertainment. In 2015, Boat Rocker completed a minority investment in Industrial Brothers, acquiring 30% of the business and securing an exclusive development, first-look and co-production partnership. By the end of 2020, between dividends and other returns on invested capital, Boat Rocker had recouped the entirety of the purchase price it paid for its minority stake, and expects to continue generating an attractive financial return in the future. In addition, pursuant to the co-production partnership mentioned above, Boat Rocker co-produces Industrial Brothers' original programs and Boat Rocker distributes the programming and manages the exploitation of key rights including merchandising and licensing. See "The Business of the Company – How Boat Rocker Shortens the Distance – Shortening the Distance Case Studies" for further illustration of this concept for Dino Ranch. Boat Rocker has leveraged its full suite of capabilities in cultivating Industrial Brothers' brands, including utilizing its animation studio to provide animation production services on certain Industrial Brothers' series.

After making its investment in Industrial Brothers and acquiring Radical Sheep Productions (an award winning animated content producer), the Company set its sights on acquiring a full service animation studio to support its expanding animation slate. In pursuing Jam Filled Entertainment, the Company sought an animation studio with a stellar reputation in Canada and the U.S. for high quality 2D animation, creativity, excellent customer service, and a positive corporate culture with intense employee loyalty. The acquisition of Jam Filled Entertainment was completed on August 3, 2016. In the final days of closing the transaction, a strategic opportunity arose to buy assets from Arc, a 3D animation studio located in Toronto which fell into receivership in 2016. Seeing an opportunity to add 3D infrastructure to Jam Filled Entertainment's existing 2D capabilities and to secure a turn-key, state of the art, animation studio in Toronto, Boat Rocker, utilizing the industry expertise of the management of the newly acquired Jam Filled Entertainment, quickly assessed Arc's assets and crews and closed on the deal mere weeks after the opportunity arose. In connection with the Arc acquisition, Boat Rocker secured three of Arc's projects (Thomas and Friends for Mattel, Rusty Rivets for Spin Master and Kody Kapow for NBCUniversal) and rehired many of its former employees. The Company's combined animation studio group now spans three cities and 650 animators, and has resulted in a 32% net income before income taxes CAGR, and a 23% Adjusted EBITDA CAGR in the unit since the acquisitions of Jam Filled Entertainment and assets of Arc. See "Non-IFRS Measures".

Additionally, through its ventures arm (Boat Rocker Ventures) Boat Rocker works with leading companies at the intersection of media, technology and consumer retail through joint ventures, minority investments and strategic partnerships. Notable investments in Boat Rocker Ventures' portfolio include Serial Box, an audio and ebook platform that offers a mobile application, Marco Polo, an early learning pre-school application that offers literacy and a comprehensive STEAM (Science, Technology, Engineering, Arts, and Math) curriculum, Creative Labs, a venture lab focused on building new direct-to-consumer brands that leverage the reach and awareness of celebrity talent, and Bustle, a digital media company with 84 million readers.⁴² Boat Rocker seeks venture opportunities which offer a strategic partnership for Boat Rocker's business, in addition to a compelling financial investment. For example, as part of its investment in Serial Box, Boat Rocker partnered with them to create an audio book extension of its successful show Orphan Black entitled Orphan Black: The Next Chapter. Similarly, Boat Rocker's animation studio produced pre-school video content for Marco Polo entitled The Polos, which is distributed by Boat Rocker's distribution team.

⁴² Bustle Digital Group, https://bustle.company/, 2020.

Rocker benefits from inbound, and often proprietary, opportunities generated by its relationships and reputation. Management believes that as a result of the temporary market disruption brought about by the COVID-19 global pandemic, attractive acquisition opportunities are likely to emerge.

Experienced and Aligned Management Team

Since its inception in 2003, Boat Rocker has built an entrepreneurial culture that equally values creativity and commercial success. Founders, Co-Executive Chairmen, and Co-Chairmen of Boat Rocker Studios, David Fortier and Ivan Schneeberg, bring experience as entertainment lawyers and as creative television producers, and the Company's Chief Executive Officer, John Young, brings operational expertise, with previous experience as a lawyer and private equity Managing Director. Most of the senior management team have worked continuously together for over a decade, including Chief Corporate Officer and General Counsel, Samantha Traub, and Boat Rocker President and General Manager of Boat Rocker Studios, Michel Pratte. The Company's Chief Financial Officer, Michelle Abbott, has both media and technology industry experience and has previously worked at a public company listed on the TSX. Executive Vice President, Human Resources, Cindy Brown, joined Boat Rocker in 2016 after a 25-year tenure at a Canadian chartered bank, with roles in human resources, communications and marketing. Andrew Spergel, Chief Investment Officer, joined the Company with expertise in strategic initiatives and corporate development in the media industry and a background in management consulting.

Strong Financial Profile Enhanced by Strategic Long-Term Shareholder

Boat Rocker has consistently proven its ability to add scale and drive long term shareholder value with increased revenue and profitability over time. In the five year period from 2014 to 2019, the Company grew revenue at a 55% CAGR and Adjusted EBITDA at a 73% CAGR driven by secular industry tailwinds, strategic acquisitions and organic growth. See "The History of the Company" for details of strategic acquisitions. In 2019, the Company generated revenue of \$244 million, a net loss of \$19.5 million, and Adjusted EBITDA of \$32.5 million. The Adjusted EBITDA Margin in 2019 was 13%. See "Non-IFRS Measures".

Growth Strategies and Goals

Expanding Creative and Commercial Capabilities

Boat Rocker believes its integrated creative and commercial capabilities add value beyond the sum of their individual parts, empowering the Company to shorten the distance between each of the three steps in the Company's value creation process: Source the IP, Assess the IP and Monetize the IP. As outlined in "The Business of the Company – Creative and Commercial Capabilities", these capabilities include: creation and development, production, animation, distribution, franchise and brand management, and talent management.

Capitalizing on Operating Leverage

Increasing Sources of IP

Acquiring and Licensing: Boat Rocker has a strong track record of acquiring and licensing IP. The Company intends to pursue more and higher profile IP by purchasing IP libraries or brands and acquiring or licensing well-known IP from third-party sources including books, articles, comics, stage plays, formats and original pitch concepts and speculative scripts.
Partnerships: Boat Rocker intends to increase its IP sourcing from partnerships with content creators, talent and third-party brands across a variety of structures (e.g., individual projects, multi-project, overall exclusive, minority investments, joint ventures etc.) in order to source new ideas and develop content. Boat Rocker believes that it can continue to attract and retain creative and brand partners as a result of its differentiated creative and commercial capabilities, its strong talent management relationships with high profile celebrities, and its independence from

Hollywood studios and consumer video buyers. Management believes that independence is particularly attractive to creators and brand partners because it affords them flexibility as to where and how their projects are structured and distributed.

• In-House Origination: Boat Rocker's internal creation and development teams create and cocreate original ideas for new projects (e.g., Being Erica, History in the Making, Go-Big Show, Recipe to Riches, and Late Nite Eats). Boat Rocker intends to increase its in-house IP origination efforts by continuing to attract and retain top tier creative executive talent as well as expanding into new areas such as comic book publishing and podcasting where Boat Rocker can work with creators to finance, develop and monetize their work.

Building and Monetizing Global Entertainment Brands

Boat Rocker understands that compelling storytelling and leading talent are both essential to creating global entertainment brands that transcend television. The Company has invested in and built a team of experts, who have developed, produced, and monetized global brand franchises, including the Company's Orphan Black, The Next Step, Love Monster and Danger Mouse, as well as other companies' brands (in prior executive roles) including SpongeBob SquarePants and Thomas and Friends. With its extensive expertise and creative partnerships, Boat Rocker is well positioned to continue to seek to optimize value across the IP monetization spectrum (e.g., television, gaming, publishing, toys) for both current and new projects. Boat Rocker will also continue to apply a holistic brand portfolio approach, applying lessons learned to improve the outcomes for its prospective global entertainment brands.

In order to seek to maximize the monetization of its global entertainment brands, Boat Rocker intends to continue fostering stronger, more direct relationships with audiences and consumers. Specific examples of this initiative include, but are not limited to:

Leveraging social media and AVOD platforms to enhance audience reach and engagement;
Deepening relationships with linear channels and OTT platforms in a broad range of markets; and
Developing and enhancing strategic partnerships in key non-television monetization channels (e.g., live events, podcasts, and toys).

The Company intends to maximize monetization by selectively investing capital to retain rights in IP with high potential to earn recurring revenues, while offering an attractive risk reward profile. See "The Business of the Company – How Boat Rocker Shortens the Distance – Shortening the Distance Case Studies".

Pursuing Strategic Acquisitions and Investments

Since 2015, Boat Rocker has successfully completed and integrated nine acquisitions, including Jam Filled Entertainment, Matador Content, Platform One Media, and Untitled Entertainment, and acquired minority interests in several other companies, including Industrial Brothers. In doing so, Boat Rocker has established strong merger and acquisition expertise and is well placed to use its resources to enhance its competitive position through acquisitions within its Television, Kids and Family, and Representation segments. Leveraging its capabilities, Boat Rocker intends to source, pursue and integrate acquisition and investment opportunities in its existing businesses as well as in new, adjacent business verticals (although no letters of intent or binding agreements have been entered into in respect of any contemplated or potential acquisitions in process at this time). Additionally, Boat Rocker intends to utilize its ventures arm (Boat Rocker Ventures) to work with leading companies at the intersection of media, technology and consumer retail through joint ventures, minority investments and strategic partnerships. Following Boat Rocker's investment in Untitled Entertainment, the Boat Rocker Ventures group is increasingly focused on identifying and attaching Untitled Entertainment clients to direct-to-consumer brands. Finally, Boat Rocker intends to focus its strategic investment and acquisition efforts on expanding the Company's geographic footprint to capitalize on the global growth of content spend.

Management believes that as a result of the temporary market disruption brought about by the COVID-19 global pandemic, attractive acquisition opportunities are likely to emerge. Boat Rocker's investments and acquisitions are expected to continue to augment Boat Rocker's ability to deliver significant growth and attractive financial returns.

Buyers

As an independent content creator, Boat Rocker is platform agnostic and sells its video content to a global set of programming buyers, consisting of both traditional entertainment players (e.g., ViacomCBS, Disney, Corus Entertainment, Bell Media, NBCUniversal, BBC, Discovery) and newer OTT platform market entrants (e.g., Netflix, Amazon Prime Video, Apple TV+). The proliferation of buyers presents an increased opportunity to find the optimal buyer for content, often resulting in competitive bidding. Boat Rocker has capitalized on the significant growth in buyers, cultivating relationships with new buyers and, as a result, has recently sold or licensed projects to new platforms including newer OTT platform market entrants such as Peacock, Apple TV+ and CBS All Access. See below for a sample of Boat Rocker's buyers.

Competition

Boat Rocker operates in a highly competitive, high growth industry. As outlined in "Industry and Market Opportunity", annual content programming spend continues to grow and Boat Rocker competes with numerous domestic and international entertainment and content companies to gain share of the growing sums spent on content by buyers. Boat Rocker's competitors for content sales include large, often vertically integrated television production and distribution studios, mid-sized independent television studios, and small-scale, niche, domestic-only content producers.

While certain competitors within the competitive landscape share subsets of Boat Rocker's creative and commercial capabilities, many of the Company's smaller competitors do not have sufficient scale or diversity of operations to mitigate the inherent risk of a hit-driven business. In contrast, the larger, integrated television production and distribution studios that have substantial resources are often distracted by the management of other businesses undergoing significant disruption such as theatrical film distribution or linear channels. Furthermore, unlike these larger competitors which often own and operate television channels and SVOD services, Boat Rocker is unaffiliated with any individual content buyer. This allows the Company to retain control and flexibility when determining where to sell its IP (enabling the Company to sell each project to the optimal buyer, often in competitive situations).

Boat Rocker also competes with other entertainment and content companies for IP created by third parties, as well as for the services of performing artists, directors, writers and other creative and technical personnel required for a production.

The Company believes that it can successfully compete with its peers given its independence from any individual content buyer, its deep industry relationships and its differentiated creative and commercial capabilities.

Employees

Boat Rocker has grown from 36 employees located in Toronto as of December 31, 2015 to currently over 850 employees in Toronto, Ottawa, Halifax, New York, Los Angeles, London and Hong Kong. Of these employees, over 600 employees work in its animation division, with the balance working in Boat Rocker's other divisions and across its corporate and executive team. Boat Rocker believes that it has strong relationships with its highly skilled and diverse workforce and is an employer of choice in the industry. None of Boat Rocker's full-time employees are currently engaged pursuant to collective bargaining agreements; however a subsidiary of the Company recently received notice of an application to certify certain of the Company's animation employees at its animation studio in Halifax. See "Risk Factors – Risks Related to Securing and Retaining Key Personnel and Business Relationships". Boat Rocker voluntarily adheres to industry standard collective bargaining agreements on a project by project basis for those of its productions on which it utilizes union or guild represented talent or crews.

Facilities

All of Boat Rocker's offices are rented. The Company's principal executive and administrative offices are located at 310 King Street East, Toronto, Ontario, Canada, M5A 1K6, and are comprised of 43,000 square feet of space under a lease that expires in November 2028. The Company also leases additional space in Toronto (in one case, on market terms from a company which is partly owned by the Principal Shareholders), Ottawa, Ontario and Halifax, Nova Scotia in Canada, New York City and Los Angeles in the United States, London, England and Hong Kong.

Boat Rocker believes that its facilities are suitable and adequate for the Company's business as presently conducted. However, the Company periodically reviews its facility requirements and may lease new space to meet its business needs. If additional space is required, Boat Rocker expects that it will be able to obtain additional facilities on commercially reasonable terms.

OUTLOOK

In August 2019, in order to grow the Company's U.S. and international scripted businesses, Boat Rocker acquired Los Angeles-based Platform One Media, a producer of premium scripted television video content. .At the time of the acquisition, Platform One Media was contracted to deliver two premium scripted series which were originally scheduled to deliver in 2020. Following its acquisition of Platform One Media (now rebranded as Boat Rocker Studios, Scripted), Boat Rocker invested considerable additional working capital in the business, and will continue to do so in 2021 in support of the completion of these two premium dramas, which, after delays due to COVID-19, are now both expected to be delivered in the second half of 2021. The Company expects 2021 to be a year of significant investment in content, funded in part by a portion of the net proceeds from the Treasury Offering. Boat Rocker also has a number of additional scripted projects in paid development with third parties or greenlit for production which are expected by the Company to be delivered in 2021 or 2022. Combined with the Company's other capabilities, acquisitions and organic initiatives, the acquisition of Platform One Media has established Boat Rocker as a content-creation platform capable of producing, delivering and monetizing content across all major genres at scale.

The above \$475 million estimate is based on the following key assumptions, among others:

(a) approximately 85% of revenue that is expected to be recognized in respect of video content that is already in-production and for which binding contracts have been entered into, a substantial portion of which relates to two premium scripted dramas for which production is being undertaken in accordance with COVID-19 guidelines;
(b) approximately 10% of revenue is comprised of projects that have either been contracted or greenlit, and which are expected to be produced and delivered in 2021 but are not yet in-production; and
(c) approximately 5% of revenue is comprised of: (i) minimum guarantees from toy licensing partners that are guaranteed to be earned as a result of specific contractual objectives (e.g., toy sales commencing at retailers, television shows premiering on certain networks in certain markets) that the Company expects to meet in 2021; and (ii) distribution revenue from already completed sales but in respect of which the revenue cannot be recognized until either the license period and/or airdate occurs or the distribution report is received by the Issuer, which is expected to occur in 2021.

The remaining \$225 million estimate is based on the following key assumptions, among others:

(a) approximately 65% is comprised of expected revenue to be derived from the delivery of unscripted television productions and kids and family series that are either expected to be renewed in 2021 due to historical success or are in advanced stages of development and/or negotiations with buyers and expected to move forward in 2021;
(b) approximately 20% is comprised of expected revenue to be derived from the delivery of an additional premium scripted series that was pitched to potential buyers in a competitive sales process and was ultimately set-up with a major buyer, which is expected to be produced and delivered in 2021; and
(c) approximately 15% is comprised of expected revenue derived from the Representation segment which is expected to continue to recover in 2021 considering additions to the third-party IP library the Company represents in recent years and a return to historical results for revenue growth for talent

management, particularly in light of an increase in the number of clients on Untitled Entertainment's roster in recent years.

While the premium series that the Company is now producing are expected to generate significant revenues and have a large absolute dollar contribution, they will likely deliver a lower overall Adjusted EBITDA margin percentage, compared to historical levels. As a result, while Boat Rocker's 2019 Adjusted EBITDA margin was in excess of 13%, management anticipates that the Company's Adjusted EBITDA margin in 2020 and 2021 will be in the low to mid-single digits due to increased COVID-19 related costs and actual and anticipated delays, and investments in organic growth initiatives in those years. The anticipated 2021 Adjusted EBITDA margin (based on an assumed average foreign exchange rate of US\$1.00 = C\$1.30) is based on the following key assumptions, among others:

that the Company will receive approximately \$700 million in revenue in 2021;
that the segment profit as a percentage of segment revenue in the Television segment in 2021 will be lower than the reported 6% achieved in 2019 due to larger overall production budgets and incremental COVID-19 related production costs; and
that the Representation and Kids and Family segments will have an increase in revenue and segment profit in 2021 as compared to revenue and segment profit achieved in 2019.

For 2022, management anticipates Adjusted EBITDA margins will increase to the high-single digits to low double-digits as the Company's business mix is further diversified into higher margin activities, and the Company continues to take advantage of operating leverage, based on the following key assumptions, among others:

an assumed average 2022 foreign exchange rate of US\$1.00 = C\$1.35;
delivery of certain premium scripted series, including some currently in paid development with third-party buyers;
delivery of certain scripted series that are based on previously produced successful series that ran for several seasons;
delivery of a number of the Company's U.S. and Canadian unscripted titles and formats, including subsequent seasons of series already produced;
growth of the Company's Representation segment as demand for existing and new video content continues to grow, offering opportunities for Untitled Entertainment's clients and propelling sales of third-party titles being distributed by the Company;
delivery of certain kids and family programs, including subsequent seasons of series already produced, and revenue growth from merchandise and licensing monetization;
the Kids and Family segment will recognize a growth in segment profit as compared to the Company's other segments, primarily driven by the launch of merchandise and licensing productions for key brands; and
the segment profit as a percentage of segment revenue in the Television segment will return to pre-COVID-19 historical levels, with the expectation that Boat Rocker's 2022 projects will not be burdened with extra COVID-19 production costs.

The foregoing description of the Company's potential growth opportunity and management estimates is based on management's current strategies, its assumptions concerning its growth outlook, expected orders of development projects by buyers and renewals of series in-production, expected timing of key title deliveries to its buyers, expected results from exploiting IP through merchandise and licensing opportunities, the achievement of additional operating leverage across the Company's infrastructure and previous acquisitions, the Company's assessment of the outlook for the business and the projected continued growth in the demand for content by buyers world-wide, and may be considered to be forward-looking information for purposes of applicable Canadian securities legislation. Management considers these assumptions to be reasonable in the circumstances, given the time period for such outlook, the Company's capabilities and business plan, historical results, and past re-order practices of the Company's buyers. Readers are cautioned that actual results may vary and that there can be no assurance that the Company will be able to achieve the results set out above. See "Caution Regarding Forward-Looking Statements" and "Non-IFRS Measures" and, for a description of the risks and uncertainties that impact Boat Rocker's business and that could cause actual results to vary, see "Risk Factors – Risks Related to Boat Rocker's Business and Industry", "Risk Factors – Risks Related to External Factors Which Boat Rocker Cannot Control, Including COVID-19," "Risk Factors – Risks Related to Anticipating and Managing Costs, Revenues and Liquidity", "Risk Factors – Risks Related to Boat Rocker's Growth Strategy", "Risk Factors – Risks Related to Doing Business Internationally", "Risk Factors – Risks Related to Securing and Retaining Key Personnel and Business Relationships", "Risk Factors – Risks Related to Bad Publicity and Negative Perceptions of the Company's Business, Key Personnel, Clients or Brands", "Risk Factors – Risks Related to Regulations" and "Risk Factors – Other Risks".

The Company intends, subject to applicable law, to provide updates not less than annually with respect to these 2021 and 2022 targets, including comparing them to actual results and discussing variances.

SELECTED ANNUAL AND INTERIM FINANCIAL INFORMATION OF BOAT ROCKER

The following sets forth a summary of Boat Rocker's selected historical consolidated financial data as at the dates and for the periods indicated below. The information should be read together with the Boat Rocker Financial Statements and the Boat Rocker Interim Financial Statements appearing elsewhere in this Prospectus. The historical financial information as at and for the years ended December 31, 2019, 2018 and 2017 summarized below is derived from the Boat Rocker Financial Statements. The historical financial interim information as at and for the three and nine months ended September 30, 2020 and 2019 summarized below is derived from the Boat Rocker Interim Financial Statements. Historical financial and operating information may not be indicative of future performance.

	Selected Financial Information for Boat Rocker

(in thousands of Canadian dollars)	As at and for the Three Months Ended September 30,		As at and for the Nine Months Ended September 30,		As at and for the 12 Months Ended December 31,
	2020	2019	2020	2019	2019	2018	2017
Revenue \$78,009		\$51,001	\$171,189	\$184,730	\$244,165	\$164,845	\$129,050
Net (loss) income \$( 22,990)		\$(9,613)	\$(43,544)	\$(13,279)	\$(19,483)	\$9,757	\$14,235
Net (loss) income attributable to non controlling interests \$1,387		\$654	\$2,978	\$3,322	\$4,224	\$397	\$106
Net (loss) income attributable to Shareholders \$(24,377 )		\$(10,267)	\$(46,522)	\$(16,601)	\$(23,707)	\$9,360	\$14,129
Adjusted EBITDA(1) \$6,0 34		\$2,454	\$6,019	\$25,371	\$32,469	\$32,014	\$26,581
Total cash and cash equivalents –		–	\$75,553	–	\$59,268	\$55,416	–
Total assets –		–	\$615,950	–	\$516,143	\$395,529	–
Loans and borrowings, excluding interim production financing and convertible							–
debentures–		–	\$99,481	–	\$87,869	\$47,432
Lease liabilities –		–	\$33,844	–	\$29,626	\$27,583	–
Total non-current liabilities –		–	\$114,375	–	\$94,328	\$59,316	–
Net Debt(2) –		–	\$103,791	–	\$85,297	\$57,732	–

Notes:

_________________

Reconciliation of Non-IFRS Measures

Adjusted EBITDA, Adjusted EBITDA Margin, Free Cash Flow, Net Debt, Cash Available for Use and Cash Required for Use in Productions are non-IFRS measures that Boat Rocker uses to monitor and assess its operating performance and to better compare its results from operations on a relative basis from period to period. See "Non-IFRS Measures".

The following table provides the reconciliation of Adjusted EBITDA:

(in thousands of Canadian dollars)	For the Three Months Ended September 30,		For the Nine Months Ended September 30,		For the 12 Months Ended December 31,
	2020	2019	2020	2019	2019	2018	2017
Net (Loss) Income	\$(22,990)	\$(9,613)	\$(43,544)	\$(13,279)	\$(19,483)	\$9,757	\$14,235
Add:
Interest expense, net	\$2,404	\$2,237	\$7,860	\$6,299	\$8,415	\$2,580	\$1,225
Amortization of property and equipment, right-of-use assets and other intangible assets	\$4,736	\$4,687	\$13,817	\$13,993	\$18,989	\$6,562	\$2,713
Income taxes	\$1,598	\$681	\$620	\$209	\$1,067	\$4,073	\$5,829
Amortization of program intangibles	\$719	\$758	\$2,208	\$6,357	\$7,196	\$2,137	\$206
Change in fair value of other financial liabilities	\$3,359	\$2,002	\$6,951	\$6,703	\$8,710	\$265	–
Change in fair value of contingent consideration	–	\$(10)	\$880	\$384	\$368	\$(824)	\$(225)
Share-based compensation	\$2,478	\$191	\$3,020	\$479	\$721	\$3,321	\$239
Transaction items	\$429	\$1,499	\$714	\$3,452	\$4,292	\$5,613	\$2,359
Goodwill impairment	\$12,959	–	\$12,959	–	–	–	–
Loss on debt modification	\$342	–	\$342	–	\$4,317	–	–
Reorganization costs	–	\$22	\$192	\$774	\$956	\$1,322	–
Gain on sale of assets	–	–	–	–	\$(3,079)	\$(2,792)	–
Adjusted EBITDA(1)	\$6,034	\$2,454	\$6,019	\$25,371	\$32,469	\$32,014	\$26,581

Notes:

(1) Adjusted EBITDA is a non-IFRS measure and may not be comparable to similar measures used by other companies.

The following table provides the reconciliation of Adjusted EBITDA Margin:

(in thousands of Canadian dollars)	For the Three Months Ended September 30,			For the Nine Months Ended September 30,		For the 12 Months Ended December 31,
	2020	2019	2020	2019	2019	2018	2017
Adjusted EBITDA	\$6,034	\$2,454	\$6,019	\$25,371	\$32,469	\$32,014	\$26,581
Divided by:
Revenue	\$78,009	\$51,001	\$171,189	\$184,730	\$244,165	\$164,845	\$129,050
Adjusted EBITDA Margin %(1)	8%	5%	4%	14%	13%	19%	21%

Notes:

(1) Adjusted EBITDA Margin is a non-IFRS measure and may not be comparable to similar measures used by other companies.

The following table provides the reconciliation from cash provided by (used in) operating activities to Free Cash Flow:

(in thousands of Canadian dollars)		For the Nine Months Ended September 30,	For the 12 Months Ended December 31,
	2020	2019	2019	2018	2017
Cash provided by (used in) operating activities	\$(3,417)	\$13,409	\$(33,780)	\$7,393	\$22,010
Proceeds from interim production financing	\$103,418	\$33,269	\$83,145	\$45,131	\$43,122
Repayments from interim production financing	\$(85,086)	\$(31,790)	\$(34,280)	\$(37,906)	\$(56,418)
Repayment of lease liabilities	\$(5,895)	\$(5,222)	\$(7,415)	\$(2,265)	–
Distribution to non-controlling interest shareholders	\$(1,989)	\$(3,529)	\$(5,330)	–	–
Free Cash Flow(1)	\$7,031	\$6,137	\$2,340	\$12,353	\$8,714

Notes:

____________

(1) Free Cash Flow is a non-IFRS measure and may not be comparable to similar measures used by other companies.

The following table provides the reconciliation of Net Debt:

(in thousands of Canadian dollars)	As at
	September 30, 2020	December 31, 2019	December 31, 2018
Loans and borrowings, excluding interim production financing and convertible debentures	\$99,481	\$87,869	\$47,432
Lease liabilities	\$33,844	\$29,626	\$27,583
Plus: Loan fees, net of amortization	\$419	\$1,305	–
Less: Loan modification	\$(2,821)	\$(4,317)	–
Less: Cash Available for Use	\$(27,132)	\$(29,186)	\$(17,283)
Net Debt(1)(2)	\$103,791	\$85,297	\$57,732

Notes:

_______________

(1) Excludes interim production financing and convertible debentures.

(2) Net Debt is a non-IFRS measure and may not be comparable to similar measures used by other companies.

The following table provides a breakdown of Cash Available for Use and Cash Required for Use in Productions:

(in thousands of Canadian dollars)	As at
	September 30, 2020	December 31, 2019	December 31, 2018
Cash Available for Use(1)	27,132	29,186	17,283
Cash Required for Use in Productions(2)	48,421	30,082	38,133
Total Cash and Cash Equivalents	75,553	59,268	55,416

Notes:

_______________

(1) Cash Available for Use is a non-IFRS measure and may not be comparable to similar measures used by other companies.

(2) Cash Required for Use in Productions is a non-IFRS measure and may not be comparable to similar measures used by other companies.

BOAT ROCKER PRO FORMA CONSOLIDATED FINANCIAL INFORMATION

(in thousands of Canadian dollars)	Actual For the Year Ended December 31, 2019	Pro Forma For the Year Ended December 31, 2019(1)
Revenue	\$244,165	\$244,165
Expenses
Production, distribution and service costs	\$157,576	\$158,746
General and administrative costs	\$69,820	\$75,366
Amortization of property and equipment, right-of-use assets and intangible assets	\$18,989	\$19,245
Gain on sale of property and equipment	\$(3,079)	\$(3,079)
Finance costs (income), net	\$8,415	\$8,341
Foreign exchange gain	\$(307)	\$(307)
Loss on loan modification	\$4,317	\$4,317
Share of income of equity accounted investees	\$(360)	\$(360)
Change in the fair value of financial instruments	\$(1,868)	\$(1,868)
Change in the fair value of other financial liabilities	\$8,710	\$8,710
Change in the fair value of contingent consideration	\$368	\$368
Loss before income taxes	\$(18,416)	\$(25,314)
Current income taxes	\$8,984	\$8,984
Deferred income tax recoveries	\$(7,917)	\$(7,917)
Net loss for the year	\$(19,483)	\$(26,381)

________________ Notes:

⁽¹⁾ On August 31, 2019, the Company acquired 100% of the outstanding membership interests of Platform One Media. The Boat Rocker Pro Forma Financial Statements have been prepared to reflect the acquisition of Platform One Media as if the acquisition had occurred on January 1, 2019 and related pro forma adjustments as described in the Boat Rocker Pro Forma Financial Statements.

MANAGEMENT'S DISCUSSION AND ANALYSIS OF BOAT ROCKER

Boat Rocker's management's discussion and analysis for the three and nine months ended September 30, 2020 and 2019 and for the years ended December 31, 2019, 2018 and 2017 (the "Boat Rocker MD&A"), included in the "Index to the Financial Statements and Management's Discussion and Analyses" of this Prospectus, provides information concerning Boat Rocker's financial condition and results of operations. The Boat Rocker MD&A should be read in conjunction with the Boat Rocker Financial Statements and the Boat Rocker Interim Financial Statements, which are included elsewhere in this Prospectus.

Included elsewhere in this Prospectus are the additional management's discussion and analysis of: (a) Insight Production Company Ltd. for the year ended December 31, 2017 and for the period from January 1, 2018 to May 17, 2018; (b) Platform One Media for the years ended December 31, 2018 and 2017 and the period from January 1 to August 30, 2019; and (c) Untitled Entertainment for the year ended December 31, 2018.

REGULATORY MATTERS

In addition to license fees from buyers, in respect of some of the content produced by the Company (particularly in the programming produced in Canada), the Company finances a significant portion of those production budgets with funding from (a) federal and provincial governmental agencies and incentive programs, including, in some cases, the CMF, provincial film equity investment and incentive programs, federal tax credits, provincial tax credits and state tax credits, (b) Independent Production Funds certified by the CRTC, such as Shaw Rocket Fund and Rogers Documentary Fund, and (c) other Canadian investment and incentive programs.

The Company could lose its ability to exploit Canadian government tax credits and incentives described above if it ceases to be "Canadian" as defined under the Investment Canada Act (Canada) (the "ICA"). The ICA establishes a number of rules and presumptions (the "ICA Canadian Status Rules") for determining who is a "Canadian" for purposes of the ICA. Under the ICA Canadian Status Rules, the Company would not be considered to be a Canadian if one non-Canadian or two or more members of a voting group who are non-Canadians own 50% or more of the voting shares of the Company. Moreover, as the Company will be engaged in a prescribed business which is related to Canada's cultural heritage or national identity (i.e., a so called "cultural business" which includes among others, any business which is engaged in film or television production or distribution in Canada), even if the Company qualifies as Canadian-controlled by virtue of the normal ICA Canadian Status Rules, the Minister of Canadian Heritage may nevertheless determine that the Company is not Canadian-controlled where, after considering any information and evidence submitted by or behalf of the Company or otherwise made available to the Minister, the Minister is satisfied that the Company is controlled in fact by one or more non-Canadians.

In Canada, under applicable domestic legislation, regulations and guidelines, and under Canada's international co-production treaties, a program will generally qualify as a "Canadian-content" production if, among other requirements, (i) it is produced and owned or co-owned by a Canadian-controlled entity with the involvement of Canadians in certain key prescribed principal functions; and (ii) a substantial prescribed minimum portion of the budget is spent on Canadian elements and post-production in Canada. In addition, (and with the exception of a treaty co-production) the Canadian producer must have full creative and financial control of the project. A substantial number of the Company's programs are contractually required by Canadian linear channels to be certified as "Canadian-content" productions. In such cases, in the event that a production does not qualify for "Canadian content" certification, the Company would be in default under any government incentive and broadcast licenses for that production which require "Canadian content" certification. In the event of such default, among other remedies, the linear channel could refuse acceptance of the Company's productions.

On November 3, 2020, the Canadian Heritage Minister introduced Bill C-10 (the "Bill") to amend the Broadcasting Act. The proposed changes would bring OTT platforms, such as Netflix, Amazon Prime Video and Disney+, under domestic Canadian broadcasting regulation and may require them to, among other things, make expenditures to support Canadian audio or audio-visual programs. If passed, the Bill would give the CRTC the power to: (i) decide which OTT platforms to regulate; (ii) require and determine any financial contributions to be made by these services, and (iii) regulate the discoverability of Canadian programs on such streaming platforms. Failure to comply with the CRTC's orders could lead to monetary penalties.

Some of the proposed changes are based on recommendations by the Broadcasting and Telecommunications Legislative Review Panel (the "Panel"), which reviewed Canada's broadcasting laws and published 97 recommendations in its final report released in January 2020. Aligned with the Panel's recommendations, the Bill proposes to classify internet streaming services as "online undertakings" under the Broadcasting Act. This classification would bring them into the regulatory system that currently only imposes "Canadian content" financial contribution requirements on traditional Canadian "broadcasting undertakings".

The Liberal government projects that streaming services (including OTT platforms, music streaming services, and other "online undertakings") could contribute \$830 million in additional funding to Canadian television and music production by 2023, if the Bill is passed. This projection assumes the CRTC will require online linear channels to contribute to Canadian content at a similar rate as traditional linear channels. However, the government also acknowledged that the CRTC, as the independent regulator, will determine whether and how online undertakings are required to contribute, and the form of those contributions.

If the Bill is passed, it is anticipated that these significant changes to the Canadian regulatory system will be beneficial to the Canadian video content producers, including the Company.

USE OF PROCEEDS

The aggregate net proceeds to be received by the Company from the Treasury Offering are estimated to be \$[●] (or \$[●] if the Over-Allotment Option is exercised in full), after deducting the Underwriters' Fee of \$[●] (or \$[●] if the Over-Allotment Option is exercised in full) and the expenses of the Offering, which are estimated to be \$[●].

The Company expects to use the estimated net proceeds of the Treasury Offering of \$[●] (assuming no exercise of the Over-Allotment Option), as follows: (i) approximately 63% of the net proceeds are expected to be used to repay all of its term debt under the Corporate Credit Facility (which is the Company's principal corporate credit arrangement); (ii) approximately 13% of the net proceeds are expected to be used as short-term funding for scripted productions; (iii) approximately 15% are expected to be used to support the business plans of the scripted and the franchise and brand management teams; (iv) approximately 4% are expected to be used to fund acquisitions of capital assets; and (v) approximately 5% are expected to be used to secure and develop IP, as well as potential future acquisitions and/or strategic investments. The Corporate Credit Facility is used by the Company for general corporate purposes, including acquisitions and ordinary operations. See "Description of Material Indebtedness". While the Company currently anticipates that it will use the net proceeds from the Treasury Offering as outlined above, the actual use of the net proceeds may vary depending upon numerous factors, including the Company's operating costs and capital expenditure requirements, its strategy relative to the market and other conditions in effect at the time, as well as the other factors described under "Risk Factors" in this Prospectus. Accordingly, the Company will retain the discretion to allocate the net proceeds of the Treasury Offering, and reserves the right to change the allocation of the net proceeds from time to time.

In respect of the use of proceeds set out in clause (i) above, the Company expects to use a portion of the net proceeds of the Treasury Offering to repay all of its term debt under the Corporate Credit Facility. When the term portion of its Corporate Credit Facility is fully repaid from the net proceeds of the Treasury Offering, the Company does not expect to have other material debt principal payment obligations maturing in the next 12 months, as interim production financing, while technically demand in nature, is generally not payable other than from tax credits, license fees, and other third-party sources of funding as and when received.

In respect of the use of proceeds set out in clause (ii) above, a portion of the net proceeds of the Treasury Offering is expected to be used to fund the 2021 cash requirements associated with the production of two premium scripted series by the Company's scripted production business. Those two series are scheduled to deliver in the second half of 2021, and when they do, the Company is expected to receive its fees in respect of producing the two series. In 2022, the Company expects to collect the majority of the film and television tax credits earned in respect of these two premium series, which is expected to reduce the required on-going funding of the Company's scripted business.

In respect of the use of proceeds set out in clause (iii) above, a portion of the net proceeds of the Treasury Offering is expected to be used to fund the business plans of the scripted and the franchise and brand management teams as both businesses are currently in build mode. In 2021, the Company intends to invest materially in growing its franchise and brand management business to seek to ensure that it delivers on the opportunities presented by Dino Ranch and other of the Company's key brands. With Dino Ranch consumer goods scheduled to be sold commencing in the second half of 2021, the Company anticipates that the franchise and brand management unit will become a source of cash in 2022.

In respect of the use of proceeds set out in clause (iv) above, a portion of the net proceeds of the Treasury Offering is expected to be used to fund the acquisition of capital assets. This use is expected to be modest, and capital expenditures, mainly related to computer hardware and software, are expected to be maintained at historical levels.

In respect of the use of proceeds set out in clause (v) above, a portion of the net proceeds of the Treasury Offering is expected to be used to fund potential future acquisitions and/or strategic investments (although no letters

of intent or binding agreements are in force at this time in respect of any such opportunities). See "The Business of the Company - Growth Strategies and Goals".

Working Capital Deficiency and Net Cash Used in Operations

While the Company currently has a working capital deficiency (calculated as current assets less current liabilities), the Company is of the view that this measure does not provide a meaningful indication of the Company's true short-term liquidity position, as a portion of several of the liabilities classified as current on the Company's statement of financial position (in compliance with IFRS) are expected to be settled after 12 months, such as interim production financing and loans and borrowings, or will not be settled in cash, such as the 2020 Debenture, which is to be converted into Subordinate Voting Shares on Closing. On the statement of financial position as at September 30, 2020, the Company's current liabilities are \$449.4 million compared to its current assets of \$153.3 million. As at December 31, 2020, the Company's unaudited draft current liabilities are estimated to be \$533.2 million compared to the unaudited draft current assets of \$149.4 million. For a further discussion on the Company's working capital deficiency, refer to the Boat Rocker MD&A.

Historically, the Company's net cash flow from operations has been both a source and a use of cash on a quarterly basis over the course of 2019 and 2020 to September 30, 2020. While the movements in accounts receivable, tax credits receivables, deferred revenue, production expenses and accounts payable are classified in the operations section of the statement of cash flow, the interim production financing is classified in the financing section of the statement of cash flow. As discussed in "Description of Material Indebtedness – Interim Production Financing", interim production financing is the bridge between the Company's cash inflows from license fees, film and television tax credits, and other sources of production financing and cash outflows for production expenses on video content produced by the Company. If cash used from operations is added to the proceeds and repayments from interim production financing on the statement of cash flow, the resulting balance would be a source, not a use, of cash in the nine months ended September 30, 2020 of \$14.9 million and in the 12 months ended December 31, 2019 of \$15.1 million. This is the basis of the Company's calculation of Free Cash Flow, which is considered to be a useful measure of the Company's liquidity. For the calculation of the Company's Free Cash Flow, refer to "Selected Annual and Interim Financial Information of Boat Rocker – Reconciliation of Non-IFRS Measures".

Forward-looking Cash Flow

In order to achieve its business plan, the Company expects that cash flow from operations plus the net cash proceeds from interim production financing will be a use of cash in the four quarters of 2021 in the range of \$55 to \$70 million. The net proceeds from the Treasury Offering are expected to be partially used to fund this cash requirement as described above. The two main drivers of this use of cash are the funding required to support the business plans of the Company's scripted and franchise and brand management teams, as described above. The Company expects to use a portion of the net proceeds of the Treasury Offering to repay all of its term debt under the Corporate Credit Facility. The use of cash noted above is expected to reduce the Company's cash balance at December 31, 2021 from its post-Treasury Offering, post-debt repayment level. With the term portion of its Corporate Credit Facility fully repaid, the Company does not expect to have other material principal debt obligations payable in the next 12 months.

While the Company expects to use a portion of the net proceeds of the Treasury Offering to fund its operations in 2021, management projects that with the expected increase in revenue in 2021, the Company's strong production pipeline leading into 2022 (including the anticipated renewals of certain existing series), the anticipated lessening impact of COVID-19 in the second half of 2021, and strong industry tailwinds, the Company should generate positive Free Cash Flow in 2022 and beyond. See "Caution Regarding Forward-Looking Statements" and "Risk Factors".

For further information, see the "Liquidity and Capital Resources" section of the Boat Rocker MD&A.

The Company will not receive any of the proceeds from the sale of Subordinate Voting Shares by the Selling Shareholders, and the Selling Shareholders have agreed to pay the Underwriters' Fee in respect of the Subordinate Voting Shares sold in the Secondary Offering. The Selling Shareholders are expected to receive net proceeds of \$[●] in connection with the Secondary Offering, after payment of the Underwriters' Fee payable in connection with such Secondary Offering.

AUTHORIZED SHARE CAPITAL UPON CLOSING

Upon Closing, the Company's authorized share capital will consist of (i) an unlimited number of Multiple Voting Shares; (ii) an unlimited number of Subordinate Voting Shares; and (iii) an unlimited number of preferred shares, issuable in series. Except as provided in any rights privileges, restrictions and conditions attaching to any series of preferred shares issued from time to time, the holders of preferred shares will not be entitled to receive notice of, attend or vote at any meeting of the Shareholders.

The following describes the Company's authorized share capital upon Closing. The following description may not be complete and is subject to, and qualified in its entirety by reference to, the terms and provisions of the Company's articles, as they will be amended.

The Shares are designed to enable the Company and its Canadian subsidiaries to maintain its and their status as Canadian for both applicable Canadian tax credits and other applicable Canadian governmental funding program purposes. No preferred shares are expected to be issued and outstanding at Closing.

Multiple Voting Shares and Subordinate Voting Shares

Dividend Rights

All Shares shall rank equally with the other Shares as to dividends on a share-for-share basis, without preference or distinction, except that, subject to applicable regulatory and stock exchange approvals, stock dividends or distributions may be declared by the Board that are payable in Multiple Voting Shares on the Multiple Voting Shares, and in Subordinate Voting Shares on the Subordinate Voting Shares, provided an equal number of shares is declared as a dividend or distribution on a per-share basis in each case. See "Dividend Policy".

Voting Rights

The holders of Multiple Voting Shares will be entitled to up to 10 votes per Multiple Voting Share, and the holders of Subordinate Voting Shares will be entitled to one vote per Subordinate Voting Share. Holders of Multiple Voting Shares and Subordinate Voting Shares will be entitled to receive notice of any meeting of Shareholders and may attend and vote at such meetings, except those meetings where only the holders of shares of another class or of a particular series are entitled to vote.

The number of votes to which a holder of a Multiple Voting Share is entitled will be determined as follows:

(a) If the holder is a Canadian Person, the holder of the Multiple Voting Share in question will be entitled to 10 votes in respect of such Multiple Voting Share; and
(b) If the holder is a Non-Canadian Person, the holder of the Multiple Voting Share in question will be entitled to a variable number of votes, not less than one and not exceeding 10 (and which may be a fraction), in respect of such Multiple Voting Share.

The variable number of votes will be determined on the following basis: all holders of Multiple Voting Shares who are Non-Canadian Persons will have their voting rights per Multiple Voting Share held automatically proportionately reduced if and to the extent necessary to enable the Company to maintain its eligibility and qualification under the Canadian Status Rules. In so determining, all holders of Subordinate Voting Shares (other than Persons who are also holders of Multiple Voting Shares that are Canadian Persons) shall be assumed to be Non-Canadian Persons. The variable number of votes shall automatically increase (but not to exceed 10) or decrease from time to time where applicable based on the above test. In the event that, and while the variable number of votes per Multiple Voting Share are reduced below 10, the Company will include disclosure to this effect in those public filings where a description of the material characteristics of the Company's outstanding securities is provided.

Subject to the Corporations Act, at the request of the Company, registered and beneficial Shareholders and actual or proposed transferees will be required to respond to enquiries regarding their status as Canadian Persons or Non-Canadian Persons, and shall be required to provide declarations as to their status as a Canadian Person, failing which they would, in the Company's discretion, be deemed to be Non-Canadian Persons. Where a person has been required to furnish a declaration, the articles of the Company will also permit the directors of the Company to refuse to register a transfer of a Share in such Person's name or to issue a Share to such Person until that Person has furnished the declaration.

Under the articles, where Shares are held, beneficially owned or controlled jointly by (a) one or more Canadian Persons and (b) one or more Non-Canadian Persons, such Shares shall be deemed to be held, beneficially owned or controlled by a Non-Canadian Person.

A person acting solely in the capacity of an intermediary in connection with either the payment of funds and/or the delivery of securities and that provides centralized facilities for the deposit, clearing or settlement of trades in securities (including CDS or any successor or assign), without general discretionary authority over the voting or disposition of such securities will not, for the purposes of the articles, be considered to be a holder, beneficial owner, or controller of any Shares.

Offer to Purchase

The Company may not make an offer to purchase any outstanding Multiple Voting Shares unless at the same time it makes an offer to purchase, on the same terms, an equivalent proportion of the outstanding Subordinate Voting Shares.

Redemption

No class of Shares is redeemable at the option of either the Company or the holder of any such Shares.

Automatic Conversion of Multiple Voting Shares

Multiple Voting Shares will be automatically converted into Subordinate Voting Shares upon the earliest of any of the following events:

(a) for any particular holder's Multiple Voting Shares, if such holder's (together with such holder's permitted transferees) beneficial ownership in the aggregate declines below 1/3 of the Multiple Voting Shares that such holder beneficially owned as at Closing (after any exercise of the Over-Allotment Option), provided that, for greater certainty, any Multiple Voting Shares which are being transferred to Fairfax or IDJ in accordance with the Principal Shareholders Agreement shall not be subject to such automatic conversion, and provided further that the foregoing shall not apply to any member of IDJ in the event that IDJ still hold in aggregate at least 1/3 of the Multiple Voting Shares that they held in aggregate as of Closing;
(b) for Fairfax, if a controlled subsidiary of Fairfax that holds Multiple Voting Shares ceases to be a controlled subsidiary of Fairfax such that the Multiple Voting Shares are no longer beneficially owned by Fairfax, provided that, for greater certainty, any Multiple Voting Shares which are being transferred to IDJ in accordance with the Principal Shareholders Agreement shall not be subject to such automatic conversion, and further provided that the Multiple Voting Shares that remain beneficially owned by Fairfax shall not be automatically converted and only those Multiple Voting Shares that are no longer beneficially owned by Fairfax shall automatically convert;
(c) for a member of IDJ, if such holder was a controlled subsidiary or family trust of any member of IDJ but ceases to be a controlled subsidiary or family trust of such member of IDJ, provided that for greater certainty any Multiple Voting Shares which are being transferred to other members of IDJ or to Fairfax in accordance with the Principal Shareholders Agreement shall not be subject to such automatic conversion; and
(d) for the applicable holder of Multiple Voting Shares, if any person other than Fairfax or IDJ becomes the beneficial owner (directly or indirectly, but without regard to the beneficial

ownership of Fairfax or its successors for so long as it is a publicly-traded company) of such Multiple Voting Shares.

Quorum at Meetings of Shareholders

A quorum for the transaction of business at a meeting of Shareholders shall be a number of Shareholders representing, collectively, a voting interest of at least 40% of the votes entitled to be cast at a meeting of Shareholders while the Multiple Voting Shares represent at least 33 1/3% of the votes entitled to be cast at a meeting of Shareholders, and thereafter shall consist of 25% of the votes entitled to be cast at a meeting of Shareholders.

Redemption and Conversion Rights

Holders of Subordinate Voting Shares will have no redemption or conversion rights. Multiple Voting Shares, however, are convertible at any time at the option of the holder into fully-paid, non-assessable Subordinate Voting Shares.

Liquidation Rights

Upon the liquidation, dissolution or winding-up of the Company, whether voluntary or involuntary, the holders of Multiple Voting Shares and Subordinate Voting Shares without preference or distinction, will be entitled to participate ratably (on a per share basis) in the remaining property of the Company, subject to the prior rights of the holders of any other prior ranking shares that may be outstanding at such time.

Subdivision and Consolidation

No subdivision or consolidation of the Multiple Voting Shares or Subordinate Voting Shares shall occur unless, simultaneously, the other classes of Shares are subdivided or consolidated or otherwise adjusted so as to maintain and preserve the relative rights of the holders of Shares of each of the said classes.

Nomination of Directors

The Principal Shareholders Agreement will provide that the Company will have up to seven directors. Subject to the terms of the Principal Shareholders Agreement, the Principal Shareholders, in certain circumstances, have the right to nominate directors to the Board. See "Principal Shareholders Agreement – Nomination Rights" for details of the nomination rights of the Principal Shareholders.

The Company intends to include certain advance notice provisions in its by-laws (the "Advance Notice Provisions"). The following description is a summary only and is qualified in its entirety by the full text of the applicable provisions of the Advance Notice Provisions.

The Advance Notice Provisions are intended to: (i) facilitate orderly and efficient annual general or, where the need arises, special meetings; (ii) ensure that all Shareholders receive adequate notice of Board nominations and sufficient information with respect to all nominees; and (iii) allow Shareholders to register an informed vote. Once in effect, only persons who are nominated by Shareholders in accordance with the Advance Notice Provisions will be eligible for election as directors to the Board. Nominations of persons for election to the Board may be made for any annual meeting of Shareholders, or for any special meeting of Shareholders if one of the purposes for which the special meeting was called was the election of directors: (a) by or at the direction of the directors of the Company, including pursuant to a notice of meeting; (b) by or at the direction or request of one or more Shareholders pursuant to a requisition of the Shareholders made in accordance with applicable law and the by-laws; or (c) by any person (a "Nominating Shareholder"): (A) who, at the close of business on the date of the giving of the notice provided for below and on the record date for notice of such meeting, is entered in the Company's register as a holder of one or more shares carrying the right to vote at such meeting or who beneficially owns shares that are entitled to be voted at such meeting; and (B) who complies with the notice procedures set forth in the Advance Notice Provisions.

In addition to any other applicable requirements, for a nomination to be made by a Nominating Shareholder, the Nominating Shareholder must have given timely notice thereof in proper written form to the Board. To be timely, a Nominating Shareholder's notice to the directors must be made: (a) in the case of an annual meeting of Shareholders, not less than 30 days prior to the date of the annual meeting of Shareholders; provided, however,

that in the event that the annual meeting of Shareholders is to be held on a date that is less than 50 days after the date (the "Notice Date") that is the earlier of the date that a notice of meeting is filed for such meeting and the date on which the first public announcement of the date of the annual meeting was made, notice by the Nominating Shareholder may be made not later than the close of business on the 10th day following the Notice Date; and (b) in the case of a special meeting (which is not also an annual meeting) of Shareholders called for the purpose of electing directors of the Company (whether or not called for other purposes), not later than the close of business on the 15th day following the day that is the earlier of the date that a notice of meeting is filed for such meeting and the date on which the first public announcement of the date of the special meeting of Shareholders was made.

To be in proper written form, a Nominating Shareholder's notice to the Board must set forth, among other things: (a) as to each person whom the Nominating Shareholder proposes to nominate for election as a director: (A) the name, age, business address and residential address of the person; (B) the principal occupation or employment of the person for the past five years; (C) the status of the person as a "resident Canadian" (as defined in the Corporations Act); (D) the class or series and number of shares which are controlled or which are owned beneficially or of record by the person as of the record date for the meeting of Shareholders (if such date shall then have been made publicly available and shall have occurred) and as of the date of such notice; (E) full particulars regarding any contract, agreement, arrangement, understanding or relationship (collectively, "Arrangements"), including without limitation financial, compensation and indemnity related Arrangements, between the proposed nominee or any associate or affiliate of the proposed nominee and any Nominating Shareholder or any of its representatives; and (F) any other information relating to the person that would be required to be disclosed in a dissident's proxy circular in connection with solicitations of proxies for election of directors pursuant to applicable securities laws; and (b) as to the Nominating Shareholder giving the notice, (A) the name, age, business address and, if applicable, residential address of such Nominating Shareholder; (B) any proxy, contract, arrangement, understanding or relationship pursuant to which such Nominating Shareholder has a right to vote any shares; and (C) any other information relating to such Nominating Shareholder that would be required to be made in a dissident's proxy circular in connection with solicitations of proxies for election of directors pursuant to applicable securities laws. The Company may require any proposed nominee to furnish such other information as may reasonably be required by the Company to determine the eligibility of such proposed nominee to serve as an independent director or that could be material to a reasonable Shareholder's understanding of the independence, or lack thereof, of such proposed nominee.

The chairperson of the meeting shall have the power and duty to determine whether a nomination was made in accordance with the procedures set forth in the foregoing provisions and, if any proposed nomination is not in compliance with such foregoing provisions, the discretion to declare that such defective nomination shall be disregarded.

Notwithstanding the foregoing, the Board may, in its sole discretion, waive any requirement in the Advance Notice Provisions.

Forum Selection

The Company intends to include a forum selection provision in its by-laws that will provide that, unless the Company consents in writing to the selection of an alternative forum, the Superior Court of Justice of the Province of Ontario, Canada and the appellate courts therefrom, will be the sole and exclusive forum for: (i) any derivative action or proceeding brought on behalf of the Company; (ii) any action or proceeding asserting breach of fiduciary duty owed by any director, officer, or other employee of the Company to the Company; (iii) any action or proceeding asserting a claim arising pursuant to any provision of the Corporations Act or the Company's articles or by-laws (as the same may be amended from time to time); or (iv) any action or proceeding asserting a claim otherwise related to the Company's "affairs" (as such term is defined in the Corporations Act). The Company's forum selection provision will also provide that the Company's securityholders are deemed to have consented to personal jurisdiction in the Province of Ontario and to service of process on their counsel in any foreign action initiated in violation of the Company's by-laws.

Preferred Shares

The preferred shares may at any time and from time to time be issued in one or more series, each series to consist of such number of preferred shares as may, before the issue thereof, be determined by resolution of the Board. Subject to the provisions of the Corporations Act, the Board may, by resolution, fix from time to time before the issue thereof the designation, rights, privileges, restrictions and conditions attaching to the preferred shares of each series including, without limitation, any right to receive dividends (which may be cumulative or noncumulative and variable or fixed) or the means of determining such dividends, the dates of payment thereof, any terms or conditions of redemption or purchase, any conversion rights, any retraction rights, any rights on the liquidation, dissolution or winding up of the Company, any voting rights and any other provisions, the whole to be subject to the filing of articles of amendment setting forth the designation, rights, privileges, restrictions and conditions attaching to the preferred shares of the series. Except as required by law or in any series provisions, the preferred shares will not be entitled to receive notice of, attend or vote at any meeting of the Shareholders.

Preferred shares of each series, if and when issued, will generally, with respect to the payment of dividends, rank on a parity with the preferred shares of every other series and will be entitled to preferred over the Multiple Voting Shares, the Subordinate Voting Shares and any other shares of the Company ranking junior to the preferred shares with respect to payment of dividends.

In the event of liquidation, dissolution or winding up of the Company, whether voluntary or involuntary, the holders of preferred shares will be entitled to receive, before any distribution of any part of the assets of the Company among the holders of the Multiple Voting Shares, the Subordinate Voting Shares and any other shares of the Company ranking junior to the preferred shares, for each preferred share, an amount equal to the redemption price of such share and any dividends declared (or accrued in the case of cumulative dividends) thereon and unpaid (if applicable) and no more.

The Company will file an undertaking with the Ontario Securities Commission ("OSC") pursuant to which it will agree to provide reasonable prior notice to the OSC in the event the Company intends to issue a series of preferred shares that: (a) carry a greater number of votes on a per share basis, irrespective of the number or percentage of preferred shares owned, than the Subordinate Voting Shares; or (b) would cause any of the factors set out in section 4.1 of OSC Rule 56-501 Restricted Shares to be present in relation to the Subordinate Voting Shares, regardless of any existing restrictions on the Subordinate Voting Shares due to the existence of the Multiple Voting Shares.

PRE-CLOSING CAPITAL CHANGES

Prior to the completion of the below-noted transactions (collectively, the "Pre-Closing Capital Changes"), the Company's authorized share capital consisted of an unlimited number of: (i) voting common shares; (ii) nonvoting common shares, issuable in series; and (iii) preferred shares. In connection with, and prior to, the Closing, the following pre-closing capital changes will be implemented:

Boat Rocker's authorized share capital will be amended to create an unlimited number of each of the Multiple Voting Shares, Subordinate Voting Shares and preferred shares, issuable in series, with the terms as described under "Authorized Share Capital Upon Closing";
all of the then issued and outstanding voting common shares held by each of the Principal Shareholders will be exchanged into Multiple Voting Shares based on an exchange ratio of 1:1;
the unanimous shareholders agreement by and among the existing shareholders of Boat Rocker will be terminated;
all of the then issued and outstanding non-voting common shares held by each of the Principal Shareholders will be exchanged into voting common shares based on an exchange ratio of 1:1;
all of the then issued and outstanding non-voting common shares and preferred shares held by each of the remaining shareholders of Boat Rocker will be exchanged into voting common shares, in each case based on an exchange ratio of 1:1;
all of the then issued and outstanding voting common shares held by each of the Principal Shareholders and the remaining shareholders of Boat Rocker will be exchanged into Subordinate Voting Shares based on an exchange ratio of 1:1;
the 2020 Debenture, including any accrued but unpaid interest thereon, will be converted into approximately 3,966,090 Subordinate Voting Shares (assuming a Closing Date of March 2, 2021);
the Legacy Options to acquire up to 2,052,218 non-voting common shares issued while Boat Rocker was a private company will become fully vested and exercisable commencing upon Closing in accordance with the table below, and will expire in accordance with their current terms:

Number of Subordinate Voting Shares	Exercise Price
400,168	\$3.08
244,244	\$5.76
160,160	\$5.93
288,288	\$7.49
32,032	\$9.99
619,018	\$10.06
128,128	\$10.61
180,180	\$11.01

an aggregate of 1,373,534 Subordinate Voting Shares will be issued to certain of the former owners of Matador Content and to certain other Matador Content employees;
the Principal Shareholders Agreement will be entered into; see "Principal Shareholders Agreement";
the issued and outstanding share capital will be split on a 1.6016:1.0000 basis; and
following Closing, the articles will be restated to reflect the removal of all former classes of shares included in Boat Rocker's authorized capital prior to the amendments.

ISSUED SHARE CAPITAL UPON CLOSING

The following table summarizes the issued share capital of the Company immediately following Closing and after giving effect to the Pre-Closing Capital Changes:

	Share Ownership Immediately Following Closing(1)
	13,908,581 Multiple Voting Shares
Fairfax(2)	8,017,739 Subordinate Voting Shares
DF BRM Holdco Inc	4,335,943 Multiple Voting Shares
IS BRM Holdco Inc.	4,335,943 Multiple Voting Shares
John Young	972,583 Multiple Voting Shares
Other Private Shareholders prior to Closing(3)	5,219,682 Subordinate Voting Shares
Public Shareholders	13,461,539 Subordinate Voting Shares(4)

Notes:

____________

(1) Assuming no exercise of the Over-Allotment Option and an assumed Offering Price of \$13.00 per Subordinate Voting Share, the midpoint of the estimated price range set forth on the cover page of this Prospectus.

(2) 3,966,090 Subordinate Voting Shares represents the equity issued to Fairfax in connection with the mandatory conversion of the 2020 Debenture upon Closing at an effective conversion price of approximately \$10.24 per Subordinate Voting Share, assuming a Closing Date of March 2, 2021. Upon Closing, the 2020 Debenture will be cancelled.

(3) Includes EMC. In March 2019, preferred shares were issued to EMC in consideration for an investment by EMC of US\$20 million. Pursuant to EMC's investment, EMC obtained certain registration rights, which will become effective upon Closing. See "Registration Rights".

(4) In the event the Over-Allotment Option is exercised in full, the public shareholders will hold 15,480,770 Subordinate Voting Shares.

Upon completion of the Offering, assuming exercise in full of the Over-Allotment Option, an aggregate of 23,553,050 Multiple Voting Shares and 28,718,191 Subordinate Voting Shares are expected to be issued and outstanding.

RIGHTS TO ACQUIRE SHARES

Platform One Media

Pursuant to the terms of the transaction agreement dated August 31, 2019 (the "P1 Transaction Agreement"), the Company is currently conditionally obligated to issue 685,922 Subordinate Voting Shares to the former owners of Platform One Media if certain performance metrics are met. While it is theoretically possible that those earn out targets could be met in the next 12 months, the Company does not believe it is likely that the applicable targets will be met and that the additional Subordinate Voting Shares will be issuable to the former owners. In addition to the foregoing, the P1 Transaction Agreement contemplates that in the event the net margin for a certain project exceeds a certain target, a key employee and certain other employees of Platform One Media shall be entitled to receive up to an aggregate of US\$2,500,000 (the "Management Consideration"). The Management Consideration, if earned, is payable by the Company, at the Company's discretion, either all in cash, or in cash and Subordinate Voting Shares, no later than March 15 of the year following the year the Company receives the net margin. In addition, the former owners of Platform One Media may also be entitled to consideration (in cash) ranging from 10% to 30% of net profits received by the Company from the exploitation of certain programs consistent with customary industry practices.

In connection with the acquisition of Untitled Entertainment, Boat Rocker entered into an amended and restated limited liability company agreement, dated February 1, 2019 which governs Untitled Entertainment and its members (the "Untitled Entertainment LLC Agreement"). Pursuant to the Untitled Entertainment LLC Agreement, the member of Untitled Entertainment with a 49% interest, which is owned by the two key principals of Untitled Entertainment, has a put right with respect to some or all of its interest commencing in February 2024 (or earlier in the event of certain "good leaver" employment termination events) pursuant to which such member will be entitled to receive the fair market value (as mutually agreed or determined by an independent appraiser) of such interest, payable in cash. Reciprocally, the Company has call rights over some or all of such 49% interest commencing in February 2024 (or earlier in the event of certain terminations of employment), pursuant to which the member will be entitled to receive the fair market value (as mutually agreed or determined by an independent appraiser) of such interest, payable in cash. The party exercising can withdraw from the put or call transactions, as applicable in the circumstances, if it is not satisfied with the price determined by the independent appraiser. Certain discounts to the payment amounts may apply in the case of specified "bad leaver" events. The amount of any required payment is not possible to determine at this time, and may need to be funded by a combination of cash reserves or, if insufficient, borrowed funds.

In addition, under Untitled Entertainment's constating documents, direct or indirect transfers of Untitled Entertainment interests are restricted without the approval of the board of directors of Untitled Entertainment. Pursuant to the Untitled Entertainment LLC Agreement, transfers of Untitled Entertainment shares are restricted by the following:

Untitled Entertainment's board of directors has the right to drag along Untitled Entertainment's members on a sale of Untitled Entertainment. The Company currently has the right to appoint a majority of the members of Untitled Entertainment's board of directors; and
Untitled Entertainment's members each have the right to tag-along on any sale by any other Untitled Entertainment member, as well as a 45-day right of first refusal prior thereto.

In addition, in connection with the acquisition of Untitled Entertainment, the Company entered into a phantom share plan with certain of the minority members of Untitled Entertainment, pursuant to which phantom share awards are linked to the value of the Company's shares. The phantom share plan contemplates that following receipt of audited financial statements of the Company for each of the years 2020 and 2021, the EBITDA of Untitled Entertainment for that period shall be determined and, if it equals or exceeds certain hurdles, and the applicable minority member is still employed (other than in the event of death, disability or certain "good leaver" termination events), the phantom share value will be payable by the Company. Under the phantom share plan, the value equivalent of approximately 105,706 Subordinate Voting Shares is expected to be paid in cash to the sellers of the 49% interest in Untitled Entertainment in 2022, assuming Untitled Entertainment meets the requisite performance threshold in 2021. In certain cases, the Company may elect to deliver Subordinate Voting Shares rather than pay cash. In the event the Company elects to deliver Subordinate Voting Shares, the sellers would be entitled to piggyback registration rights on terms substantially similar to those granted to the Principal Shareholders.

Insight Productions

In connection with the Company's acquisition of Insight Productions, it entered into a unanimous shareholders agreement dated May 17, 2018, which governs Insight Productions and its shareholders (the "Insight Shareholders Agreement"). Pursuant to the Insight Shareholders Agreement, the 30% holder of Insight Productions, which is controlled by the chief executive officer of Insight Productions, has a put right with respect to its 30% interest commencing in May 2021 (or earlier in the event of death or termination of employment of Insight Productions' chief executive officer) pursuant to which the holder will be entitled to receive the fair market value (as mutually agreed or determined by an arbitrator) of such shares (less a 20% discount in the event of termination for cause of Insight Productions' chief executive officer). Reciprocally, the Company has call rights over such 30% interest commencing at the same time (or earlier in the event of termination of employment of Insight Productions' chief executive officer), pursuant to which the holder will be entitled to receive the fair market value (as mutually agreed or determined by an arbitrator) of such shares (less a 20% discount in the event of termination for cause or resignation of Insight Productions' chief executive officer without good reason). The 30% holder can elect cash or Shares (based on their then market price) at the holder's option.

In addition, pursuant to the Insight Shareholders Agreement, the shares of Insight Productions are subject to (i) pre-emptive rights, (ii) drag-along rights which allow the Company to force the sale of all shares of Insight Productions in certain circumstances and (iii) piggy-back rights, allowing other shareholders to participate in a sale of Boat Rocker's shares of Insight Productions.

Industrial Brothers

In connection with its 30% minority investment in Industrial Brothers, Boat Rocker entered into a unanimous shareholders agreement dated December 9, 2015, which governs Industrial Brothers and its shareholders (the "Industrial Brothers Shareholders Agreement"). Pursuant to the Industrial Brothers Shareholders Agreement, the shares of Industrial Brothers are subject to a right of first refusal, drag-along rights, tag-along rights and pre-emptive rights in favour of the shareholders of Industrial Brothers in certain situations. The Company is entitled, pursuant to the Industrial Brothers Shareholders Agreement, to appoint one third of the members of the board of directors of Industrial Brothers. The Industrial Brothers board of directors is currently comprised of three directors and the Company's nominee is Michel Pratte, President of Boat Rocker and General Manager of Boat Rocker Studios.

Existing Equity Participation Plan

Under the terms of the Company's existing Equity Participation Plan (the "Legacy EPP"), in the event of an initial public offering of the Company, all of the then unvested rights to acquire shares (the "Legacy Options") held by the participants become vested in full immediately prior to, and conditional upon, consummation of the initial public offering and, in the event a participant has not exercised their vested Legacy Options by consummation of the initial public offering, unless otherwise determined by the Board in its sole discretion, such Legacy Options shall terminate at such time. The Board intends to allow the Legacy Options issued pursuant to the Legacy EPP to continue to be exercisable into Subordinate Voting Shares throughout the "rights period" (as defined in the Legacy EPP, generally 10 years from the date of the grant). In addition, prior to Closing, the Company intends to amend the Legacy EPP to permit participants to exercise the Legacy Options issued pursuant to the Legacy EPP for Subordinate Voting Shares on a cashless basis. Following Closing, the Company will not grant any further rights under the amended Legacy EPP.

Existing Restricted Share Unit Plan

Under the terms of the Company's existing Restricted Share Unit Plan (the "Legacy RSU Plan"), the Company has granted restricted share units to acquire equity ("Legacy RSUs"). All of the Legacy RSUs have vested as of the date of this Prospectus. As of Closing, there will be Legacy RSUs exercisable for an aggregate of 502,581 Subordinate Voting Shares outstanding. The Company will not grant further rights under the Legacy RSU Plan following Closing. See "Pre-Closing Capital Changes".

Recent Equity Grants

On Closing, the Company intends to grant options ("2021 Options"), subject to certain vesting conditions and exercisable at the Offering Price, to acquire up to an aggregate of [●] Subordinate Voting Shares, 1,155,797 PSUs and [●] RSUs, which PSUs and RSUs will be subject to certain vesting conditions, to key employees in accordance with the terms of the Equity Incentive Plan. Such 2021 Options and RSU awards will be effective as at January 1, 2021 and, in the case of the 2021 Options and RSUs, will vest in equal parts over three years with the first tranche vesting on January 1, 2022. The PSUs will vest over five years and will be effective as at Closing. In addition, it is expected that independent directors will receive 50% of their annual retainer in DSUs. See "Director Compensation".

DIVIDEND POLICY

Boat Rocker has not declared or paid any dividends or distributions on the securities of the Company during the fiscal years ended December 31, 2019, 2018 or 2017, other than \$1,200,000 paid to certain shareholders of Boat Rocker in the year ended December 31, 2017 and \$2,699,000 paid to certain shareholders of Boat Rocker in July 2018. In addition, the Company received certain proceeds totaling, in the aggregate, \$7,087,315 as a result of the sale and refinancing of certain formerly owned real estate. The Company subsequently distributed an amount equal to such proceeds to each of the Principal Shareholders by way of a return of capital, which was reinvested in the Company's equity by the Principal Shareholders. In addition, the Company transferred all of its shares in a company which held certain real estate and in which the Company held a minority interest on November 17, 2020, to the Principal Shareholders by way of a return of capital, in the amount of \$1,358,091.

Holders of Multiple Voting Shares and Subordinate Voting Shares will be entitled to receive dividends out of the assets of the Company legally available for the payment of dividends at such times and in such amount and form as the Board may determine. The Company will pay dividends thereon on a pari passu basis, if, as and when declared by the Board.

Initially, the Company intends to focus on growth and does not anticipate paying dividends. The amount and timing of the payment of any dividends are subject to the discretion of the Board.

PRINCIPAL AND SELLING SHAREHOLDERS

Post-Offering Shares

Upon completion of the Offering (assuming the exercise in full of the Over-Allotment Option), the Principal Shareholders will collectively hold 100% of the Company's issued and outstanding Multiple Voting Shares and 27.9% of the Company's issued and outstanding Subordinate Voting Shares. After giving effect to the Offering (assuming no exercise of the Over-Allotment Option), the Principal Shareholders will collectively hold approximately 62.8% of the Company's total issued and outstanding Shares and will hold approximately 92.9% of the voting power attached to all of the Shares (approximately 60.4% and 92.2%, respectively, if the Over-Allotment Option is exercised in full). As a result, the Principal Shareholders will following Closing, in the aggregate, have over 90% of the voting power over all corporate actions requiring shareholder approval. See "Risk Factors – Risks Related to the Offering – Significant Ownership by the Principal Shareholders".

After giving effect to the Pre-Closing Capital Changes, but prior to completion of the Offering, the Selling Shareholders will collectively beneficially own 10,103,566 Shares, which will represent approximately 27.1% of the issued and outstanding Shares.

DF BRM Holdco Inc. intends to sell, as part of the Secondary Offering, 204,055 Subordinate Voting Shares, which will result in DF BRM Holdco Inc. holding approximately 0% of the total issued and outstanding Subordinate Voting Shares upon Closing. Upon completion of the Offering, DF BRM Holdco Inc. will also hold 4,335,943 Multiple Voting Shares.

IS BRM Holdco Inc. intends to sell, as part of the Secondary Offering, 204,055 Subordinate Voting Shares, which will result in IS BRM Holdco Inc. holding approximately 0% of the total issued and outstanding Subordinate Voting Shares upon Closing. Upon completion of the Offering, IS BRM Holdco Inc. will also hold 4,335,943 Multiple Voting Shares.

John Young intends to sell, as part of the Secondary Offering, 50,987 Subordinate Voting Shares, which will result in John Young holding approximately 0% of the total issued and outstanding Subordinate Voting Shares upon Closing. Upon completion of the Offering, John Young will also hold 972,583 Multiple Voting Shares.

Upon completion of the Offering, the Selling Shareholders will collectively beneficially own 9,644,469 Multiple Voting Shares, representing approximately 40.9% of the outstanding Multiple Voting Shares.

Assuming no exercise of the Over-Allotment Option, the following table sets out the Shareholders who, immediately following Closing, will, to the Company's knowledge, beneficially own, control or direct, directly or indirectly, voting securities carrying 10% or more of the voting rights attached to any class of the Company's voting securities.

		Immediately following the Pre-Closing Capital Changes and prior to the Closing			Immediately following the Closing
Name of Shareholder(1)	Type of Ownership	Number of Multiple Voting Shares Owned	Number of Subordinate Voting Shares Owned	Number of Subordinate Voting Shares Sold in the Offering	Number of Multiple Voting Shares Owned	Number of Subordinate Voting Shares Owned	Percentage of Outstanding Shares(2) (3)	Percentage of Total Voting Rights(4) (5)
Fairfax	Beneficial	13,908,581	8,017,739	__	13,908,581	8,017,739	43.6%	56.1%
DF BRM Holdco Inc.	Direct	4,335,943	204,055	204,055	4,335,943	__	8.6%	16.5%
IS BRM Holdco Inc.	Direct	4,335,943	204,055	204,055	4,335,943	__	8.6%	16.5%
John Young	Direct	972,583	50,987	50,987	972,583	__	1.9%	3.7%

Notes:

___________

(1) Each of Fairfax, DF BRM Holdco Inc., IS BRM Holdco Inc. and John Young acquired shares convertible into Subordinate Voting Shares on November 17, 2020 at a price per share equal to \$6.45. See "Prior Issuances".

(2) On a fully-diluted basis (assuming the exercise of all Legacy Options, Legacy RSUs, 2021 Options, RSUs and PSUs outstanding immediately following Closing), Fairfax, DF BRM Holdco Inc., IS BRM Holdco Inc., and John Young's respective ownership represents [●]%, [●]%, [●]%, and [●]% of the issued and outstanding Shares immediately following the Closing.

(3) If the Over-Allotment Option is exercised in full, Fairfax, DF BRM Holdco Inc., IS BRM Holdco Inc., and John Young's respective ownership will represent 41.9%, 8.3%, 8.3% and 1.9% ([●]%,[●]%, [●]% and [●]% on a fully-diluted basis, respectively) of the issued and outstanding Shares immediately following the Closing.

(4) On a fully-diluted basis (assuming the exercise of all Legacy Options, Legacy RSUs, 2021 Options, RSUs and PSUs outstanding immediately following Closing), Fairfax, DF BRM Holdco Inc., IS BRM Holdco Inc., and John Young's respective Multiple Voting Shares will represent [●]%, [●]%, [●]%, and [●]% of the total voting power of the issued and outstanding Shares immediately following the Closing.

(5) If the Over-Allotment Option is exercised in full, Fairfax, DF BRM Holdco Inc., IS BRM Holdco Inc., and John Young's respective Multiple Voting Shares will represent 55.7%, 16.4%, 16.4% and 3.7% ([●]%,[●]%, [●]% and [●]% on a fully-diluted basis, respectively) of the total voting power of the issued and outstanding Shares immediately following the Closing.

Other than the Principal Shareholders, no person or company will own, directly or indirectly, any Multiple Voting Shares on Closing. All of the Multiple Voting Shares held after the completion of the Offering by the Principal Shareholders will be subject to contractual lock-up arrangements with the Underwriters. See "Plan of Distribution – Lock-up Arrangements".

Except as provided in the Coat-tail Agreement, any sale or transfer by the Principal Shareholders of Multiple Voting Shares other than to (i) IDJ, (ii) Fairfax or (iii) a bank or other arm's length financial institution who will hold the Multiple Voting Shares as pledgee in order to secure a bona fide lending arrangement, subject to certain conditions (collectively, the "Permitted Holders"), will result in such Multiple Voting Shares being automatically converted into Subordinate Voting Shares. For more information on permitted pledges see "Principal Shareholders Agreement – Transfer Restrictions and Sale Procedures".

Issuance of Additional Multiple Voting Shares

From and after the Closing, the Company may not issue additional Multiple Voting Shares without obtaining minority approval of shareholders, within the meaning of the applicable rules of the TSX, except in connection with a subdivision or conversion of Shares or a stock dividend on a pro rata basis as between each class of Shares.

Take-over Bid Protection – Coat-tail Agreement

Under applicable Canadian law, an offer to purchase Multiple Voting Shares would not necessarily require that an offer be made to purchase Subordinate Voting Shares. In accordance with the rules of the TSX designed to ensure that, in the event of a take-over bid, the holders of Subordinate Voting Shares will be entitled to participate on an equal footing with holders of Multiple Voting Shares, the Principal Shareholders, as the owners of all the outstanding Multiple Voting Shares, will enter into a customary coat-tail agreement with the Company and a trustee (the "Coat-tail Agreement"). The Coat-tail Agreement will contain provisions customary for dual class, TSX-listed corporations designed to prevent transactions that otherwise would deprive the holders of Subordinate Voting Shares of rights under applicable provincial take-over bid legislation to which they would have been entitled if the Multiple Voting Shares had been Subordinate Voting Shares.

The undertakings in the Coat-tail Agreement will not apply to prevent a sale by the Principal Shareholders or a Permitted Holder of Multiple Voting Shares if concurrently an offer is made to purchase issued and outstanding Subordinate Voting Shares that:

(a) offers a price per Subordinate Voting Share at least as high as the highest price per share to be paid pursuant to the take-over bid for the Multiple Voting Shares;
(b) provides that the percentage of outstanding Subordinate Voting Shares to be taken up (exclusive of shares owned immediately prior to the offer by the offeror or persons acting jointly or in concert with the offeror) is at least as high as the percentage of Multiple Voting Shares to be sold (exclusive of Multiple Voting Shares owned immediately prior to the offer by the offeror and persons acting jointly or in concert with the offeror);
(c) has no condition attached other than the right not to take up and pay for Subordinate Voting Shares tendered if no shares are purchased pursuant to the offer for Multiple Voting Shares; and
(d) is in all other material respects identical to the offer for Multiple Voting Shares.

In addition, the Coat-tail Agreement will not prevent the transfer of Multiple Voting Shares by the Principal Shareholders to Permitted Holders, provided such transfer is not or would not have been subject to the requirements to make a take-over bid (assuming the vendor or transferee were resident in Ontario) or constitutes or would constitute an exempt take-over bid (as defined in Ontario securities legislation). The conversion of Multiple Voting Shares into Subordinate Voting Shares, whether or not such Subordinate Voting Shares are subsequently sold, would not constitute a disposition of Multiple Voting Shares for the purposes of the Coat-tail Agreement.

The Coat-tail Agreement will contain provisions for authorizing action by the trustee to enforce the rights under the Coat-tail Agreement on behalf of the holders of the Subordinate Voting Shares. The obligation of the trustee to take such action will be conditional on the Company or holders of the Subordinate Voting Shares providing such funds and indemnity as the trustee may reasonably require. No holder of Subordinate Voting Shares will have the right, other than through the trustee, to institute any action or proceeding or to exercise any other remedy to enforce any rights arising under the Coat-tail Agreement unless the trustee fails to act on a request authorized by holders of not less than 10% of the total outstanding number of Subordinate Voting Shares and reasonable funds and indemnity have been provided to the trustee.

Other than in respect of non-material amendments and waivers that do not adversely affect the interests of holders of Subordinate Voting Shares, the Coat-tail Agreement will provide that it may not be amended, and no provision thereof may be waived, unless, prior to giving effect to such amendment or waiver, the following have been obtained: (a) the consent of the TSX; and (b) the approval of at least two-thirds of the votes cast by holders of Subordinate Voting Shares represented at a meeting duly called for the purpose of considering such amendment or waiver, voting together as if they were a single class, excluding votes attached to Subordinate Voting Shares held by the Principal Shareholders or their affiliates and any persons who have an agreement to purchase Multiple Voting Shares on terms which would constitute a sale or disposition for purposes of the Coat-tail Agreement, other than as permitted thereby.

No provision of the Coat-tail Agreement will limit the rights of any holders of Subordinate Voting Shares under applicable law.

PRINCIPAL SHAREHOLDERS AGREEMENT

The Principal Shareholders are currently parties to a unanimous shareholders' agreement governing Boat Rocker, which was initially entered into concurrent with the Fairfax investment on July 17, 2015. This agreement will be terminated immediately prior to Closing and replaced with a shareholders' agreement among Boat Rocker and the holders of the Multiple Voting Shares, which will be Fairfax and IDJ (the "Principal Shareholders Agreement"), with respect to the ownership, transfer and conversion of the Multiple Voting Shares and their respective rights in certain governance matters. The description of the Principal Shareholders Agreement is a summary only and is qualified in its entirety by the full text of the Principal Shareholders Agreement.

Nomination Rights

The Principal Shareholders Agreement will provide that Ivan Schneeberg ("IS", which includes his controlled subsidiaries, including family trusts) and David Fortier ("DF", which includes his controlled subsidiaries, including family trusts, and together with IS, "ID"), together will be entitled to nominate the greater of:

(a) up to two individuals for election to the Board for so long as at least one of IS and DF remain employed on a full-time basis as a senior executive officer of the Company, provided that, if neither IS nor DF remain so employed, IS and DF together shall still be entitled to nominate up to two individuals for election to the Board so long as: (i) IS and DF collectively, continue to beneficially own, directly or indirectly, at least 50% of the Multiple Voting Shares that were collectively held by IS and DF as of the Closing Date; or (ii) the securities beneficially owned, directly or indirectly, by either of IS or DF represent not less than 7.5% of all of the votes eligible to be cast by all securityholders at a meeting of Shareholders; or (iii) the securities beneficially owned, directly or indirectly, by IS and DF collectively represent not less than 12.5% of all of the votes eligible to be cast by all securityholders at a meeting of Shareholders; and
(b) the number provided for below, having regard to the combined holdings of ID and John Young ("JY", which includes his controlled subsidiaries, including family trusts) (i) for so long as IDJ own securities to which are attached not less than 30% of the total votes that may be cast at a meeting of Shareholders, ID will be entitled to nominate up to three directors for election to the Board (and if three directors are so nominated, one of them shall be JY for as long as he is the Chief Executive Officer of the Company, failing which one of the nominated directors shall be independent from the Company within the meaning of NI 52-110); and (ii) for so long as IDJ own securities to which are attached more than 50% of the total votes that may be cast a meeting of Shareholders, ID will be entitled to nominate up to four directors for election to the Board (and if four directors are so nominated, one of them shall be independent from the Company within the meaning of NI 52-110, and one of them shall be JY for as long as he is the Chief Executive Officer of the Company, failing which two of them shall be independent from the Company within the meaning of NI 52-110).

ID may elect to nominate fewer individuals than it is entitled to nominate, but this shall not affect ID's right to nominate the full number of individuals it is entitled to nominate in the future. The Chief Executive Officer of the Company shall at all times be a nominee for election to the Board so long as JY is the Chief Executive Officer. In addition, if clause (a) above applies and JY is not a nominee of ID, and Fairfax is entitled to and does nominate four directors, then JY (in his capacity as Chief Executive Officer) shall be an additional fifth nominee of Fairfax.

The Principal Shareholders Agreement will also provide that Fairfax shall be entitled to nominate individuals for election to the Board as follows:

(i) for so long as Fairfax owns securities to which are attached more than 50% of the total votes that may be cast at a meeting of Shareholders, Fairfax will be entitled to nominate up to four directors for election to the Board;

(ii) for so long as Fairfax owns securities to which are attached not less than 40% of the total votes that may be cast at a meeting of Shareholders, Fairfax will be entitled to nominate up to three directors for election to the Board;
(iii) for so long as Fairfax owns securities to which are attached not less than 15% of the total votes that may be cast at a meeting of Shareholders, Fairfax will be entitled to nominate two directors for election to the Board; and
(iv) for so long as Fairfax owns securities to which are attached not less than 7.5% of the total votes that may be cast at a meeting of Shareholders, Fairfax will be entitled to nominate one director for election to the Board.

Fairfax shall ensure that, if it is entitled to and does appoint: (a) four nominees for election to the Board, three of them shall be independent from the Company within the meaning of NI 52-110; (b) three nominees for election to the Board, two of them shall be independent from the Company within the meaning of NI 52-110; and (c) two nominees for election to the Board, one of them shall be independent from the Company within the meaning of NI 52-110. In any event, the required number of independent director nominees shall be reduced by the number of independent directors nominated by ID.

To the extent that Fairfax nominates any independent directors for election to the Board, Fairfax agrees to consult with IS, DF and the Chief Executive Officer of the Company in respect of such nomination, provided that this shall not limit or otherwise restrict Fairfax from nominating any qualified and independent individual in Fairfax's sole discretion following such consultation. For clarity, Fairfax may elect to nominate fewer individuals than it is entitled to nominate, but this shall not affect Fairfax's right to nominate the full number of individuals it is entitled to nominate in the future.

Any other nominees not nominated as provided for above, up to the maximum of seven directors, shall be determined by the Board.

The Company will put forward and recommend such nominees to the Shareholders for election to the Board, ID will support and vote in favour of the election of each of Fairfax's nominees to the Board (and if applicable the Chief Executive Officer), and Fairfax will support and vote in favour of the election of each of ID's nominees to the Board (and, if applicable, the Chief Executive Officer).

As of the Closing Date, two individuals are to be jointly selected by the Principal Shareholders to be independent directors, who shall be nominees of Fairfax as provided above, with a third individual to be jointly selected within one year of filing of the final prospectus. See "Corporate Governance – Composition of the Board on Closing". In the event of the resignation or removal of any of these selected independent directors (or any replacement thereof), Fairfax will select a replacement independent director in accordance with the process described above.

Registration Rights

Each of Fairfax and IDJ will have certain demand and piggy-back registration rights. See "Registration Rights".

Pre-Emptive Rights

The Principal Shareholders Agreement will provide that in the event that the Company decides to issue equity securities of the Company or rights to acquire equity securities of the Company, each holder of Multiple Voting Shares will have customary pre-emptive rights in proportion to such party's pro rata ownership share of all Multiple Voting Shares at such time, provided that the pre-emptive rights granted to a holder of Multiple Voting Shares will terminate on the date that such holder no longer holds, directly or indirectly, in the aggregate, less than the lesser of: (i) 5% of the issued and outstanding Shares from time to time and (ii) 1/3 of the number of Multiple Voting Shares held by such holder as of Closing. Further, these pre-emptive rights will not apply in connection with the following: (i) incentive compensation issued under the Company's security-based compensation arrangements;

(ii) securities issued to lenders; (iii) capital reorganizations of the Company; (iv) equity securities issued in lieu of cash dividends; (v) equity securities (or rights to acquire equity securities) issued pursuant to a shareholder rights plan; (vi) equity securities (or rights to acquire equity securities) issued pursuant to a dividend reinvestment plan; (vii) the issuance of Subordinate Voting Shares in respect of a conversion of Multiple Voting Shares or any other right to acquire equity securities; (viii) any corporate transaction or share or asset acquisition where equity securities (or rights to acquire equity securities) are used to pay all or a portion of the purchase price; or (ix) any issuance of equity securities (or rights to acquire equity securities) where the exercise of pre-emptive rights by such holder would require Shareholder approval, except as otherwise determined by the Board.

Transfer Restrictions and Sale Procedures

IDJ may not transfer any Multiple Voting Shares held by them except: (i) for greater certainty, to their respective controlled subsidiaries (an "IDJ Internal Reorganization"); (ii) to other members of IDJ, subject to applicable coat-tail provisions (i.e., at a price not more than a 15% premium to the prior 20 trading day average closing price of the Subordinate Voting Shares as determined in accordance with applicable securities laws) (a "Permitted IDJ Transfer"); (iii) to any of IDJ in connection with them exercising the IDJ Second Purchase Right (as defined below); and (iv) to Fairfax in connection with Fairfax exercising the Fairfax Purchase Right (as defined below).

Fairfax may not transfer any Multiple Voting Shares held by it except: (i) for greater certainty, to its controlled subsidiaries (a "Fairfax Internal Reorganization"); or (ii) to IDJ in connection with any of IDJ exercising their right of first refusal in connection with a proposed conversion by Fairfax.

Pledges of Multiple Voting Shares will be prohibited unless, subject to TSX approval, made in connection with a bona fide lending arrangement with an arm's length financial institution pursuant to which the lender agrees to be subject to the restrictions regarding Multiple Voting Shares described herein in the event of realization and to convert them into Subordinate Voting Shares should it wish to vote them or cause them to be voted at any time following an event of default under such lending arrangement which is continuing.

Rights of First Refusal

In the event that Fairfax wishes to convert any of its Multiple Voting Shares into Subordinate Voting Shares, except in connection with a Fairfax Internal Reorganization, Fairfax will first send a notice offering to sell such Multiple Voting Shares to IDJ for purchase for a period of 10 days, which notice shall specify the price per share (the "Fairfax Price Per Share") at which IDJ would be entitled to acquire the share subject to such notice (the "IDJ First Purchase Right"). Any member of IDJ may purchase such Multiple Voting Shares in proportion to his or its percentage ownership of all Multiple Voting Shares held by IDJ at the time. In the event that one or more of IDJ wishes to purchase less than or none of his or its entitlement to such Multiple Voting Shares, such available Multiple Voting Shares may be purchased within 10 days by the other members of IDJ at the Fairfax Price Per Share in their respective pro rata proportions or may be purchased in such proportions as may be otherwise agreed by IDJ. Any Multiple Voting Shares not purchased by IDJ in accordance with the foregoing may be converted by Fairfax or its applicable controlled affiliate(s) within 30 days thereafter, and may thereafter be sold at any time, provided that the Multiple Voting Shares or Subordinate Voting Shares resulting from the conversion thereof may not be sold to any purchaser at less than the Fairfax Price Per Share, except pursuant to a sale by way of a public offering via a prospectus (or a non-prospectus offering to the extent a prospectus exemption is available), at the then prevailing marketing price plus a standard market discount, and if not converted within such period the above restrictions shall again apply.

In the event that any member of IDJ wishes to convert any of his or its Multiple Voting Shares into Subordinate Voting Shares, except in connection with an IDJ Internal Reorganization or a Permitted IDJ Transfer, such person will first offer such Multiple Voting Shares to the other members of IDJ for purchase for a period of 30 days, which notice shall specify the price per share (the "IDJ Price Per Share") at which the other members of IDJ would be entitled to acquire the share subject to such notice (the "IDJ Second Purchase Right"). Any member of IDJ may purchase such Multiple Voting Shares in proportion to his or its percentage ownership of all Multiple Voting Shares held by the non-offering members of IDJ at the time. In the event that one of the non-offering members of IDJ wishes to purchase less than or none of his or its entitlement to such Multiple Voting Shares, such available Multiple Voting Shares may be purchased within 10 days by the other member of IDJ at the IDJ Price Per Share in their respective pro rata proportions or may be purchased in such proportions as may be otherwise agreed by IDJ. Any Multiple Voting Shares not purchased by non-offering members of IDJ in accordance with the foregoing will then be offered to Fairfax for purchase for a period of 10 days at the IDJ Price Per Share (the "Fairfax Purchase Right"). Any Multiple Voting Shares not purchased by IDJ or Fairfax in accordance with the foregoing may be converted by the offering member of IDJ within 30 days thereafter, and may thereafter be sold at any time, provided that the Multiple Voting Shares or Subordinate Voting Shares resulting from the conversion thereof may not be sold to any purchaser at less than the price offered to the other members of the Principal Shareholders, except pursuant to a sale by way of a public offering via a prospectus (or a non-prospectus offering to the extent a prospectus exemption is available), at the then prevailing marketing price plus a standard market discount, and that if not converted within such period the above restrictions shall again apply.

Both the Fairfax Price Per Share and the IDJ Price Per Share may not exceed the maximum price permitted under the coat-tail arrangements applicable to the Multiple Voting Shares (which will conform to the maximum price permitted under the "private agreement" takeover bid exemption under Ontario securities laws, and will be deemed to be automatically reduced to such maximum permitted price in such event if it would exceed such amount). This maximum permitted price will be determined as the maximum permitted price on the date of the original offer (or, if applicable and if lower, on the date of an acceptance thereof).

Automatic Conversions

Multiple Voting Shares will be automatically converted into Subordinate Voting Shares in certain circumstances. See "Authorized Share Capital Upon Closing – Multiple Voting Shares and Subordinate Voting Shares".

Term

The Principal Shareholders Agreement will terminate upon the earliest of: (i) one Shareholder holding all of the issued and outstanding Multiple Voting Shares; (ii) the mutual agreement of the Principal Shareholders; (iii) the conversion of all Multiple Voting Shares into Subordinate Voting Shares (whether by automatic or voluntary conversion); and (iv) the dissolution, winding-up or liquidation of the assets of the Company. Termination of the Principal Shareholders Agreement will not affect or prejudice any rights or obligations of each of the Principal Shareholders which may have arisen or accrued under the Principal Shareholders Agreement prior to its termination.

REGISTRATION RIGHTS

Upon completion of the Offering, the Company will enter into registration rights agreements (the "Registration Rights Agreements") with IDJ, certain subsidiaries of Fairfax, and EMC (the "Registering Shareholders"). The Registration Rights Agreements will provide the Registering Shareholders with the registration rights outlined below in respect of the Subordinate Voting Shares held by such holders from time to time. These Subordinate Voting Shares are referred to as "registrable securities".

Demand Registration Rights

Each of the Registering Shareholders can request that the Company qualify by prospectus (a "Long-Form Demand Registration") or short-form prospectus (a "Short-Form Demand Registration", and together with the Long-Form Demand Registration, a "Demand Registration") in Canada all or a portion of their registrable securities, provided that the aggregate offering price is at least \$15 million in the case of a Long-Form Demand Registration or at least \$10 million in the case of a Short-Form Demand Registration. Each Registering Shareholder is entitled to three Long-Form Demand Registration rights and five Short-Form Demand Registration rights. No prospectus need be filed by the Company within 180 days of the last prospectus for a Demand Registration. The Company can postpone the filing of a prospectus for up to 90 days twice in a 12-month period if the Board determines that a Demand Registration would materially interfere with any material financing, acquisition, corporate reorganization or merger or other transaction or which would require disclosure of information at a time when the Company has a bona fide business purpose not to immediately disclose such information. The underwriters for any Demand Registration will be selected by the Registering Shareholders in consultation with Boat Rocker. The Company may participate in a proposed Demand Registration by selling Subordinate Voting Shares from treasury if the underwriters of the Demand Registration, acting reasonably, are of the view that to do so would facilitate the offering. All reasonable expenses incurred by the Company and the Registering Shareholder in connection with the

Demand Registration, including all registration, qualification and filing fees and underwriting fees, shall be borne by the Registering Shareholder in proportion to the amount the gross proceeds received by the Registering Shareholder bear to the total gross proceeds of the Demand Registration, except the fees and disbursements of legal counsel which shall be borne by the respective parties participating in the Demand Registration.

Piggy-back Registration Rights

If the Company proposes to register or qualify its securities for sale to the public, it must provide notice to each holder of registrable securities and certain other Shareholders holding piggy-back registration rights and use its reasonable commercial efforts to cause to be registered all registrable securities that the holders of such registrable securities request in writing be so registered. These piggy-back registration rights are unlimited in number. If a public offering of securities is being effected, those securities offered shall be allocated first to the Company then, in the discretion of the lead underwriter, to EMC and Fairfax (pro rata based on the amount owned by each) (provided that the collective allocation to EMC and Fairfax may not be reduced below 25%), and then, also in the discretion of the lead underwriter, to IDJ (pro rata based on the amount owned by each) and then, also in the discretion of the lead underwriter, to other persons exercising piggy-back registration rights. The Company will agree to pay all costs and expenses in connection with each piggy-back registration, except underwriting fees applicable to the securities sold by the holders of registrable securities and any legal fees of independent counsel to such holders of registrable securities.

In the case of both demand and piggy-back registration rights, all person(s) holding either type of right must agree to enter into such lock-up agreements as may be reasonably requested by the lead underwriter of any public offering, not to exceed 180 days following Closing.

DESCRIPTION OF MATERIAL INDEBTEDNESS

Existing Credit Facilities

Corporate Credit Facility

On October 30, 2018, Boat Rocker and its wholly-owned subsidiary Boat Rocker Media (US) Inc., entered into an amended and restated offer of financing with a Canadian chartered bank (as subsequently amended on February 1, 2019, December 31, 2019, July 20, 2020 and February 8, 2021, the "Corporate Credit Facility"). The Corporate Credit Facility is comprised of (1) a \$5,000,000 demand revolver, (2) a \$21,460,000 demand term loan (the balance as at December 31, 2020 was \$19,582,250), (3) a \$1,000,000 treasury risk management facility, (4) a \$300,000 credit card facility, (5) a US\$37,110,000 demand term loan (the balance as at December 31, 2020 was US\$34,990,000), (6) a US\$2,000,000 demand revolver (which is also available by way of letters of credit in US dollars up to a maximum of US\$1,650,000), (7) a US\$13,000,000 demand term loan (the balance as at December 31, 2020 was US\$11,862,500), and (8) a \$13,377,926 demand term loan (the balance as at December 31, 2020 was \$12,040,133). As at December 31, 2020, the aggregate amount outstanding under the Corporate Credit Facility was approximately \$91,303,098.

The Corporate Credit Facility is guaranteed by certain Canadian, U.S. and U.K. subsidiaries of Boat Rocker. The Company and the guarantors have provided the lender with a first priority lien over all of their respective assets, subject to certain exclusions and permitted liens. The Company and certain of the guarantors also pledged 100% of the equity interests they hold in the capital of substantially all of their subsidiaries. The Corporate Credit Facility was used by the Company for general corporate purposes, including acquisitions and ordinary operations.

Subject to certain exceptions, the Corporate Credit Facility contains restrictive covenants customary for credit facilities of this nature, including, without limitation, restrictions on the Company, Boat Rocker Media (US) Inc. and each guarantor to grant or create any mortgage, charge, lien, pledge, security interest or other encumbrance, sell, transfer, lease or otherwise dispose of any of its properties or assets, make distributions, acquisitions, loans, advances or guarantees, merge, amalgamate or consolidate with other persons, make investments, incur indebtedness, enter into any sale-leaseback transactions or repay indebtedness. Pursuant to the July 20, 2020 amendment to the Corporate Credit Facility, a target EBITDA was set for certain legal entities over which the lender had security for the last two quarters of 2020 and first two quarters of 2021. As the impact of COVID-19 continued through the fall of 2020, the lender agreed to waive the EBITDA targets entirely. See "Management's Discussion and Analysis of Boat Rocker", "Risk Factors– The impact of the COVID-19 global pandemic could materially adversely affect the Company's business, financial condition and results of operations" and "Risk Factors – Risks Related to Indebtedness".

On Closing, the Company intends to repay all of its term debt under the Corporate Credit Facility and, as a result, the demand term loan facilities will be terminated. Upon Closing, the Corporate Credit Facility is expected to be comprised of (1) a \$5,000,000 demand revolver (which will be undrawn at Closing), (2) a \$1,000,000 treasury risk management facility, (3) a \$300,000 credit card facility, and (4) a US\$2,000,000 demand revolver (which is also available by way of letters of credit in U.S. dollars up to a maximum of US\$1,650,000). See "Use of Proceeds".

Insight Corporate Facilities

On November 13, 2020, Insight Productions amended and extended its then-existing credit facility pursuant to an amended and restated offer of financing with a Canadian chartered bank (the "Insight Corporate Facilities"). The Insight Corporate Facilities are comprised of (1) a \$1 million revolving demand facility, (2) a \$262,276.50 nonrevolving lease facility, and (3) a \$75,000 credit card facility. Insight Productions is in compliance with all covenants contained in the Insight Corporate Facilities (as they may have been waived as a result of COVID-19). See "Management's Discussion and Analysis of Boat Rocker" and "Risk Factors – Risks Related to Indebtedness". As at December 31, 2020, the \$1 million revolving demand facility was undrawn and the balance on the non-revolving lease facility was \$199,735.

Matador Equipment Lease

Boat Rocker has guaranteed the payment and performance obligations of Matador Content as lessee pursuant to a master lease agreement (as supplemented, the "Matador Equipment Lease"), dated as of January 14, 2014, by and between First American Commercial Bancorp, Inc. ("First American") and Matador Content, for the lease of certain equipment, software and personal property. Under the Matador Equipment Lease, First American has a security interest in all equipment subject to leases, any other property of Matador Content under First American's control and any other collateral in which Matador Content has granted to First American to secure any other obligations. As of December 31, 2020, Matador Content's outstanding balance owing under the Matador Equipment Lease was approximately US\$82,290, which amount is anticipated to be repaid by Matador Content in full on or before February 28, 2021.

US Scripted Production Facility

Subsidiaries of Platform One Media are party to a US\$100,000,000 senior secured five-year revolving credit facility with a major U.S. bank, which may be increased to US\$250,000,000, in connection with the interim financing of certain scripted programming produced by the Company in the U.S. (the "US Scripted Production Facility"). The borrower under the US Scripted Production Facility is a direct subsidiary of Platform One Media and the subsidiaries of the borrower are guarantors of the facility. The US Scripted Production Facility is not guaranteed by Platform One Media or the Company. As at December 31, 2020, the aggregate amount outstanding under the US Scripted Production Facility was approximately US\$71,000,000. The subsidiaries of the Company who are party to the US Scripted Production Facility are in compliance with all covenants contained in the US Scripted Production Facility. See "Management's Discussion and Analysis of Boat Rocker" and "Risk Factors – Risks Related to Indebtedness".

Other Interim Production Financing Facilities

Many of the Company's programs are financed by Canadian banks who specialize in lending to media producers. Generally, the borrower under each of these facilities is a single purpose production company subsidiary of the Company which has been formed for the specific purpose of producing the programming. Typically, Boat Rocker and certain of its operating subsidiaries are guarantors of the facilities, which means that if for some reason the single purpose production company was unable to repay the loan, the lender can look to Boat Rocker to settle the debt. Each interim production financing facility is a demand loan, but the Company has never in its history experienced a lender demanding repayment of an interim financing production loan prior to maturity. In respect of each facility, the borrower will pledge the third-party financing (e.g., license fees, tax credits, other subsidies) for the programming to the interim lender as collateral security for the facilities. The interim production lender takes an assignment of the specific receivable. In the Company's experience, the interim production financier will not provide financing unless it is satisfied that there are no unusual pre-conditions to payment of the licensee fee and that the licensee is credit-worthy. As at December 31, 2020, the Company and its subsidiaries were party to 27 interim production financing facilities under which an aggregate amount of approximately \$50,949,552 in loans was outstanding (not including the amounts owing under the US Scripted Production Facility). For more details and examples of production financing see "Management's Discussion and Analysis of Boat Rocker" and "Risk Factors – Risks Related to Indebtedness".

Interim Production Financing

In respect of the Company's business of producing video content as a studio (as opposed to producing content on a "work for hire" or "services" basis), the Company funds the costs of its video content from third-party cash sources which, in the case of license fees and third-party distribution advances, are contracted prior to starting production, and, in the case of film and television tax credits, are estimated based on established tax laws, regulations and guidelines. In respect of any one program, the license fee(s) from the buyer(s) plus the film and television tax credits from federal, provincial, and/or state government agencies and any other sources of third-party financing (such as third-party distribution advances or other government grants) generally equal the expenses of the production budget for the particular program. However, the license fees (and, if applicable, third-party distribution advances) are paid on a negotiated schedule with the buyer that does not necessarily align with the cashflow requirements of the production budget. The tax credits are determined based on the labour (and in some cases, other costs) incurred to produce the content and are generally not earned until the costs have been incurred and are not collectable until many months thereafter. Specifically, video content that is financed with interim production financing may be produced over a period as short as six weeks (for a live event program) or as long as twenty-four months (for an animated series), with cash needed to fund costs throughout that period; license fees are generally payable on a schedule negotiated with the buyer where portions are paid on the commencement of pre-production, the commencement of principal photography, the completion of principal photography, and when certain postproduction and delivery milestones are met. Canadian film and video production tax credits in respect of video content that is financed with interim production financing is typically received by the Company six to 18 months after delivery of the video content to the buyer (or six to 18 months after the end of the production company's fiscal year, in respect of certain of the Canadian tax credits). As a result of the mis-match in timing between the cash needs of a production and the receipt of those receivables which are intended to cover the production budget, the Company enters into interim production financing arrangements with lenders to borrow the necessary funds to seek to ensure that they are available when the cash is needed to fund the cost of producing the video content. The lender take security over the receivables (license fees, third-party distribution advances (if any), film and television tax credits, and any other government subsidies or grants) so that those receivables are either directed to be paid to the lender to pay down the interim production financing facility, or received by the Company and deposited into the productionrelated bank account to repay the interim production financing. For most productions, the production budget includes the estimated interest expense on interim production financing, so that collectively the financiers of the video content are funding the cost of the interim production financing used in the production. Where the production budget does not include the interest expense, the Company covers the interest expense from the fees it charges to produce the video content.

There are certain productions where the production expenses are not fully covered by cash inflows from buyers, tax credits and other third-party sources. These are instances where the Company has chosen to invest its own capital in the video content, usually because it is retaining rights in the IP that it intends to self-distribute in secondary markets or license to a third-party sub-distributor to sell on the Company's behalf. This choice is made by the Company in order for the Company to receive a larger portion of the anticipated returns from the video content later in the sales cycle. In these cases, the Company's investment in the video content cannot be financed via interim production financing but is funded by the Company's operating capital, with the intent and expectation that the investment will be recouped as the Company (or its sub-distributor) begins to generate sales of the video content in international markets through its sales team.

Interim production financing is included as a current liability on the statement of financial position because interim production financing loans may be repayable on demand prior to the agreed maturity date (subject to the applicable common law, which generally allows for a reasonable period of time to repay following demand). While it is standard for interim production financing loans to be demand loans, it is the experience of the Company and the practice in the industry that interim production financing repayments occur when all of the receivables (license fees, tax credits, etc.) are received to repay the principal and interest on the loan, and not on demand. Interim production financing facilities are typically considered "low risk", as the entirety of the funds loaned by the bank are covered by the assignment of specific receivables (namely, license fees, third-party distribution advances, tax credits and other government grants) which often exceed the principal amount of the loan together with an interest reserve. Therefore, as long as the license fees and tax credits and other sources of funding continue to be collectible (which they generally will be so long as the programming is completed and delivered), there is no reason for the bank to demand early repayment of the interim production financing. The Company has a successful 17-year history of estimating, applying for and collecting tax credits.

Another source of comfort for the Company's interim production lenders is that the license fees are payable by credit-worthy buyers. The Company's interim-financed license fees are payable by well-established buyers such as Bell Media, Canadian Broadcasting Company, Corus, Apple TV+, Netflix and Showtime. Generally, banks will not finance a third-party license fee from a licensee who is not well-established or for whom the bank thinks there is an undue risk of collection.

The Company has a successful 17-year history of repaying its interim production financing and has never had a bank demand payment of an interim production financing loan prior to maturity. The banks from whom the Company borrows for the Company's interim production financing needs continue to offer competitive financing terms to the Company and such financing is expected by the Company to be an important source of funds for the Company in the future.

As noted above and in "Risk Factors – Risks Related to Indebtedness – Risks related to the Company's other interim production financing arrangements", while the Company has never had an interim production financing facility demanded prior to maturity, in the very unlikely event that the Canadian banks who loan funds to the Company pursuant to these interim production financing arrangements were to demand all outstanding loans at one time, the Company may not have the necessary cash readily available to repay all of the loans and, in such case, would need to seek alternative financing from a third-party or other sources of cash on an expedited basis. The Company has no reason to believe that its interim financing production loans will be demanded prior to maturity as this is very uncommon in the industry in which Boat Rocker operates and as any such demand by the lender might actually undermine the Company's ability to repay the loan, as it could interfere with the Company's ability to complete and deliver the video content that triggers the payment of the receivables assigned to the bank.

CONSOLIDATED CAPITALIZATION

The following table sets forth the Company's consolidated capitalization as at September 30, 2020, both before and after giving effect to, among other things, the Offering, the Pre-Closing Capital Changes (including the conversion of the A&R Debenture on January 1, 2021 and the conversion of the 2020 Debenture upon Closing), the repayment of the term debt in its entirety under the Corporate Credit Facility with the net proceeds of the Treasury Offering, and the settlement on January 1, 2021 of the non-interest bearing notes owed to the Company by the Principal Shareholders in connection with the sale of certain real estate investments (collectively, the "Pro Forma Adjustments"), but without giving effect to the exercise of the Over-Allotment Option. This table is presented and should be read in conjunction with the Boat Rocker Financial Statements and the Boat Rocker Interim Financial Statements included elsewhere in this Prospectus. See also "Selected Annual and Interim Financial Information of Boat Rocker", "Management's Discussion and Analysis of Boat Rocker", "Use of Proceeds" and "Pre-Closing Capital Changes".

(in thousands of Canadian dollars)	As at September 30, 2020	As at September 30, 2020, adjusted for Pro Forma Adjustments(2)
Total Cash	\$75,553	\$172,064
Debt(1)
Loans and borrowings, excluding interim production financing and convertible debentures.	\$99,481	–
Lease Liabilities	\$33,844	\$33,844
A&R Debenture	\$22,429	–
Corporate debt(1)	\$155,754	\$33,844
Shareholders' Equity
Equity attributable to Shareholders	\$23,187	\$256,978
Equity attributable to non-controlling interests	\$29,001	\$29,001
Total Equity	\$52,188	\$285,979
Total Capitalization(1)	\$207,942	\$319,823

___________ Notes:

(1) Excludes interim production financing. Interim production financing is drawn to bridge the timing between cash inflows from the license fees and production service fees of the buyer, the film and television tax credits earned on eligible production expenses, and cash outflows of the production expenses. Interim production financing for a particular production is expected to be repaid from the license fees and film and television tax credits of that same production in the ordinary course and is not considered part of the Company's capitalization.

(2) Assumes an Offering of \$175,000,000 and an Offering Price of \$13.00 per Subordinate Voting Share, the midpoint of the estimated price range set forth on the cover page of this Prospectus.

OPTIONS TO PURCHASE SECURITIES

The following table sets forth the aggregate number of options to purchase Shares expected to be outstanding upon completion of the Offering, after giving effect to the Pre-Closing Capital Changes:

Category	Number of Options to acquire Subordinate Voting Shares	Exercise Price	Expiration Date

Legacy EPP
	236,004	\$3.08	January 1, 2026
All executive officers and past executive officers of the	112,112	\$5.76	January 1, 2027
Company, and all directors and past directors of the	64,064	\$5.93	June 2, 2027
Company, as a group (5 in total)	96,096	\$5.93	December 2, 2027
	60,060	\$7.49	June 14, 2028
	128,128	\$10.61	January 1, 2029
	552,552	\$10.06	January 1, 2030
	96,096	\$11.01	May 13, 2029
	164,164	\$3.08	January 1, 2026
All other employees and past employees of the Company, as	132,132	\$5.76	January 2, 2027
a group (45 in total)	228,228	\$7.49	June 14, 2028
	32,032	\$9.99	October 1, 2028
	32,032	\$10.06	October 1, 2029
	34,434	\$10.06	January 1, 2030
	44,044	\$11.01	January 7, 2029
	40,040	\$11.01	January 31, 2029
Equity Incentive Plan
All executive officers and past executive officers of the Company, and all directors and past directors of the Company, as a group (4 in total)	(1) 107,635	\$13.00(1)	January 1, 2031
All other employees and past employees of the Company, as a group (110 in total)	395,511(1)	\$13.00(1)	January 1, 2031

Notes:

_____________

(1) Assumes an Offering Price of \$13.00, representing the midpoint of the estimated price range set forth on the cover page of this Prospectus.

For a description of the Company's equity-based incentive plans, see "Executive Compensation – Principal Elements of Compensation – Long-Term Incentives".

PRIOR ISSUANCES

The table below summarizes the issuances by Boat Rocker of shares or securities convertible into shares during the 12-month period preceding the date of this Prospectus, except as described under "Rights to Acquire Shares" or "Pre-Closing Capital Changes". The information set out below gives effect to the Pre-Closing Capital Changes.

Date	Type of Security(1)	Number of Securities	Issuance / Exercise Price per Security
November 17, 2020(2)	Non voting common shares	1,098,843	\$6.45
December 1, 2020(3)	2020 Debenture	2,491,254	\$10.24
January 1, 2021(4)	Non voting common shares	3,411,903	\$6.45
February 1, 2021(3)	2020 Debenture	1,474,836	\$10.24

Notes:

_____________

(2) Issued shares on November 17, 2020, in connection with a distribution of surplus real estate proceeds in connection with the sale of certain real estate investments.

(3) Issuable shares to Fairfax upon conversion of the 2020 Debenture, assuming a Closing Date of March 2, 2021. See "Pre-Closing Capital Changes" and "Issued Share Capital Upon Closing".

(4) On January 1, 2021, the A&R Debenture, including any accrued but unpaid interest thereon, converted into shares that will become 3,411,903 Subordinate Voting Shares.

See "Pre-Closing Capital Changes" for a description of the shares of the Company to be converted and/or issued prior to Closing pursuant to the Pre-Closing Capital Changes.

⁽¹⁾ Will convert into Subordinate Voting Shares upon Closing.

DIRECTORS AND EXECUTIVE OFFICERS

Directors

The Board is currently comprised of five directors. On Closing, it is expected that the size of the Board will be increased to six directors. The directors of the Company will be elected at each annual meeting of Shareholders and all directors will hold office for a term expiring at the close of the next annual meeting or until their respective successors are elected or appointed and will be eligible for re-election or re-appointment.

The following table sets forth the names, places of residence, positions and duration of service of each of the directors of the Company, after giving effect to the Offering. Additional biographical information for each individual is provided below.

Name and Municipality of Residence(1)	Position Held with Boat Rocker	Director Since
David Fortier(2) (3) (4) Toronto, Ontario, Canada	Co-Executive Chairman, Boat Rocker, Co-Chairman, Boat Rocker Studios and Director	2003
Ivan Schneeberg(2) (3) (4) Toronto, Ontario, Canada	Co-Executive Chairman, Boat Rocker, Co-Chairman, Boat Rocker Studios and Director	2003
John Young Toronto, Ontario, Canada	Chief Executive Officer and Director	2009
Quinn McLean Toronto, Ontario, Canada	Director	December 2, 2020
Sangeeta Desai(2) (3) Founex, Switzerland	Director (independent)	February 1, 2021
Katherine Cunningham(5) (6) Toronto, Ontario, Canada	Director (independent)	Closing

_______________ Notes:

⁽¹⁾ Each of David Fortier, Ivan Schneeberg, John Young, Quinn McLean and Sangeeta Desai is a director of the Company as of the date of this Prospectus.

⁽²⁾ Member of the Audit and Risk Committee.

⁽³⁾ Member of the Compensation, Nominating and Corporate Governance Committee.

⁽⁴⁾ Upon completion of the Offering and the appointment of Katherine Cunningham as a director of the Board, Ivan Schneeberg will be replaced as a member of the Audit and Risk Committee and David Fortier will be replaced as a member of the Compensation, Nominating and Corporate Governance Committee.

⁽⁵⁾ Expected to be a member of the Compensation, Nominating and Corporate Governance Committee and the Audit and Risk Committee at Closing.

⁽⁶⁾ Katherine Cunningham will not be serving in the capacity of a director of the Company as at the date of this Prospectus and as a result will not be statutorily liable for the contents of this Prospectus.

Executive Officers

The following table sets forth the names, places of residence, positions and years of service with the Company of each current executive officer of Boat Rocker. Additional biographical information for each individual is provided below.

Name and
Municipality of Residence	Position Held with Boat Rocker	Years with Boat Rocker(1)
David Fortier Toronto, Ontario, Canada	Co-Executive Chairman, Boat Rocker, Co-Chairman, Boat Rocker Studios and Director	17
Ivan Schneeberg Toronto, Ontario, Canada	Co-Executive Chairman, Boat Rocker, Co-Chairman, Boat Rocker Studios and Director	17
John Young Toronto, Ontario, Canada	Chief Executive Officer and Director	11
Michelle Abbott Toronto, Ontario, Canada	Chief Financial Officer	4
Cindy Brown Toronto, Ontario, Canada	Executive Vice President, Human Resources	3
Michel Pratte Toronto, Ontario, Canada	President , Boat Rocker, and General Manager, Boat Rocker Studios	12
Andrew Spergel Toronto, Ontario, Canada	Chief Investment Officer	2
Samantha Traub Toronto, Ontario, Canada	Chief Corporate Officer and General Counsel	13

_______________ Notes:

(1) Includes years with Boat Rocker and its predecessors.

Based on shareholdings as of the date of this Prospectus (assuming the completion of the Pre-Closing Capital Changes), the directors and executive officers of Boat Rocker as a group, beneficially own, or control or direct, directly or indirectly, approximately 9,644,469 Multiple Voting Shares and 459,097 Subordinate Voting Shares, representing approximately 27.1% of Boat Rocker's issued and outstanding Shares. One additional independent director is expected to be appointed within one year from the date of the final prospectus.

Biographical Information Regarding the Directors and Executive Officers

David Fortier, Co-Executive Chairman, Boat Rocker, Co-Chairman, Boat Rocker Studios and Director

David Fortier (along with Ivan Schneeberg) is the Co-Executive Chairman of the Company and Co-Chairman of Boat Rocker Studios. Fortier (together with Schneeberg) co-founded the Company in 2003. Together the pair originated and executive-produced dozens of televisions series, including the critically acclaimed, international commercial successes, Orphan Black, Being Erica, and The Next Step. From there, Fortier and Schneeberg went on to oversee the growth and transformation of the Company into a global entertainment company.

Fortier and Schneeberg were finalists for the Ernst & Young Entrepreneur of the Year award (Ontario) in 2012 and are the proud recipient of numerous industry awards for their work as executive producers in television, including the prestigious Peabody Award, which the pair accepted for Orphan Black.

Prior to founding the Company, Fortier was a lawyer in the Entertainment Group at Goodmans LLP. Fortier holds a Bachelor of Arts from McGill University and a Juris Doctor from the University of Toronto.

Ivan Schneeberg, Co-Executive Chairman, Boat Rocker, Co-Chairman, Boat Rocker Studios and Director

Ivan Schneeberg (along with David Fortier) is the Co-Executive Chairman of the Company and Co-Chairman of Boat Rocker Studios. Schneeberg (together with Fortier) co-founded the Company in 2003. Together the pair originated and executive-produced dozens of televisions series, including the critically acclaimed, international commercial successes, Orphan Black, Being Erica, and The Next Step. From there, Schneeberg and Fortier went on to oversee the growth and transformation of the Company into a global entertainment company.

Schneeberg and Fortier were finalists for the Ernst & Young Entrepreneur of the Year award (Ontario) in 2012 and are the proud recipient of numerous industry awards for their work as executive producers in television, including the prestigious Peabody Award, which the pair accepted for Orphan Black.

Prior to founding the Company, Schneeberg was a partner in the Entertainment Group at Goodmans LLP. In 2001, Schneeberg was named one of Canada's Top 40 lawyers under 40. Schneeberg holds a Bachelor of Laws from Western University.

John Young, Chief Executive Officer and Director

John Young is the Chief Executive Officer of the Company. He was born and raised in Scotland and graduated with an honours degree from the Law School at the University of Dundee. He also received a Diploma in Legal Practice from Glasgow University. Young brings 20 years of experience as a lawyer with a particular focus on mergers and acquisitions. Young was named one of Canada's top 40 in-house lawyers under 40. He is also a graduate of the Director's Governance College at University of Toronto's Rotman School of Business. Young is the Chair of the Board of the Academy of Canadian Cinema and Television, and a member of the Boards of SIR Corp. and Caldwell Partners. He is Co-Founder and Chair of the Board of Feeding Canadian Kids.

Quinn McLean, Director

Quinn McLean is a Vice President at Hamblin Watsa Investment Counsel, a wholly-owned subsidiary of Fairfax. He is responsible for the Fairfax insurance subsidiary investment portfolios in the Middle East/Turkey/North Africa (Gulf Insurance Group) and South Africa/Botswana (Bryte Insurance). McLean is currently on the board of directors of Gulf Insurance Group based in Kuwait, FarmersEdge Inc. (Winnipeg, Canada) and Helios Fairfax Partners Corporation (Toronto, Canada). McLean has been with Hamblin Watsa Investment Counsel since 2011. Initial work experience was in the public accounting profession including work in audit and tax. Subsequently McLean entered the investment management profession as an investment analyst working for an Institutional Investment Manager in Toronto, Canada focusing on international equities (Europe and Asia). He is a Chartered Professional Accountant (CA, CPA) and Chartered Financial Analyst (CFA designation).

Sangeeta Desai, Director (independent)

Sangeeta Desai has held leadership roles in the international content production and distribution industry, and currently serves on a number of listed and private boards globally. She is the chair of the board of directors of Mopar Media Group AB and is a non-executive director of Panther Media Group Ltd., Aurora Acquisition Corp. and Ocean Outdoor Ltd. She is also chair of the audit committee of the latter. Until 2018, she was Group Chief Operating Officer and Chief Executive Officer of Emerging Markets at Fremantle, and prior to that, she was Chief Operating Officer of Hit Entertainment Ltd. Prior to joining HIT Entertainment Ltd., Desai was a Principal at Apax Partners LLP investing in the media industry globally, and she began her career as an investment banker at Goldman Sachs Group Inc. and JP Morgan Chase & Co. She holds a Bachelor of Science in Business Administration from the Haas School of Business at the University of California, Berkeley and a Masters in Business Administration from the Wharton School at the University of Pennsylvania.

Katherine Cunningham, Director

Katherine Cunningham is the Chief Financial Officer at The Globe and Mail Inc., Canada's national newspaper, where she is responsible for strategy, corporate development and all aspects of financial management. Until 2019, she was a Senior Vice President at Sun Life Financial Inc., holding SVP Finance, Chief Financial Officer Canada, and Chief Auditor roles. Prior to joining Sun Life in 2014, Cunningham was an Audit Partner at KPMG Canada LLP in the Communications and Media and, later, Financial Services industries. She is a Chartered Professional Accountant (CPA, CA) and has a Bachelor of Commerce from Queen's University.

Michelle Abbott, Chief Financial Officer

Michelle Abbott is the Chief Financial Officer at the Company. She is a CPA, CA and holds a Bachelor of Commerce from Queen's University. Previously, she worked as Vice-President, Finance at Aastra Technologies Ltd., a developer and distributor of enterprise communications hardware and software in the telecom sector that was listed on the TSX. In that role, Abbott was involved in several global acquisitions, integrating the acquired finance teams, setting up new business processes and accounting policies, and coordinating the international audits. She was involved in the due diligence process as Aastra Technologies Ltd. was sold to Mitel Networks Corporation in January 2014. Additionally, Abbott was Vice-President, Finance of Arc Productions Ltd. from April 2016 until August 2016 and held roles at Deloitte & Touche and TMP Worldwide.

Cindy Brown, Executive Vice President, Human Resources

Cindy Brown leads Boat Rocker's human resources function globally and is responsible for all aspects of people and culture. Since joining the Company in 2017, Brown has built out the human resources function from the ground up and has supported the Company's ambitious growth through acquisition, successfully integrating newly acquired companies' talent, compensation, benefits and employment programs. Prior to joining Boat Rocker, Brown was with a chartered Canadian bank for many years in both business and human resources leadership roles, including as Director, Human Resources for the bank's Global Wealth Management business and as Director of Marketing for the bank's multi-billion dollar Canadian Mortgage business. Brown has a Bachelor of Arts from Ambassador University and obtained her CHRP designation through the Rotman School of Business at the University of Toronto. Outside of her work, Brown is a mentor to growth company executives through her affiliation with the Lazaridis Institute and Wilfrid Laurier University.

Michel Pratte, President, Boat Rocker and General Manager, Boat Rocker Studios

Michel Pratte is the President of the Company and General Manager of Boat Rocker Studios. He joined the Company in 2008 and has held multiple positions within the Company during his tenure. Pratte spearheaded Boat Rocker's expansion into original digital content and lead the Company's corporate development activity, including many key transactions and investments (the acquisitions of Jam Filled Entertainment, Matador Content, Untitled Entertainment and Platform One Media, as well as various venture investments). Prior to joining the Company, Pratte worked at the British House of Commons. Pratte has a Masters in International Political Economy from the London School of Economics, and an honours degree in economics and history from McGill University.

Andrew Spergel, Chief Investment Officer

Andrew Spergel is the Chief Investment Officer of the Company and oversees corporate development & strategy, including Boat Rocker Ventures, the Company's animation division and systems and infrastructure group. Andrew joined the Company in 2018 from Entertainment One, where he served as SVP of Corporate Development and Strategy and led numerous transactions and integration initiatives. Prior to working in the entertainment industry, Spergel was a management consultant at Bain & Company, where he focused on business transformations and mergers and acquisitions. Spergel holds a Masters in Business Administration from The Ivey School of Business at the University of Western Ontario and a Bachelor of Commerce from Dalhousie University.

Samantha Traub, Chief Corporate Officer and General Counsel

Samantha Traub provides leadership on all aspects of the business and operations of the Company. She oversees business & legal affairs, facilities, regulatory matters and governance for the Company. She acts as general counsel and provides leadership on strategic investments, acquisitions, partnerships and litigation matters. Traub is the Company's longest standing employee (other than the Co-Executive Chairmen). Prior to joining the Company in 2007, Traub practiced corporate and entertainment law at Goodmans LLP in Toronto and Sidley Austin LLP in New York City. Traub secured her law degree, with distinctions, from Osgoode Hall Law School in Toronto.

Cease Trade Orders, Bankruptcies, Penalties or Sanctions

None of Boat Rocker's directors and officers is, or within 10 years prior to the date of this Prospectus, has been, a director, chief executive officer or chief financial officer of any company (including Boat Rocker) that (i) was subject to a cease trade order, an order similar to a cease trade order, or an order that denied the relevant company access to any exemption under securities legislation, that was in effect for a period of more than 30 consecutive days, that was issued while the director or executive officer was acting in the capacity as director, chief executive officer or chief financial officer; or (ii) was subject to a cease trade order, an order similar to a cease trade order, or an order that denied the relevant company access to any exemption under securities legislation, that was in effect for a period of more than 30 consecutive days, that was issued after the director or executive officer ceased to be a director, chief executive officer or chief financial officer and which resulted from an event that occurred while that person was acting in the capacity as director, chief executive officer or chief financial officer.

Except as indicated below, none of Boat Rocker's directors and officers is, or within 10 years prior to the date of this Prospectus, has been, a director or executive officer of any company (including Boat Rocker) that (i) while that person was acting in that capacity, or within a year of that person ceasing to act in that capacity, became bankrupt, made a proposal under any legislation relating to bankruptcy or insolvency or was subject to or instituted any proceedings, arrangement or compromise with creditors or had a receiver, receiver manager or trustee appointed to hold its assets; or (ii) has, within 10 years prior to the date of this Prospectus, become bankrupt, made a proposal under any legislation relating to bankruptcy or insolvency, or become subject to or instituted any proceedings, arrangement or compromise with creditors, or had a receiver, receiver manager or trustee appointed to hold the assets of the director or executive officer. From April 2016 to August 2016, Michelle Abbott was Vice-President, Finance of Arc Productions Ltd., which was placed into receivership in August 2016. The Company acquired assets from Arc Productions Ltd. in that receivership process and Abbott was invited to join the Company at that time.

None of Boat Rocker's directors and officers has been subject to (i) any penalties or sanctions imposed by a court relating to securities legislation or by a securities regulatory authority or has entered into a settlement agreement with a securities regulatory authority; or (ii) any other penalties or sanctions imposed by a court or regulatory body that would likely be considered important to a reasonable securityholder in deciding whether to invest in Boat Rocker.

CORPORATE GOVERNANCE

Boat Rocker recognizes that good corporate governance will play an important role in its overall success and in enhancing Shareholder value and, accordingly, following Closing, Boat Rocker intends to adopt certain corporate governance policies and practices. Unless otherwise indicated, the following disclosure reflects the present expectations of the Company in respect of its corporate governance practices and assumes that the formal establishment of committees of the Board described below and the ratification and adoption of their respective proposed charters (without any material modifications) will occur following Closing. However, such disclosure remains subject to revision prior or subsequent to Closing. See "Caution Regarding Forward-Looking Statements" in this Prospectus.

Statement of Corporate Governance Practices

The Company's corporate governance disclosure obligations are set out in the Canadian Securities Administrators' NI 52-110, National Instrument 58-101 – Disclosure of Corporate Governance Practices ("NI 58- 101") as interpreted in National Policy 58-201 – Corporate Governance Guidelines ("NP 58-201"). These instruments set out a series of guidelines and requirements for effective corporate governance (collectively, the "Guidelines"). The Guidelines address matters such as the constitution and independence of corporate boards, the functions to be performed by boards and their committees and the effectiveness and education of board members. NI 58-101 requires the disclosure by each listed corporation of its approach to corporate governance with reference to the Guidelines.

Set out below is a description of the Company's anticipated approach to corporate governance in relation to the Guidelines.

Composition of the Board on Closing

The Board is to consist of up to seven directors as determined from time to time. At Closing, the Board will consist of six directors, two of whom are considered "independent" under Canadian securities laws. NI 52-110 defines "independence" as having no direct or indirect material relationship with the Company. A "material relationship" is in turn defined as a relationship which could, in the view of the Board, be reasonably expected to interfere with such member's independent judgment. In determining whether a particular director is an "independent director" or a "non-independent director", the Board considers the factual circumstances of each director in the context of the Guidelines.

Based on information provided by each director concerning their background, employment and affiliations, the Board has determined that David Fortier, Ivan Schneeberg, John Young, and Quinn McLean, will not be considered "independent" as defined under NI 52-110 as a result of their respective relationships with the Company.

The mandate of the Board is to provide governance and stewardship to the Company and its business. The Board delineates its role and responsibilities by maintaining regular communications with management, questioning and discussing the results of operations, and recommending strategic plans.

Co-Executive Chairmen

Following Closing, it is expected that the founders of the Company, Ivan Schneeberg and David Fortier, will serve as Co-Executive Chairmen of the Board. The Co-Executive Chairmen's primary roles, in relation to the Board, are to: (i) seek to ensure that appropriate structures and procedures are in place so that the Board may function independently of management; (ii) assist in setting the agenda for meetings of the Board and to preside over all Board meetings; and (iii) lead the process by which the directors seek to ensure that the Board represents and protects the interests of all Shareholders. The Co-Executive Chairmen provide leadership to the directors of the Company. The Company believes that having management as Co-Executive Chairmen of the Board will not impair the Co-Executive Chairmen's ability to provide leadership to the directors with the assistance of the Compensation, Nominating and Corporate Governance Committee.

Lead Director

As the Co-Executive Chairmen are not considered independent within the meaning of NI 58-201, the Board intends to appoint Sangeeta Desai as lead independent director (the "Lead Director") at or prior to Closing to provide leadership to the directors in discharging the Board's mandate, including by assisting the Co-Executive Chairmen in fulfilling their responsibilities. In the absence of both of the Co-Executive Chairmen, the Lead Director would serve as acting Chair, presiding over meetings of the Board and of Shareholders.

Meeting in-Camera

The Company intends to take steps to seek to ensure that adequate structures and processes are in place to permit the Board to function independently of management. Independent directors are expected to hold in-camera sessions without management present at Board meetings, if considered necessary. The Lead Director is expected to chair the in-camera meetings and encourage open and candid discussions among the independent directors by providing them with an opportunity to express their views on key topics before decisions are taken. Feedback from the in-camera sessions would then be brought to the attention of the Co-Executive Chairmen by one of the independent directors.

Diversity

Boat Rocker recognizes the importance and benefit of having a Board and executive and senior management comprised of highly talented and experienced individuals (i) who reflect the diversity of the Company's stakeholders, including its buyers, the viewers of its programming and employees and the changing demographics of the communities in which the Company operates; and (ii) having regard to the need to foster and promote diversity among Board members and executive and senior management with respect to, but not limited to, gender and sexual identities, indigenous identity, ethno-racial identity, place of origin, age and ability.

In support of these principles, it is expected that the Board and Compensation, Nominating and Corporate Governance Committee will seek to, when identifying candidates to nominate for election to the Board or appoint as executive or senior management:

consider individuals who are highly qualified, based on their talents, experience, functional expertise and personal skills, character and qualities having regard to the Company's current and future plans and objectives, as well as anticipated regulatory and market developments;
consider criteria that promote diversity, including, but not limited to, gender and sexual identities, indigenous identity, ethno-racial identity, place of origin, age and ability;
strive to ensure the Company has no less than 30% of the Board comprised of members who identify as women or, where there are fewer than eight members, no less than 25% of the Board;
consider the level of representation of women on the Board and in executive and senior management positions when making recommendations for nominees to the Board or for appointment as executive or senior management and in general with regard to succession planning for the Board and executive and senior management;
consider the level of representation of individuals with other attributes of diversity on the Board and in executive and senior management positions when making recommendations for nominees to the Board or for appointment as executive or senior management and in general with regard to succession planning for the Board and executive and senior management;
support and maintain an environment in which women can make an equitable contribution on the Board and in executive and senior management positions;
support and maintain an environment in which individuals with other attributes of diversity can make an equitable contribution on the Board and in executive and senior management positions;
increase the representation and contribution of racialized minorities on the Board and in executive and senior management positions;
where considered appropriate, engage qualified independent external advisors to assist the Company in conducting its search for candidates that meet the Board's criteria regarding skills, experience and diversity; and
where considered appropriate, engage qualified independent external advisors to assess the cultural competence of the Board and executive and senior management and provide access to development resources to increase the cultural competence and diversity of thought as it relates to the business.

Following Closing, it is expected that the Board will adopt a written diversity policy (the "Diversity Policy") consistent with the above. The Company will seek to promote the above stated objectives through the mechanisms set out in the Diversity Policy with a focus on identifying and fostering the development of a suitable pool of female and racialized candidates, as well as candidates that reflect other attributes of diversity, for nomination or appointment over time. Several of the individuals that will comprise the management team following Closing are women, including, among others, Michelle Abbott, Chief Financial Officer, Samantha Traub, Chief Corporate Officer and General Counsel and Cindy Brown, Executive Vice President, Human Resources. At or following Closing, two directors of the Company, or approximately 30% of the Board, will be women, and, as of Closing, three out of eight members of the Company's executive leadership team, or 37.5%, will be women, and 46% of the Company's senior leadership team will be women. The Company does not expect to adopt formal targets regarding the number of women in executive officer positions because the Compensation, Nominating and Corporate Governance Committee is expected to identify, evaluate and recommend candidates that, as a whole, consist of individuals with various and relevant career experience, industry knowledge and experience, and financial and other specialized experience, while taking diversity, including gender diversity, into account.

Position Descriptions

The Board has not adopted position descriptions for the Co-Executive Chairmen, the Lead Director or for the chairs of each of its committees. Each committee is expected to have a chair whose role it is to seek to ensure that the committee's mandate is followed, and to report to the Board. The Board has not adopted a position description for the Chief Executive Officer. The role of the Chief Executive Officer is to lead the Company.

Orientation and Continuing Education

It is expected that the Compensation, Nominating and Corporate Governance Committee will oversee an appropriate orientation for new Board members in order to familiarize them with the Company and its business (including the Company's reporting and organizational structure, strategic plans, significant financial, accounting and risk issues, compliance programs and policies, management and the external auditors), the role of the Board and its committees and the contribution that an individual director is expected to make to the Board, its committees (as applicable) and the Company. Further, it is expected that the Compensation, Nominating and Corporate Governance Committee will also periodically recommend to the Board (and coordinate the development of) continuing education activities or programs for directors, from time to time as appropriate, that shall, among other things, assist directors of the Company to maintain or enhance their skills and abilities as directors, and assist directors of the Company in ensuring that their knowledge and understanding of the Company and its business remains current.

In addition, Board members will be expected to keep themselves current with industry trends and developments and will be encouraged to communicate with management and, where applicable, auditors, advisors and other consultants of the Company. Board members will have access to the Company's in-house and external legal counsel in the event of any questions or matters relating to the Board members' corporate and director responsibilities and to keep themselves current with changes in legislation.

Ethical Business Conduct

The Board has not adopted a code of business conduct and ethics. The Board encourages and promotes an overall culture of ethical business conduct by promoting compliance with applicable laws, rules and regulations; providing guidance to directors, officers and other employees and consultants to help them recognize and deal with ethical issues; promoting a culture of open communication, honesty and accountability; and seeking to ensure an awareness of disciplinary action for violations of ethical business conduct.

Insider Trading Policy

Following Closing, the Board intends to adopt a policy relating to the trading in securities of the Company by, among others, directors (or the equivalent thereof), officers, employees, advisors and other insiders of the Company and its subsidiaries (the "Insider Trading Policy"). Among other things, the following are expected to be prohibited by the Insider Trading Policy: (i) speculating in securities of the Company; (ii) buying the Company's securities on margin; (iii) short selling a security of the Company or any other arrangement that results in a gain only if the value of the Company's securities declines in the future; (iv) trading in call or put options; and (v) purchasing any financial instruments designed to hedge or offset a decrease in the market value of the Company's securities. Consequently, the foregoing prohibitions in the expected Insider Trading Policy will not permit a Company executive officer or director to purchase financial instruments that are designed to hedge or offset a decrease in market value of the Company's equity securities granted as compensation or held, directly or indirectly, by an executive officer or director of the Company.

Director Term Limits/Mandatory Retirement

The Board intends to consider the matters of term limits and mandatory retirement. At this time, the Company does not expect that these types of policies would be appropriate for the Board. The Company believes that a rigorous self-evaluation process combined with input from an external third-party governance firm would be a more effective and transparent manner to ensure that the Company's directors add value and remain strong contributors.

Conflicts of Interest

Certain of the proposed directors and executive officers of Boat Rocker are or may become officers and directors of, or are associated with, other public and private companies. Such associations may give rise to conflicts of interest with Boat Rocker from time to time.

The Corporations Act requires, among other things, that the directors and executive officers of Boat Rocker act honestly and in good faith with a view to the best interest of Boat Rocker, to disclose any personal interest which they may have in any material contract or transaction which is proposed to be entered into with Boat Rocker and, in the case of directors, to abstain from attending any part of a meeting during which such material contract or transaction is discussed and from voting as a director for the approval of any such material contract or transaction. To the extent that conflicts of interest arise, such conflicts will be resolved in accordance with the provisions of the Corporations Act.

Directors' and Officers' Liability Insurance

Boat Rocker intends to carry a directors' and officers' liability insurance policy, which is designed to, subject to the terms and conditions thereof, protect Boat Rocker and its directors and officers against legal actions which may arise as a result of wrongful acts on the part of director and/or officers of Boat Rocker. Such policy is expected to be written with a maximum limit and be subject to a corporate deductible on all claims.

Committees of the Board

The Board will establish two committees: the Audit and Risk Committee and the Compensation, Nominating and Corporate Governance Committee.

Audit and Risk Committee

Overview

The Audit and Risk Committee will initially consist of Ivan Schneeberg, David Fortier and Sangeeta Desai, each of whom is financially literate within the meaning of NI 52-110 and Ms. Desai is independent within the meaning of NI 52-110. Immediately following Closing, it is expected that the Audit and Risk Committee will consist of three directors, a majority of whom are persons determined by the Board to be independent within the meaning of NI 52-110, and each of whom is financially literate within the meaning of NI 52-110. At such time, Ivan Schneeberg will be replaced by Katherine Cunningham as a member of the Audit and Risk Committee, who will act as chair of the Audit and Risk Committee. Each member of the Audit and Risk Committee is expected to have an understanding of the accounting principles used to prepare financial statements and varied experience as to the general application of such accounting principles, as well as an understanding of the internal controls and procedures necessary for financial reporting. The relevant education and experience of each member of the Audit and Risk Committee is described as part of their respective biographies above under "Directors and Executive Officers – Biographical Information Regarding the Directors and Executive Officers".

The Board intends to adopt a written charter for the Audit and Risk Committee, setting forth the Audit and Risk Committee's role in reviewing and approving the financial statements of Boat Rocker and public disclosure documents containing financial information and reporting on such review to the Board, seeking to ensure that adequate procedures are in place for the reviewing of Boat Rocker's public disclosure documents that contain financial information, overseeing the work and reviewing the independence of the external auditors, and overseeing the Company's risk management activities generally. The expected form of the written charter of the Audit and Risk Committee is set out in Appendix A.

The members of the Audit and Risk Committee will be appointed by the Board, and each member of the Audit and Risk Committee will serve at the request of the Board until the member resigns, is removed, or ceases to be a member of the Board.

Pre-Approval Policies and Procedures

All non-audit services to be provided by the Company's external auditor are required to be pre-approved by the Audit and Risk Committee. The Audit and Risk Committee may delegate authority to one or more independent members to grant pre-approvals of non-audit services, provided that any such pre-approvals will be presented to the full committee at its next scheduled meeting.

External Audit Service Fees

The fees billed to Boat Rocker by its external auditor for the financial years ended December 31, 2019 and 2018 were as follows:

Year	Audit Fees(1)	Audit-Related Fees(2)	Tax Fees(3)	All Other Fees(4)	Total
2019	\$889,705	\$121,462	\$147,375	\$250,302	\$1,408,845
2018	\$668,899	\$117,356	\$175,950	\$57,230	\$1,019,434

_______________ Notes:

(1) "Audit Fees" include the audits and interim reviews of Boat Rocker's financial statements during the 12 months ended December 31, 2019 and 2018, as well as prospectus-related assistance to the Underwriters and related procedures in connection with the Offering.

(2) "Audit Related Fees" include support provided in due diligence matters.

(3) Fees for tax compliance, tax advice and tax planning.

(4) All other fees not included above.

Compensation, Nominating and Corporate Governance Committee

It is expected that the Compensation, Nominating and Corporate Governance Committee will be formed at Closing and will consist of three directors, a majority of whom will be "independent directors" (within the meaning of NI 58-201). It is expected that Sangeeta Desai will be appointed as chair of the Compensation, Nominating and Corporate Governance Committee. The Compensation, Nominating and Corporate Governance Committee will conduct its business, subject to the Principal Shareholders Agreement, on the basis of majority approval, encouraging an objective process for determining compensation.

The Compensation, Nominating and Corporate Governance Committee's role is expected to include assisting the Board in relation to: (i) the appointment, evaluation and compensation of named executive officers of the Company; (ii) the recruitment, development and retention of senior executives of the Company; (iii) maintaining talent management and succession planning systems and processes relating to senior executives of the Company; (iv) developing the compensation structure for senior executives of the Company including salaries, annual and long-term incentive plans including plans involving share issuances and other share-based awards; (v) establishing policies and procedures designed to identify and mitigate risks associated with the Company's compensation policies and practices; (vi) assessing the compensation of directors; (vii) developing corporate governance guidelines and principles for the Company and providing the Company with governance leadership; (viii) identifying individuals qualified to be nominated as members of the Board; (ix) reviewing and consulting with the nominating Principal Shareholder on all proposed independent director nominees; (x) proposing amendments to the Company's policies on diversity for consideration by the Board; (xi) monitoring compliance with Company policies and initiating investigations of reported violations; (xii) reviewing the structure, composition and mandate of committees of the Board; and (xiii) evaluating the performance and effectiveness of the Board and of committees of the Board.

The Compensation, Nominating and Corporate Governance Committee is also expected to, subject to any contractual agreements, annually review and assess the size, composition and operation of the Board to ensure effective decision making and annually review and assess the size, composition and Chairs of all of the committees of the Board. Following Closing, the Company intends to develop and implement policies surrounding board assessment.

The members of the Compensation, Nominating and Corporate Governance Committee will be appointed by the Board, and each member of the Compensation, Nominating and Corporate Governance Committee will serve at the request of the Board until the member resigns, is removed, or ceases to be a member of the Board.

EXECUTIVE COMPENSATION

Introduction

The following discussion describes the significant elements of the compensation of the Company's Co-Executive Chairmen, Chief Executive Officer, President and Chief Financial Officer (collectively, the "named executive officers") namely:

David Fortier, Co-Executive Chairman, Boat Rocker and Co-Chairman, Boat Rocker Studios;
Ivan Schneeberg, Co-Executive Chairman, Boat Rocker and Co-Chairman, Boat Rocker Studios;
John Young, Chief Executive Officer;
Michel Pratte, President, Boat Rocker and General Manager, Boat Rocker Studios; and
Michelle Abbott, Chief Financial Officer.

Compensation Discussion and Analysis

Overview

The Compensation, Nominating and Corporate Governance Committee, in consultation with the Co-Executive Chairmen and the Chief Executive Officer, will be responsible for establishing, reviewing and overseeing the compensation policies of the Company and compensation of the named executive officers. The Company's executive compensation program is designed to attract, retain and motivate highly qualified executives while also aligning the interests of the executives with the Company's Shareholders.

It is anticipated that the Co-Executive Chairmen and the Chief Executive Officer will make recommendations to the Compensation, Nominating and Corporate Governance Committee each year with respect to the compensation for named executive officers in consideration of the executive's performance during the year as well as the performance of the Company. The Compensation, Nominating and Corporate Governance Committee will review the recommendations of the Co-Executive Chairmen and the Chief Executive Officer in determining whether to make a recommendation to the Board or recommend any further changes to compensation for the executives. In addition, the Compensation, Nominating and Corporate Governance Committee will annually review and make recommendations to the Board regarding the compensation for the Co-Executive Chairmen and the Chief Executive Officer.

Compensation Risk

In reviewing the compensation policies and practices of the Company each year, the Compensation, Nominating and Corporate Governance Committee will seek to ensure the executive compensation program provides an appropriate balance of risk and reward consistent with the risk profile of the Company. The Compensation, Nominating and Corporate Governance Committee will also seek to ensure the Company's compensation practices do not encourage excessive risk-taking behaviour by the executive team. The Company's long-term incentive plan has been designed to focus on the long-term performance of the Company, which discourages executives from taking excessive risks in order to achieve short-term, unsustainable performance.

The Company expects to adopt a standalone clawback policy relating to annual bonus payments and awards granted under the Company's Equity Incentive Plan to executives, including named executive officers, that may be triggered if an executive engages in misconduct that results in the need to restate the Company's financial statements where the individual received a bonus or award calculated on the achievement of those financial statements and where such bonus or award received would have been lower had the financial statements been properly reported.

All of the Company's executives, including the named executive officers, directors and employees will be subject to the Company's Insider Trading Policy, which will prohibit trading in the securities of the Company while in possession of material undisclosed information about the Company. Under the Insider Trading Policy, such individuals will also be prohibited from entering into certain types of hedging transactions involving the securities of the Company, such as short sales, puts and calls. Furthermore, the Company will permit executives, including the named executive officers, to trade in the Company's securities, including the exercise of options, only during prescribed trading windows. See "Corporate Governance – Insider Trading Policy".

Principal Elements of Compensation

The compensation of the named executive officers will include three major elements: (i) base salary; (ii) an annual bonus; and (iii) long-term equity incentives, consisting of awards granted from time to time under the Company's equity incentive plan (the "Equity Incentive Plan"). Perquisites and personal benefits are not a significant element of compensation of the named executive officers.

Base Salaries

A primary element of the Company's compensation program is base salary. The Company's view is that a competitive base salary is a necessary element for attracting and retaining qualified executive officers. The amount payable to a named executive officer is determined based on the scope of their responsibilities and prior experience, while taking into account competitive market compensation and overall market demand for such executives at the time of hire.

Base salaries are reviewed annually and increased for merit reasons based on the executive's success in meeting or exceeding Company and individual objectives. Additionally, base salaries can be adjusted as warranted throughout the year to reflect promotions or other changes in the scope or breadth of an executive's role or responsibilities, as well as for market competitiveness.

Annual Bonuses

Annual bonuses are designed to motivate executive officers to meet the Company's business objectives generally and the Company's annual financial performance targets in particular. Annual bonuses are earned and measured with reference to the Company's Adjusted EBITDA and, where applicable, that of any specific division(s) for which the applicable executive officer has responsibility. Annual bonus targets are set as a percentage of the relevant individuals' base salary, which varies based on his or her position level – up to a maximum of 50% to 150% of base salary in the case of named executive officers, if maximum financial performance targets are achieved. The Company sets Adjusted EBITDA targets in connection with the annual budget process to ensure that bonus targets will only be achieved if Adjusted EBITDA results are an improvement over prior year and/or budget. The Company currently makes these bonus payments in cash and anticipates continuing to do so following Closing.

Long-term Incentives

Overview

On Closing, the Company intends to adopt the Equity Incentive Plan under which grants of equity-based entitlements may be made. The key features of the Equity Incentive Plan are described below.

Equity Incentive Plan

On Closing, the Company intends to adopt the Equity Incentive Plan to supplement the Company's cashbased incentive compensation arrangements and to replace the Legacy EPP and Legacy RSU Plan. Following Closing, the Legacy EPP and Legacy RSU Plan will remain in effect but no further grants will be made thereunder. Under the Equity Incentive Plan, the directors, officers, employees and independent contractors (directly or indirectly through a corporation or other person) of the Company and any Designated Subsidiary (collectively, "Eligible Participants") are eligible, subject to the restrictions described below, to receive awards in the form of options to purchase Subordinate Voting Shares ("Options"), restricted share units ("RSUs"), performance share units ("PSUs") and deferred share units ("DSUs", and, together with Options, RSUs, and PSUs, "Awards"). However, directors who are not employees of the Company shall not be eligible to be granted RSUs or PSUs pursuant to the Equity Incentive Plan, and only independent directors are eligible to be granted DSUs under the Equity Incentive Plan.

Under the terms of the Equity Incentive Plan, the Board (or if authorized by the Board, any committee of the Board) may grant Awards to Eligible Participants. Participation in the Equity Incentive Plan is voluntary and, if an Eligible Participant agrees to participate, the grant of Awards will be evidenced by an Award agreement with each such Eligible Participant. The interest of any Eligible Participant in any Award is not assignable or transferable, whether voluntary or involuntary, other than by will, the laws of descent, or by the designation of a beneficiary by such Eligible Participant pursuant to the terms of the Equity Incentive Plan.

Unless otherwise determined by the Board in its sole discretion or as may otherwise be set out in the applicable Award agreement, on the payment date for cash dividends paid on Subordinate Voting Shares, each Eligible Participant's "Restricted Share Unit Account", "Performance Share Unit Account" and/or "Deferred Share Unit Account" (each as defined in the Equity Incentive Plan), as applicable, shall be credited with additional RSUs, PSUs or DSUs, as applicable, in respect of such Awards credited to and outstanding in the Eligible Participant's account(s) as of the record date for payment of such dividends.

The Equity Incentive Plan will provide that, in the event that the Board determines that any dividend or other distribution (whether in the form of cash, Shares, other securities or other property), recapitalization, share split, share dividend, reverse share split, reorganization, merger, consolidation, split-up, spin-off, combination, repurchase or exchange of Shares or other securities of the Company, issuance of warrants or others rights to purchase Shares or other securities of the Company, or other similar corporate transactions or events affect the Shares (which effect is not contemplated by the terms of the Equity Incentive Plan) such that an adjustment is appropriate in order to prevent dilution or enlargement of benefits or potential benefits under the Equity Incentive Plan and/ or any Awards, then the Board may, subject to approval of any applicable stock exchanges in certain circumstances, adjust any or all of: (1) the number and kind of Subordinate Voting Shares or other securities which thereafter may be made the subject of Awards; (2) the number and kind of Subordinate Voting Shares or other securities subject to outstanding Awards; and (3) the fair market value or the grant or exercise price with respect to any Award; or, if deemed appropriate, take such other action as the Board deems fit. In connection with any adjustment undertaken by the Board, as described above, the number of Subordinate Voting Shares subject to any Award denominated in Subordinate Voting Shares will always be rounded down to a whole number. The Equity Incentive Plan is considered an "evergreen" plan, as all of the Subordinate Voting Shares covered by the exercised, cancelled or terminated Awards will automatically become available Subordinate Voting Shares for the purposes of Awards that may be subsequently granted under the Equity Incentive Plan.

The maximum number of Subordinate Voting Shares available for issuance under the Equity Incentive Plan, together with Subordinate Voting Shares issuable pursuant to all other security-based compensation arrangements of the Company (which shall not include purely cash-based compensation arrangements) shall not exceed 9% of the total issued and outstanding Shares from time to time calculated on a non-diluted basis.

The maximum number of securities of the Company that may be: (i) issuable to insiders of the Company at any time; and (ii) issued to insiders of the Company within any one year period, in each case, under the Equity Incentive Plan alone, or when combined with all of the Company's other security-based compensation arrangements, shall not exceed 9% of the total issued and outstanding Shares from time to time (calculated on a nondiluted basis), subject to permitted adjustments. Additionally, the value of all Awards and all other security-based compensation arrangements of the Company issuable to any one director who is not an employee within any one year period shall not exceed a grant value (as reasonably determined by the Board) of \$100,000 of Options and \$150,000 in total equity.

When granting RSUs, PSUs and Options under the Equity Incentive Plan, each of which are subject to certain vesting conditions, the Board determines the parameters of such Awards, including, in the case of Options, the exercise price and the expiry date, provided that the minimum exercise price shall not be less than the Fair Market Value of a Subordinate Voting Share on the date of grant of that Option. Vested RSUs and vested PSUs shall be exercisable until the 10th anniversary of the date of grant, subject to earlier termination as described below and subject to the terms of the applicable Award agreement. In order to facilitate the payment of the exercise price of the Options, the Equity Incentive Plan will have a cashless exercise feature pursuant to which an Eligible Participant may elect to undertake a "net exercise" subject to the procedures set out in the Equity Incentive Plan and applicable withholding taxes. Notwithstanding the above, any RSUs or PSUs issued to an Eligible Participant who is a United States citizen or United States resident alien as defined for purposes of Section 7701(b)(1)(A) of the Internal Revenue Code of 1986, as amended, shall be settled within 60 days following the earlier of (i) the applicable vesting date of the Award, which shall be set forth in writing in the applicable Award Agreement, or (ii) any deemed vesting date as determined by the Board, in the event of a Change of Control, termination of employment or other circumstance.

Only independent directors are eligible to be granted DSUs under the Equity Incentive Plan. A DSU is a unit, equivalent in value to a Subordinate Voting Share, credited by means of a bookkeeping entry in the books of the Company, to an account in the name of the director. DSUs granted under the Equity Incentive Plan will vest immediately upon grant and may not be exercised until the earlier of the date that the applicable Eligible Participant ceases to be a director of Boat Rocker or all corporations related to Boat Rocker (within the meaning of the Tax Act), or the death of the Eligible Participant. DSUs may be exercised in exchange for Subordinate Voting Shares, or, if permitted by the Board (in its sole discretion), redeemed in exchange for cash.

The Equity Incentive Plan will provide that the exercise period for Awards shall automatically be extended if the date on which the exercise period is scheduled to terminate will occur during an applicable black-out period or within 10 business days after the expiry of an applicable black-out period. In such cases, the extended exercise period shall terminate 10 business days after the last day of the applicable black-out period (provided that, for U.S. taxpayers such extension does not violate Section 409A of the Internal Revenue Code of 1986, as amended), provided, however, that in the case of DSUs, the expiry date of the exercise period may not be later than December 31st of the first calendar year commencing after the earlier of (i) the death of the applicable Eligible Participant, and (ii) the time the applicable Eligible Participant ceases to be an employee, officer or director of the Company.

As outlined in "Director Compensation", it is expected that independent directors will receive 50% of their annual retainer in DSUs. Additionally, under the Equity Incentive Plan, such independent directors may irrevocably elect, no later than December 15th of each calendar year, to receive all or a portion of his or her remaining compensation for serving on the Board and on any applicable committee earned in respect of the calendar year following the date of the election, to be satisfied by way of DSUs, subject to the limits on total grant value described above.

The following table describes the impact of certain events upon the rights of holders of Awards, including termination for cause, voluntary resignation, retirement from active employment (as reasonably determined by the Company), termination other than for cause, and death and long-term disability, subject to the terms of an Eligible Participant's employment agreement, Award agreement, and the change of control provisions described below.

Options

Event Provision	Provisions
Termination for cause	Immediate forfeiture of all vested and unvested Options.
Resignation, retirement and termination other than for cause	Forfeiture of all outstanding unvested Options upon the date of termination. All vested Options will remain exercisable until the earlier of (i) the date which is three months following the date of termination, and (ii) the expiry date of the applicable vested Option.
Death or long-term disability	Forfeiture of all outstanding unvested Options, other than those Options which would have otherwise vested within 12 months following the date of death or long-term disability (such Options are then deemed to have vested). All vested Options shall remain exercisable until the earlier of (i) 12 months following the date of death or long-term disability, and (ii) the expiry date of the applicable vested Option.

RSUs and PSUs

Event Provision	Provisions
Termination for cause or voluntary resignation	Immediate forfeiture of all vested and unvested RSUs and PSUs.
Termination without cause	RSUs and PSUs will continue to vest in accordance with the Equity Incentive Plan and the applicable Award agreements, until the earlier of: (i) the end of any notice period given to the applicable Eligible Participant in connection with the Eligible Participant's termination, and (ii) the expiry of the applicable exercise period of the RSU or PSU, except that (a) in the event that any PSUs are subject to performance criteria the Board shall consider and determine the extent of satisfaction of such performance criteria in determining the number of PSUs that shall be eligible for vesting and exercise, and (b) any RSUs or PSUs which would not vest and be exercisable within the above noted time periods will be immediately forfeited.
Death, long-term disability or retirement	RSUs and PSUs will continue to vest in accordance with the terms of the Equity Incentive Plan and the applicable Award agreements.

The Equity Incentive Plan provides that, if a Change of Control occurs, or the Company has entered into an agreement relating to a transaction which, if completed, would result in a Change of Control, and unless otherwise provided in an Award agreement or a written contract between the Company or Designated Subsidiary and a participate, the Board may provide that: (i) the vesting and/or expiry date, as applicable, of any or all outstanding Options are accelerated and, notwithstanding the vesting provisions of such Options or any underlying option Award agreement, such designated outstanding Options shall be conditionally fully vested and exercisable upon (or prior to) the completion of the Change of Control, provided that the Board shall not authorize the exercise of Options beyond the expiry date; (ii) the successor corporation or entity will assume each Award or replace it with a substitute Award on terms substantially similar to the existing Award; (iii) at the option of the holder, the Awards will be surrendered for a cash payment made by the Company or successor corporation or entity equal to the Fair Market Value thereof as of the date of the Change of Control; or (iv) any combination of the foregoing will occur, provided that the replacement of any Option held by a Canadian resident or non-Canadian resident performing services in Canada with a substitute Option shall, at all times, comply with the provisions of subsection 7(1.4) of the Tax Act, and the replacement of any Award with a substitute Option, substitute RSU or substitute PSU shall be such that the substitute Award shall continuously be governed by section 7 of the Tax Act. If, pursuant to (i), the Board elects to accelerate the vesting and/or the expiry date, as applicable, of an Option, then if any of such Options are not conditionally exercised within seven days after the affected holders are given written notice of the effect of the anticipated Change of Control on the outstanding Options (or such later expiry date as the Board may prescribe), such unexercised Options shall, unless the Board otherwise determines, terminate and expire at the time of completion of the Change of Control. If, for any reason, the Change of Control does not occur, the acceleration of

the vesting and/or the Expiry Date of the Options, as applicable, shall be retracted and shall instead revert to the manner provided in the Equity Incentive Plan and the underlying option Award agreement, as applicable.

The Board may, in its sole discretion, suspend, terminate, amend or revise the Equity Incentive Plan at any time or amend or revise any Award agreement, provided that such actions shall, unless required by applicable law, securities regulators or the TSX: (i) not adversely alter or impair any Award previously granted, except as permitted by the terms of the Equity Incentive Plan or with the consent of the applicable holder(s); and (ii) be in compliance with applicable law and be completed with all necessary approvals from the Shareholders, applicable stock exchanges or otherwise.

The Equity Incentive Plan specifies certain types of amendments which may be made without Shareholder approval, including (i) a change to the termination provisions of Options which does not entail an extension beyond the original expiry date; (ii) an amendment of the Equity Incentive Plan or an Award agreement as necessary to comply with applicable law or the requirements of any exchange upon which the securities of the Company are then listed or any other regulatory body having authority over the Company, the Equity Incentive Plan, the Eligible Participants or the Shareholders; (iii) any amendment of a "housekeeping" nature, including, without limitation, those made to clarify the meaning of an existing provision of the Equity Incentive Plan or any Award agreement, to correct or supplement any provision of the Equity Incentive Plan that is inconsistent with the other provisions of the Equity Incentive Plan or any Award agreement, or to correct any grammatical or typographical error contained in the Equity Incentive Plan; (iv) amend the definitions in the Equity Incentive Plan regarding administration of the Equity Incentive Plan; or (v) any amendment regarding the administration of the Equity Incentive Plan.

Notwithstanding the above, without the approval of the Shareholders, no amendment can be made that would, among other things: (i) increase the maximum number of Subordinate Voting Shares that may be issuable pursuant to Awards under the Equity Incentive Plan, subject to certain permitted adjustments; (ii) reduce the exercise price of an Award benefitting an insider of the Company, subject to certain permitted adjustments; (iii) extend the exercise date of an Award benefitting an insider of the Company, except in the case of an extension due to a black-out restriction period; (iv) remove or increase the insider participation limits; or (v) amend the amendment provision in the Equity Incentive Plan.

Summary Compensation Table

The following table sets out information concerning the expected fiscal 2021 compensation to be earned by, paid to, or awarded to the named executive officers.

					Non-Equity Incentive Plan Compensation (\$)
Name and Principal Position Year	Salary (\$)(1)	Share Based Awards (\$)(4)	Option Based Awards (\$)(5)	Annual Incentive Plans (\$)(9)	Long Term Incentive Plans	Pension Value (\$)(11)	All Other Compensation (\$)(12)	Total Compensation (\$)
David Fortier, Co Executive Chairman, Boat Rocker, Co Chairman, Boat Rocker Studios and Director	2021	600,000(2)	2,183,227(6)	–	300,000	–	–	–	3,083,227
Ivan Schneeberg, Co Executive Chairman, Boat Rocker, Co Chairman, Boat Rocker Studios and Director	2021	600,000(2)	2,183,227(6)	–	300,000	–	–	–	3,083,227
John Young, Chief Executive Officer	2021	600,000(2)	2,183,227(6)	–	300,000	–	–	–	3,083,227
Michel Pratte, President, Boat Rocker and General Manager, Boat Rocker Studios	2021	570,780(3)	(7) 2,319,367	–	285,390(10)	–	–	–	3,175,537
Michelle Abbott, Chief Financial Officer	2021	330,000	165,000(8)	165,000	82,500	–	–	–	742,500

Notes:

______________

(1) Represents the annualized base salary expected to be paid in fiscal year 2021.

(2) Assumes completion of the Offering.

(3) Represents an annualized base salary of US\$450,000 converted into Canadian dollars at the Bank of Canada exchange rate on February 16, 2021 of US\$1.00 = C\$1.2684.
(4) Amounts reported for PSUs, which vest over a five-year period and are subject to certain performance vesting conditions, represent the grant date fair value as determined based on the most-likely scenario, using a Black-Scholes and Monte Carlo Simulation. The values are derived at a point in time and will be different than the value upon vesting. The grant date fair value of the RSUs, which are subject to a three-year vesting period, is based on the Offering Price.

(5) The grant date fair value of option awards was calculated using the Black-Scholes model. The Black-Scholes factor has been determined using vesting over three years, 10 years expected life, a volatility of 50% and a risk free interest rate of 0.45%.

(6) On Closing, each of Fortier, Schneeberg and Young will be granted 301,512 PSUs (equivalent to 0.6% of the issued and outstanding Shares on a non-diluted basis assuming an Offering of \$175,000,000 and an Offering Price of \$13.00, the midpoint of the estimated price range set forth on the cover page of this Prospectus), which vest over a five-year period and are subject to certain vesting conditions, under the Equity Incentive Plan.
(7) On Closing, Michel Pratte will be granted 251,261 PSUs (equivalent to 0.5% of the issued and outstanding Shares on a non-diluted basis assuming an Offering of \$175,000,000 and an Offering Price of \$13.00, the midpoint of the estimated price range set forth on the cover page of this Prospectus) and 38,462 RSUs, each of which are subject to certain vesting conditions, under the Equity Incentive Plan.

(8) On Closing, Michelle Abbott will be granted 12,692 RSUs, which are subject to certain vesting conditions, under the Equity Incentive Plan.

(9) Amounts reflect the threshold bonuses anticipated to be awarded to named executive officers in fiscal year 2021. The actual amount of bonuses paid in respect of fiscal year 2021 may be higher or lower depending on the achievement of certain performance targets. In fiscal 2021, the threshold opportunity for each of Fortier, Schneeberg, Young and Pratte is 50% of their base salary, which will be adjusted based on the achievement of performance objectives such that the bonus opportunity shall be 100% and 150% of their base salary, upon achievement of "Target" and "Maximum" performance respectively. Abbott's threshold opportunity is 25% of her base salary, which will be adjusted based on the achievement of performance objectives such that the bonus opportunity shall be 50% and 75% of her base salary, upon achievement of "Target" and "Maximum" performance, respectively.
(10) Compensation is paid to Michel Pratte in U.S. dollars which has been converted into Canadian dollars at the Bank of Canada exchange rate on February 16, 2021 of US\$1.00 = C\$1.2684.

⁽¹¹⁾ The Company does not currently offer a pension plan.

(12) None of the Company's named executive officers are entitled to perquisites or other personal benefits which, in the aggregate, are worth over \$50,000 or over 10% of their base salary.

Employment Agreements, Termination and Change of Control Benefits

The Company has written employment agreements with each of its named executive officers other than Michel Pratte, who is subject to an oral employment agreement. On or prior to Closing, the Company intends to amend the employment agreements for each of David Fortier, Ivan Schneeberg, John Young and Michelle Abbott and enter into a written employment agreement with Michel Pratte. Each executive is entitled to receive compensation established by the Company as well as other benefits in accordance with plans available to the most senior employees (including health, dental, life insurance, accidental death and dismemberment, sick days and shortterm disability and long-term disability). The Company's named executive officer employment contracts do not contain any provisions relating to a change of control. For a summary of the change of control benefit provisions provided under the Company's long-term incentive plan, see "Executive Compensation – Principal Elements of Compensation – Long-Term Incentives".

David Fortier and Ivan Schneeberg, Co-Executive Chairmen, Boat Rocker and Co-Chairmen, Boat Rocker Studios and John Young, Chief Executive Officer

Under the Company's written employment agreements with each of Fortier, Schneeberg, and Young, as amended, they will each be entitled to an annual base salary of \$600,000 per annum upon completion of the Offering. In addition, each of Fortier, Schneeberg and Young will be eligible for an annual bonus of up to a maximum of 150% of their respective base salary, subject to achievement of certain performance targets as established by the Board at its discretion.

Each of Fortier, Schneeberg, and Young will be entitled to participate as an executive member in the group benefit plans offered to the most senior employees of the Company and will also be entitled to five weeks paid vacation per annum, pro-rated for partial years. In accordance with the Company's vacation policy and subject to the ESA, up to five unused vacation days may be carried forward to be used during the subsequent fiscal year. Each of Fortier, Schneeberg, and Young will be covered under the Company's director & officer insurance policy and will be entitled to the reimbursement of all reasonable out-of-pocket expenses incurred or paid by them in connection with their respective employment agreement. Each of Fortier, Schneeberg, and Young will also be eligible to participate in equity incentive plans established by the Company and approved by the Board from time to time, including the Equity Incentive Plan. During their respective terms of employment with the Company, each of Fortier, Schneeberg, and Young will be permitted to serve on the boards of directors of up to an aggregate of four private or public companies or charitable organizations, subject to the approval of the Board of each such position.

The Company may terminate any of Fortier, Schneeberg or Young's employment agreements at any time, without cause, by providing them with notice of termination. If any of Fortier, Schneeberg or Young's employment is terminated without cause or if any one or more of them resigns for good reason (each term as defined in their respective employment agreement), Fortier, Schneeberg, or Young, respectively, will be entitled to receive a lump sum payment from the Company equal to 24 months of their base salary, the maximum bonus for a 12-month period, and payment in respect of any unpaid base salary and accrued unused vacation pay which they have earned as of the termination date. In this event, their respective entitlement under any Company incentive plans, including the Equity Incentive Plan, shall be determined in accordance with the provisions of such plans and any applicable agreements thereunder. The Company will continue life, health and dental insurance coverage in accordance with any applicable benefits program for 24 months following the date of termination.

If any of Fortier's, Schneeberg's, or Young's employment is terminated for cause or due to their resignation without good reason, death or incapacity, the terminated executive, or their estate, as applicable, will be entitled to accrued but unpaid base salary pro-rated up to the termination date including payment in respect of any accrued but unused vacation, the reimbursement of expenses properly incurred in the course of their respective employment up to the termination date, their entitlements under any Company incentive plans, and any additional payments required by the ESA. Fortier's, Schneeberg's, and Young's entitlements upon termination are conditioned on their respective execution of a release of all claims related to employment and termination of employment and any compensation therefor. The employment term of each of Fortier, Schneeberg, and Young continues indefinitely unless their respective agreement is terminated. Each of Fortier, Schneeberg, and Young may terminate their respective employment with the Company upon giving the Company 90 days' notice of resignation of their

employment. In this event, the Company has the option of requiring the terminating executive to terminate its employment immediately.

The employment agreements of each of Fortier, Schneeberg, and Young will also contain customary confidentiality covenants and certain restrictive covenants, including non-solicitation and non-competition provisions, that will continue to apply following the date that any of them cease to be an employee of the Company. The non-competition obligations for each of Fortier, Schneeberg, and Young cease to apply 12 months following the termination of their respective employment for any reason. This includes non-solicitation and non-competition provisions in effect during the term of their employment that will continue to apply following the termination of their employment for a period of 12 months.

Michel Pratte, President, Boat Rocker and General Manager, Boat Rocker Studios

A written employment agreement with Michel Pratte is expected to be entered into on or prior to Closing. The Company is in the process of negotiating the terms of such employment agreement. Below is a summary of the material terms expected to be included in the employment agreement; however such terms remain subject to change.

Under the Company's written employment agreement with Pratte, Pratte is expected to be entitled to an annual salary of US\$450,000. In addition Pratte is expected to be eligible for an annual bonus of up to a maximum of 150% of his base salary, subject to achievement of certain performance targets as established by the Board at its discretion. Pratte is expected to be entitled to participate in any benefits, such as group extended health, dental, accidental death and dismemberment, and life insurance, which the Company offers to its employees. Pratte is also expected to be eligible to participate in equity incentive plans established by the Company and approved by the Board from time to time, including the Equity Incentive Plan, consistent with other senior executives of the Company. He is expected to be entitled to five weeks paid vacation per annum. In accordance with the Company's vacation policy and subject to the ESA, up to five unused vacation days may be carried forward to be used during the subsequent fiscal year. Pratte is also expected to be entitled to a cell phone/PDA reimbursement of up to US\$178 per month.

The Company may terminate Pratte's employment at any time without cause (as such term will be defined in his employment agreement) by providing him with written notice of termination. If Pratte's employment is terminated without cause, the Company will be required to pay to Pratte:

(a) an amount equal to his accrued but unpaid salary pro-rated to the termination date plus cell phone/PDA expenses and unused vacation pay accrued up to the end of the minimum statutory notice period required under the ESA; plus
(b) continued payments of Pratte's base salary for a period of 18 months (the "Pratte Notice Period"); plus
(c) an amount equal to 12 months of bonus, determined based on his two-year historic rolling average bonus, up to a maximum of the value of 12 months of Pratte's bonus; plus
(d) an amount equal to his two-year historic rolling average bonus, divided by 12 and multiplied by the number of months (including partial months) in the bonus year in which he was actively employed.

In this event, if Pratte's 2020 bonus is included in the calculations in (c) or (d) above, solely for the purpose of the calculation in (c) and (d), Pratte's 2020 bonus shall not be less than \$596,700. In addition, in the event Pratte's employment is terminated without cause, his entitlements under any Company incentive plans, including the Equity Incentive Plan, are expected to be treated in accordance with the terms of such plans and any applicable agreements thereunder. Pratte is expected to be entitled to benefits continuation for the Pratte Notice Period.

Pratte's employment may be terminated for cause by providing Pratte with only his minimum applicable entitlements under the ESA. Pratte may terminate his employment with the Company upon giving the Company 90 days' notice of resignation of his employment. In this event, the Company will have the option of requiring Pratte to work out the notice of resignation period, but in the case that the Company does not require this, Pratte will still receive his salary and benefits for the full notice of resignation period. Upon the effective date of Pratte's

resignation, the Company shall not be obligated to make any further payments other than any minimum entitlements required by the ESA.

Pratte's employment agreement is also expected to contain customary confidentiality arrangements and certain restrictive covenants that will continue to apply following termination of his employment. This is expected to include a non-solicitation and non-competition provisions in effect during the term of his employment that will continue to apply following the termination of his employment for a period of six months.

Pratte's employment term will continue indefinitely unless the agreement is terminated.

Michelle Abbott, Chief Financial Officer

Under the Company's written employment agreement with Abbott, as amended, Abbott will be entitled to an annual base salary of \$330,000 per annum. In addition, Abbott will be eligible for an annual bonus of up to a maximum of 75% of her base salary, subject to achievement of certain performance targets as established by the Board at its discretion.

Abbott will be entitled to participate in any benefits, such as group extended health, dental, accidental death and dismemberment, and life insurance, which the Company offers to its employees. Abbott will also be eligible to participate in equity incentive plans established by the Company and approved by the Board from time to time, including the Equity Incentive Plan, consistent with other senior executives of the Company. She will be entitled to 4.5 weeks paid vacation days per annum. In accordance with the Company's vacation policy and subject to the ESA, up to five unused vacation days may be carried forward to be used during the subsequent fiscal year. The Company shall reimburse Abbott's CPA membership dues and required CPA professional development costs to the extent required to fulfill her duties to the Company, provided she has first received the Company's approval for reimbursement of any professional development courses. Abbott will be covered under the Company's directors' and officers' liability policy pursuant to its terms. Abbott will also be entitled to a parking allowance of \$200 per month and a cell phone/PDA reimbursement of up to \$100 per month.

The Company may terminate Abbott's employment at any time without cause (as defined in her employment agreement) by providing her with written notice of termination. If Abbott's employment is terminated without cause, the Company will be required to pay to Abbott her accrued but unpaid salary to the termination date and the greater of: (a) her entitlements under the ESA in respect of the termination of her employment, and (b) pay in lieu of notice equal to her salary for one month for each completed year of service following her start date of September 26, 2016 (the "Abbott Notice Period"), provided that the Abbott Notice Period shall not be less than nine months or more than 12 months, plus an amount equal to the her two-year historic rolling average bonus, divided by 12 and multiplied by the number of months in the Abbott Notice Period, plus an amount equal to her two-year historic rolling average bonus, divided by 12 and multiplied by the number of months (including partial months) in the bonus year in which she was employed prior to her termination date. In this event, her entitlements under any Company incentive plans, including the Equity Incentive Plan, will be treated in accordance with the terms of such plans and any applicable agreements thereunder. In addition, Abbott will be entitled to benefits continuation for the minimum period required pursuant to the ESA, unpaid vacation pay accrued to the end of the minimum period required by the ESA, eligibility for continued indemnification and continued directors' and officers' insurance as customarily made available by the Company, and reimbursement for any unreimbursed reasonable business expenses incurred by Abbott in good faith up to the termination date.

Abbott's employment may be terminated for cause by providing Abbott with only her minimum applicable entitlements under the ESA. Abbott may terminate her employment with the Company upon giving the Company 90 days' notice of resignation of her employment. In this event, the Company has the option of requiring Abbott to work out the notice of resignation period, but in the case that the Company does not require this, Abbott will still receive her salary and benefits for the full notice of resignation period. Upon the effective date of Abbott's resignation, the Company shall not be obligated to make any further payments other than any minimum entitlements required by the ESA.

Abbott's employment agreement will also contain customary confidentiality arrangements and certain restrictive covenants that continue to apply following termination of her employment. This includes a nonsolicitation and non-competition provisions in effect during the term of her employment that will continue to apply following the termination of her employment for a period of six months.

Abbott's employment term continues indefinitely unless the agreement is terminated.

Incremental Payments to Named Executive Officers

The table below shows the incremental payments that would be made to the Company's named executive officers under the terms of their employment agreements upon the occurrence of certain events, if such events were to occur immediately following the completion of the Offering.

Name and Principal Position	Event	Severance (\$)(1)	Options (\$)(2)	Other Payments (\$)(2)	Total (\$)
David Fortier Co-Executive Chairman, Boat Rocker, Co Chairman, Boat Rocker Studios	Termination other than for cause including following a change of control	2,100,000	–	–	2,100,000
Ivan Schneeberg Co-Executive Chairman, Boat Rocker, Co Chairman, Boat Rocker Studios	Termination other than for cause including following a change of control	2,100,000	–	–	2,100,000
John Young Chief Executive Officer	Termination other than for cause including following a change of control	2,100,000	–	–	2,100,000
Michel Pratte(3) President, Boat Rocker and General Manager, Boat Rocker Studios	Termination other than for cause including following a change of control	1,291,745	–	–	1,291,745
Michelle Abbott Chief Financial Officer	Termination other than for cause including following a change of control	345,583	–	–	345,583

Notes:

______________

⁽¹⁾ Severance payments are calculated based on the base salary and annual bonus the Company pays or will pay to its named executive officers following completion of the Offering.

⁽²⁾ For further information on the treatment of Awards upon termination other than for cause including following a change of control, see "Executive Compensation – Principal Elements of Compensation - Long-term Incentives – Equity Incentive Plan".

⁽³⁾ Compensation paid to Michel Pratte in U.S. dollars has been converted into Canadian dollars at the Bank of Canada exchange rate on February 16, 2021 of US\$1.00 = C\$1.2684.

Outstanding Option-Based Awards and Share-Based Awards

The following table sets out information concerning the option-based and share-based awards granted to the named executive officers expected to be outstanding upon completion of the Offering. Information set out below gives effect to the Pre-Closing Capital Changes.

	Option-Based Awards			Share-Based Awards
Name and Principal Position	Number of Securities Underlying Unexercised Options (#)(1)	Option Exercise Price (\$)	Option Expiration Date(s)	Intrinsic Value of Unexercised In-the-Money Options (\$)(2)	Number of Shares that have not Vested(3)	Market or Payout Value of Share Based Awards that have not Vested (\$)	Market or Payout Value of Vested Share-Based Awards not Paid Out or Distributed (\$)(6) (7)
David Fortier		–	–	–	301,512	3,919,656(5)	2,177,851
Co-Executive Chairman, Boat Rocker, and Co Chairman, Boat Rocker Studios	–
Ivan Schneeberg	–	–	–	–	301,512	3,919,656(5)	2,177,851
Co-Executive Chairman, Boat Rocker, and Co Chairman, Boat Rocker Studios
John Young	–	–	–	–	301,512	3,919,656(5)	2,177,851
Chief Executive Officer
Michel Pratte	88,088	\$3.08	January 1, 2026	873,833	289,723(4)	3,766,393 (5)	–
President, Boat Rocker and	40,040	\$3.08	June 1, 2026	397,197
General Manager, Boat Rocker Studios	40,040	\$5.76	January 1, 2027	289,890
	32,032	\$5.93	June 1, 2027	226,466
	48,048	\$5.93	December 1, 2027	339,699
	528,528	\$10.06	January 1, 2030	1,553,872
Michelle Abbott	16,016	\$7.49	June 14, 2028	88,248	12,692(4)	165,000	–
Chief Financial Officer	16,016	\$11.01	January 1, 2030	31,872
	48,048	\$10.06	May 13, 2029	141,261
	28,415(7)	13.00(7)	January 1, 2031	–

______________ Notes:

(1) Represents options granted under the Legacy Option Plan and options anticipated to be granted to Michelle Abbott under the Equity Incentive Plan, which are subject to certain vesting conditions, on Closing.

(2) The value of unexercised in-the-money options is calculated based on an assumed Offering Price of \$13.00 per Subordinate Voting Share, the midpoint of the estimated price range set forth on the cover page of this Prospectus.

(3) Represents PSUs and/or RSUs, which vest over three and five-year periods, respectively, and are subject to certain vesting conditions, anticipated to be granted under the Equity Incentive Plan on Closing.

(4) On Closing, Michel Pratte will be granted 251,261 PSUs (equivalent to 0.5% of the issued and outstanding Shares on a non-diluted basis assuming an Offering of \$175,000,000 and an Offering Price of \$13.00) and 38,462 RSUs and Michelle Abbott will be granted 12,692 RSUs under the Equity Incentive Plan. The number of RSUs anticipated to be awarded to Michel Pratte and Michelle Abbott on Closing assumes an Offering Price of \$13.00 per Subordinate Voting Share, the midpoint of the estimated price range set forth on the cover page of this Prospectus. The RSUs and PSUs vest over a period of three and five years, respectively.

(5) The value of the PSUs and/or RSUs is calculated based on an assumed Offering Price of \$13.00 per Subordinate Voting Share, the midpoint of the estimated price range set forth on the cover page of this Prospectus. The RSUs vest over a period of three years. The PSUs vest over a period of five years and are subject to certain performance vesting conditions.

(6) Represents the 167,527 Legacy RSUs awarded to each of Fortier, Schneeberg and Young under the Legacy RSU Plan.

(7) Assumes an Offering Price of \$13.00 per Subordinate Voting Share, the midpoint of the estimated price range set forth on the cover page of this Prospectus.

DIRECTOR COMPENSATION

The Company's directors' compensation program is designed to attract and retain the most qualified individuals to serve on the Board. The Board, through the Compensation, Nominating and Corporate Governance Committee, will be responsible for reviewing and approving the directors' compensation arrangements and any changes to those arrangements. In consideration for serving on the Board, each director that is not an employee will be paid an annual retainer that is expected to be settled in cash or, in the case of an independent director, 50% in cash and 50% in DSUs. See also "Executive Compensation – Principal Elements of Compensation – Long-term Incentives – Equity Incentive Plan". In addition, it is expected that (i) directors will be reimbursed for their reasonable out-of-pocket expenses incurred in serving as Directors, and (ii) directors will be entitled to receive remuneration for services rendered to the Company in any other capacity, except in respect of their service as directors of any of the Company's subsidiaries. Directors who are employees of and who receive a salary from the Company or one of its affiliates or subsidiaries will not be entitled to receive any remuneration for serving as directors, but will be entitled to reimbursement of their reasonable out-of-pocket expenses incurred in serving as directors.

The following chart outlines the Company's proposed director compensation program for non-employee directors.

Type of Fee		Amount
	Board Retainer Co-Executive Chairmen or Chief Executive Officer	Nil
	Independent Board Member	\$80,000/year
	Lead Director	\$35,000/year
Committee Retainer Audit and Risk Committee Chair		\$20,000/year
	Compensation, Nominating and Corporate Governance Committee Chair	\$15,000/year
	Committee Membership	\$5,000/year
Meeting Fees Board / Committee Meeting		Nil

INDEBTEDNESS OF DIRECTORS AND EXECUTIVE OFFICERS

As of the date of this Prospectus, no current director or officer of Boat Rocker is indebted to Boat Rocker or is expected to be indebted to Boat Rocker following Closing.

RISK FACTORS

Investing in the Company's Subordinate Voting Shares involves a high degree of risk. Purchasers of Subordinate Voting Shares should carefully consider the risks and uncertainties described below together with all of the other information contained in this Prospectus, including under the headings "Prospectus Summary", "Selected Annual and Interim Financial Information of Boat Rocker" and "Management's Discussion and Analysis of Boat Rocker" and in the Boat Rocker Financial Statements and the Boat Rocker Interim Financial Statements included elsewhere in this Prospectus, before deciding to invest in its Subordinate Voting Shares. If any of the following risks actually occur, Boat Rocker's business, prospects, financial condition and results of operations could suffer materially, the trading price of its Subordinate Voting Shares could decline and purchasers of Subordinate Voting Shares could lose all or part of their investment. The risks and uncertainties described below are not the only ones Boat Rocker faces. Additional risks and uncertainties not presently known to the Company or that it currently believes to be immaterial may also materially adversely affect the Company's business, assets, liabilities, financial condition, results of operations, prospects, cash flows and the value of future trading price of the Subordinate Voting Shares (one or more of the foregoing, a "Material Adverse Effect").

Risks Related to Boat Rocker's Business and Industry

Boat Rocker may be adversely affected by various operating risks common to the content production and distribution and talent management industries, including competition, consumer opinions and reviews, technological changes and the Company's dependence on key personnel and relationships, any or all of which may adversely affect Boat Rocker.

Boat Rocker faces substantial competition.

The industry within which Boat Rocker operates is competitive, with many video content production companies and studios competing to have their ideas and scripts funded, productions greenlit and produced, and video content aired and re-ordered for subsequent seasons. Some of Boat Rocker's competitors are much larger and more diversified and have greater financial resources than the Company has. The resources and influence that some of Boat Rocker's competitors have may give them an advantage in terms of having projects ordered by buyers. Increasingly, current buyers of the Company are seeking to build their own studios and acquire or partner with production companies that compete with the Company, which means that the Company's current buyers may limit the amount of product they purchase from independent third-party studios and producers like Boat Rocker.

Competition can lead to reduced margins. As many production companies and studios compete for a limited talent pool and limited financing, the Company's costs of doing business may increase, and its margins may shrink. Low barriers to entry may enable new competitors to quickly establish themselves with only a single popular program or series. New participants with a popular idea or property can gain access to consumers and become a source of competition for the Company, including through new widely and easily available platforms, including advertising-based video on demand platforms such as YouTube. Those upstart competitors tend to be smaller and have lower overhead costs than Boat Rocker and can, as a result, produce video content for Boat Rocker's buyers at a lower price than the Company, which could drive down the fees the Company can charge its buyers. Conversely, some of Boat Rocker's competitors are much larger than Boat Rocker and are better capitalized. They may, as a result, be willing to pay more than the Company for intellectual property rights and talent, which could reduce the Company's ability to source and develop projects that are marketable to its buyers. As a result, Boat Rocker may not be able to continue to compete effectively against current and future competitors, which could have a negative impact on its business, financial condition, operating results, liquidity and prospects.

Changes in public and consumer tastes and preferences and industry trends could reduce demand for productions and adversely affect the business of the Company.

Boat Rocker's business depends on the appeal of its programming to its buyers. The Company's ability to generate revenues is highly sensitive to rapidly changing consumer preferences and industry trends, as well as the popularity of the talent, brands and owners of intellectual property the Company represents, and the assets it owns. Consumer preference is difficult to predict and is subject to influences beyond the Company's control, such as the quality and appeal of competing programming, general economic conditions and the availability of other entertainment activities. The Company makes decisions about which projects to develop and finance long before those projects are completed as finished video content and available for consumption. As such, Boat Rocker needs to anticipate consumer sentiments in the future and its success depends on its ability to deliver entertainment properties and brands which will be desired by buyers, viewers, and consumers in the future. The production and sales of video content and the exploitation of brands is inherently risky because the revenues the Company derives from various sources primarily depend on its ability to satisfy consumer tastes and expectations in a consistent manner.

Boat Rocker's success depends on the commercial success of the programming it creates, which is unpredictable. Generally, the popularity of the Company's video content depends on many factors, including the critical and popular acclaim it receives, the format of initial release, on-screen talent, genre and specific subject matter of the video content, the quality and acceptance of video content that Boat Rocker's competitors release into the marketplace at or near the same time, the availability of alternative forms of entertainment and leisure activities, general economic conditions and other tangible and intangible factors, many of which the Company does not control and all of which may change. Boat Rocker cannot predict the future effects of these factors with certainty. The

Company's success will depend on the experience and judgment of management to select and develop new investment and programming opportunities. Boat Rocker cannot provide assurance that its programing will obtain favorable reviews or ratings, or that buyers will license the rights to broadcast any of its video content in development, order subsequent seasons of recently completed programs, or renew licenses to broadcast programming in its library. The failure to achieve any of the foregoing could have a Material Adverse Effect.

Specific to programming created by Boat Rocker's kids and family division intended to be developed into a brand franchise, it takes years to develop kids and family programming, produce the programming, partner with licensees for toys and other merchandise, secure meaningful exhibition windows for the programming, and have the program air in key markets on a consistent and substantial basis. Even if all of those elements are achieved, ultimately the Company does not know whether the video content and any related products will appeal to children and parents and achieve consumer acceptance. Even if one of Boat Rocker's brands becomes successful, it may cease to be so or be rapidly replaced with a competing product. The preferences and interests of children and families evolve quickly, can change drastically from year to year and season to season and are difficult to anticipate. Significant, sudden shifts in demand are caused by "hit" entertainment properties and brands, which are often unpredictable. A decline in the popularity of the Company's brands and entertainment properties, or the failure of the Company's video content, entertainment properties and brands to achieve and sustain market acceptance with consumers, could significantly lower the Company's revenues and operating margins, which would harm the Company's business, financial condition and performance.

In regards to the Company's business of producing and exploiting video content, despite the proliferation of streaming services over the past few years having increased demand for content and despite the COVID-19 pandemic having increased the amount of time people are spending watching video content at home, it is not certain that such demand will be sustained over the long term or that the Company will benefit from consumer appetite for programming. Consumer desire may pivot to leisure activities outside the home, or to audio visual content which the Company doesn't currently produce, such as virtual reality products, short form user-generated content or video games.

Boat Rocker's success is dependent on its ability to source IP and creative talent who can develop IP.

The Company competes with other producers, studios and platforms for entertainment properties, ideas and storylines created by third parties. The competition to source high quality IP from which the Company can generate video content and partner with creative talent who can shepherd their projects through development and production is fierce. While Boat Rocker has entered into a number of first-look deals with talent which guarantee the payment of overhead costs and salaries for a period of time in exchange for the first opportunity to develop IP with such artists, the Company is smaller than some of its competitors and may not be able to extend such first-look deals at any given time or secure more of them. Boat Rocker's competitors, some of whom are bigger and better capitalized, may enter into long term arrangements with talent and Boat Rocker cannot necessarily pay the same option fees and guaranteed compensation that these larger players can offer. Some of the Company's competitors have distribution platforms (such as SVOD services) which allow them to offer creators and showrunners a guarantee that their projects will be produced and exhibited; as the Company does not have a distribution platform, it cannot offer that guarantee, which may make the Company less competitive in bidding for projects and talent. In addition, Boat Rocker competes with other producers, studios and platforms to license underlying IP (such as books, articles, comics, stage plays, formats, original pitch concepts and speculative scripts) and the Company may not be able to pay as much for such IP as its competitors. Boat Rocker's inability to source compelling IP and/or secure top-tier creators, writers, showrunners and talent will limit its ability to sell projects and retain rights which could adversely affect the business, results of operations or financial condition of the Company.

A limited number of buyers could hinder the Company's performance.

While Boat Rocker is platform agnostic and sells its video content to a global set of programming buyers and no one buyer contributed more than 10% of consolidated revenue in 2019, it is possible in future years that revenue from production and distribution of video content may originate from disproportionately few buyers and the Company may have higher buyer concentration if it is delivering one or more big-budget programs to a given buyer. In addition, depending on the genre of a particular property, there may only be six to 12 buyers that would or could contribute the license fees necessary to produce the project. While there are many buyers for completed video content internationally, there are generally only a handful of platforms that will consider pre-licensing content (i.e., agreeing to provide substantial funding upfront to the cost of producing programming, rather than acquiring rights after the video content is completed). Moreover, many of the Company's buyers are also competitors. If the Company cannot find buyers for its projects, it will severely impact business results. If the Company is dependent on one or a few buyers for a high percentage of its revenue, the Company's business results may be negatively impacted if those buyers cease to buy video content from the Company or if the business, results of operations or financial condition of those buyers are adversely affected in the future.

A limited pool of owned assets could hinder the Company's performance.

While the Company has numerous programs currently in-production or greenlit for production in 2021, revenue from production of Boat Rocker's video content may originate from only a few of its programs if those programs have disproportionately bigger budgets than other of the Company's programs. In respect of the Company's business of distributing video content, in any given year the Company may depend on a limited number of titles for a significant portion of the revenues generated by its content library, particularly if it has a "hit" show which is substantially more popular than other titles in its library. In addition, some of the titles in the Company's distribution library are not presently distributed and generate minimal or no revenue. If the Company cannot acquire or develop new products and rights to popular titles through production, distribution agreements, acquisitions, mergers, joint ventures or other strategic alliances, it could have a Material Adverse Effect.

The Company may not be able to keep up with developments in technology and evolving trends.

The media industry in which the Company operates is characterized by technological change and evolving trends. Technological change can have positive effects, but may also have a material adverse effect on the Company's business, prospects, results of operations and financial condition. For example, the emergence of new production or computer-generated imagery technologies, or a new digital broadcasting standard, may diminish the value of the Company's existing equipment and content.

Although Boat Rocker is committed to adapting new production technologies, there can be no assurance that it will be able to incorporate other new production and post-production technologies which may become de facto industry standards.

Risks Related to External Factors Which Boat Rocker Cannot Control, Including COVID-19

The impact of the COVID-19 global pandemic could materially adversely affect the Company's business, financial condition and results of operations.

The impacts associated with the ongoing COVID-19 global pandemic, measures to prevent its spread, and the resulting economic uncertainty, have and may continue to affect the Company's business adversely.

Commencing in March of 2020, governments in jurisdictions in which the Company produces programming implemented preventative measures in order to curb the spread of COVID-19. As a result of these measures, and the Company's need to protect its employees, crews, talent and broader communities, certain of Boat Rocker's productions were temporarily suspended or delayed.

While the Company was able to re-commence production on many of its shows in the summer and fall of 2020, there continues to be a risk that governments in jurisdictions in which the Company operates will order future lock-downs which could force Boat Rocker to again suspend productions. Certain jurisdictions in which the Company films its live action productions instituted renewed restrictions in the late fall of 2020 and winter 2020/2021; however, in all jurisdictions in which the Company is presently filming live action productions, there is an exemption available that permits the Company, subject to certain guidelines and limitations, to continue filming. That said, there continues to be a risk that the governments in these jurisdictions will extend the restrictions to film and television production, or that other jurisdictions in which the Company is filming live action television series, or intends to film live action television in the next few months, will impose new restrictions which prevent the Company from completing and delivering its programming. As well, while the Company may be permitted to continue to film its programming, a case of COVID-19 amongst its cast or crew could result in a temporary or full shut-down of a program in-production. If production on any programming is halted, the Company could incur substantial costs and further filming would be delayed which could result in Boat Rocker losing access to key crew, talent and locations. While the Company has implemented industry standard health and safety protocols and procedures on all of its sets and in all of its offices in an effort to avoid the spread of COVID-19, these procedures are not infallible and it is still possible for cast or crew to contract COVID-19.

Additionally, insurance against risks relating to the COVID-19 pandemic, including potential liability for infections, an unexpected shutdown of operations, or other hazards as a result of operation of the business, is limited or not available. While certain of the Company's productions have insurance coverage in place in the event of a shut down or suspension as a result of either a government ordered shutdown or a key cast or crew member becoming ill, those policies do not cover every potential possible COVID-19 related scenario, and those policies may not fully cover the Company's costs. Moreover, while many of the Company's current productions have some insurance coverage for COVID-19 related claims, there are currently very few insurance products available for the Company to purchase for future productions which will cover claims associated business interruption or losses related to COVID-19. To the extent such products become available, the pricing and limits of such new insurance policies will likely be much less favourable to the Company. There are currently certain government-backed insurance programs in place in Canada and internationally that the Company may be able to rely upon for some level of insurance coverage, but they will likely not cover all of the costs associated with a COVID-19 related claim, and are currently only available in certain territories, not including the United States. The lack of insurance in the event of a COVID-19 related claim could materially reduce the funds available to the Company for future operations and a significant shutdown could result in a Material Adverse Effect.

The Company has incurred increased production costs as a result of new COVID-19-associated protocols that were not included in the production budgets of the Company's programming which were greenlit prior to the start of the pandemic. These additional costs include shorter workdays for certain union crew, personal protective equipment, and other costs of adhering to new health and safety measures. These protocols and costs are crucial to protect cast and crew and seek to ensure that production continues without further delay and to reduce the risk of the spread of COVID-19 on sets. While the Company's buyers have agreed in many cases to share the additional costs associated with producing video content during the COVID-19 pandemic, and have agreed to bear a certain portion of shutdown and ramp-up costs in the event of a temporary halt to certain of the Company's programming, Boat Rocker's potential losses in the event of a COVID-19 related suspension or shutdown of one of its shows may not be fully covered by its buyers, which could have a Material Adverse Effect.

In addition to the foregoing, the ongoing impact of COVID-19 may continue to have the following material adverse effects on the Company, including, among others:

continued disruptions and volatility in the global capital markets, which may increase cost of capital and restrict access to capital;
continued impacts on workforces throughout the regions in which COVID-19 is present, which may result in the Company's workforce being unable to work effectively, including because of labour shortages, illness, quarantines, government actions, facility closures or other restrictions in connection with the COVID-19 pandemic;
availability and cost of interim financing for production receivables if traditional lenders deem production activities too risky or underinsured; and
other unpredictable adverse impacts.

Given the recent approval of and nascent roll-out of multiple COVID-19 vaccines in the countries in which the Company operates, the Company is hopeful that, despite the current second wave of the COVID-19 pandemic, there will be a lessening of COVID-19's impact in the second quarter of 2021, and a reduction in risks to the Company's operations and COVID-19 related production costs by the summer of 2021. The Company currently expects that there will be a large-scale rollout of safe, effective and widely available vaccines in the United States and Canada in the latter part of 2021, which the Company expects will mitigate the risks of COVID-19 and avoid any significant COVID-19 production suspensions or shutdowns thereafter.

However, until an effective COVID-19 vaccine is widely available or more effective treatments are accessible to the public the effects and risks of COVID-19 will remain and as such the Company is unable at this time to predict the long-term impact of COVID-19 on its operations, liquidity, financial condition and results. The extent to which COVID-19 may have a sustained impact on the Company's results is uncertain and it is possible that the Company's future results may continue to be materially negatively impacted.

Boat Rocker's success depends on external factors which it cannot control.

Global economic turmoil and regional economic conditions in the U.S., Canada and globally could adversely affect the Company's business. Global economic turmoil, such as that being created by the ongoing COVID-19 global pandemic and its effects, may cause a general tightening in the credit markets, lower levels of liquidity, increases in the rates of default and bankruptcy, increased regulation from governments, increased taxes, decreased consumer confidence, overall slower economic activity and extreme volatility in credit, equity and fixed income markets. A decrease in economic activity in the regions of the world in which Boat Rocker does business could adversely affect demand for its video content, thus reducing the Company's revenues and earnings. For instance, lower household income and decreases in consumer discretionary spending, which are sensitive to general economic conditions, may affect cable television and other video service subscriptions and ad sales for the Company's buyers, which in turn may reduce buyers' budgets and ability to commission the Company's programming. In respect of Boat Rocker's Kids and Family brand business, a decrease in consumer discretionary spending may result in decreased demand for merchandise produced by the Company's licensees.

Business interruptions could adversely affect Boat Rocker's operations.

Boat Rocker's operations are vulnerable to outages and interruptions due to fire, floods, power loss, telecommunications failures, pandemics such as COVID-19 and similar events beyond its control.

In the event of a short-term power outage, the Company has installed uninterrupted power source equipment designed to protect its servers for a sufficient amount of time designed to allow for the system to be shut down safely without risking the loss of data. The Company also mitigates the risk around loss of critical data by increasingly relying on third-party cloud-based service providers for certain business operations (e.g., payroll, enterprise software, document management, etc.). Cloud services allow many departments to work independently of the Company's data centres and continue operations throughout an outage of certain infrastructure. In addition, cloud services tend to be more secure than on-premises servers, but they are not immune to technological failures or security breaches. The Company has not experienced any major service interruptions with its key technology providers, with the exception of certain internet interruptions, which affected large portions of North America and were not specific to the Company's connections. During this time, some employees were not able to access email or connect to the Company's resources in the Company's data centre. Outages have been brief, however there can be no assurance that any future outages will continue to be so.

However, a long-term power outage or other damage such as fire or flood to the Company's information technology infrastructure could disrupt its operations and generate losses. While Boat Rocker has critical data backed-up on a regular basis and while its head office data centre has temperature sensors, a security system, surge protection and water-proofing, in the event of an unlikely but catastrophic failure of the Company's technology infrastructure, the Company would incur delays in accessing its files, which could delay the delivery of certain of its programming, harm Boat Rocker's reputation with its buyers, and lead to increased costs. The Company currently carries insurance for damage to its systems and infrastructure and business interruption insurance for potential losses; however, this insurance may not available in all circumstances or may not be sufficient to fully cover the Company's losses or those of its buyers, and such insurance may not continue to be available to on affordable terms in the future.

Risks Related to Securing and Retaining Key Personnel and Business Relationships

Boat Rocker relies on key personnel, the loss of any one of whom could have a negative effect on its business.

Boat Rocker's success depends to a significant extent on its ability to attract, recruit and retain quality executives and other key employees, including production, creative and technical personnel, in a highly competitive labour market. There are many contributing factors that affect the Company's ability to retain key employees, some of which are within its control and some of which are not (for example, the economic climate, sector growth and skill demand). The impact of failing to retain key employees can be high due to loss of key knowledge and relationships, lost productivity, and hiring and training costs, and could have a Material Adverse Effect.

While competition for the most talented people is always challenging, Boat Rocker's increasing profile in the industry is helping it to attract and retain the key personnel. In addition, Boat Rocker offers competitive remuneration and has put in a place a long-term incentive plan to incentivize loyalty and performance from key personnel and to help recruit future talent. See "Executive Compensation – Principal Elements of Compensation – Long-term Incentive Plan". In addition, the Company has entered into employment agreements with certain key personnel as a method of retaining the services of key employees. However, this profile and these incentive programs and agreements cannot assure the Company of the continued services of such employees.

The success of Untitled Entertainment depends, in part, on its continuing ability to identify, recruit and retain qualified and experienced managers.

The success of the Company's majority-owned Untitled Entertainment depends, in part, upon its continuing ability to identify, recruit and retain qualified and experienced managers. There is significant competition for qualified and experienced managers in the entertainment industry, and can be no assurance that Untitled Entertainment will be able to continue to hire or retain a sufficient number of qualified individuals to meet its requirements, or that it will be able to do so under terms that are economically attractive to it. Most of Untitled Entertainment's managers and other key personnel are not party to long-term contracts and can leave their employment with little or no notice. The Company can give no assurance that all or any of these individuals will remain with Untitled Entertainment.

Untitled Entertainment depends on the relationships of its managers with clients and any failure by Untitled Entertainment to identify, sign and retain clients could adversely affect the Company's business.

Untitled Entertainment depends heavily upon relationships that its managers and other key personnel have developed with clients. In particular, Untitled Entertainment's client management business is dependent upon the highly personalized relationships between its manager teams and their respective clients. A substantial deterioration in the relationship between managers and clients could result in the loss of a client which could have an adverse effect on Boat Rocker's business, financial condition and results of operations.

Untitled Entertainment derives substantial revenue from the engagements and endorsements entered into by its clients. Untitled Entertainment depends on identifying, signing and retaining as clients those performers and artists who are in high demand by producers, studios, networks, the public and brands. Untitled Entertainment's success is dependent on its continuing ability to attract, develop and retain clients whose work is likely to achieve a high degree of value. Untitled Entertainment's failure to attract and retain these clients, an increase in the costs required to attract and retain such clients, or an untimely loss or retirement of these clients could adversely affect the Company's financial results and growth prospects.

As is customary in the industry, Untitled Entertainment generally does not enter into written agreements with many of the clients it represents and as such there is no contractual commitment from such clients to be represented by Untitled Entertainment managers for a predetermined period of time. As a result, clients are free to seek alternative representation at any time and, if they do, the revenue generated by Untitled Entertainment could diminish overall, though Untitled Entertainment would generally continue to receive fees in respect of existing projects (including future seasons and subsequent productions). Further, the loss of such clients could lead other of Untitled Entertainment's clients to terminate their relationships with it.

In addition to the foregoing, the founders and minority owners of Untitled Entertainment have the ability to require Boat Rocker to purchase their remaining share of the Untitled Entertainment business in 2024 and are not required to continue to provide services to Untitled Entertainment if they do so. While there are significant incentives for the founders to continue to provide services to Untitled Entertainment if they exercise their "put" right, if they choose not to continue on with Untitled Entertainment, this could result in a significant loss of clients which could adversely affect Boat Rocker's financial results and growth prospectus. See "Risk Factors – Other Risks – Partially-owned entities" and "Rights to Acquire Shares – Untitled Entertainment".

Boat Rocker may face labour shortages that could slow its growth.

The successful operation of the Company's business depends upon its ability to attract, motivate and retain a sufficient and significant number of qualified employees. In particular, the production of live action programming depends on securing crew members from limited talent pools in shooting locations with significant competition for talent. Similarly, the Company's animation studios are dependent on large teams of designers, animators, lighters, technical directors and other production personnel; in the markets in which Boat Rocker operates its animation studios there is significant competition for these individuals. An inability to secure talented and experienced crews on its productions (whether live-action or animated) could adversely impact the Company's ability to deliver high quality productions to its buyers. In addition, competition for qualified employees could require Boat Rocker to pay higher wages, which could result in higher labour costs and could have an adverse effect on the Company's business, financial condition and results of operations.

A strike or other form of labour unrest affecting guilds or unions in the television and film industries could disrupt the Company's production schedules which could result in delays and additional expenses.

Production of many of the Company's live-action programs is dependent on the services of specialized union members who are essential to the production of video content. A strike by, or a lockout of, one or more of the unions that provide personnel essential to the production of programming could delay or halt the Company's ongoing production activities, or could cause a delay in the delivery of its video content. While the Company seeks to maintain positive relationships with the guilds and unions in the industry, a strike or other form of labour protest or unrest affecting those guilds or unions could, to some extent, disrupt production schedules which could result in delays and additional expenses.

Some parts of the Company's video content production business are not unionized. Specifically, Boat Rocker does not utilize unionized crews on many of its unscripted productions or its animated series. The International Alliance of Theatrical Stage employees ("IATSE") has sought to organize individuals who work on animated productions for the past decade in Canada and recently, in the fall of 2020, IATSE successfully unionized a third-party animation studio based in Vancouver. The Canada Media Guild ("CMG"), together with IATSE, have sought to unionize Canadian unscripted production crews for over five years. See description of the class action lawsuit filed against Insight under "Risk Factors – Risks Related to Litigation, IP Infringement and IP Protection" below.

On January 29, 2021, a subsidiary of Boat Rocker received notice of an application for certification filed by IATSE with the Labour Board of Nova Scotia, which seeks to unionize certain animation employees employed at Boat Rocker's animation studio in Halifax, Nova Scotia, Canada (the "IATSE Application"). On the date of the IATSE Application, less than 100 employees were engaged by the subsidiary of Boat Rocker, many of whom Boat Rocker would classify as management or otherwise ineligible to form part of the bargaining unit. The vote to determine whether the Halifax animation studio will be unionized occurred on February 4, 2021, but the result will ultimately not be determined for a few weeks. Management believes that IATSE has been attempting to organize animation workers in Halifax prior to the Company opening its studio there in late 2019 and management does not believe that the application is an indication that its employees in Halifax are disgruntled or dissatisfied with their working conditions. That said, if the Company's Halifax studio were unionized, the Company's costs to produce animation in Halifax could increase, which may reduce the Company's margins in respect of programming produced in Halifax. In addition, if the Halifax studio were unionized, IATSE may be emboldened to pursue more aggressive campaigning in respect of the Company's Toronto and Ottawa animation studios.

The Company has no output agreements with buyers and it depends on key relationships with buyers.

A key component of the Company's success is its relationships with buyers and programming executives at the linear networks and OTT platforms that purchase or license its programming. Boat Rocker is dependent on maintaining these existing relationships and expanding upon them to seek to ensure that the Company has a robust network of buyers for its programming. The Company does not have any long-term output agreements with its buyers and, as a result, every project it intends to produce requires a commission or sale on bespoke negotiated terms. The relationships between Boat Rocker's key personnel and those of its buyers are crucial to selling the Company's programming. Any loss in key sales personnel at Boat Rocker, any fractures in relationships with key buyers, or any transitions of key buying executives to roles at competitors, may limit the Company's ability to sell its video content and could result in a Material Adverse Effect. Additionally, programming executives who work for the Company's buyers regularly resign or are terminated; when this occurs, successor executives will often wish to "start fresh" and may choose not to greenlight projects in development that were supported by their predecessors. This kind of "regime change" amongst executives who work for the Company's buyers could have a negative impact on the Company's ability to secure greenlights, which would in turn negatively impact the Company's results of operations or financial condition.

Risks Related to Anticipating and Managing Costs, Revenues and Liquidity

Boat Rocker cannot guarantee the avoidance of budget overruns.

Boat Rocker's business model is predicated on delivering its video content for the cost set out in its production budgets. The production, completion and distribution of video content can be subject to a number of uncertainties, including delays and increased expenditures due to disruptions or events beyond the Company's control. Although the Company has historically completed its productions within their budget parameters, there can be no assurance that it will continue to do so. The Company currently maintains insurance policies covering certain potential disruptions or risks that if occasioned would increase its production costs. There can be no assurance that any overrun resulting from any occurrence will be adequately covered or that such insurance coverage will continue to be available or, if available, whether it will be on terms acceptable to the Company. In the event of budget overruns, the Company may have to seek additional financing from outside sources in order to complete production of a television program. No assurance can be given as to the availability of such financing or, if available, whether it will be on terms acceptable to the Company. In addition, in the event of substantial budget overruns, there can be no assurance that such costs will be recouped from future sales of the production, which could have a significant impact on the Company's results of operations or financial condition.

Boat Rocker's revenues and results of operations may fluctuate significantly.

Results of the Company's operations for any periods are significantly dependent on the number and timing of programming delivered or made available to licensees. Boat Rocker's results of operations depend significantly upon the timing of programming orders, deliveries and the number of programs that are in-production in a given year. As well, video content distribution revenues can fluctuate significantly from period to period, driven by timing fluctuations and/or quarterly reporting from the Company's distribution partners. Accordingly, Boat Rocker's results of operations may fluctuate significantly from period to period, and the results of any one period may not be indicative of the results for any future periods. Programming produced by the Company may not be re-ordered for subsequent seasons and items in its distribution catalogue may not be licensed by exhibitors, both of which could have a Material Adverse Effect in a given period.

The Company's operating results also fluctuate due to its accounting practices, which may cause the Company to recognize production expenses in different periods than the recognition of related revenues, which may occur in later periods. For example, in accordance with IFRS and industry practice, Boat Rocker recognizes the revenue from programming made on a "work for hire basis" as the video content is produced. For programming which the Company owns, it recognizes revenue when the video content is delivered in full. Consequently, the Company's results of operations may fluctuate materially from period to period and the results of any one period are not necessarily indicative of production volume or results for future periods. Cash flows may also fluctuate and are not necessarily closely correlated with revenue recognition.

The Company faces substantial capital requirements and financial risks, including liquidity needs.

The acquisition, production and distribution of video content requires substantial capital. Although Boat Rocker reduces the risks of its production exposure through pre-sale licenses to buyers, tax credit programs, other government and industry subsidies, co-financiers, third-party distributors and other sources, the Company cannot assure investors that it will continue to be able to successfully implement these arrangements or that it will not be subject to substantial financial risks relating to the acquisition, production and distribution of future video content.

The Company may contribute a recoupable distribution advance towards the financing of certain of its video content. Such investments are made based Boat Rocker's internal sales estimates. If those estimates prove erroneous, the Company may not recoup its investment in the video content, or may not recoup it as quickly as the Company had anticipated.

If Boat Rocker increases (through internal growth or acquisition) its programming slate or its production budgets, the Company may be required to increase overhead and/or make larger upfront payments to talent and, consequently, bear greater financial risks. Any of the foregoing could have a Material Adverse Effect.

As at September 30, 2020, the Company's current liabilities exceeded its current assets on the statement of financial position by \$296.1 million. However, the Company is of the view that this working capital deficiency does not provide a meaningful indication of the Company's true short-term liquidity position because a number of the liabilities are expected to be settled only after 12 months (such as interim production financing, see "Description of Material Indebtedness – Interim Production Financing"), or, in the case of the 2020 Debenture, will not be settled in cash but rather with the issuance of Subordinate Voting Shares on Closing. In the nine months ended September 30, 2020, the Company's cash flow from operations was a use of cash of \$3.4 million. Consistently negative cash flow from operations could lead to liquidity or solvency concerns or adversely affect the Company's ability to continue as a going concern.

While Boat Rocker intends to seek to manage liquidity by forecasting and monitoring operating cash flows and through the use of interim production financing, any failure to adequately manage liquidity could adversely affect the business and its results of operations, including by limiting its ability to meet its working capital needs. There can be no assurance that Boat Rocker will continue to have access to sufficient short term capital resources, on acceptable terms or at all, to meet its liquidity requirements.

Boat Rocker may incur impairments and write-offs if the video content it acquires and produces does not perform well enough to recoup the Company's acquisition, production, marketing and distribution costs.

The Company incurs significant costs to acquire, produce and distribute video content. Where Boat Rocker acts as a distributor, it may invest funds as a minimum guarantee against future sales. The minimum guarantees are derived from Boat Rocker's estimate of net revenues that will be realized from its distribution of the video content in the relevant markets, and actual results may differ from those estimates. If sales do not meet the Company's original estimates, Boat Rocker may: (i) not recognize the expected gross margin or net profit; (ii) not recoup its minimum guarantees; (iii) record accelerated amortization and/or fair value write-downs of minimum guarantee paid; and/or (iv) not recoup the additional funds and expenses invested to market the programming that the Company has produced or acquired.

With respect to video content that Boat Rocker produces, it is required to amortize capitalized production costs based on estimated ultimate revenues. Unamortized production costs are evaluated for impairment each reporting period on a project-by-project basis. If estimated remaining revenue is not sufficient to recover the unamortized production costs, the unamortized production costs may need to be written down to fair value. In any given quarter, if Boat Rocker lowers its previous forecast with respect to total anticipated revenue from any individual program, it may be required to accelerate amortization or record impairment charges with respect to the unamortized costs, even if Boat Rocker has previously recorded impairment charges for such project or other projects. Such impairment and accelerated amortization charges and write-offs could result in a Material Adverse Effect.

Many of Boat Rocker's productions are funded in part by tax credits, which may be overestimated or subject to audit.

The costs of many of Boat Rocker's programs are subsidized through tax credits or other grants. The Company is required to estimate production tax credits and other subsidies receivable on such programming, taking into applicable tax laws, regulations, guidelines and interpretations that pertain to such funding and Boat Rocker's operations. In addition, Boat Rocker is subject to audits from tax authorities on an ongoing basis and the outcome of such audits could materially affect the amount of tax credits receivable recorded on its consolidated balance sheets and the income tax expense recorded on its consolidated statements of earnings. If Boat Rocker fails to accurately estimate tax credits and other grants, misinterprets applicable laws, regulations or guidelines related to such subsidies, or becomes the subject of a regulatory audit which uncovers inaccuracies in applications for tax credits and other subsidies, there could be a negative implication for Boat Rocker's business, financial condition and operating results or prospects.

Risks Related to Boat Rocker's Growth Strategy

Boat Rocker may be unable to realize its acquisition strategy following Closing and there may be additional risks to the Company's business and operations in executing those acquisitions.

The Company has made, and intends to continue to pursue, various acquisitions, investments and joint ventures intended to complement or expand its business. See "The Business of the Company – Growth Strategies and Goals – Pursuing Strategic Acquisitions and Investments". The successful implementation of such acquisition strategy depends on the capital resources of the Company and Company's ability to identify suitable acquisition candidates, acquire such companies on acceptable terms, integrate the acquired company's operations and technology successfully with its own, and maintain the goodwill of the acquired business. The Company is unable to predict whether or when it will be able to identify any suitable additional acquisition candidates that are available for a reasonable price, or the likelihood that any potential acquisition will be completed. When evaluating a prospective acquisition opportunity, the Company cannot assure that it will correctly identify the costs and risks inherent in the business to be acquired. The scale of such acquisition risks will be related to the size of the company or companies acquired relative to that of the Company at the time of acquisition, and certain target companies may be larger than Boat Rocker.

Although the Company seeks to conduct appropriate levels of due diligence of its acquisition targets, these efforts may not always prove to be sufficient in identifying all risks and liabilities related to the acquisition, including as a result of limited access to information, time constraints for conducting due diligence, the inability to communicate with the target company's personnel or buyers or other limitations on the due diligence process. As a result, the Company may become subject to liabilities or risks not discovered through the due diligence process, which could have a materially adverse effect on the Company's businesses, operations, prospects or cash flows. Moreover, in connection with acquisitions undertaken by the Company, certain representations and warranties will be obtained from the selling owners, respecting the business and its assets and liabilities. If such representations and warranties are incorrect in any material respect, the Company could be required to make a claim under the indemnities received from the selling owners. Some of the selling owners could become key employees of the Company and seeking legal recourse under acquisition agreements against such key employees could have adverse effects that outweigh the benefits of seeking such recourse. In addition, there would be no assurance that the Company would be successful in pursuing any such claim.

Growth and expansion resulting from past or future acquisitions may place significant demands on management's resources. While Boat Rocker believes it has the experience and know-how to integrate acquisitions, such efforts entail significant risks including, but not limited to: (a) the failure to integrate successfully the personnel, information systems, technology, and operations of the acquired business; (b) the potential loss of key employees or buyers from either the Company's current business or the business of the acquired company; (c) the failure to maximize the potential financial and strategic benefits of the transaction; (d) the failure to realize the expected synergies from acquired businesses; (e) the assumption of significant and/or unknown liabilities of the acquired company; and (f) the diversion of management's time and resources.

Past and future acquisitions are accompanied by the risk that the obligations and liabilities of an acquired company may not be adequately reflected in the historical financial statements of such company and the risk that such historical financial statements may be based on assumptions which are incorrect or inconsistent with the Company's assumptions or approach to accounting policies. In addition, such acquisitions could involve tangential businesses which could alter the strategy and direction of the Company.

There can be no assurance that Boat Rocker will have the capital resources required to complete any such acquisitions. In addition, future acquisitions may result in potentially dilutive issuances of equity securities, have a negative effect on the Company's share price, or may result in the incurrence of debt or the amortization of expenses related to intangible assets, all of which could have a Material Adverse Effect.

Changes in Boat Rocker's business strategy, plans for growth or restructuring of its businesses may increase costs or otherwise affect the profitability of the business.

As changes in Boat Rocker's business environment occur, it may adjust its business strategies to meet these changes, which may include growing a particular area of business or restructuring a particular business or asset. In

addition, external events, including changing technology, changing consumer patterns, and changes in macroeconomic condition, including the volatility and uncertainty in financial markets as a result of the ongoing COVID-19 global pandemic and its effects, may impair the value of Boat Rocker's assets. When these changes or events occur, Boat Rocker may incur costs to change its business strategy and may need to write down the value of assets. The Company may also make investments in existing or new businesses, including investments in the international expansion of its business and in new business lines. Some of these investments may have short-term returns that are negative or low and the ultimate prospects of the businesses may be uncertain, or, in international markets, may not develop at a rate that supports the Company's level of investment. In any of these events, the Company's costs may increase, it may have significant charges associated with the write-down of assets, or returns on new investments may be lower than prior to the change in strategy, plans for growth or restructuring.

Boat Rocker may have difficulty raising additional capital which could adversely affect the market for the Company's securities.

The Company may require capital in the future in order to meet additional working capital requirements, to make capital expenditures, to take advantage of investment and/or acquisition opportunities or for other reasons. Additionally, if Boat Rocker increases (through internal growth or acquisition) its programming slate or its production budgets, it may be required to fund more development projects, provide additional funding for video content, increase overhead, make larger upfront payments to talent, and consequently bear greater financial risks. Accordingly, it may need to raise additional capital in the future. The Company's ability to obtain additional financing will be subject to a number of factors, including market conditions and its operating performance. These factors may make the timing, amount, terms and conditions of additional financing unattractive or unavailable for the Company. Disruptions in the capital markets, including changes in market interest rates or lending practices or the availability of capital, could have a materially adverse effect on the Company's ability to raise or refinance debt.

In order to raise such capital, the Company may sell additional equity securities in subsequent offerings and may issue additional equity securities. Sales or issuances of a substantial number of equity securities, or the perception that such sales could occur, may adversely affect the prevailing market price for the securities. With any additional sale or issuance of equity securities, investors will suffer dilution and the Company may experience dilution in its earnings per share.

Alternatively, the Company may incur debt. Capital raised through debt financing would require the Company to make periodic interest payments and may impose restrictive covenants on the conduct of the Company's business.

Furthermore, additional financings may not be available on terms favourable to the Company, or at all. The Company's failure to obtain additional funding could prevent the Company from making expenditures that may be required to grow its business or maintain its operations.

Risks Related to Doing Business Internationally

Boat Rocker faces risks inherent in doing business internationally, many of which are beyond its control and which could have a Material Adverse Effect.

Boat Rocker produces and distributes video content and conducts other business activities outside of Canada directly and through foreign subsidiaries and derives revenues from these sources. As a result, Boat Rocker is subject to certain risks inherent in international business, many of which are beyond its control. These risks include:

changes in local regulatory requirements, including restrictions on content;
changes in the laws and policies affecting trade, investment and taxes (including laws and policies relating to the repatriation of funds and to withholding taxes);
impact of trade disputes;
anti-corruption laws, sanctions and other bans instituted by the applicable authorities on doing business with particular countries, companies and individuals;
differing degrees of protection for IP and less stringent attitudes toward piracy;
differential regulation around data privacy and security;
changes in local regulatory requirements including regulations designed to stimulate local productions, promote and preserve local culture and economic activity (including local content quotas, investment obligations, local ownership requirements, and levies to support local film funds);
instability of foreign economies and governments;
increased market concentration in certain territories;
difficulties in understanding and complying with local laws, regulations and customs in foreign jurisdictions;
inability to adapt the Company's offerings successfully to differing languages, cultural tastes, and preferences in international markets;
wars and acts of terrorism; and
the spread of viruses, diseases or other widespread health hazards, including COVID-19.

Any of these factors could have a Material Adverse Effect.

Fluctuations in foreign currency exchange rates could harm the Company's results of operations. Foreign currency and exchange control regulations may adversely affect the repatriation of funds to Canada.

The presentation currency for the Company's consolidated financial statements is the Canadian dollar. Foreign exchange affects the Company's revenues and results of operations in two ways. First, revenue is recognized in the Company's United States subsidiaries in U.S. dollars and in the Company's U.K. subsidiary in pounds sterling. If the U.S. dollar and/or pound sterling weakens against the Canadian dollar, it would have a negative impact on the Company's consolidated operating results upon translation to Canadian dollars for the purposes of financial statement consolidation. Second, the Company invoices for sales, recognizes debt, and incurs expenses in a currency other than the functional currency of the legal entity. For example, a Canadian legal entity may invoice and receive U.S. dollar revenue, forcing that sale to be translated to Canadian dollars. If the relative values of the Canadian dollar and U.S. dollar fluctuate between invoicing and collection of cash, a foreign currency gain or loss is recognized on the consolidated statement of income. Currency exchange rates are determined by market factors beyond the control of the Company and current foreign exchange rates may not be indicative of future exchange rates. Although the Company may engage from time to time in hedging its foreign exchange risk by locking in rates for cash flows in the future, depending upon changes in future currency rates, such gains or losses could have a significant and potentially adverse effect on Boat Rocker's results of operations.

In addition, the ability of the Company to repatriate to Canada funds arising in connection with the foreign exploitation of its programming may also be adversely affected by currency and exchange control regulations imposed by the country in which the production is exploited. At present, the Company is not aware of any existing currency or exchange control regulations in any country in which the Company currently contemplates exploiting its programming which would have an adverse effect on the Company's ability to repatriate such funds.

Risks Related to Litigation, IP Infringement and IP Protection

Boat Rocker may be subject to claims and legal proceedings that could be time-consuming, expensive and result in significant liabilities for the Company.

Governmental, legal or arbitration proceedings may be brought in the future or threatened against Boat Rocker. Regardless of their merit, any such claims could be time consuming and expensive to evaluate and defend, divert management's attention and focus away from the business and subject Boat Rocker to potentially significant liabilities.

In particular, Insight Productions, of which the Company currently owns 70%, is the defendant in a class action for alleged unpaid overtime and misclassification of employees as independent contractors. Insight believes that the claim has been sponsored by the CMG and IATSE who wish to leverage unscripted producers in Canada into signing collective agreements in respect of their crews who are not unionized. While the claim has not been certified as a class action, and Insight believes it has many defenses to the claim, there is no assurance that Insight Productions will be successful in defending this action, or that other similar actions may not emerge against the Company. See "Legal Proceedings".

Boat Rocker's business involves risks of liability claims for content, which could adversely affect Boat Rocker's business, results of operations and financial condition.

As a distributor and producer of video content, the Company's revenues are dependent on the unrestricted ownership or control of its rights to programming. Any successful claims challenging ownership or control of these intangible assets could hinder the Company's ability to exploit these rights. In its exploitation of intellectual property, the Company may face potential claims for:

defamation;
invasion of privacy;
misappropriation of personality;
copyright or trademark infringement;
breach of contract for licensing rights beyond what it has secured from third parties or licensing rights in contravention of exclusivity arrangements; or
other claims based on the nature and content of the materials distributed.

One of the risks of the video content production business is the possibility that others may claim that Boat Rocker's programming misappropriates or infringes the intellectual property rights of third parties with respect to their previously developed films and television series, stories, characters, other entertainment or intellectual property. Boat Rocker seeks to protect itself against these claims by not accepting unsolicited submissions, undertaking appropriate searches, securing grants to intellectual property rights in writing, legally monitoring its programming for these kinds of claims, and securing insurance. Despite the processes and protections the Company puts in place, these types of IP claims are not uncommon in the Company's business. Regardless of the validity or the success of the assertion of any such claims, the Company could incur significant costs and diversion of resources in enforcing its intellectual property rights or in defending against such claims. Any imposition of liability that is not covered by insurance or is in excess of insurance coverage could have a Material Adverse Effect.

The Company maintains rights management system to seek to ensure that it tracks what rights it controls in its distribution library and what rights it has licensed to third parties so as to seek to ensure that the Company is not in breach of any exclusivity arrangements it has entered into with licensees. However, rights management in a digital business environment is becoming increasingly complex due to challenges with definitions, semantics and taxonomic issues related to contractual rights. Failure to adequately manage such rights could expose Boat Rocker to risks related to breach of contract or copyright infringement, which could have a Material Adverse Effect.

Protecting and defending against intellectual property claims may have a Material Adverse Effect on the Company's business.

Boat Rocker's ability to compete depends, in part, upon successful protection of its intellectual property. The Company attempts to protect proprietary and intellectual property rights to its programming through available copyright and trademark laws and licensing and distribution arrangements with reputable international companies in specific territories and media for limited durations. Despite these measures, existing copyright and trademark laws afford only limited practical protection in certain countries in which the Company may distribute its products and no assurance can be given that challenges will not be made to the Company's copyrights and trademarks. In addition, technological advances and conversion of video content into digital format have made it easier to create, transmit and share unauthorized copies of television programs. Users may be able to download and/or stream and distribute unauthorized or "pirated" copies of copyrighted material over the Internet. As long as pirated content is available to download and/or stream digitally, some consumers may choose to digitally download or stream material, even where

it is illegal to do so. As a result, it may be possible for unauthorized third parties to copy and distribute the Company's programming, which could have a Material Adverse Effect.

Specific to Boat Rocker's franchise and brand management business, the value of the Company's brands will depend on its ability to protect its intellectual property from third parties who might counterfeit Boat Rocker's products or infringe on its copyrights, trade names and trademarks. While Boat Rocker intends to seek to protect its proprietary rights in its brands and franchises through copyright and trademark registrations, as well as confidentiality provisions and licensing arrangements, such steps may not prevent misappropriation of the Company's intellectual property or deter independent third-party development of similar products. Boat Rocker may not be able to, or may not find it commercially reasonable to, register copyrights or trademarks in all countries in which its intellectual property is exploited, and as a result it may not have the legal right to prevent others from copying or creating competitive products. Monitoring the unauthorized use of the Company's intellectual property throughout the world is costly, and any dispute or other litigation, regardless of the outcome, may be costly and time-consuming and may divert the Company's resources. Additionally, while Boat Rocker has registered various domain names relating to some of its brands, if the Company fails to maintain these registrations, or if a third-party acquires domain names similar to the Company's and engages in a business that may be confusing to the Company's buyers, revenues may decline and the Company may incur additional expenses in maintaining its brands.

Boat Rocker cannot give any assurance that its actions will be adequate to prevent imitation or copying of its video content by others or to prevent third parties from seeking to block sales of its video content as a violation of their proprietary rights. Litigation may be necessary to enforce Boat Rocker's intellectual property rights, to protect its trademarks, to determine the validity and scope of the proprietary rights of others or to defend against claims of infringement or invalidity. Any such litigation, infringement or invalidity claims could result in substantial costs and the diversion of resources and could have a Material Adverse Effect.

Risks Related to the Company's Infrastructure and Protection of Confidential Information

Boat Rocker is dependent on its information technology ecosystem. Failures in certain components of the information technology ecosystem could adversely affect the Company and its operations.

Boat Rocker's ability to conduct its business, including maintaining financial controls, and keeping its production at its animation studio on schedule, is based in part on the efficient and uninterrupted operation of its information technology ecosystem, including its management information systems, animation infrastructure, access to the internet and various cloud solutions. If any of Boat Rocker's production, financial, rights management, personnel, email, other information technology systems, internet access or other systems or processes were to stop operating properly for any significant period of time for any reason (including, for example, hardware or software malfunctions, computer viruses, internet problems or sabotage), Boat Rocker could suffer a disruption to its business, loss of data, increased costs, regulatory intervention and/or reputational damage. In order to reduce the risk that its systems fail, the Company regularly replaces hardware, upgrades software and maintains a robust infrastructure and systems team. In the event the Company does not adequately maintain its information technology systems, any failure of such systems would negatively impact its ability to operate the business, deliver projects on time and would harm the Company's reputation with its buyers and other partners. An inability to operate or enhance information technology systems could have an adverse impact on, among other things, the Company's ability to produce accurate and timely invoices, manage operating expenses and produce accurate and timely financial reports. See also "Risk Factors – Risks Related to External Factors Boat Rocker Cannot Control, Including COVID-19 – Business interruptions could adversely affect Boat Rocker's operations."

A breach of the Company's network security or other theft or misuse of confidential and proprietary information, digital content could have a Material Adverse Effect.

The number and sophistication of attempted and successful information security breaches have increased in recent years and, as a result, the risks associated with such an event continue to increase. Outside parties regularly attempt to penetrate the Company's systems and those of its vendors or to fraudulently induce its employees or buyers or employees of its vendors to disclose sensitive or confidential information to obtain or gain access to the Company's data, business information or other sensitive or confidential information. The Company and its employees are regularly targeted in phishing schemes, including attempts by hackers to impersonate executives or vendors to direct payments outside the Company. Increasingly, the Company is concerned that hackers could attempt to penetrate its information technology systems so as to hold its data and work in progress hostage subject to the payment of significant ransom amounts.

Recently, the email server of one of the Company's subsidiaries was breached. The breach was contained to an isolated server dedicated for use by this subsidiary and no personal information was breached. The Company believes the hacker was attempting to hijack the subsidiary's internet protocol address to carry out illegal activities. As the breach was caught by the Company prior to the hacker using the subsidiary's internet protocol address, the damage was limited to the cost of rebuilding main infrastructure servers, installing new firewall and approximately three weeks of modest but meaningful business interruption to the impacted users. The Company has cyber insurance and has submitted a claim for the costs associated with the breach in the amount of approximately \$150,000 (subject to a deductible). The claim is currently under review and there can be no assurance that any coverage will be available.

The costs relating to any hacking activities or data breaches can be material. Although the Company develops and maintains information security practices and systems designed to prevent these events from occurring, the development and maintenance of these systems are costly and require ongoing monitoring and updating as technologies change and tactics to overcome information security measures become more sophisticated. Despite the Company's efforts, the possibility of these events occurring cannot be eliminated entirely. Moreover, the techniques used by parties seeking to evade information security practices and systems to infiltrate, disrupt, or for some other hostile purpose change rapidly and often are not recognized until launched against some targets. Information security risks will likely continue to increase, and the Company will likely need to expend additional resources to protect its information systems, networks, data, business information and other sensitive or confidential information.

Although the Company has taken steps to reduce these risks, there can be no assurance that potential failures of, or deficiencies in, these systems or processes will not have an adverse effect on the Company's operations and/or its financial results. Moreover, if the Company's systems are penetrated, the costs to repair those systems and the concomitant downtime in the Company's production pipeline can be significant and costly.

Inadequate investment in information technology infrastructure and slow integration of acquired businesses could increase vulnerability of the Company's cyber security against ever changing cyber risks.

The Company has grown and expects to grow through acquisitions. Certain of the businesses the Company has acquired and may acquire in the future have unsophisticated information technology infrastructure which leaves the ecosystem of that business and the Company as a whole vulnerable. If the Company is unable to integrate new businesses into its information technology ecosystems in a timely manner, and apply its policies and practices to all of its infrastructure and users, the Company may be exposed to cyber risks which could negatively impact the Company and its operations and results.

Unauthorized disclosure of sensitive or confidential information could harm the Company's business and standing with its clients, customers, buyers or employees.

The protection of client, buyer, customer, employee and other business data is critical to the Company. Boat Rocker collects, stores, transmits and uses information relating to, among others, its buyers, partners, representatives and financiers. In addition, at any given time the Company has personal information in its files related to its employees, crew and cast members, and the clients of Untitled Entertainment. Despite the Company's attempt to adhere to privacy regulations in various jurisdictions, there is always a risk that personal information within the scope of these regulations could be inadvertently or deliberately disclosed by the Company's employees or that the Company's systems where such information is stored could be breached. See "Risk Factors – Risks Related to the Company's Infrastructure and Protection of Confidential Information – A breach of the Company's network security or other theft or misuse of confidential and proprietary information, digital content could have a Material Adverse Effect". The Company also provides confidential information, digital content and limited personal information to third parties when it is necessary to pursue business objectives. While Boat Rocker seeks assurances that these third parties will protect this information and, where appropriate, monitor the protections employed by these third parties, there is a risk that data systems of these third parties may be compromised and the confidential information may be disclosed.

Risks Related to Bad Publicity and Negative Perceptions of the Company's Business, Key Personnel, Clients or Brands

Adverse publicity concerning Boat Rocker, one of its businesses, its clients or its key personnel or talent could negatively affect the Company's business.

The Company's professional reputation is essential to its continued success, and any decrease in the quality of its reputation could impair its ability to, among other things, recruit and retain key personnel, retain or attract Untitled Entertainment's managers and clients, maintain relationships with its buyers and partners.

Boat Rocker's reputation may be negatively impacted by a number of factors, including negative publicity concerning the Company, members of its management or other key personnel. In addition, Boat Rocker is dependent for a portion of its revenues on key talent managed by Untitled Entertainment, such as actors, many of whom are public personalities with large social media followings whose actions generate significant publicity and public interest. Any adverse publicity relating to such individuals or entities that Boat Rocker employs or represents, or to the Company (including Untitled Entertainment), including from reported or actual incidents or allegations of illegal or improper conduct, such as harassment, discrimination or other misconduct, could result in significant media attention, even if not directly relating to or involving Boat Rocker. Such publicity could have a negative impact on the Company's professional reputation, potentially resulting in termination of licensing or other contractual relationships, or the shunning of talent represented by Untitled Entertainment. Boat Rocker's professional reputation could also be impacted by adverse publicity relating to one or more of its brands or programs. Any the foregoing situations could adversely affect the Company's business, financial condition and results of operations.

In addition, changes in consumers' tastes or a change in the perceptions of the Company's business partners, whether as a result of the social and political climate or otherwise, could adversely affect Boat Rocker's operating results. The Company's failure to avoid a negative perception among consumers or buyers or anticipate and respond to changes in consumer preferences, including in the video content its creates, could result in reduced demand for the Company's services and content offerings or those of its clients, which could have a Material Adverse Effect.

Boat Rocker's business involves potential internal conflicts of interest.

Increasingly, the Company must manage actual and potential internal conflicts of interest in its business due to the breadth and scale of its operations. Different parts of Boat Rocker's business may have actual or potential conflicts of interests with each other, including client representation, video content production, brand exploitation, and content development businesses. Although the Company attempts to manage these conflicts appropriately, any failure to adequately address or manage internal conflicts of interest could adversely affect Boat Rocker's reputation and the willingness of buyers, talent and third parties to work with the Company may be affected if it fails, or appears to fail, to deal appropriately with actual or perceived internal conflicts of interest, which could have a Material Adverse Effect.

Risks Related to Regulations

The Company's activities are subject to a variety of laws and regulations which may adversely impact its operations or, if violated, could subject the Company to an increased risk of litigation and regulatory actions.

The Company is subject to numerous laws and regulations in each territory in which it operates, including among others privacy laws, and any failure by the Company to comply with such laws and regulations could have a Material Adverse Effect.

Boat Rocker is dependent on tax credits to fund its productions, and any change in the regulations for subsidies or reduction in such subsidies could negatively affect the Company's business.

In addition to license fees from buyers, in respect of some of the content produced by the Company (particularly the programming produced in Canada), the Company finances a significant portion of those production budgets with funding from federal and provincial governmental agencies and incentive programs, including, in some cases, the CMF, provincial film equity investment and incentive programs, federal tax credits, provincial tax credits and state tax credits, and other investment and incentive programs. In addition, many of the Company's programs produced outside of Canada are also financed by tax credits and government grants which are subject to complicated eligibility rules and dependent on the ongoing support of such programs by local governments. While Boat Rocker seeks to ensure that it qualifies for local subsidies and that such subsidies are secure, there can be no assurance that individual incentive programs available to the Company will not be reduced, amended or eliminated or that the Company or its productions will qualify for such incentive programs, or that the Company will not have compliance issues in respect of tax credits, any of which may have a Material Adverse Effect.

Loss of Canadian status may result in loss of government tax credits and incentives or default by the Company under broadcast licenses.

The Company could cease to be eligible for the television and film production-related Canadian government tax credits and incentives which subsidize many of its productions produced in Canada if it ceases to be "Canadian" as defined under the ICA. The ICA establishes the ICA Canadian Status Rules for determining who is a "Canadian" for purposes of the ICA. Under the ICA Canadian Status Rules, the Company would not be considered to be a Canadian if one non-Canadian or two or more members of a voting group who are non-Canadians own 50% or more of the voting shares of the Company. Moreover, as the Company is engaged in a prescribed business which is related to Canada's cultural heritage or national identity (i.e., a so called "cultural business" which includes among others, any business which is engaged in film or television production or distribution in Canada), even if the Company qualifies as Canadian-controlled by virtue of the normal ICA Canadian Status Rules, the Minister of Canadian Heritage may nevertheless determine that the Company is not Canadian-controlled where, after considering any information and evidence submitted by or behalf of the Company or otherwise made available to the Minister, the Minister is satisfied that the Company is controlled in fact by one or more non-Canadians. If the Company ceases to be "Canadian" under the ICA, it will no longer be eligible for applicable "Canadian content" government tax credits and incentives and could be required to repay previously received amounts, both of which could have a Material Adverse Effect. The Company's Multiple Voting Shares are designed to help Boat Rocker maintain Canadian status for such purposes. See "Regulatory Matters" and "Authorized Share Capital Upon Closing".

In addition, a certain number of the Company's programs are contractually required by Canadian buyers to be certified as "Canadian-content" productions. If the Company ceased to be "Canadian" under the ICA, it would be in default under any broadcast licenses which require "Canadian content" certification. In the event of such default, among other remedies, the Canadian buyer could refuse acceptance of the Company's productions and demand repayment of its license fee. Moreover, if the Company was no longer "Canadian" under the ICA, it could no longer qualify as a co-production partner under international treaty co-production agreements and it could no longer qualify as a Canadian distributor both for its own productions and for Canadian productions produced by third parties, which would limit its ability to source new library content from Canadian producers.

The regulatory system that governs Canadian producers and Canadian media is under review and changes to the system may have a negative impact on the Company.

Since September 2016, the Canadian government has been reviewing its cultural policies and the legislative frameworks around telecommunications and broadcasting acts, in an effort to update and modernize its approach for the digital era and to address, among other things, how to best support the creation, production and distribution of Canadian content. On November 3, 2020, the Canadian Heritage Minister tabled a bill seeking to modernize the Broadcasting Act (Canada) by extending its application to foreign OTT platforms. The proposed changes to the Broadcasting Act (Canada) would, if adopted, require online players such as Netflix, Amazon Prime Video, Disney+ and Spotify to financially contribute to the support of Canadian music, stories, creators and producers. If the legislation is passed, it is anticipated that these changes to the Canadian regulatory system will be beneficial to the Canadian video content producers, including the Company. However, it is also anticipated that in an effort to "level the playing field" for legacy Canadian linear channels, the CRTC may relax or alter the financial contributions required to be made by those Canadian linear channels towards Canadian programming, which could have an adverse effect on the business of the Company. See "Regulatory Matters".

Risks Related to Indebtedness

As of December 31, 2020, the Company had loans and borrowings of \$93.6 million (inclusive of amounts owing under the Corporate Credit Facility and the Matador Equipment Lease), convertible debentures issued to Fairfax of \$47.3 million (of which \$22.0 million was converted into equity on January 1, 2021 and the remainder will be converted into Subordinate Voting Shares at or prior to Closing), lease obligations of \$31.5 million (inclusive of amounts owing under the Insight Corporate Facilities) and interim production financing of \$139.8 million (inclusive of amounts outstanding under the US Scripted Production Facility). Descriptions of the Company's material debt facilities are described above in "Description of Material Indebtedness". The Company intends to repay all of its term debt under the Corporate Credit Facility (which is the Company's principal corporate credit arrangement) on Closing from the net proceeds of the Treasury Offering. See "Use of Proceeds".

Risks related to US Scripted Production Facility.

Subsidiaries of Platform One Media are party to a US\$100,000,000 senior secured five-year revolving credit facility with a major U.S. bank, which may be increased to US\$250,000,000, in connection with the interim financing of the television productions of Platform One Media. For more details see "Description of Material Indebtedness". The US Scripted Production Facility could have adverse consequences on the business of Boat Rocker, such as:

limiting Boat Rocker's ability to obtain additional financing;
requiring a substantial portion of the Company's cash flows to be dedicated to debt service payments and capitalization of the facility instead of other purposes;
increasing the Company's vulnerability to the ongoing COVID-19 global pandemic and its effects, economic downturns and adverse developments in its business;
exposing the Company to the risk of increased interest rates as certain of its borrowings under the US Scripted Production Facility are at variable rates of interest;
limiting Boat Rocker's flexibility in planning for and reacting to changes in the conditions of the financial markets and its industry;
placing the Company at a competitive disadvantage compared to other, less leveraged competitors and limiting its ability to seek alternative financing for future projects;
increasing the Company's cost of borrowing;
restricting the way in which the business of the Company, specifically its U.S.-based scripted television division, is conducted because of financial and operating covenants in the facility; and
exposing Boat Rocker to potential events of default (if not cured or waived) if one of the Company's subsidiaries breach covenants contained in the credit agreement.

Risks related to corporate debt.

The Company and certain of its subsidiaries are currently indebted under the Corporate Credit Facility and the Matador Equipment Lease, as applicable, and may incur additional indebtedness under such facilities or otherwise in the future. On Closing, the Company intends to repay all of its term debt under the Corporate Credit Facility from the proceeds of the Treasury Offering and, as a result, the demand term loan facilities will be terminated. The Company's corporate indebtedness currently requires, and may require the Company in the future, to comply with various restrictive financial and other covenants that affect, among other things, the manner in which the Company may structure or operate its business or pursue its growth strategies. A failure by the Company to comply with such covenants could result in various adverse consequences, including an event of default (if not cured or waived) or, in the case of the Corporate Credit Facility, an acceleration of the Company's indebtedness. In addition, as a result of the demand nature of the Corporate Credit Facility, an acceleration of the Company's indebtedness can occur without an event of default having occurred. In order to avoid excessive debt, the Company is required to generate sufficient cash flow to service principal and interest payments as they come due. Consistently negative cash flow from operations or material losses could lead to excessive debt levels or restrict the Company from qualifying for new borrowings and other sources of financing if the need were to arise. In addition, consistently negative cash flow from operations could lead to liquidity or solvency concerns or adversely affect the Company's ability to continue as a going concern.

Risks related to the Company's other interim production financing arrangements.

Many of the Company's programs are financed by Canadian banks who specialize in lending to media producers. See "Description of Material Indebtedness – Existing Credit Facilities" and "Description of Material Indebtedness – Interim Production Financing". These interim production facilities could have adverse consequences on Boat Rockers business, such as:

these interim production facilities are demand loans which can be called for repayment by the financier at any time;
Boat Rocker is required to estimate the repayment date for these loans and the interest costs over the life of the loans and, if any of these estimates are incorrect, the cost of borrowing could be higher than anticipated;
these facilities restrict the way in which Boat Rocker conducts its business because of operating covenants in the agreements which prohibit certain actions and expose Boat Rocker to potential events of default (if not cured or waived); and
these interim production facilities are generally guaranteed by Boat Rocker's parent entity and/or other operating companies within the business, and as a result the financiers generally have the ability to seek recourse from Boat Rocker in respect of a default by the operating companies which provided the guarantees.

While the Company has never had an interim financing facility demanded prior to maturity, in the very unlikely event that the Canadian banks who loan funds to the Company pursuant to these arrangements were to demand all outstanding loans, the Company may not have the necessary cash readily available to repay all of the loans and, in such case, would need to seek alternative financing from a third-party or other sources of cash on an expedited basis. The Company has no reason to believe that its production loans will be demanded prior to maturity as this is very uncommon in the industry in which Boat Rocker operates.

Other Risks

Failure to design, test and maintain effective processes and controls could lead to errors in the Company's financial reporting, which could harm the Company's financial performance and cause a decline in its share price.

Boat Rocker has not historically prepared public company financial statements. Boat Rocker was not required to design or maintain effective controls over the financial statement close and reporting process in order to ensure the accrual and timely preparation of financial statements in accordance with IFRS. In addition, information technology controls, including end user and privileged access rights and appropriate segregation of duties, were not required to be designed and tested.

In order to comply with National Instrument 52-109 – Certification of Disclosure in Issuers' Annual and Interim Filings, Boat Rocker has engaged external advisors to evaluate and document the design and operating effectiveness of its internal controls and assist with the remediation and implementation of its internal controls as required. The Company is evaluating the longer-term resource needs of its various financial functions. The process of creating the appropriate control environment and seeking to ensure that it is effective may distract the Company's officers and employees, entail substantial costs to implement new processes and modify the Company's existing processes and take significant time to complete. If Boat Rocker fails to design and fails to have effective controls and is unable to meet the demands that will be placed upon it as a public company, the Company may be unable to report financial results accurately, which could increase operating costs and harm the Company's business, including investors' perception of the business and the share price. If a material weakness were to be found in its controls, the Company cannot make assurances that it will be able to remediate the issue in a timely manner, which could impair its ability to report its financial position and the continued trading of the Company's securities.

Boat Rocker does not expect that its disclosure controls and procedures and internal controls over financial reporting will prevent all error or fraud. A control system, no matter how well-designed and implemented, can provide only reasonable, not absolute, assurance that the control system's objectives will be met. Due to the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues within an organization are detected. Due to the inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and may not be detected in a timely manner or at all. If the Company cannot provide reliable financial reports or prevent fraud, its reputation and operating results could be materially adversely affected, which could also cause investors to lose confidence in the Company's reported financial information, which in turn could result in a reduction of the trading price of the Company's shares or prevent the continued trading of its securities.

Boat Rocker may be exposed to credit risk arising from cash and cash equivalents as well as outstanding receivables which may have a Material Adverse Effect.

Credit risk arises from cash and cash equivalents, as well as credit exposure to buyers, including outstanding receivables. Boat Rocker will seek to manage credit risk on cash and cash equivalents by seeking to ensure wherever appropriate that the counterparties are banks, governments and government agencies with high credit ratings. The balance of trade amounts receivable are mainly with a range of linear channels and other distribution buyers. Management seeks to manage credit risk by regularly reviewing and accounts receivable and appropriate credit analysis.

In assessing credit risk, management includes in its assessment the Company's long-term receivables and considers what impact the long-term nature of the applicable receivable has on credit risk. For certain arrangements with licensees, the Company is considered the agent, and only reports the revenue net of the licensor's share. When the Company bills a third-party in full where it is an agent for the licensor, the Company records an offsetting amount in accounts payable that is only payable to a licensee when the amount is collected from the third-party. This reduces the risk, as the Company is only exposed to the amounts receivable related to the revenue it records.

Boat Rocker may not be able to secure the necessary studio space to produce its television series, or the cost of such studio space may be in excess of estimated amounts.

Boat Rocker produces much of its live action video content in Los Angeles, New York and Toronto, where there is a shortage of suitable studio space for filming live action productions. The Company's larger competitors are able to commit to renting studio space at a premium for multi-year terms in order to ensure they always have space available for their productions. Boat Rocker cannot make such commitments in advance of securing full financing for any production and as such it may have to consider less than ideal studio spaces or pay for studio space in excess of budgeted amounts. If the demand for studio space continues, and the supply is not increased, Boat Rocker will continue to have uncertainty in respect of its ability to produce the series on its development slate at the estimated cost and as contemplated in its production schedules, which could have a negative effect on the Company's business operations and results.

Certain of the Company's buyers and customers may terminate their contracts.

Much of the Company's programming, particularly animation, is produced on a "work for hire" or "services" basis. In those cases, the Company is contracted by the owner of the intellectual property to produce a project on agreed terms and Boat Rocker has no rights to the project or, in some cases, assurance that the customer will not terminate the services agreement or re-hire Boat Rocker for a subsequent season. Though Boat Rocker has never had a customer terminate an animation contract mid-way through production and endeavours to negotiate service agreements that have limited termination rights, provide sufficient notice of termination and/or provide the Company with a significant termination fee in the event of cancellation, there can be no assurance that it will always be able to secure these terms or that a customer will not elect to terminate a project underway. In respect of unscripted programming produced on a "work for hire" or "services" basis, buyers may indicate that a program is greenlit, but subsequently choose not to order the show, or in some limited cases, enter into a binding contract to engage the Company to produce video content and subsequently terminate the contract prior to the start of principal photography. In the latter case, the Company will be paid for its work to date and may be paid a termination fee, but not the entirety of the fees it would have made if the programming was produced. If the Company's customers and buyers exercise their termination rights it could have a negative effect on the Company's business operations and results.

Boat Rocker is subject to income taxes both federally and provincially, and to audits from tax authorities in those jurisdictions. Any audits could materially affect the income taxes payable or receivable in any jurisdiction, which changes would affect Boat Rocker's financial statements.

In preparing its financial statements, the Company is required to estimate production tax credits receivable in each of the jurisdictions in which it operates, taking into consideration tax laws, regulations and interpretations that pertain to its activities. In addition, Boat Rocker is subject to audits from these tax authorities on an ongoing basis and the outcome of such audits could materially affect the amount of tax credits receivable recorded on its consolidated balance sheets and the income tax expense recorded on its consolidated statements of earnings. Any cash payment or receipt resulting from such audits would have an impact on Boat Rocker's cash resources available for its operations and its overall results of operations.

Investment eligibility.

The Company will endeavour to cause the Subordinate Voting Shares to continue to be a qualified investment under the Tax Act for trusts governed by registered retirement savings plans, registered education savings plans, registered retirement income funds, deferred profit sharing plans, registered disability savings plans and tax free savings accounts, although no assurance can be given that the shares will satisfy the conditions prescribed in relation to qualified investments for such plans, funds or accounts at any particular time. The Tax Act imposes penalties on such plans, funds or accounts for the acquisition or holding of non-qualified or prohibited investments.

Registration rights of Registering Shareholders could result in a significant reduction in the market price of the Subordinate Voting Shares.

Shareholders who have been granted registration rights have the right to require the Company to arrange the sale of their Subordinate Voting Shares by way of a prospectus. See "Registration Rights". Any sale of Subordinate Voting Shares by such Shareholders by way of prospectus or otherwise could significantly reduce the market price of the Subordinate Voting Shares and impede Boat Rocker's ability to raise capital through the issuance of additional Subordinate Voting Shares.

Partially-owned entities.

The Company has interests in non-wholly-owned subsidiaries, including Insight Productions and Untitled Entertainment, which are subject to agreements that may affect the Company's flexibility and ability to implement strategies and financing and other plans that the Company believes are in the Company's and/or the applicable subsidiary's best interests. Such agreements may also contain, among other things, provisions relating to the applicable subsidiary's governance structure, drag and/or tag along rights, put/call rights and restrictions on equity transfers.

Specifically, the founders of Untitled Entertainment have a put right with respect to some or all of their interest commencing in February 2024 (or earlier in the event of certain "good leaver" employment termination events) pursuant to which the founders will be entitled to receive the fair market value (as mutually agreed or determined by an independent appraiser) of such interest, payable in cash. Boat Rocker has a reciprocal call right. In the event that one or both of the founders of Untitled Entertainment elects to exercise their put right, the value of their stake in the business will be determined, in part, on whether such founder has agreed to continue to work for Untitled Entertainment beyond the closing of the put/call transaction. In the event one or both of the founders of Untitled Entertainment exercised their put right and do not elect to continue to work for Untitled Entertainment, there is a risk that Untitled Entertainment will be unable to retain its managers and/or clients, which could result in a Material Adverse Effect. See "Rights to Acquire Shares – Untitled Entertainment".

The sellers of Insight Productions retain a 30% ownership stake in the company. Effective May 17, 2021, the minority shareholder of Insight will have the right to "put" its remaining stake in Insight to Boat Rocker for purchase (and Boat Rocker has a mirror "call" right). The employment agreement for John Brunton, Insight's chairman and chief executive officer (and founder, who is the majority shareholder of the minority shareholder) expires at the same time. Mr. Brunton has long standing relationships with many of Boat Rocker's buyers of unscripted content, particularly in Canada. In the event Mr. Brunton elects to cause the minority shareholder of Insight to exercise the put, and he does not continue his employment with Insight, Insight's ability to sell unscripted content in the Canadian market may be negatively impacted which could result in a Material Adverse Effect. See "Rights to Acquire Shares – Insight Productions".

The Company's by-laws provide that any derivative actions, actions relating to breach of fiduciary duties and other matters relating to the Company's internal affairs will be required to be litigated in Canada, which could limit your ability to obtain a favourable judicial forum for disputes with the Company.

Prior to Closing, the Company expects to adopt a forum selection provision in its by-laws that provides that, unless the Company consents in writing to the selection of an alternative forum, the Superior Court of Justice of the Province of Ontario, Canada and appellate courts therefrom (or, failing such court, any other "court" as defined in the Corporations Act having jurisdiction, and the appellate courts therefrom), will be the sole and exclusive forum for (i) any derivative action or proceeding brought on the Company's behalf, (ii) any action or proceeding asserting a breach of fiduciary duty owed by any of the Company's directors, officers or other employees to the Company, (iii) any action or proceeding asserting a claim arising pursuant to any provision of the Corporations Act or the Company's articles or by-laws; or (iv) any action or proceeding asserting a claim otherwise related to the Company's "affairs" (as defined in the Corporations Act). The Company's forum selection provision also provides that its shareholders are deemed to have consented to personal jurisdiction in the Province of Ontario and to service of process on their counsel in any foreign action initiated in violation of the foregoing provisions. Therefore, it may not be possible for Shareholders to litigate any action relating to the foregoing matters outside of the Province of Ontario.

The Company's forum selection provision seeks to reduce litigation costs and increase outcome predictability by requiring derivative actions and other matters relating to its affairs to be litigated in a single forum. While forum selection clauses in corporate charters and by-laws are becoming more commonplace for public companies in the United States and have been upheld by courts in certain states, they are untested in Canada. Accordingly, it is possible that the validity of the Company's forum selection provision could be challenged and that a court could rule that such provision is inapplicable or unenforceable. If a court were to find the Company's forum selection provision inapplicable to, or unenforceable in respect of, one or more of the specified types of actions or proceedings, the Company may incur additional costs associated with resolving such matters in other jurisdictions and may not obtain the benefits of limiting jurisdiction to the courts selected.

Risks Related to the Offering

Risks related to forward-looking information in this Prospectus.

The forward-looking statements included in this Prospectus relating to, among other things, future results, performance, achievements, prospects or opportunities of the Company or the market in which the Company operates (including, in particular, the information contained in "Prospectus Summary", "The Business of the Company", "Outlook", "Boat Rocker Pro Forma Consolidated Financial Information", "Management's Discussion and Analysis of Boat Rocker", "Regulatory Matters", "Use of Proceeds", "Authorized Share Capital Upon Closing", "Pre-Closing Capital Changes", "Issued Share Capital Upon Closing", "Dividend Policy", "Principal and Selling Shareholders", "Principal Shareholders Agreement", "Registration Rights", "Consolidated Capitalization", "Directors and Executive Officers", "Corporate Governance", "Executive Compensation", "Director Compensation" and "Risk Factors") and the other statements in "Caution Regarding Forward-Looking Statements" are based on opinions, assumptions and estimates made by the Company in light of its experience and perception of historical trends, current conditions and expected future developments, as well as other factors that the Company believes are appropriate and reasonable in the circumstances. However, there can be no assurance that such estimates and assumptions will prove to be correct. Actual results of the Company in the future may vary significantly from the historical and estimated results and those variations may be material. There is no representation by the Company that actual results achieved by the Company in the future will be the same, in whole or in part, as those included in this Prospectus. The proceeds from the Treasury Offering are expected in part to fund certain operational investments under the Company's business plan for 2021 and in the first half of 2022. There is no assurance that the proceeds will be sufficient to do so. See "Caution Regarding Forward-Looking Statements".

No prior public market for the Subordinate Voting Shares.

The TSX has not conditionally approved the Company's listing application for the Subordinate Voting Shares and there is no assurance that it will do so. Prior to the Offering, there has been no public trading market for the Subordinate Voting Shares, and the Company cannot offer assurances that one will develop or be sustained after the Offering. The Company cannot predict the prices at which the Subordinate Voting Shares will trade. The Offering Price was determined through negotiations among the Company, the Selling Shareholders and the Underwriters, and may not bear any relationship to the market price at which the Subordinate Voting Shares may trade after the Offering, or to any other established criteria of the Company's value.

Risk of loss of entire investment.

An investment in the Subordinate Voting Shares is speculative and may result in the loss of an investor's entire investment. Only potential investors who are experienced in high risk investments and who can afford to lose their entire investment should consider an investment in the Company.

The market price of the Subordinate Voting Shares may be volatile as a result of factors beyond the Company's control.

Securities markets have a high level of price and volume volatility, and the market price of shares of many companies have experienced wide fluctuations in price which have not necessarily been related to the operating performance, underlying asset values or prospects of such companies. The market price for the Subordinate Voting Shares may be volatile and subject to wide fluctuations in response to numerous factors, many of which are beyond the Company's control, including without limitation the following:

actual or anticipated fluctuations in the Company's quarterly results of operations, including changes in earnings or variations in operating results;
change in the value of the Company's assets;
operating performance and, if applicable, share price performance of the Company's competitors;
addition or departure of members of management and other key personnel;
expiration of lock-up agreements in respect of outstanding Subordinate Voting Shares;
sales of additional Subordinate Voting Shares;
conditions in the economy in general or in the film, television, talent management or broadcasting sectors in particular;
the impact of the ongoing COVID-19 global pandemic and measures to prevent its spread, and the resulting economic uncertainty;
changes in applicable laws and regulations;
significant acquisitions or business combinations, strategic partnerships, joint ventures or capital commitments by or involving the Company or its competitors;
news reports relating to trends, concerns, technological or competitive developments, regulatory changes and other related industry and market issues; and/or
loss of a major funding source.

Financial markets have recently experienced significant price and volume fluctuations that have particularly affected the market prices of equity securities and that have often appeared to have been unrelated to the operating performance, underlying asset values or business prospects. Accordingly, the market price of the Subordinate Voting Shares may decline even if the Company's operating results, underlying asset values or business prospects have not changed. There can be no assurance that continuing fluctuations in share price and volume will not occur, which could have an adverse effect. No prediction can be made as to the effect, if any, that future sales of Subordinate Voting Shares or the availability of Subordinate Voting Shares for future sale (including Subordinate Voting Shares issuable upon the exercise of stock options or other rights) will have on the market price of the Subordinate Voting Shares prevailing from time to time. Sales of substantial numbers of Subordinate Voting Shares, or the perception that such sales could occur, could adversely affect the prevailing price of the Company's Subordinate Voting Shares.

In addition, the trading market for the Subordinate Voting Shares may rely in part on the research and reports that securities analysts and other third parties choose to publish about the Company, if applicable. The Company does not control these analysts or other third parties and it is possible that no analysts or third parties will cover the Company. The price of the Subordinate Voting Shares could decline if one or more securities analysts downgrade the Company or if one or more securities analysts or other third parties publish inaccurate or unfavourable research about the Company or cease publishing reports about the Company.

As a result of any of these factors, the market price of the Subordinate Voting Shares may be volatile and, at any given point in time, may not accurately reflect the long-term value of Boat Rocker. This volatility may affect the ability of holders of Subordinate Voting Shares to sell their Subordinate Voting Shares at an advantageous price.

Future sales of Subordinate Voting Shares by existing shareholders.

Sales of a substantial number of issued and outstanding Subordinate Voting Shares in the public market could occur at any time after the expiration of the 180-day contractual lock-up period described under "Plan of Distribution – Lock-Up Arrangements" of this Prospectus, subject to certain exceptions. These sales, or the market perception that the holders of a large number of Subordinate Voting Shares intend to sell their Subordinate Voting Shares, could reduce the market price of the Subordinate Voting Shares. The Company cannot predict the effect, if any, that future public sales of these securities or the availability of these securities for sale will have on the market price for the Subordinate Voting Shares. If the market price of the Subordinate Voting Shares was to drop as a result, it could impair the Company's ability to raise additional capital through the sale of securities.

While the Company's existing shareholders have agreed not to sell their shares for 180 days following the Closing, there can be no assurance that following such a restriction period some or all of such shareholders will not sell all or a substantial portion of their shares. Moreover, after the Offering, certain of the Company's existing shareholders will have certain rights under the Registration Rights Agreement to require the Company to file a prospectus covering their registrable securities or to include their registrable securities in prospectuses that the Company may file. The Company cannot predict the size of future issuances of the Subordinate Voting Shares or the effect, if any, that future issuances and sales of Subordinate Voting Shares will have on the market price for such securities.

Public company financial reporting and other regulatory obligations.

Prior to this Offering, the Company was not subject to the continuous and timely disclosure requirements of Canadian securities laws and the rules, regulations and policies of any stock exchange. As a public company, Boat Rocker will incur increased legal, accounting and other costs not incurred as a private company. Boat Rocker will be subject to, among other things, the rules and regulations of the applicable securities regulators and stock exchange. Boat Rocker expects that compliance with these requirements will increase the Company's legal and financial compliance costs and will make some activities more time consuming and costly. In addition, the Company expects that its management and other personnel will need to divert attention from operational and other business matters to devote substantial time to these public company requirements. The Company has made, and will continue to make, changes to its financial management control systems and other areas to seek to manage its obligations as a public company, including corporate governance, internal controls, disclosure controls and procedures and financial reporting and accounting systems. However, the Company cannot assure holders of Subordinate Voting Shares that these and other measures that it might take will be sufficient to allow it to satisfy its obligations as a public company on a timely basis.

As a public company, the Company will be subject to the reporting requirements and related rules and regulations of the Canadians securities regulators, as well as the rules of any applicable stock exchange. The financial and managerial resources necessary to seek to ensure such compliance could escalate significantly in the future, which could have a Material Adverse Effect. In order to establish effective disclosure controls and procedures and internal control over financial reporting, under applicable securities law, significant resources and management oversight will be required. The Company expects to incur significant additional annual costs related to its public company status including but not limited to filing fees, fees related to its reporting requirements, legal and administrative costs, and increased audit fees. As well, such laws and regulations are subject to change. Accordingly, it is impossible for the Company to predict the cost or impact of such laws and regulations on future operations.

Dilution.

The Company is authorized to issue an unlimited number of Shares for such consideration and on those terms and conditions as shall be determined by the Board without the approval of any Shareholders, subject to applicable stock exchange and regulatory requirements. The Company may make future acquisitions or enter into other transactions involving the issuance of securities which may be dilutive.

Future offerings of debt and equity.

In the future, the Company may attempt to increase its capital resources by making offerings of debt securities or additional offerings of equity securities. Upon bankruptcy or liquidation, holders of the Company's debt securities and lenders with respect to other borrowings will be entitled to receive a distribution of the Company's available assets prior to the holders of its Subordinate Voting Shares. Additional equity offerings may dilute the holdings of the Company's existing shareholders or reduce the market price of its Subordinate Voting Shares, or both. Preferred shares, if issued, could have a preference on liquidating distributions or a preference on dividend payments or both that could limit the Company's ability to make a dividend or other distribution to the holders of its Subordinate Voting Shares. The Company's decision to issue securities in any future offering will depend on market conditions and other factors beyond its control. As a result, the Company cannot predict or estimate the amount, timing or nature of its future offerings, and purchasers of its Subordinate Voting Shares in this Offering bear the risk of the Company's future offerings reducing the market price of its Subordinate Voting Shares and diluting their ownership interest in the Company.

Claims for indemnification by Boat Rocker's directors and officers.

Boat Rocker's by-laws provide that the Company will indemnify its directors and officers. In addition, Boat Rocker expects to enter into agreements prior to Closing to indemnify its directors and certain officers and other key employees as determined by the Board. Under the terms of the indemnification agreements, the Company is required to indemnify each of its directors and officers, to the fullest extent permitted by law, if the basis of the indemnitee's involvement was by reason of the fact that the indemnitee is or was a director or officer of the Company or any of its subsidiaries. Boat Rocker may be required to indemnify its officers and directors against all reasonable fees, expenses, charges and other costs of any type or nature whatsoever, including any and all expenses and obligations paid or incurred in connection with investigating, defending, being a witness in, participating in (including on appeal), or preparing to defend, be a witness or participate in any completed, actual, pending or threatened action, suit, claim or proceeding, whether civil, criminal, administrative or investigative, or establishing or enforcing a right to indemnification under the indemnification agreement.

Limited public company experience.

The individuals who now constitute Boat Rocker's senior management team have limited or no experience managing a publicly-traded company and limited or no experience complying with the increasingly complex laws pertaining to public companies. Boat Rocker's senior management team may not successfully or efficiently manage the Company's transition to being a public company subject to significant regulatory oversight and reporting obligations under Canadian securities laws. In particular, these new obligations will require substantial attention from the Company's senior management and could divert their attention away from the day-to-day management of Boat Rocker's business.

Use of Treasury Offering proceeds.

Part of the net proceeds from the Treasury Offering are expected to be used to repay all of the Company's term debt under the Corporate Credit Facility (which is its principal corporate credit arrangement). Management will have broad discretion to use the balance of the net proceeds from the Treasury Offering for working capital and general corporate purposes (which may include securing and developing IP, as well as potential future acquisitions and/or strategic investments) and is unable to definitively allocate the balance of the net proceeds to such uses at this time. See "Use of Proceeds". Holders of Subordinate Voting Shares will be relying on the judgment of management regarding the application of these proceeds, and management might not apply the net proceeds from the Treasury Offering in ways that increase the value of the Shares or yield a significant return, if any, on any investment of these net proceeds.

Holders of Subordinate Voting Shares will not have the opportunity to influence the Company's decision on how to use the net proceeds from the Treasury Offering.

Significant ownership by the Principal Shareholders.

The Company's Multiple Voting Shares have up to 10 votes per share and the Company's Subordinate Voting Shares, which are the shares being sold in the Offering, have one vote per share. On Closing, it is expected that the Principal Shareholders, either directly or, indirectly, will hold an approximate 92.9% voting interest (and an approximate 62.8% equity interest) in the Company through their ownership of Shares (or an approximate 92.2% voting interest and a 60.4% equity interest in the Company if the Over-Allotment Option is exercised in full). As a result, the Principal Shareholders will following Closing, in the aggregate, have over 90% of the voting power over all corporate actions requiring shareholder approval, including election of the Company's directors and significant corporate transactions.

In addition, because of the maximum 10-to-1 voting ratio between the Company's Multiple Voting Shares and Subordinate Voting Shares, the Principal Shareholders will continue to control a majority of the combined voting power of the Company's voting Shares even where the Multiple Voting Shares represent a substantially reduced percentage of the Company's total outstanding Shares. The concentrated voting control of the Principal Shareholders will limit the ability of holders of Subordinate Voting Shares to influence corporate matters for the foreseeable future, including the election of directors of the Company as well as with respect to decisions regarding amendment of the Company's share capital, creating and issuing additional classes of shares, making significant acquisitions, selling significant assets or parts of the Company's business, merging with other companies and undertaking other significant transactions. As a result, the Principal Shareholders will have the ability to influence many matters affecting the Company and actions may be taken that holders of Subordinate Voting Shares may not view as beneficial. The market price of the Subordinate Voting Shares could be adversely affected due to the significant voting interest of the Principal Shareholders. The Subordinate Voting Shares may be less liquid and trade at a discount relative to the trading that could occur in circumstances where the Principal Shareholders did not have the ability to significantly influence or determine matters affecting the Company. Additionally, the Principal Shareholders' interest in the Company may discourage transactions involving a change of control of the Company, including transactions in which an investor, as a holder of Subordinate Voting Shares, might otherwise receive a premium for its Subordinate Voting Shares over the then-current market price. See "Principal Shareholders Agreement".

Future transfers by the Principal Shareholders are subject to certain rights of first refusal. See "Principal Shareholders Agreement – Rights of First Refusal", which, if exercised will have the effect of increasing the relative voting power of those Principal Shareholders that retain their Multiple Voting Shares. In addition, in the event that these rights of first refusal are not exercised by the other Principal Shareholders, it will generally result in those Multiple Voting Shares converting into Subordinate Voting Shares, which will again have the effect, over time, of increasing the relative voting power of those Principal Shareholders that retain their Multiple Voting Shares. See "Authorized Share Capital Upon Closing – Voting Rights". If, for example, the Company's Chief Executive Officer, John Young, who will hold approximately 4.1% of the outstanding Multiple Voting Shares following the Offering, retains a significant portion of his holdings of Multiple Voting Shares for an extended period of time or exercises his rights of first refusal upon a future transfer from another Principal Shareholder, he could, in the future, control an increased percentage of the combined voting power of the Company's Subordinate Voting Shares and Multiple Voting Shares. Each of the Company's directors and officers owes a fiduciary duty to the Company and must act honestly and in good faith with a view to the Company's best interests. However, any director and/or officer that is a Shareholder, even a controlling Shareholder, is entitled to vote his or her shares in his or her own interests, which may not always be in the interests of the Shareholders generally.

Limited voting rights of the Subordinate Voting Shares.

Holders of Subordinate Voting Shares will only have a right to vote, as a class, in the limited circumstances described elsewhere in this Prospectus. The Board will determine major policies and strategy, including policies and strategy regarding financing, growth, debt capitalization and any future dividends to shareholders. Generally, the Board may amend or revise these and other policies and strategies without a vote of the holders of Subordinate Voting Shares. The Board's broad discretion in setting policies and strategies and the limited ability of holders of Subordinate Voting Shares to exert control over those policies and strategies may increase the uncertainty and risks of an investment in the Company.

PLAN OF DISTRIBUTION

General

Pursuant to an underwriting agreement dated [●], 2021 among the Company, the Selling Shareholders and the Underwriters, (the "Underwriting Agreement"), the Company and the Selling Shareholders have agreed to sell and the Underwriters have agreed to severally purchase on Closing (or such later date as the Company, the Selling Shareholders and the Underwriters agree, but not later than [●], 2021) [●] Subordinate Voting Shares and 459,097 Subordinate Voting Shares, respectively, at a price of \$[●] per Subordinate Voting Share, for aggregate gross consideration of \$[●] payable in cash to the Company and \$[●] payable in cash to the Selling Shareholders against delivery of the Subordinate Voting Shares. The Company and the Selling Shareholders have agreed to pay the Underwriters, in consideration for the services provided in connection with the Offering, an Underwriters' Fee of \$[●] per Subordinate Voting Share. It is estimated that the total expenses of the Offering, not including the Underwriters' Fee, will be approximately \$[●], which will be paid by the Company.

The Offering Price of the Subordinate Voting Shares has been determined by negotiation among the Company, the Selling Shareholders and the Underwriters. After the Underwriters have made a reasonable effort to sell all of the Subordinate Voting Shares offered by this Prospectus at that price, the initially stated Offering Price may be decreased, and further changed from time to time, by the Underwriters to an amount not greater than the initially stated Offering Price and, in such case, the compensation realized by the Underwriters will be decreased by the amount that the aggregate price paid by the purchasers for the Subordinate Voting Shares is less than the gross proceeds paid by the Underwriters to the Company and the Selling Shareholders. Any such reduction in price will not affect the proceeds received by the Company. The Underwriters may form a selling group including other qualified investment dealers and determine the fee payable to the members of such group, which fee will be paid by the Underwriters out of their fees.

The obligations of the Underwriters under the Underwriting Agreement are several and not joint. The Underwriters are, however, severally obligated to take up and pay for all of the Subordinate Voting Shares if any of the Subordinate Voting Shares are purchased under the Underwriting Agreement. The Underwriters are not required to take up or pay for the Subordinate Voting Shares covered by the Over-Allotment Option described below. The Selling Shareholders will pay the Underwriters' Fee in respect of the Subordinate Voting Shares sold by the Selling Shareholders under the Secondary Offering. The obligations of the Underwriters under the Underwriting Agreement are conditional and may be terminated upon the occurrence of certain stated events, including "regulatory proceedings out", "disaster out", "market out", "material change or change in material fact out" and "noncompliance with conditions out".

Under applicable securities laws in Canada, certain persons and individuals, including the Company, the Selling Shareholders and the Underwriters, have statutory liability for any misrepresentation in this Prospectus, subject to available defences. The Company and the Selling Shareholders have agreed to indemnify the Underwriters and their directors, executive officers, employees and agents, against certain liabilities, including civil liabilities under applicable securities legislation, and to contribute with respect to payments that the Underwriters may be required to make in respect thereof. The Company and the Selling Shareholders have agreed to indemnify one another against liabilities with respect to certain information related solely to the respective party and furnished to the others for use in this Prospectus.

The Offering is being made in each of the provinces and territories of Canada (the "Offering Jurisdictions"). The Subordinate Voting Shares will be offered in each of the Offering Jurisdictions through those Underwriters or their affiliates who are registered to offer the Subordinate Voting Shares in such provinces and such other registered dealers as may be designated by the Underwriters. Subject to applicable law and the provisions of the Underwriting Agreement, the Underwriters may offer the Subordinate Voting Shares outside of Canada.

The Company has applied to have the Subordinate Voting Shares listed on the TSX under the trading symbol "BRMI". Listing is subject to the approval of the TSX in accordance with its original listing requirements. The TSX has not conditionally approved the listing of the Subordinate Voting Shares and there is no assurance that the TSX will approve the Company's listing application.

There is currently no market through which the Subordinate Voting Shares may be sold and prospective purchasers may not be able to resell the Subordinate Voting Shares purchased under the final prospectus. Subscriptions for the Subordinate Voting Shares will be received subject to rejection or allotment, in whole or in part, and the Underwriters reserve the right to close the subscription books at any time without notice. Closing is expected to occur on the Closing Date, or such other date as the Company and the Underwriters may agree, but in any event no later than [●], 2021. Closing is conditional upon the Subordinate Voting Shares being approved for listing on the TSX.

The Subordinate Voting Shares offered hereby have not been, and will not be, registered under the U.S. Securities Act or the securities laws of any state of the United States and may not be offered, sold or delivered, directly or indirectly, in the United States except pursuant to an exemption from the registration requirements of the U.S. Securities Act and applicable state securities laws. Accordingly, each Underwriter has agreed that it will not offer or sell the Subordinate Voting Shares within the United States except in transactions exempt from the registration requirements of the U.S. Securities Act and applicable state securities laws. The Underwriting Agreement provides that the Underwriters, acting through their respective U.S. registered broker-dealer affiliates, may re-offer and re-sell the Subordinate Voting Shares that they have acquired pursuant to the Underwriting Agreement in the United States, to "qualified institutional buyers" (as defined in Rule 144A under the U.S. Securities Act) in accordance with Rule 144A under the U.S. Securities Act and in compliance with similar exemptions under applicable state securities laws. The Underwriting Agreement also provides that the Underwriters may offer and sell the Subordinate Voting Shares outside the United States in accordance with Regulation S under the U.S. Securities Act. The Subordinate Voting Shares that are sold in the United States will be restricted securities within the meaning of Rule 144 under the U.S. Securities Act. In addition, until 40 days after the commencement of the Offering, an offer or sale of the Subordinate Voting Shares within the United States by any dealer (whether or not participating in the Offering) may violate the registration requirements of the U.S. Securities Act, unless such offer is made pursuant to an exemption from registration under the U.S. Securities Act.

Over-Allotment Option

Pursuant to the Underwriting Agreement, the Company has granted the Underwriters an Over-Allotment Option to cover over-allotments, if any, and for market stabilization purposes. The Over-Allotment Option may be exercised by the Underwriters, in whole or in part at any time and from time to time, for a 30 day period following the Closing and entitles the Underwriters to purchase from the Company up to [●] Subordinate Voting Shares at the Offering Price (being 15% of the aggregate number of Subordinate Voting Shares offered under this Prospectus) solely to cover over-allotments, if any, and for market stabilization purposes. If the Over-Allotment Option is exercised in full, the total Price to the Public will be \$[●], the Underwriters' Fee will be \$[●] and the Net Proceeds to the Company will be \$[●]. This Prospectus qualifies the grant of the Over-Allotment Option and the distribution of the Subordinate Voting Shares upon exercise of the Over-Allotment Option. A purchaser who acquires the Subordinate Voting Shares forming part of the Underwriters' over-allocation position acquires those Subordinate Voting Shares under this Prospectus, regardless of whether the over-allocation position is ultimately filled through the exercise of the Over-Allotment Option or secondary market purchases.

Price Stabilization and Short Positions

In connection with the Offering, the Underwriters may, subject to applicable law, over-allocate or effect transactions which stabilize, maintain or otherwise affect the market price of the Subordinate Voting Shares at levels other than those which otherwise might prevail on the open market, including: stabilizing transactions; short sales; purchases to cover positions created by short sales; imposition of penalty bids; and syndicate covering transactions.

Stabilizing transactions consist of bids or purchases made for the purpose of preventing or retarding a decline in the market price of the Subordinate Voting Shares while the Offering is in progress. These transactions may also include making short sales of the Subordinate Voting Shares, which involve the sale by the Underwriters of a greater number of Subordinate Voting Shares than they are required to purchase in the Offering. Short sales may be "covered short sales", which are short positions in an amount not greater than the Over-Allotment Option, or may be "naked short sales", which are short positions in excess of that amount.

The Underwriters may close out any covered short position either by exercising the Over-Allotment Option, in whole or in part, or by purchasing Subordinate Voting Shares in the open market. In making this determination, the Underwriters will consider, among other things, the price of the Subordinate Voting Shares available for purchase in the open market compared with the price at which they may purchase Subordinate Voting Shares through the Over-Allotment Option.

The Underwriters must close out any naked short position by purchasing Subordinate Voting Shares in the open market. A naked short position is more likely to be created if the Underwriters are concerned that there may be downward pressure on the price of the Subordinate Voting Shares in the open market that could adversely affect purchasers who purchased in the Offering. Any naked short sales will form part of the Underwriters' over-allocation position. A purchaser who acquires Subordinate Voting Shares forming part of the Underwriters' over-allocation position resulting from any covered short sales or naked short sales will, in each case, acquire such Subordinate Voting Shares under this Prospectus, regardless of whether the over-allocation position is ultimately filled through the exercise of the Over-Allotment Option or secondary market purchases.

In addition, in accordance with rules and policy statements of certain Canadian securities regulators, the Underwriters may not, at any time during the period of distribution, bid for, or purchase, Subordinate Voting Shares. The foregoing restriction is, however, subject to exceptions where the bid or purchase is not made for the purpose of creating actual or apparent active trading in, or raising the price of, the Subordinate Voting Shares. These exceptions include a bid or purchase permitted under the by-laws and rules of applicable regulatory authorities and the applicable securities exchange, including the Universal Market Integrity Rules for Canadian marketplaces, relating to market stabilization and passive market making activities and a bid or purchase made for and on behalf of a buyer where the order was not solicited during the period of distribution.

As a result of these activities, the Underwriters may effect transactions which stabilize or maintain the market price for the Subordinate Voting Shares, and the price of the Subordinate Voting Shares maybe higher than the price that otherwise might exist in the open market. If these activities are commenced, they may be discontinued by the Underwriters at any time. The Underwriters may carry out these transactions on any stock exchange on which the Subordinate Voting Shares are listed, in the over-the-counter market, or otherwise.

Book Entry System

Registration of interests in and transfers of the Subordinate Voting Shares may be made through the bookentry system administered by CDS, the whole subject to applicable law. On or about the date of Closing, the Company and the Selling Shareholders will cause a certificate or global certificates representing the aggregate number of Offered Shares to be delivered to, and registered in the name of CDS, or will cause the Offered Shares to be issued or authenticated in non-certificated format, as applicable. The Subordinate Voting Shares must be purchased, transferred and surrendered for redemption, exchange or retraction through a participant in the CDS depository service ("CDS Participant"). All rights of an owner of the Subordinate Voting Shares must be exercised through, and all payments or other property to which such owner is entitled will be made or delivered by CDS or the CDS Participant through which the owner holds the Subordinate Voting Shares. Upon a purchase of any Subordinate Voting Shares, the owner will receive only the customary confirmation. References in this Prospectus to a shareholder of the Subordinate Voting Shares means, unless the context otherwise requires, the owner of the beneficial interest in such securities.

The ability of a beneficial owner of the Subordinate Voting Shares to pledge such securities or otherwise take action with respect to such owner's interest in such securities (other than through a CDS Participant) may be limited due to the lack of a physical unit certificates.

The Company has the option to terminate registration of the Subordinate Voting Shares through the bookentry system, in which event certificates for shares in fully registered form will be issued to the beneficial owners of such shares or their nominees.

Lock-up Arrangements

The Company, the Selling Shareholders, and each security holder of the Company holding, directly or indirectly (together with such security holder's associates and affiliates), securities of the Company outstanding prior to the Closing of the Offering have agreed that, without the prior written consent of the Joint Bookrunners, not to be unreasonably withheld, they will not, during the period ending 180 days after the Closing Date: (i) offer, sell, issue, contract to sell, pledge or otherwise dispose of, directly or indirectly, any equity securities of the Company, rights to purchase any equity securities of the Company or any securities convertible into or exercisable or exchangeable for equity securities of the Company; (ii) enter into any swap, hedge or any other agreement that transfers, in whole or in part, the economic consequences of ownership of equity securities of the Company; or (iii) agree or announce any intention to do any of the foregoing, other than the Subordinate Voting Shares subject to the Over-Allotment Option and certain other exceptions. Notwithstanding the foregoing, the Company may: (a) grant stock options and other securities in the normal course pursuant to any equity incentive plan of the Company existing on or prior to the Closing Date; (b) issue securities of the Company upon the conversion, exercise or exchange of convertible, exercisable or exchangeable securities existing on the Closing Date or upon the exercise of stock options or equity incentive securities subsequently granted as permitted; (c) issue securities in connection with obligations of the Company to issue securities in respect of agreements existing as of the Closing Date; and (d) issue securities of the Company as consideration or partial consideration to vendors in connection with the ordinary course purchase of assets or shares by the Company, subject to certain conditions.

Relationship Between the Company and Certain of the Underwriters

BMO is an affiliate of a Canadian chartered bank which has made the Corporate Credit Facility and certain interim production financing facilities available to the Company. In addition, an affiliate of JP Morgan is a lender under the US Scripted Production Facility made available to the Company. See "Description of Material Indebtedness". Consequently, the Company may be considered a "connected issuer" of each of BMO and JP Morgan under applicable Canadian securities laws.

The terms of the Offering, including the Offering Price, were determined by negotiation among the Joint Bookrunners, on their own behalf and on behalf of each of the other Underwriters, the Company and the Selling Shareholders. None of the banks with which any of the Underwriters are affiliates were involved in the determination of the terms of the Offering. As a consequence of the Offering, each of such Underwriters will receive its proportionate share of the Underwriters' Fee.

The estimated net proceeds of the Treasury Offering will be used, in part, to repay all of the term debt outstanding under the Corporate Credit Facility. For a description of the principal purposes for which indebtedness under the Corporate Credit Facility has been used, see "Description of Material Indebtedness". The Company does not expect to use any of the net proceeds of the Treasury Offering to repay the US Scripted Production Facility.

LEGAL PROCEEDINGS

To the knowledge of Boat Rocker, other than as outlined below, there are no material legal proceedings to which it or any of its subsidiaries is a party or to which any of their respective property is subject and, to Boat Rocker's knowledge, no such proceedings are contemplated.

On February 21, 2020, a class action lawsuit was filed by Cavalluzzo LLP against Insight Productions, a subsidiary of the Company. The claim alleges that all non-managerial and non-unionized person who, since 2001 worked or continue to work for Insight Productions in Ontario were either misclassified as independent contractors and ought to have been engaged as employees and receive the benefits afforded to employees under the Employment Standards Act (Ontario), or were engaged as employees but were not paid overtime or vacation pay. The claim demands \$35 million in general damages and other relief. The claim has not been certified as a class action. No date has been set for a class certification hearing and no filings are currently due by Insight Productions. It has been agreed by the parties to the litigation and the case management judge that no dates will be set in this matter until Cavalluzzo LLP files its materials in support of its claim. As of the date of this Prospectus, no such materials have been filed.

For context, a nearly identical proposed class action lawsuit was filed against Cineflix Media, an unrelated and unaffiliated Canadian-based producer, on October 9, 2018. The Cineflix Media claim has not been certified as a class action and according to available public records, the certification hearing for the Cineflix Media claim is not scheduled until March 30, 2021.

Management of Insight Productions believes that the claim has been sponsored by CMG and IATSE who wish to leverage unscripted producers in Canada into signing collective agreements in respect of their crews who are not unionized, though it is the belief of the Company that on the whole the crews who work on the Company's unscripted productions in Canada do not wish to be unionized.

Boat Rocker believes that the claim is without merit and that the Company has valid defenses to the claim, and intends to vigorously contest it on several grounds. As a result, and given that no certification materials have been filed, the Company cannot estimate any potential liability in regards to the matter. As such, no provision relating to this matter has been recorded in the Company's financials as at September 30, 2020.

On January 29, 2021, a subsidiary of the Company received notice of an application for certification filed by IATSE with the Labour Board of Nova Scotia, which seeks to unionize certain animation employees employed at Boat Rocker's animation studio in Halifax, Nova Scotia, Canada. The vote to determine whether the Halifax animation studio will be unionized occurred on February 4, 2021, but will ultimately not be determined for a few weeks. See "Risk Factors – Risks Related to Securing and Retaining Key Personnel and Business Relationships".

LEGAL MATTERS

The matters referred to under "Eligibility for Investment" and "Certain Canadian Federal Income Tax Considerations", as well as certain other legal matters relating to the issue and sale of the Subordinate Voting Shares, will be passed upon on behalf of the Company and the Selling Shareholders by Stikeman Elliott LLP and on behalf of the Underwriters by Goodmans LLP. As at the date of this Prospectus, the partners and associates of each of Stikeman Elliott LLP and Goodmans LLP beneficially own, directly and indirectly, less than 1% of the outstanding securities or other property of the Company, its associates or its affiliates. Marie Garneau, a banking law partner of Stikeman Elliott LLP, is the spouse of Ivan Schneeberg.

INTERESTS OF MANAGEMENT AND OTHERS IN MATERIAL TRANSACTIONS

Except as described in this Prospectus, none of the proposed directors or executive officers of Boat Rocker, or any person or company beneficially own, or control or direct more than 10% of any class or series of shares of Boat Rocker, or any associate or affiliate of any of the foregoing persons, has or has had any material interest in any past transaction within the three years before the date of the Prospectus, or any proposed transaction, that has materially affected or is reasonably expected to materially affect Boat Rocker or any of its expected subsidiaries.

ENFORCEMENT OF JUDGMENTS AGAINST FOREIGN PERSONS OR COMPANIES

Sangeeta Desai resides outside of Canada and has appointed the Company as agent for service of process.

Purchasers are advised that it may not be possible to enforce judgements obtained in Canada against any person or company that is incorporated, continued or otherwise organized under the laws of a foreign jurisdiction or resides outside of Canada, even if the party has appointed an agent for service of process.

AUDITORS, TRANSFER AGENT AND REGISTRAR

Boat Rocker's auditors are PricewaterhouseCoopers LLP, Chartered Professional Accountants, having an address of 18 York Street, Suite 2600, Toronto, Ontario, M5J 0B2. Such firm has advised that it is independent of Boat Rocker within the meaning of the Rules of Professional Conduct of the Chartered Professional Accountants of Ontario (registered name of The Institute of Chartered Accountants of Ontario).

TSX Trust Company, at its principal offices in Toronto, Ontario, is the transfer agent and registrar for the Shares.

CERTAIN CANADIAN FEDERAL INCOME TAX CONSIDERATIONS

In the opinion of Stikeman Elliott LLP, counsel to the Company, and Goodmans LLP, counsel to the Underwriters, the following is a summary of the principal Canadian federal income tax considerations under the Tax Act generally applicable to a Shareholder who acquires Subordinate Voting Shares pursuant to this Offering and who at all relevant times, for purposes of the Tax Act: (a) holds the Subordinate Voting Shares as capital property; and (b) deals at arm's length with the Company and the Underwriters and is not affiliated with the Company or the Underwriters (a "Holder"). Generally, the Subordinate Voting Shares will be considered to be capital property to a Holder unless they are held or acquired in the course of carrying on a business of trading in or dealing in securities or as part of an adventure or concern in the nature of trade. Certain Holders who are residents of Canada and whose Subordinate Voting Shares do not otherwise qualify as capital property may in certain circumstances make an irrevocable election in accordance with subsection 39(4) of the Tax Act to have their Subordinate Voting Shares and every other "Canadian security" (as defined in the Tax Act) owned by such Holder in the taxation year of the election and in all subsequent taxation years deemed to be capital property.

This summary is not applicable to a Holder: (a) that is a "financial institution" for purposes of the "markto-market rules" in the Tax Act; (b) an interest in which is a "tax shelter investment" as defined in the Tax Act; (c) that is a "specified financial institution" as defined in the Tax Act; (d) that has made a "functional currency" election under the Tax Act to determine its "Canadian tax results", as defined in the Tax Act, in a currency other than Canadian currency; or (e) who enters into, or has entered into, a "derivative forward agreement" as such term is defined in the Tax Act, with respect to Subordinate Voting Shares. Any such Holder to which this summary does not apply should consult its own tax advisor.

This summary does not address the possible application of the "foreign affiliate dumping" rules in section 212.3 of the Tax Act to a Holder that: (i) is a corporation resident in Canada and (ii) is or becomes (or does not deal at arm's length for purposes of the Tax Act with a corporation resident in Canada that is or becomes), as part of a transaction or event or series of transactions or events that includes the acquisition of a Subordinate Voting Share, controlled by a non-resident person, or group of non-resident persons who do not deal at arm's length with each other. Such Holders should consult their own tax advisors with respect to the possible application of these rules.

This summary does not address the deductibility of interest on money borrowed to acquire Subordinate Voting Shares.

This summary is based upon the current provisions of the Tax Act, all specific proposals to amend the Tax Act which have been announced by or on behalf of the Minister of Finance (Canada) prior to the date hereof (the "Tax Proposals"), and counsel's understanding of the current published administrative policies and assessing practices of the Canada Revenue Agency. This summary assumes that the Tax Proposals will be enacted in the form proposed and does not take into account or anticipate any other changes in law, whether by way of judicial, legislative or governmental decision or action, nor does it take into account provincial, territorial or foreign income tax legislation or considerations, which may differ from the Canadian federal income tax considerations described herein. No assurances can be given that the Tax Proposals will be enacted as proposed or at all, or that legislative, judicial or administrative changes will not modify or change the statements expressed herein.

This summary is of a general nature only and is not intended to be, nor should it be construed to be, legal or tax advice to any particular Holder of a Subordinate Voting Share, and no representation concerning the tax consequences to any particular Holder or prospective Holder are made. Accordingly, prospective Holders of Subordinate Voting Shares should consult their own tax advisors with respect to an investment in the Subordinate Voting Shares having regard to their particular circumstances.

Residents of Canada

The following portion of this summary applies to a Holder who, for the purposes of the Tax Act and any applicable income tax treaty or convention, is resident in Canada (a "Resident Holder").

Dividends on Subordinate Voting Shares

Dividends received on Subordinate Voting Shares by a Resident Holder who is an individual (and certain trusts) will be included in the Resident Holder's income and be subject to the gross-up and dividend tax credit rules applicable to taxable dividends received by an individual from taxable Canadian corporations, including the enhanced gross-up and dividend tax credit for "eligible dividends" properly designated as such by the Company. There can be no assurances that the dividends paid by the Company will be able to be designated as eligible dividends.

Dividends received on Subordinate Voting Shares by a Resident Holder that is a corporation will be included in the Resident Holder's income and will generally be deductible in computing such Resident Holder's taxable income. In certain circumstances, subsection 55(2) of the Tax Act will treat a taxable dividend received by a Resident Holder that is a corporation as proceeds of disposition or a capital gain. Resident Holders that are corporations should consult their own tax advisors having regard to their own circumstances.

A Resident Holder that is a "private corporation" or a "subject corporation" (each as defined in the Tax Act) may be liable under Part IV of the Tax Act to pay a refundable tax on dividends received on the Subordinate Voting Shares to the extent that such dividends are deductible in computing the Resident Holder's taxable income.

Dividends received by a Resident Holder who is an individual (including certain trusts) may result in such Holder being liable for alternative minimum tax under the Tax Act.

Dispositions of Subordinate Voting Shares

A Resident Holder who disposes of or is deemed to have disposed of a Subordinate Voting Share will generally realize a capital gain (or incur a capital loss) in the year of disposition equal to the amount by which the proceeds of disposition in respect of such Subordinate Voting Share exceed (or are exceeded by) the aggregate of the adjusted cost base of such Subordinate Voting Share and any reasonable expenses associated with the disposition. The tax treatment of capital gains and capital losses is described under "Taxation of Capital Gains and Capital Losses".

Taxation of Capital Gains and Capital Losses

Generally, one-half of any capital gain (a "taxable capital gain") realized by a Resident Holder must be included in computing the Resident Holder's income for the taxation year in which the disposition occurs. Subject to and in accordance with the provisions of the Tax Act, one-half of any capital loss incurred by a Resident Holder (an "allowable capital loss") may be used to offset taxable capital gains realized by the Resident Holder in the taxation year of disposition. Allowable capital losses in excess of taxable capital gains for the taxation year of disposition may be applied to reduce net taxable capital gains realized by the Resident Holder in the three preceding taxation years or in any subsequent year in the circumstances and to the extent provided in the Tax Act.

The amount of any capital loss realized on the disposition of a Subordinate Voting Share by a Resident Holder that is a corporation may, in certain circumstances, be reduced by the amount of dividends which have been previously received or deemed to have been received by the Resident Holder on such share. Similar rules may apply where a corporation is, directly or through a trust or partnership, a member of a partnership or a beneficiary of a trust that owns Subordinate Voting Shares.

A Resident Holder that is, throughout the relevant taxation year, a "Canadian-controlled private corporation" (as defined in the Tax Act) may be subject to pay a refundable tax on its "aggregate investment income", which is defined in the Tax Act to include capital gains.

A Resident Holder who is an individual (including certain trusts) that realizes a capital gain on the disposition or deemed disposition of Subordinate Voting Shares may be liable for alternative minimum tax under the Tax Act.

Non-Residents of Canada

The following portion of this summary is applicable to a Holder who, for the purposes of the Tax Act and at all relevant times, is not resident nor deemed to be resident in Canada and does not use or hold, and is not deemed to use or hold, the Subordinate Voting Shares in connection with carrying on a business in Canada (a "Non-Resident Holder"). Special rules which are not described in this summary may apply to a non-resident that is an insurer carrying on business in Canada and elsewhere.

Dividends on Subordinate Voting Shares

Any dividends on Subordinate Voting Shares paid or credited or deemed to be paid or credited to a Non-Resident Holder will be subject to Canadian withholding tax at the rate of 25% of the gross amount of the dividends, subject to any reduction in the rate of withholding to which the Non-Resident Holder is entitled under any applicable income tax treaty or convention between Canada and the country in which the Non-Resident Holder is resident. For example, where a Non-Resident Holder is a resident of the United States, is fully entitled to the benefits under the Canada-United States Income Tax Convention (1980), as amended, and is the beneficial owner of the dividend, the applicable rate of Canadian withholding tax is generally reduced to 15% of the amount of such dividend.

Dispositions of Subordinate Voting Shares

A Non-Resident Holder generally will not be subject to tax under the Tax Act in respect of a capital gain realized on the disposition or deemed disposition of a Subordinate Voting Share, nor will capital losses arising therefrom be recognized under the Tax Act, unless the Subordinate Voting Share constitutes "taxable Canadian property" to the Non-Resident Holder for purposes of the Tax Act, and the gain is not exempt from tax pursuant to the terms of an applicable income tax treaty or convention between Canada and the country in which the Non-Resident Holder is resident.

As long as the Subordinate Voting Shares are listed on a designated stock exchange (which currently includes the TSX), a Subordinate Voting Share generally will not constitute taxable Canadian property of a Non-Resident Holder, unless: (a) at any time during the 60-month period immediately preceding the disposition or deemed disposition of such share: (i) 25% or more of the issued shares of any class or series of the share capital of the Company was owned by, or belonged to, one or any combination of (x) the Non-Resident Holder, (y) persons with whom the Non-Resident Holder did not deal at arm's length (within the meaning of the Tax Act) and (z) partnerships in which the Non-Resident Holder or a person referred to in (y) holds a membership interest directly or indirectly through one or more partnerships; and (ii) more than 50% of the fair market value of the share was derived directly or indirectly from one or any combination of: (A) real or immovable property situated in Canada; (B) Canadian resource property (as defined in the Tax Act); (C) timber resource property (as defined in the Tax Act); or (D) options in respect of, or interests in, or for civil law rights in, property described in any of (A) through (C) above, whether or not such property exists; or (b) the share is otherwise deemed under the Tax Act to be taxable Canadian property.

If a Subordinate Voting Share is taxable Canadian property to a Non-Resident Holder, any capital gain realized on the disposition or deemed disposition of such share may not be subject to Canadian federal income tax pursuant to the terms of an applicable income tax treaty or convention between Canada and the country of residence of the Non-Resident Holder. Non-Resident Holders whose Subordinate Voting Shares are taxable Canadian property should consult their own tax advisors.

MATERIAL CONTRACTS

This Prospectus includes a summary description of certain of the Company's material agreements. The summary description is not complete and is qualified by reference to the terms of the material agreements, which will be filed with the Canadian securities regulatory authorities and available on the Company's SEDAR profile at www.sedar.com. Investors are encouraged to read the full text of such material agreements.

As of Closing, the following will be the only material contracts of Boat Rocker, other than contracts entered into in the ordinary course:

(a) the Coat-tail Agreement;
(b) the Underwriting Agreement;
(c) the Principal Shareholders Agreement;
(d) the Untitled Entertainment LLC Agreement; and
(e) the Insight Shareholders Agreement.

Copies of the Untitled Entertainment LLC Agreement and Insight Shareholders Agreement are available on Boat Rocker's SEDAR profile at www.sedar.com. The other material contracts will be available following Closing on Boat Rocker's SEDAR profile at www.sedar.com.

EXEMPTIVE RELIEF

Pursuant to an application made to the OSC, as principal regulator, the Company has applied for exemptive relief from the requirements in Item 32 of Form 41-101F1 as prescribed under National Instrument 41-101 — General Prospectus Requirements, with respect to certain historical financial statements in respect of Matador Content, the assets acquired pursuant to the International Kids and Family Acquisition and Untitled Entertainment which were acquired by the Company (collectively, the "Recent Prior Acquisitions") that may be considered to form part of the "primary business" of the Company for the purposes of Item 32 of Form 41-101F1. The treatment of the Recent Prior Acquisitions as forming part of the primary business of the Company would require the Company to include in this Prospectus audited annual financial information for such businesses for up to three years prior to the date of this Prospectus.

The Company has applied for exemptive relief from the requirement to include audited financial statements for up to three years prior to the date of this Prospectus with respect to the Recent Prior Acquisitions. Specifically, the Company has applied to exclude the audited historical financial information of: (i) Matador Content for the year ended December 31, 2017 and the period from January 1 to October 30, 2018; (ii) Fremantle for the year ended December 31, 2017 and the period from January 1 to January 24, 2018; and (iii) Untitled Entertainment for the year ended December 31, 2017 and the period from January 1 to January 31, 2019.

The exemptions requested will be evidenced by the issuance of a receipt for the final prospectus. In the prefiling application, the Company made, among others, the following submissions:

None of the Recent Prior Acquisitions are individually significant having regard to the overall size and value of the Company's business and operations.
The financial information necessary to prepare audited financial statements for Matador Content in respect of the period prior to its acquisition would require the creation of working papers from scratch, which is difficult, error prone and potentially not auditable and which would be of minimal benefit to investors in the Offering as results of Matador Content prior to its acquisition are not necessarily indicative of its future results.
Prior to their acquisition by the Company, the assets acquired pursuant to the International Kids and Family Acquisition were owned and managed by a large and diversified arm's length third-party and the Company does not have access to, and is not entitled to obtain access to, sufficient financial information for any period prior to the acquisition by the Company to prepare audited financial statements.
Audited historical financial statements for Matador Content and the assets of Fremantle were not relevant to the Company's decision to acquire them.
Following their respective acquisitions, each of Matador Content and the assets acquired pursuant to the International Kids and Family Acquisition have been integrated into the operations of the Company. As a result of such post-acquisition integration, the consolidated financial statements of the Company that are included in this Prospectus, which include the financial results of Matador Content and Fremantle for the

periods following their respective dates of acquisition, provide the more appropriate financial information regarding the combined operations of the Company.

• Untitled Entertainment has been consolidated into the Company's audited financial statements from February 1, 2019 to December 31, 2019 and thereafter. The Company has also included audited financial statements for the 12 months ended December 31, 2018 in respect of Untitled Entertainment in this Prospectus.

The staff of the OSC has notified the Company that it is currently of the view that Mr. Schneeberg and Mr. Fortier are promoters of the Company within the meaning of applicable securities laws in Canada. Pursuant to Section 58(5) of the Securities Act (Ontario), the Director has consented to Mr. Schneeberg and Mr. Fortier not signing a certificate of promoter for this Prospectus. The Company has been advised by the OSC that the issuance of a receipt by the OSC for this Prospectus will evidence the granting of this consent. Neither the Company, Mr. Schneeberg nor Mr. Fortier agree or admit that Mr. Schneeberg and Mr. Fortier are promoters of the Company.

PURCHASERS' STATUTORY RIGHTS

Securities legislation in certain of the provinces and territories of Canada provides purchasers with the right to withdraw from an agreement to purchase securities. This right may be exercised within two business days after receipt or deemed receipt of a prospectus and any amendment. In several of the provinces and territories, the securities legislation further provides a purchaser with remedies for rescission or, in some jurisdictions, revisions of the price or damages if the prospectus and any amendment contains a misrepresentation or is not delivered to the purchaser, provided that the remedies for rescission, revisions of the price or damages are exercised by the purchaser within the time limit prescribed by the securities legislation of the purchaser's province or territory. The purchaser should refer to any applicable provisions of the securities legislation of the purchaser's province or territory for the particulars of these rights or consult with a legal adviser.

GLOSSARY OF TERMS

"2020 Debenture" means the second secured subordinated convertible debenture due March 31, 2022 pursuant to which Fairfax agreed to advance up to \$75 million to the Company, commencing with a \$25 million tranche on December 1, 2020, an additional \$15 million tranche on February 1, 2021 and with the balance available on a predetermined payment schedule, at the Company's request, periodically until September 1, 2021 (provided that no additional advances shall be made following Closing), and bearing interest at 8% per annum which may be satisfied on a "PIK" basis at the option of the Company, and which is to be automatically converted into Subordinate Voting Shares at Closing as described elsewhere in this Prospectus;

"2021 Options" has the meaning ascribed thereto under "Rights to Acquire Shares – Recent Equity Grants";

"A&R Debenture" means the amended and restated secured subordinated convertible debenture dated November 16, 2020 whereby United States Fire Insurance Company, a subsidiary of Fairfax, advanced US\$15 million in aggregate to the Company, and which is subject to mandatory conversion into equity (that will on Closing become Subordinate Voting Shares) of the Company on January 1, 2021 as described elsewhere in this Prospectus;

"Abbott Notice Period" has the meaning ascribed thereto under "Executive Compensation – Employment Agreements, Termination and Change of Control Benefits – Michelle Abbott, Chief Financial Officer";

"Adjusted EBITDA" has the meaning ascribed thereto under "Non-IFRS Measures";

"Adjusted EBITDA Margin" has the meaning ascribed thereto under "Non-IFRS Measures";

"Advance Notice Provisions" has the meaning ascribed thereto under "Authorized Share Capital Upon Closing – Multiple Voting Shares and Subordinate Voting Shares– Nomination of Directors";

"affiliate" means, when describing a relationship between two persons, that either one of them is under the direct or indirect control of the other, or each of them is directly or indirectly controlled by the same person;

"allowable capital loss" has the meaning ascribed thereto under "Certain Canadian Federal Income Tax Considerations – Residents of Canada – Taxation of Capital Gains and Capital Losses";

"Arc" means Arc Productions Ltd.;

"Arrangements" has the meaning ascribed thereto under "Authorized Share Capital Upon Closing – Multiple Voting Shares and Subordinate Voting Shares– Nomination of Directors";

"Audit and Risk Committee" means the audit and risk committee of the Board, as constituted from time to time;

"AVOD" has the meaning ascribed thereto under "Industry and Market Opportunity – Global Growth of OTT Platforms";

"Awards" has the meaning ascribed thereto under "Executive Compensation – Principal Elements of Compensation – Long-term Incentives – Equity Incentive Plan";

"Bill" has the meaning ascribed thereto under "Regulatory Matters";

"Board" means Boat Rocker's board of directors, as constituted from time to time;

"Boat Rocker" has the meaning ascribed thereto on the cover page of this Prospectus;

"Boat Rocker Financial Statements" means the audited consolidated annual financial statements and accompanying notes for the years ended December 31, 2019, 2018 and 2017;

"Boat Rocker Interim Financial Statements" means the unaudited interim condensed consolidated financial statements and accompanying notes for the three and nine months ended September 30, 2020 and 2019 and accompanying notes;

"Boat Rocker MD&A" has the meaning ascribed thereto under "Management's Discussion and Analysis of Boat Rocker";

"Boat Rocker Pro Forma Financial Statements" means the pro forma condensed consolidated statement of loss and accompanying notes for the year ended December 31, 2019 which include certain pro forma adjustments related to an acquisition which was completed in 2019;

"Boat Rocker Ventures" means Boat Rocker Ventures Inc.;

"business day" means a day, other than a Saturday, Sunday or statutory or civic holiday in Ontario, when banks are generally open for the transaction of business in Toronto, Ontario;

"buyer" refers to a purchaser or licensee of video content, namely a linear channel or OTT platform;

"CAGR" means compounded annual growth rate;

"Canadian Person" means a person who would qualify as Canadian for the purpose of achieving or preserving the Company's or any of its Canadian subsidiaries' status as a Canadian corporation for the purpose of the Canadian Status Rules;

"Canadian Status Rules" means (i) the ICA Canadian Status Rules, and (ii) if approved by the Board and each holder of Multiple Voting Shares (in each such holder's sole discretion) outstanding at the time of assessment of whether the Company is a Canadian Person, the rules and presumptions for determining who is a "Canadian" for

purposes of the tax credits determined by the Board and the holders of Multiple Voting Shares to be applicable to the Company or any subsidiary from time to time. For clarity, if the Board or any holder of Multiple Voting Shares does not approve of the use of a form of assessment of whether a person or entity is a Canadian Person other than the ICA Canadian Status Rules pursuant to subsection (ii) in the immediately preceding sentence, the applicable Canadian Status Rules shall be only the ICA Canadian Status Rules;

"Cash Available for Use" has the meaning ascribed thereto under "Non-IFRS Measures";

"Cash Required for Use in Productions" has the meaning ascribed thereto under "Non-IFRS Measures";

"CDS" has the meaning ascribed thereto on the cover page of this Prospectus;

"CDS Participant" has the meaning ascribed thereto under "Plan of Distribution – Book Entry System";

"CEWS" has the meaning ascribed thereto under "The Business of the Company – Overview";

"Chair" means the chair or co-chairs of the Board;

"Change of Control" means:

(a) the acquisition whether directly or indirectly, by any person, or any persons acting jointly or in concert (as determined in accordance with the Securities Act (Ontario) and the rules and regulations thereunder), of voting securities of the Company which, together with any other voting securities of the Company held by such person or persons, constitute, in the aggregate, more than 50% of the votes attached to the issued and outstanding voting securities of the Company entitled to vote for the election of the Board (except that in the case of Fairfax, on one hand, and Ivan Schneeberg, David Fortier, and/or John Young, on the other hand, in each case together with their respective affiliates, the applicable threshold shall be 90% of all issued and outstanding voting securities of the Company);
(b) an amalgamation, merger, scheme of arrangement or other form of business combination of the Company with another entity which results in the holders of voting securities of that other entity holding, in the aggregate, more than 50% of all issued and outstanding voting securities of the Company or other person (including a merged, amalgamated or surviving company) resulting from the business combination (the "Resulting Entity"), unless Fairfax, on one hand, or Ivan Schneeberg, David Fortier, and/or John Young, on the other hand, in each case together with their respective affiliates, hold, directly or indirectly, more than 50% of the votes attached to the issued and outstanding voting securities of the Resulting Entity entitled to vote for the election of the board of directors of the Resulting Entity;
(c) if the individuals who, as of the Closing Date, constitute the Board (the "Incumbent Directors") cease for any reason to constitute at least a majority of the Board, provided that any person becoming a director after the Closing Date and whose appointment, election, or nomination for election was approved by a vote of at least a majority of the Incumbent Directors then on the Board shall be deemed to be an Incumbent Director; provided, however, that no individual initially elected as a director of the Company as a result of an actual or threatened election contest with respect to the election or removal of directors ("Election Contest") or other actual or threatened solicitation of proxies or consents by or on behalf of any person other than the Board, including by reason of any agreement intended to avoid or settle any Election Contest or proxy contest, shall be deemed an Incumbent Director;
(d) a sale, lease, transfer, exclusive license or other disposition, in a single transaction or series of transactions (related or otherwise), of all or substantially all of the assets of the Company except where such sale, lease, transfer or other disposition is to a subsidiary of the Company; or

(e) the adoption by the Company of a plan of liquidation providing for the distribution of all or substantially all of the Company's assets;

"Closing" has the meaning ascribed thereto on the cover page of this Prospectus;

"Closing Date" has the meaning ascribed thereto on the cover page of this Prospectus;

"CMF" has the meaning ascribed thereto under "The Business of the Company – Overview";

"CMG" has the meaning ascribed thereto under "Risk Factors – Risks Related to Securing and Retaining Key Personnel and Business Relationships";

"Coat-tail Agreement" has the meaning ascribed thereto under "Principal and Selling Shareholders – Take-over Bid Protection – Coat-tail Agreement";

"Company" has the meaning ascribed thereto on the cover page of this Prospectus;

"Compensation, Nominating and Corporate Governance Committee" means the compensation, nominating and corporate governance committee of the Board, as constituted from time to time;

"confirmed revenue" means revenue expected by the Company to be earned in respect of video content that is contracted, greenlit or in-production (or, where such video content is to be distributed by third parties, is expected by the Company to be earned based on the terms of existing contracts);

"Corporate Credit Facility" has the meaning ascribed thereto under "Description of Material Indebtedness – Existing Credit Facilities – Corporate Credit Facility";

"Corporations Act" means the Business Corporations Act (Ontario), as it may be amended from time to time;

"COVID-19" means the global outbreak of the novel 2019 strain of the coronavirus;

"CRTC" means the Canadian Radio-television and Telecommunications Commission (CRTC);

"Customers" has the meaning ascribed thereto under "Disclaimer";

"Demand Registration" has the meaning ascribed thereto under "Registration Rights – Demand Registration Rights";

"Designated Subsidiary" means an entity which is controlled by the Company and which has been designated by the Company for the purposes of the Equity Incentive Plan from time to time;

"DF" has the meaning ascribed thereto under "Principal Shareholders Agreement – Nomination Rights";

"Diversity Policy" has the meaning ascribed thereto under "Corporate Governance – Diversity";

"DSUs" has the meaning ascribed thereto under "Executive Compensation – Principal Elements of Compensation – Long-term Incentives – Equity Incentive Plan";

"EBITDA" has the meaning ascribed thereto under "Non-IFRS Measures";

"Eligible Participants" has the meaning ascribed thereto under "Executive Compensation – Principal Elements of Compensation – Long-term Incentives – Equity Incentive Plan";

"EMC" means Evolution Media BRM, L.P.;

"Equity Incentive Plan" has the meaning ascribed thereto under "Executive Compensation – Principal Elements of Compensation";

"ESA" means the applicable employment standards legislation, as amended or restated;

"Fairfax" has the meaning ascribed thereto on the cover page of this Prospectus;

"Fairfax Internal Reorganization" has the meaning ascribed thereto under "Principal Shareholders Agreement – Transfer Restrictions and Sale Procedures";

"Fairfax Price Per Share" has the meaning ascribed thereto under "Principal Shareholders Agreement – Rights of First Refusal";

"Fairfax Purchase Right" has the meaning ascribed thereto under "Principal Shareholders Agreement – Rights of First Refusal";

"Fair Market Value" means the volume weighted average trading price of the Subordinate Voting Shares on the TSX for the five trading days on which the Subordinate Voting Shares were traded immediately preceding the applicable day or, if the Subordinate Voting Shares are not then traded on the TSX, the fair market value of a Subordinate Voting Share as determined by reasonable application by the Board of a reasonable valuation method; provided that, the Fair Market Value for purposes of determining the exercise price of an Option granted to a U.S. taxpayer shall be the greater of: (i) the volume weighted average trading price of the Subordinate Voting Shares on the TSX for the five trading days on which the Subordinate Voting Shares were traded immediately preceding the applicable day, and (ii) the closing price of the Subordinate Voting Shares on the TSX on the last trading day on which the Subordinate Voting Shares were traded immediately preceding the applicable date, or if the Subordinate Voting Shares are not then traded on the TSX, the fair market value of a Subordinate Voting Share as determined by reasonable application by the Board of a reasonable valuation method;

"First American" has the meaning ascribed thereto under "Description of Material Indebtedness – Existing Credit Facilities – Matador Equipment Lease";

"forward-looking statements" has the meaning ascribed thereto under "Caution Regarding Forward-Looking Statements";

"Free Cash Flow" has the meaning ascribed thereto under "Non-IFRS Measures";

"Fremantle" means FremantleMedia Limited;

"greenlit" in respect to programming means the programming has been contracted for production and Boat Rocker has received commitments for all or substantially all of the required financing to cover the cost of producing the programming;

"Guidelines" has the meaning ascribed thereto under "Corporate Governance – Statement of Corporate Governance Practices";

"Holder" has the meaning ascribed thereto under "Certain Canadian Federal Income Tax Considerations";

"IATSE" has the meaning ascribed thereto under "Risk Factors – Risks Related to Securing and Retaining Key Personnel and Business Relationships";

"IATSE Application" has the meaning ascribed thereto under "Risk Factors – Risks Related to Securing and Retaining Key Personnel and Business Relationships";

"ICA" has the meaning ascribed thereto under "Regulatory Matters";

"ICA Canadian Status Rules" has the meaning ascribed thereto under "Regulatory Matters";

"ID" has the meaning ascribed thereto under "Principal Shareholders Agreement – Nomination Rights";

"IDJ" has the meaning ascribed thereto on the cover page of this Prospectus;

"IDJ First Purchase Right" has the meaning ascribed thereto under "Principal Shareholders Agreement – Rights of First Refusal";

"IDJ Internal Reorganization" has the meaning ascribed thereto under "Principal Shareholders Agreement – Transfer Restrictions and Sale Procedures";

"IDJ Price Per Share" has the meaning ascribed thereto under "Principal Shareholders Agreement – Rights of First Refusal";

"IDJ Second Purchase Right" has the meaning ascribed thereto under "Principal Shareholders Agreement – Rights of First Refusal";

"IFRS" has the meaning ascribed thereto under "Non-IFRS Measures";

"Industrial Brothers" means Industrial Brothers Canada Ltd.;

"Industrial Brothers Shareholders Agreement" has the meaning ascribed thereto under "Rights to Acquire Shares – Industrial Brothers";

"in-production" in the context of Boat Rocker's business of video content production means that Boat Rocker is actively filming the programming or managing the post-production of the programming. "in-production" also includes the pre-production period that occurs a few weeks before filming commences, when crews are hired, sets are built, and other elements necessary to commence filming are put in place;

"Insider Trading Policy" has the meaning ascribed thereto under "Corporate Governance – Insider Trading Policy";

"Insight Corporate Facilities" has the meaning ascribed thereto under "Description of Material Indebtedness – Existing Credit Facilities – Insight Corporate Facilities";

"Insight Productions" means Insight Productions Ltd.;

"Insight Shareholders Agreement" has the meaning ascribed thereto under "Rights to Acquire Shares – Insight Productions";

"International Kids and Family Acquisition" has the meaning ascribed thereto under "The History of the Company";

"Investor Presentation" has the meaning ascribed thereto under "Marketing Materials";

"IP" means intellectual property;

"IS" has the meaning ascribed thereto under "Principal Shareholders Agreement – Nomination Rights";

"Jam Filled Entertainment" means Jam Filled Entertainment Inc., a predecessor entity of Boat Rocker, which was amalgamated into Boat Rocker on December 30, 2020;

"Joint Bookrunners" has the meaning ascribed thereto on the cover page of this Prospectus;

"JY" has the meaning ascribed thereto under "Principal Shareholders Agreement – Nomination Rights";

"Kids and Family" has the meaning ascribed thereto under "The Business of the Company – Overview";

"Lead Director" has the meaning ascribed thereto under "Corporate Governance – Composition of the Board on Closing – Lead Director";

"Legacy EPP" has the meaning ascribed thereto under "Rights to Acquire Shares – Existing Equity Participation Plan";

"Legacy Options" has the meaning ascribed thereto under "Rights to Acquire Shares – Existing Equity Participation Plan";

"Legacy RSUs" has the meaning ascribed thereto under "Rights to Acquire Shares – Existing Restricted Share Unit Plan";

"Legacy RSU Plan" has the meaning ascribed thereto under "Rights to Acquire Shares – Existing Restricted Share Unit Plan";

"linear channels" means a linear television channel, including conventional stations such as CTV, CBC and Global in Canada, and NBC, ABC, CBS and Fox in the United States, as well as specialty cable networks such as HGTV, Food Network, Animal Planet, Bravo and MTV;

"Long-Form Demand Registration" has the meaning ascribed thereto under "Registration Rights – Demand Registration Rights";

"Management Consideration" has the meaning ascribed thereto under "Rights to Acquire Shares – Platform One Media";

"marketing materials" has the meaning ascribed thereto under "Marketing Materials";

"Matador Content" means Matador Content LLC;

"Matador Equipment Lease" has the meaning ascribed thereto under "Description of Material Indebtedness – Existing Credit Facilities – Matador Equipment Lease";

"Material Adverse Effect" has the meaning ascribed thereto under "Risk Factors";

"Multiple Voting Shares" has the meaning ascribed thereto on the cover page of this Prospectus;

"named executive officers" has the meaning ascribed thereto under "Executive Compensation – Introduction";

"Net Debt" has the meaning ascribed thereto under "Non-IFRS Measures";

"NI 52-110" means National Instrument 52-110 – Audit Committees;

"NI 58-101" has the meaning ascribed thereto under "Corporate Governance – Statement of Corporate Governance Practices";

"Nominating Shareholder" has the meaning ascribed thereto under "Authorized Share Capital Upon Closing – Multiple Voting Shares and Subordinate Voting Shares – Nomination of Directors";

"Non-Canadian Person" is any person that is not a Canadian person;

"Non-Resident Holder" has the meaning ascribed thereto under "Certain Canadian Federal Income Tax Considerations – Non-Residents of Canada";

"Notice Date" has the meaning ascribed thereto under "Authorized Share Capital Upon Closing – Multiple Voting Shares and Subordinate Voting Shares – Nomination of Directors";

"NP 58-201" has the meaning ascribed thereto under "Corporate Governance – Statement of Corporate Governance Practices";

"Offered Shares" has the meaning ascribed thereto on the cover page of this Prospectus;

"Offering" has the meaning ascribed thereto on the cover page of this Prospectus;

"Offering Jurisdictions" has the meaning ascribed thereto under "Plan of Distribution – General";

"Offering Price" has the meaning ascribed thereto on the cover page of this Prospectus;

"Options" has the meaning ascribed thereto under "Executive Compensation – Principal Elements of Compensation – Long-term Incentives – Equity Incentive Plan";

"OSC" has the meaning ascribed thereto under "Authorized Share Capital Upon Closing – Preferred Shares";

"OTT platform" refers to a service that delivers video content via a broadband or wireless Internet connection (such as Netflix and Amazon Prime Video) utilizing any of a variety of models, including SVOD, TVOD or AVOD, thereby bypassing traditional television service providers;

"Over-Allotment Option" has the meaning ascribed thereto on the cover page of this Prospectus;

"P1 Transaction Agreement" has the meaning ascribed thereto under "Rights to Acquire Shares – Platform One Media";

"Panel" has the meaning ascribed thereto under "Regulatory Matters";

"Permitted IDJ Transfer" has the meaning ascribed thereto under "Principal Shareholders Agreement – Transfer Restrictions and Sale Procedures";

"Permitted Holders" has the meaning ascribed thereto under "Principal and Selling Shareholders – Post-Offering Shares";

"person" means any individual, partnership, association, body corporate, trust, trustee, executor, administrator, legal representative, government, regulatory authority or other entity;

"Plan Holder" has the meaning ascribed thereto under "Eligibility for Investment";

"Platform One Media" means Platform One Media LLC, which was renamed Boat Rocker Studios, Scripted, LLC effective January 1, 2021;

"Pratte Notice Period" has the meaning ascribed thereto under "Executive Compensation – Employment Agreements, Termination and Change of Control Benefits – Michel Pratte, President, Boat Rocker and General Manager, Boat Rocker Studios";

"Pre-Closing Capital Changes" has the meaning ascribed thereto under "Pre-Closing Capital Changes";

"premium" when used to describe video content means a project with high production values (i.e., well-known actors, directors and writers, bigger casts, more locations, and better special effects), typically resulting in a higher production budget;

"Principal Shareholders" has the meaning ascribed thereto on the cover page of this Prospectus;

"Principal Shareholders Agreement" has the meaning ascribed thereto under "Principal Shareholders Agreement";

"Pro Forma Adjustments" has the meaning ascribed thereto under "Consolidated Capitalization";

"programming" has the meaning ascribed thereto under "Industry and Market Opportunity";

"programming spend" has the meaning ascribed thereto under "Industry and Market Opportunity";

"Prospectus" has the meaning ascribed thereto on the cover page of this Prospectus.

"PSUs" has the meaning ascribed thereto under "Executive Compensation – Principal Elements of Compensation – Long-term Incentives – Equity Incentive Plan";

"RBC" has the meaning ascribed thereto on the cover page of this Prospectus;

"RDSP" has the meaning ascribed thereto under "Eligibility for Investment";

"Recent Prior Acquisitions" has the meaning ascribed thereto under "Exemptive Relief";

"Registered Plan" has the meaning ascribed thereto under "Eligibility for Investment";

"Registering Shareholders" has the meaning ascribed thereto under "Registration Rights";

"Representation" has the meaning ascribed thereto under "The Business of the Company – Overview";

"Resident Holder" has the meaning ascribed thereto under "Certain Canadian Federal Income Tax Considerations – Residents of Canada";

"RESP" has the meaning ascribed thereto under "Eligibility for Investment";

"RRIF" has the meaning ascribed thereto under "Eligibility for Investment";

"RRSP" has the meaning ascribed thereto under "Eligibility for Investment";

"RSUs" has the meaning ascribed thereto under "Executive Compensation – Principal Elements of Compensation – Long-term Incentives – Equity Incentive Plan";

"Secondary Offering" has the meaning ascribed thereto on the cover page of this Prospectus;

"SEDAR" means the System for Electronic Document Analysis and Retrieval, accessible at www.sedar.com;

"Selling Shareholders" has the meaning ascribed thereto on the cover page of this Prospectus;

"set-up" means, in the context of the Company's business of developing video content, a buyer has agreed to fund the writing of scripts or the creation of other significant development materials and has the option to acquire or license programming based on those scripts or other development materials;

"Shareholders" means, collectively, the holders of the Multiple Voting Shares and/or Subordinate Voting Shares, and "Shareholder" means any one of them;

"Shares" has the meaning ascribed thereto on the cover page of this Prospectus;

"Short-Form Demand Registration" has the meaning ascribed thereto under "Registration Rights – Demand Registration Rights";

"Subordinate Voting Shares" has the meaning ascribed thereto on the cover page of this Prospectus;

"SVOD" has the meaning ascribed thereto under "Industry and Market Opportunity – Global Growth of OTT Platforms";

"Tax Act" means the Income Tax Act (Canada) including the regulations promulgated thereunder, as amended;

"Tax Proposals" has the meaning ascribed thereto under "Certain Canadian Federal Income Tax Considerations";

"taxable capital gain" has the meaning ascribed thereto under "Certain Canadian Federal Income Tax Considerations – Residents of Canada – Taxation of Capital Gains and Capital Losses";

"TD" has the meaning ascribed thereto on the cover page of this Prospectus;

"Television" has the meaning ascribed thereto under "The Business of the Company – Overview";

"Term Sheet" has the meaning ascribed thereto under "Marketing Materials";

"TFSA" has the meaning ascribed thereto under "Eligibility for Investment";

"Treasury Offering" has the meaning ascribed thereto on the cover page of this Prospectus;

"TSX" has the meaning ascribed thereto on the cover page of this Prospectus;

"TVOD" has the meaning ascribed thereto under "Industry and Market Opportunity – Global Growth of OTT Platforms";

"Underwriters" has the meaning ascribed thereto on the cover page of this Prospectus;

"Underwriters' Fee" has the meaning ascribed thereto on the cover page of this Prospectus;

"Underwriting Agreement" has the meaning ascribed thereto under "Plan of Distribution – General";

"United States" or "U.S." means the United States of America;

"Untitled Entertainment" means Untitled Entertainment LLC;

"Untitled Entertainment LLC Agreement" has the meaning ascribed thereto under "Rights to Acquire Shares – Untitled Entertainment";

"US Scripted Production Facility" has the meaning ascribed thereto under "Description of Material Indebtedness – Existing Credit Facilities – US Scripted Production Facility"; and

"video content" has the meaning ascribed thereto under "Industry and Market Opportunity".

INDEX TO FINANCIAL STATEMENTS AND MANAGEMENT'S DISCUSSION AND ANALYSES

	Page
Audited consolidated annual financial statements and accompanying notes of Boat Rocker Media Inc. for the years ended December 31, 2019, 2018, 2017	F-1
Unaudited interim condensed consolidated financial statements and accompanying notes of Boat Rocker Media Inc. for the three months and nine months ended September 30, 2020 and 2019	F-80
Management's Discussion and Analysis of Boat Rocker Media Inc. for the three months and nine months ended September 30, 2020 and 2019 and the years ended December 31, 2019, 2018 and 2017	F-123
Pro forma condensed consolidated statement of loss and accompanying notes for the year ended December 31, 2019 of Boat Rocker Media Inc. which include certain pro forma adjustments related to an acquisition completed in 2019	F-183
Audited consolidated financial statements and accompanying notes of Insight Production Company Ltd. for the year ended December 31, 2017 and for the period from January 1, 2018 to May 17, 2018	F-188
Management's Discussion and Analysis of Insight Production Company Ltd. for the year ended December 31, 2017 and for the period from January 1, 2018 to May 17, 2018	F-225
Audited consolidated financial statements and accompanying notes of Platform One Media, LLC for the years ended December 31, 2018 and 2017 and for the period from January 1 to August 30, 2019	F-233
Management's Discussion and Analysis of Platform One Media, LLC for the years ended December 31, 2018 and 2017 and the period from January 1, 2019 to August 30, 2019	F-260
Audited consolidated annual financial statements and accompanying notes of Untitled Entertainment LLC for the year ended December 31, 2018	F-269
Management's Discussion and Analysis of Untitled Entertainment LLC for the year ended December 31, 2018 F-290

Consolidated Financial Statements December 31, 2019, 2018 and 2017 (expressed in thousands of Canadian dollars)

Independent auditor's report

To the Shareholders of Boat Rocker Media Inc.

Our opinion

In our opinion, the accompanying consolidated financial statements present fairly, in all material respects, the financial position of Boat Rocker Media Inc. and its subsidiaries (together, the Company) as at December 31, 2019 and 2018 and its financial performance and its cash flows for each of the three years in the period ended December 31, 2019 in accordance with International Financial Reporting Standards as issued by the International Accounting Standards Board (IFRS).

What we have audited

The Company's consolidated financial statements comprise:

the consolidated statements of financial position as at December 31, 2019 and 2018;
the consolidated statements of changes in equity for the years ended December 31, 2019, 2018 and 2017;
the consolidated statements of (loss) income for the years ended December 31, 2019, 2018 and 2017;
the consolidated statements of comprehensive (loss) income for the years ended December 31, 2019, 2018 and 2017;
the consolidated statements of cash flows for the years ended December 31, 2019, 2018 and 2017; and
the notes to the consolidated financial statements, which include significant accounting policies and other explanatory information.

Basis for opinion

We conducted our audit in accordance with Canadian generally accepted auditing standards. Our responsibilities under those standards are further described in the Auditor's responsibilities for the audit of the consolidated financial statements section of our report.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Independence

We are independent of the Company in accordance with the ethical requirements that are relevant to our audit of the consolidated financial statements in Canada. We have fulfilled our other ethical responsibilities in accordance with these requirements.

PricewaterhouseCoopers LLP PwC Tower, 18 York Street, Suite 2600, Toronto, Ontario, Canada M5J 0B2 T: +1 416 863 1133, F: +1 416 365 8215

Responsibilities of management and those charged with governance for the consolidated financial statements

Management is responsible for the preparation and fair presentation of the consolidated financial statements in accordance with IFRS, and for such internal control as management determines is necessary to enable the preparation of consolidated financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the consolidated financial statements, management is responsible for assessing the Company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.

Those charged with governance are responsible for overseeing the Company's financial reporting process.

Auditor's responsibilities for the audit of the consolidated financial statements

Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with Canadian generally accepted auditing standards will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these consolidated financial statements.

As part of an audit in accordance with Canadian generally accepted auditing standards, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:

Identify and assess the risks of material misstatement of the consolidated financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control.
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.
Conclude on the appropriateness of management's use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or

conditions that may cast significant doubt on the Company's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor's report to the related disclosures in the consolidated financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor's report. However, future events or conditions may cause the Company to cease to continue as a going concern.

Evaluate the overall presentation, structure and content of the consolidated financial statements, including the disclosures, and whether the consolidated financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the Company to express an opinion on the consolidated financial statements. We are responsible for the direction, supervision and performance of the group audit. We remain solely responsible for our audit opinion.

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

Chartered Professional Accountants, Licensed Public Accountants

Toronto, Ontario February • , 2021

Consolidated Statements of Financial Position

As at December 31, 2019 and 2018

(expressed in thousands of Canadian dollars)

	2019	2018
Assets	\$	\$
Current assets Cash and cash equivalents Accounts receivable (note 10) Receivable from related parties (note 20) Production tax credits receivable Prepaid expenses and deposits	59,268 29,460 212 73,337 5,017	55,416 43,714 258 44,722 2,768
Total current assets	167,294	146,878
Long-term accounts receivable (note 10) Long-term production tax credits receivable Investment in content (note 8) Intangible assets (note 9) Property and equipment (note 7) Right-of-use assets (note 21) Investment in equity accounted investees (note 5) Financial assets (note 6) Deferred income tax assets (note 26) Goodwill (notes 4 and 11)	1,682 10,907 115,378 58,569 11,861 26,734 1,798 7,687 6,276 107,957	1,222 38,441 72,988 14,698 21,317 25,458 1,785 7,186 996 64,560
Total assets	516,143	395,529
Liabilities
Current liabilities Accounts payable and accrued liabilities Income taxes payable Current portion of contingent consideration (note 4) Interim production financing (note 15) Current portion of loans and borrowings (note 16) Current portion of lease liabilities (note 21) Convertible debentures (note 18) Other current financial liabilities (note 17) Deferred revenue	53,761 6,844 5,106 110,177 87,869 7,260 18,618 14,412 41,362	57,644 2,354 8,575 61,312 38,390 4,521 - 31,234 54,068
Total current liabilities	345,409	258,098
Long-term contingent consideration (note 4) Loans and borrowings (note 16) Long-term lease liabilities (note 21) Other long-term financial liabilities (note 17) Deferred income tax liabilities (note 26)	17,994 - 22,366 53,968 -	9,719 9,042 23,062 14,685 2,808
Total liabilities	439,737	317,414
Shareholders' Equity
Equity attributable to owners of Boat Rocker Media Inc. Non-controlling interests	48,394 28,012	74,205 3,910
Total shareholders' equity	76,406	78,115
Total shareholders' equity and liabilities	516,143	395,529

Commitments and contingencies (note 29) Subsequent events (note 32)

On Behalf of the Board of Directors

___________________________________ Director ________________________________ Director

(expressed in thousands of Canadian dollars, except per share amounts)

	Number of common shares	Number of preferred shares	Share capital \$	Contributed surplus \$	Accumulated other comprehensive income (loss) \$	Retained earnings \$	Other equity \$	Equity attributable to owners of Boat Rocker Media Inc. \$	Non controlling interests \$	Total equity \$
Balance – December 31, 2016	15,076,923	-	32,715	97	-	23,096	-	55,908	(5)	55,903
Net income Translation reserves Grant of stock options (note 13) Dividends (note 12)	- - - -	- - - -	- - - -	- - 239 -	- 8 - -	14,129 - - (1,200)	- - - -	14,129 8 239 (1,200)	106 - - -	14,235 8 239 (1,200)
Balance – December 31, 2017	15,076,923	-	32,715	336	8	36,025	-	69,084	101	69,185
Net income Distribution to common shareholders Translation reserves Grant of stock options (note 13) Grant of restricted share units (note 13) Movement in the fair value of financial	- - - - -	- - - - -	- - - - -	- - - 340 2,981	- - (1,989) - -	9,360 (2,699) - - -	- - - - -	9,360 (2,699) (1,989) 340 2,981	397 - - - -	9,757 (2,699) (1,989) 340 2,981
assets (note 6) Acquisition of Insight (note 4(d)) Put option of Insight (notes 4(d) and 17)	- - -	- - -	- - -	- - -	513 - -	- - -	- - (3,385)	513 - (3,385)	- 3,412 -	513 3,412 (3,385)
Balance – December 31, 2018	15,076,923	-	32,715	3,657	(1,468)	42,686	(3,385)	74,205	3,910	78,115
Net (loss) income Issuance of preferred shares (note 12) Exchange of common shares for	- -	- 1,156,910	- 20,114	- -	- -	(23,707) -	- -	(23,707) 20,114	4,224 -	(19,483) 20,114
preferred shares (note 12) Grant of stock options (note 13) Acquisition of Untitled (note 4(a)) Put option of Untitled (note 4(a))	(385,637) - - -	385,637 - - -	5,934 - - -	- 721 - -	- - - -	(5,934) - - -	- - - (24,444)	- 721 - (24,444)	- - 25,208 -	- 721 25,208 (24,444)
Movement in the fair value of financial assets (note 6) Dividends distributed to minority	-	-	-	-	(667)	-	-	(667)	-	(667)
shareholders (note 22) Translation reserves	- -	- -	- -	- -	- 2,172	- -	- -	- 2,172	(5,330) -	(5,330) 2,172
Balance – December 31, 2019	14,691,286	1,542,547	58,763	4,378	37	13,045	(27,829)	48,394	28,012	76,406

Consolidated Statements of (Loss) Income For the years ended December 31, 2019, 2018 and 2017

(expressed in thousands of Canadian dollars, except per share amounts)

	2019 \$	2018 \$	2017 \$
Revenue (note 19)	244,165	164,845	129,050
Expenses Production, distribution and service costs (note 27) General and administrative costs (notes 4, 20 and 27) Amortization of property and equipment, right-of-use assets and other intangible assets (note 27) Gain on disposal of property and equipment (notes 7 and 21) Finance costs, net (note 24) Foreign exchange gain Loss on loan modification (note 16) Share of income of equity accounted investees (note 5) Change in fair value of financial assets (notes 6 and 18) Change in fair value of other financial liabilities Change in fair value of contingent consideration (note 4)	157,576 69,820 18,989 (3,079) 8,415 (307) 4,317 (360) (1,868) 8,710 368 262,581	110,117 35,741 6,562 (2,792) 2,580 (2) - (242) (390) 265 (824) 151,015	89,375 16,311 2,713 - 1,225 (26) - (387) - - (225) 108,986
(Loss) income before income taxes	(18,416)	13,830	20,064
Current income tax expense (note 26)	8,984	6,913	5,053
Deferred income tax (recoveries) expense (note 26)	(7,917)	(2,840)	776
Net (loss) income for the year	(19,483)	9,757	14,235
Net (loss) income attributable to Owners of Boat Rocker Media Inc. Non-controlling interests (note 22)	(23,707) 4,224	9,360 397	14,129 106
Earnings (loss) per share attributable to common owners of Boat Rocker Media Inc. (note 14) Basic (loss) earnings per share Diluted (loss) earnings per share	(1.60) (1.60)	0.62 0.61	0.94 0.93

Consolidated Statements of Comprehensive (Loss) Income

For the years ended December 31, 2019, 2018 and 2017

(expressed in thousands of Canadian dollars)

	2019 \$	2018 \$	2017 \$
Net (loss) income for the year	(19,483)	9,757	14,235
Other comprehensive income (loss) Item that may be reclassified to income (loss) Cumulative translation adjustments on foreign
operations	2,172	(1,989)	8
Item that will not be reclassified to income (loss) Movement in fair value of financial assets	(667)	513	-
Other comprehensive income (loss) for the year	1,505	(1,476)	8
Comprehensive (loss) income for the year	(17,978)	8,281	14,243
Comprehensive (loss) income attributable to Owners of Boat Rocker Media Inc. Non-controlling interests (note 22)	(22,202) 4,224	7,884 397	14,137 106

Consolidated Statements of Cash Flows

For the years ended December 31, 2019, 2018 and 2017

(expressed in thousands of Canadian dollars)

2019	2018	2017
\$	\$	\$

Boat Rocker Media Inc. Notes to Consolidated Financial Statements

December 31, 2019, 2018 and 2017

(expressed in thousands of Canadian dollars)

1 Corporate information

Boat Rocker Media Inc. (the Company) is an independent, integrated global entertainment company that creates and produces television and film content across many genres, distributes content worldwide and represents on-screen talent and third party intellectual property (IP) owners. The Company was incorporated in and is domiciled in Canada and the address of the Company's registered office is 310 King Street East, Toronto, Ontario M5A 1K6. The Company's controlling shareholder is Fairfax Financial Holdings Ltd. (Fairfax).

2 Basis of preparation and statement of compliance

The consolidated financial statements have been prepared in accordance with International Financial Reporting Standards (IFRS) as issued by the International Accounting Standards Board (IASB).

Assessment of Liquidity and Management's Plans

The Company manages its capital requirements through budgeting and forecasting processes while monitoring for compliance with bank covenants under its credit facilities. The cash flow requirements of the production of video content are primarily met through interim production financing.

As at December 31, 2019, the Company has \$59,268 of cash on hand. The Company has a significant working capital deficiency of \$178,115 at December 31, 2019 (2018 – \$111,220). Certain liabilities that are classified as current, including amounts within interim production financing and loans and borrowings, are not expected to be settled within the next twelve months. Furthermore, management notes that the current portion of deferred revenue of \$41,362 at December 31, 2019 (2018 – \$54,068) relates mainly to production contracts in progress where the cash toward fulfilling the obligation has already been expended.

Subsequent to December 31, 2019, the Company has experienced significant reductions in revenue in 2020, which has impacted its cash flows from operations. Revenue has declined due primarily to the impact of COVID-19 in delaying television production, as further detailed in note 32. This decline in revenue has directly impacted the Company's net income and its ability to generate cash flows from operations.

The Company has continued to meet its obligations over the course of fiscal 2020 by taking measures such as amending its loans and borrowings, as well as by issuing a secured, subordinated convertible debenture for \$25,000 to an entity owned and controlled by the controlling shareholder, Fairfax (note 32).

The estimation of the Company's future liquidity requirements includes numerous assumptions that are subject to various risks and uncertainties. The principal assumptions used to estimate the Company's future liquidity requirements consist of:

The productions that will be greenlit and produced in a particular period;
The financing plan of each production;
The timing of the production period and the cash outflows of production spend;
The timing of collection of the associated accounts receivable and production tax credits receivable; and
The ability to draw on interim production financing to bridge the timing difference between production cash inflows and outflows.

Management has concluded that there are no material uncertainties that may cast significant doubt about the Company's ability to continue as a going concern. Management, however, cannot make assurances that the assumptions used to estimate the Company's liquidity requirements may not change because while it is management's intention to execute on its budget, the future impact of COVID-19 on the business is uncertain. Failure to execute the Company's business plan due to future shutdowns as a result of COVID-19 could have a material impact on these assumptions and judgements.

These consolidated financial statements were authorized for issue by the Board of Directors on • , 2021.

3 Summary of significant accounting policies

The accounting policies set out below have been applied consistently to the periods presented in these consolidated financial statements, unless otherwise indicated. The accounting policies have been applied consistently by all companies in the consolidated group.

The significant accounting policies used in the preparation of these consolidated financial statements are described below.

Basis of presentation

The consolidated financial statements have been prepared on a historical cost basis, except for those assets and liabilities that are measured at fair value, including financial assets, contingent consideration liability and financial liabilities. These consolidated financial statements are presented in Canadian dollars, which is the functional currency of the Company. These consolidated financial statements are presented in thousands of dollars, with the exception of per share amounts, which are presented in dollars.

Basis of consolidation

The consolidated financial statements include the accounts of the Company and all of its controlled subsidiaries. All intercompany balances and transactions have been eliminated on consolidation. Subsidiaries are those entities that the Company controls. Consistent with the film and television industry, the Company utilizes single-purpose entities to manage the costs and funding for its content production projects. For accounting purposes, control is established by the Company when it is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power over the entity. Subsidiaries are fully consolidated from the date on which control is obtained by the Company and are de-consolidated from the date that control ceases. Non-controlling interests are measured at their proportionate share of the acquiree's identifiable net assets at the date of the acquisition. Changes in the Company's interest in a subsidiary that do not result in a loss of control are accounted for as equity transactions.

Investments in equity accounted investees

Associates are entities over which the Company has significant influence. Significant influence is the power to participate in the financial and operating policy decisions of the investee but is not control or joint control over those policies. The considerations made in determining significant influence are similar to those necessary to determine control over subsidiaries.

Investments in associates are originally recognized at cost and are subsequently accounted for using the equity method. Under the equity method, the investment in associates is carried on the consolidated statements of financial position at cost plus post-acquisition changes in the Company's share of income and other comprehensive income (OCI), less distributions of the investee.

The financial statements of investments in which the Company has significant influence are prepared for the same reporting period as the Company. Where necessary, adjustments are made to bring the accounting policies in line with those of the Company. All intra-company unrealized gains resulting from intra-company transactions and dividends are eliminated against the investment to the extent of the Company's interest in the associate. Unrealized losses are eliminated in the same way as unrealized gains, but only to the extent that there is no evidence of impairment.

After the application of the equity method, the Company determines at each reporting date whether there is any objective evidence that the investment in associates is impaired and, consequently, whether it is necessary to recognize an additional impairment loss on the Company's investment in associates. If this is the case, the Company calculates the amount of impairment as the difference between the recoverable amount of the associate and its carrying value and recognizes the amount in the consolidated statements of (loss) income and comprehensive (loss) income.

Revenue

On January 1, 2018, the Company adopted IFRS 15, Revenue from Contracts with Customers (see recently adopted accounting pronouncements). The following accounting policy applies to December 31, 2018 and December 31, 2019 and for the years then ended:

The Company earns revenue from the following sources:

the initial licensing of content produced and owned by the Company;
the distribution of content owned by the Company either through the Company acting as a distribution agent or using third party distribution agents;
the performance of services, both animation and live action, to facilitate production of content owned by a third party; and
the performance of brand and management services provided to talent and IP representation services to third party IP owners.

Licensing revenue for content

The Company grants licences to third parties for content owned by the Company. Licensing revenue that supports the greenlight of the production, also called a pre-sale, is presented as production revenue. Licensing revenue earned after the pre-sale is presented as distribution revenue.
The Company follows the specific guidance on licensing included in IFRS 15, Revenue from Contracts with Customers (IFRS 15). The Company determined that the licences are right to use intellectual property. Under the standard, revenue from contracts associated with the right to use intellectual property is recognized in full when all of the performance obligations are met.

Performance obligations for licensing revenue are satisfied when each of the following conditions are met:

the production has been completed;
the customer has access to the content;
the amount of revenue can be measured reliably;
the collectibility of proceeds is probable; and
the licence period associated with the contract has started.

Distribution of certain of the Company's content is performed by third parties and given the uncertainty related to these sales, the details of each arrangement and collectibility of amounts, revenue is generally only recorded on receipt of the distribution report.

The Company evaluates arrangements with third parties to determine whether revenue should be reported on a gross or net basis under each individual arrangement by determining whether the Company acts as the principal or agent under the terms of each arrangement. In the case that the Company acts as the principal in the arrangement, revenue is reported on a gross basis, resulting in revenue and expenses being classified in their respective consolidated financial statement line items. In the case that the Company is acting as an agent in the arrangement, revenue is presented net of any related expenses. The primary factor that the Company considers in its evaluation of such arrangements is if the Company has control of the content or service before it is transferred to the customer, including if it has the ability to set the pricing.

Service revenue

The Company performs production services to facilitate production of content owned by a third party. Service revenue is recognized over time.

IFRS 15 requires the Company to select a single method for measuring progress and applies it consistently. The Company elects to use the input method as the basis of the measurement. Progress of the contract is measured based on the proportion of costs incurred in the current period to total expected costs. A provision is made for the entire amount of future estimated losses, if any, on production-in-progress.

Notes to Consolidated Financial Statements

December 31, 2019, 2018 and 2017

(expressed in thousands of Canadian dollars)

Contract assets are recognized on unbilled receivables for projects that are in progress.

Representation revenue

The performance obligations pertaining to the Company's talent management services included in representation revenue are to provide various services for clients, which generally include representing, supporting and advocating for clients in the sourcing and negotiating of, and performance under client engagements with third parties. This representation revenue is earned based on a predetermined percentage of a client's earnings. The performance obligations pertaining to services provided to third party IP owners included in representation revenue typically end with the Company negotiating a licensing arrangement for the use of the IP, on which the Company earns a pre-negotiated commission from its client.

Under IFRS 15, representation revenue from talent management services is recognized as services are performed for the Company's customers over time, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those services. Revenue from variable consideration is recognized only to the extent that it is highly probable that a significant reversal in the amount of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is subsequently resolved (variable consideration constraint). The variable consideration contained in the Company's contracts primarily relates to the client's earnings. Once the variable consideration is known and the related uncertainty is resolved, which is mainly when the client has earned their income, the Company will recognize revenue. The Company typically receives its commission within a short period of time subsequent to the client earning their income. When such services are performed prior to receiving supporting statements or other information from our clients or third party customers, we estimate the amount of revenue to recognize prior to receipt of the statement with the consideration of the variable consideration constraint. If our estimates and judgments were to change, the timing and amount of revenue recognized may be different. For representation revenue derived from IP representation for third party IP, revenue is typically recognized at the point of sale since it is at this point that the Company's performance obligations are complete.

For December 31, 2017 and for the year then ended, the Company applied the requirements of International Accounting Standard (IAS) 18, Revenue. The following accounting policy is applicable for this period:

The Company earns revenue from the following sources:

the licensing of content produced and owned by the Company, also referred to as production revenue;
the distribution of content owned by the Company either through the Company acting as a distribution agent or using third party distribution agents; and
performing services, mainly animation, to facilitate production of content owned by a third party.

Revenue from the licensing of content produced by the Company is recognized when each of the following conditions are met:

• the production has been completed and the customer has access to the content;

Boat Rocker Media Inc. Notes to Consolidated Financial Statements

December 31, 2019, 2018 and 2017

(expressed in thousands of Canadian dollars)

the Company has transferred to the buyer the significant risks and rewards of ownership of the content;
the Company retains neither continuing managerial involvement to the degree usually associated with ownership nor effective control over the content;
the amount of revenue to be earned can be measured reliably;
it is probable that the economic benefits associated with the transaction will flow to the entity; and
the costs incurred or to be incurred in respect of the transaction can be measured reliably.

Revenue from the distribution of the Company's content by third parties or related parties is generally comprised of distribution advances and royalties earned on sales in which the third party sells designated licences to content buyers in negotiated territories. Revenue associated with non-refundable distribution advances is recognized when the production is delivered and all other criteria for revenue recognition have been met. Revenue associated with royalties is recognized when the Company can reliably measure the revenue earned, typically on receipt of the distribution report.

Revenue from production services for third parties is recognized on a percentage-of-completion basis. Percentage-of-completion is based on the proportion of costs incurred in the current period to total expected costs. A provision is made for the entire amount of future estimated losses, if any, on productions-in-progress.

Cash payments received in advance pursuant to a content licence or distribution arrangement are recorded as deferred revenue until all of the foregoing conditions of revenue recognition have been met.

The Company evaluates arrangements with third parties to determine whether revenue should be reported on a gross or net basis under each individual arrangement by determining whether the Company acts as the principal or agent under the terms of each arrangement. To the extent that the Company acts as the principal in an arrangement, revenues are reported on a gross basis, resulting in revenues and expenses being classified in their respective financial statement line items. Conversely, to the extent that the Company acts as the agent in an arrangement, revenues are reported on a net basis, resulting in revenues being presented net of any related expenses. Determining whether the Company acts as principal or agent is based on an evaluation of which party has substantial risks and rewards of ownership under the terms of an arrangement. The most significant factors that the Company considers include identification of the primary obligor, as well as which party has credit risk, general and inventory risk (or equivalent) and latitude in establishing prices.

Investment in content

Investment in content is classified by the Company into the following categories: development, in production, delivered and acquired content. For content produced by the Company, all direct production and financing costs incurred during production that are expected to benefit future periods are capitalized. Financing costs are capitalized until substantially all of the activities necessary to prepare the content for delivery are complete. Federal and provincial program contributions and production tax credits are recorded as a reduction of the cost of the content, as is production financing provided by third parties that acquire participation rights.

Boat Rocker Media Inc. Notes to Consolidated Financial Statements December 31, 2019, 2018 and 2017

(expressed in thousands of Canadian dollars)

Development costs represent expenditures incurred on projects prior to the commencement of production and are expensed at the date when the costs are determined not to be recoverable.

Content in production represents the accumulated costs of content currently in production. On delivery of the content to the licensor, content is reclassified into the delivered category.

Delivered content is accounted for as an intangible asset and is amortized using a declining balance method at rates ranging from 36% to 100% at the time of delivery and at rates ranging from 10% to 50% annually on a declining balance as the underlying rights are consumed.

Acquired content includes both intellectual property and distribution rights acquired from third party content creators. Acquired content is amortized using a straight-line method with useful lives ranging from 4-10 years.

Business combinations

Business combinations are accounted for using the acquisition method. The consideration transferred by the Company is measured as the fair value of assets transferred, equity instruments issued and liabilities incurred or assumed at the date of completion of the acquisition. Identifiable assets acquired and liabilities assumed in a business combination are measured initially at fair value at the acquisition date. The excess of the consideration transferred over the fair value of the net assets acquired is recorded as goodwill. If the consideration transferred is less than the net assets acquired, the difference is recognized directly in the consolidated statements of (loss) income and comprehensive (loss) income as a gain on acquisition. Results of operations of a business acquired are included in the Company's consolidated financial statements from the date of the business acquisition. Acquisition costs incurred are expensed and included in general and administrative expenses.

The consideration transferred does not include amounts related to the settlement of pre-existing relationships. Such amounts are generally recognized in profit or loss.

Any contingent consideration is measured at fair value at the date of acquisition. If an obligation to pay contingent consideration that meets the definition of a financial instrument is classified as equity, then it is not remeasured, and settlement is accounted for within equity. Otherwise, other contingent consideration is remeasured at fair value at each reporting date and subsequent changes in the fair value of the contingent consideration are recognized in income.

Goodwill

Goodwill represents the excess of the cost of an acquisition over the fair value of the net identifiable assets acquired at the date of acquisition. Goodwill is carried at cost less any accumulated impairment losses and is not subject to amortization. Goodwill is tested for impairment annually or more frequently if events or circumstances indicate that the asset might be impaired. Goodwill is allocated to a cash generating unit (CGU), or group of CGUs, which is the lowest level within an entity at which the goodwill is monitored for internal management purposes, which is not higher than an operating segment. Impairment is tested by comparing the recoverable amount of goodwill assigned to a CGU or group of CGUs to its carrying value. For the purposes of allocating goodwill, the Company has determined that it has six groups of CGUs: scripted, unscripted, Insight, kids and family, representation and animation services. The first four groups of CGUs earn production, distribution and service revenue in the indicated genre of content. The representation CGU earns a percentage of the revenues the performers manage to earn, and animation services generate service revenue.

Boat Rocker Media Inc. Notes to Consolidated Financial Statements

December 31, 2019, 2018 and 2017

(expressed in thousands of Canadian dollars)

Property and equipment

Property and equipment are recorded at cost less accumulated depreciation and accumulated impairment losses. Depreciation is provided for at the following annual rates:

Building and fixtures	straight-line	three to twenty years
Equipment	straight-line	three years
Leasehold improvement	straight-line	over lease term

Depreciation rates and the estimated useful lives of property and equipment are reviewed at each financial yearend and are adjusted if necessary. During the year ended December 31, 2019, the Company changed its depreciation method where all categories remaining at year-end are amortized straight-line over a three-year period, a period best representing the useful life of the assets. Buildings had been amortized using a 20-year useful life prior to the disposal of 772 Dovercourt Road. There are no remaining buildings owned by the Company as at December 31, 2019.

Prior to January 1, 2019, depreciation was provided for at the following rates:

Building	declining balance	6%
Office equipment	declining balance	20%
Production equipment	declining balance	20%
Furniture and fixtures	declining balance	20%
Computer equipment	declining balance	30%
Computer software	-	100%
Leasehold improvements	straight-line	over lease term

Land is recorded at cost and is not amortized.

Gains and losses on disposal of property and equipment are determined by comparing the proceeds from disposal with the carrying amount of the property and equipment and are recognized net in the consolidated statements of (loss) income and comprehensive (loss) income.

Other intangible assets

Other intangible assets include trademarks, non-compete agreements and talent relationships. Trademarks represent the value of the brand name of an acquired subsidiary. Non-compete agreements represent the value of the covenant to the purchase and sale agreement that restricts the seller of a business from competing with that business in the future. Talent relationships represent the client relationships cultivated with Untitled's roster of performers that it manages:

Trademarks	straight-line	5 years
Non-compete agreements	straight-line	5 years
Talent relationships	straight-line	10 years

Boat Rocker Media Inc. Notes to Consolidated Financial Statements

December 31, 2019, 2018 and 2017

(expressed in thousands of Canadian dollars)

Impairment of long-lived assets

The carrying amounts of the Company's long-lived assets with finite lives, including investment in content, other intangible assets and property and equipment, are reviewed whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. If any such indication exists, then the asset's recoverable amount is estimated.

The recoverable amount of an asset or CGU is the greater of its value in use and its fair value less costs to sell. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. For the purpose of impairment testing, assets that cannot be tested individually are grouped together into the smallest group of assets that generates cash inflows from continuing use that are largely independent of the cash inflows of other assets or groups of assets. For the purposes of goodwill impairment testing, goodwill acquired in a business combination is allocated to the CGU, or the group of CGUs, that is expected to benefit from the synergies of the combination. This allocation is subject to an operating segment ceiling test and reflects the lowest level at which goodwill is monitored for internal reporting purposes.

An impairment loss is recognized if the carrying amount of an asset or its CGU exceeds its estimated recoverable amount. Impairment losses are recognized in profit or loss. Impairment losses recognized in respect of CGUs are allocated first to reduce the carrying amount of any goodwill allocated to the units, and then to reduce the carrying amounts of the other assets in the unit (group of units) on a pro rata basis.

An impairment loss in respect of goodwill is not reversed. In respect of other assets, impairment losses recognized in prior periods are assessed at each reporting date for any indications that the loss has decreased or no longer exists. An impairment loss is reversed if there has been a change in the estimates used to determine the recoverable amount. An impairment loss is reversed only to the extent that the asset's carrying amount does not exceed the carrying amount that would have been determined, net of depreciation or amortization, if no impairment loss had been recognized.

Foreign currency transactions and translation

Foreign currency transactions are translated into the Company's functional currency using the exchange rates prevailing at the dates of the transactions. Foreign currency denominated monetary assets and liabilities are translated into the functional currency at the rate of exchange in effect on the reporting date. Gains and losses on the translation of monetary items are recognized in the consolidated statements of (loss) income and comprehensive (loss) income.

The assets and liabilities of foreign operations are translated into Canadian dollars at exchange rates at the reporting date. The income and expenses of foreign operations are translated into Canadian dollars at the average exchange rates for the period. Foreign currency differences are recognized and presented in OCI and in transaction reserves in equity.

Financial instruments

On January 1, 2018, the Company adopted IFRS 9, Financial Instruments, to account for its financial assets and liabilities (see recently adopted accounting pronouncements). The following accounting policy applies to December 31, 2018 and December 31, 2019 and for the years then ended:

Classification of financial assets and financial liabilities

Financial assets

A financial asset is measured at amortized cost if it meets both of the following conditions and is not designated as at FVTPL:

it is held within a business model whose objective is to hold assets to collect contractual cash flows; and
its contractual terms give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

For an investment in equity instruments that is not held for trading, the Company may elect, on an investment by investment basis, to present the subsequent change in fair value in OCI.

All financial assets not classified as amortized cost or FVOCI as described above are measured at FVTPL.

Financial liabilities

Financial liabilities are classified as measured at amortized cost or FVTPL. A financial liability is classified as at FVTPL if it is classified as held for trading or it is designated as such on initial recognition. Financial liabilities at FVTPL are measured at fair value and net gains and losses, including any interest expense, are recognized in profit or loss. Other financial liabilities are subsequently measured at amortized cost using the effective interest rate method. Interest expense and foreign exchange gains and losses are recognized in profit or loss. Any gain or loss on derecognition is also recognized in profit or loss.

Derivatives

The Company holds convertible debentures issued by its parent company whereby balances can be converted into equity. Embedded derivatives are separated from the host contract and accounted for separately if certain criteria are met. Derivatives are initially measured at fair value. Subsequent to initial recognition, derivatives are measured at fair value and changes therein are recognized in profit or loss.

Notes to Consolidated Financial Statements December 31, 2019, 2018 and 2017

(expressed in thousands of Canadian dollars)

Impairment

The Company recognizes a loss allowance for expected credit losses on financial assets that are measured at amortized cost. At each reporting date, the Company measures the loss allowance for the financial asset at an amount equal to the lifetime expected credit losses if the credit risk on the financial asset has increased significantly since initial recognition.

The Company applies the simplified approach in calculating lifetime expected credit losses on accounts receivable. Impairment losses on financial assets carried at amortized cost are reversed in subsequent periods if the financial asset is no longer credit impaired and the improvement can be related objectively to an event occurring after the impairment was recognized (such as an improvement in the counterparty's credit rating).

For December 31, 2017 and for the year then ended, the Company applied the requirements of IAS 39, Financial Instruments: Recognition and Measurement (IAS 39). The following accounting policy is applicable for this period:

Financial assets within the scope of IAS 39 are classified as financial assets at FVTPL, loans and receivables or available-for-sale (AFS), as appropriate. The Company determines the classification of its financial assets at initial recognition.

Financial instruments classified at FVTPL and financial assets classified as AFS are recognized on the trade date, which is the date that the Company commits to purchase or sell the asset.

Financial assets at FVTPL

The Company has classified cash and cash equivalents and short-term investments as financial assets at FVTPL. Financial assets at FVTPL are carried at fair value. Changes in fair value are recognized in finance costs (income) in the consolidated statements of (loss) income and comprehensive (loss) income.

Loans and receivables

The Company has classified its trade receivables and related party receivables as loans and receivables. Loans and receivables are initially recognized at fair value plus transaction costs. They are subsequently measured at amortized cost using the effective interest rate method less any impairment. Trade receivables are reduced by provisions for estimated bad debts, which are determined by reference to past experience and expectations.

Other financial liabilities

Financial liabilities within the scope of IAS 39 are classified as other financial liabilities. The Company determines the classification of its financial liabilities at initial recognition.

Other financial liabilities, including accounts payable and accrued liabilities, participation accruals, interim production financing and loans and borrowings, are measured at amortized cost using the effective interest rate method. Loans and borrowings are initially measured at fair value, which is the consideration received, net of transaction costs incurred. Transaction costs related to the loans and borrowings are included in the value of the instruments and amortized using the effective interest rate method.

Participation liabilities are accrued when the contractual obligation arises, which is generally when revenue from the related production asset is earned that is eligible for recoupment or profit-sharing under the Company's contracts with third parties. Third parties participate in gross or net revenues at different percentages depending on the amount of revenues earned from each production. The participation liability is measured based on the amount currently due under each contract and does not take into account ultimate revenues and amounts that will be due when certain thresholds are met.

Derivatives

Derivatives, such as forward currency contracts, are initially presented at their fair value on the date the derivative contract is entered into and are subsequently remeasured at fair value. Gains or losses arising from the revaluation are included in net (loss) income.

Derecognition

A financial asset is derecognized when the rights to receive cash flows from the asset have expired, or when the Company transfers its rights to receive cash flows from the asset and the associated risks and rewards to a third party. The unrealized gains and losses recorded in accumulated other comprehensive income (AOCI) are transferred to the consolidated statements of (loss) income and comprehensive (loss) income on disposal of an AFS asset.

A financial liability is derecognized when the obligation under the liability is discharged or cancelled or expires.

Impairment of financial assets

At each reporting date, the Company assesses whether there is objective evidence that a financial asset is impaired. A significant or prolonged decline in the fair value of the security below its cost is also evidence that the assets are impaired. If such evidence exists, the Company recognizes an impairment loss, as follows:

a) Financial assets carried at amortized cost

The loss is the difference between the amortized cost of the loan or receivable and the present value of the estimated future cash flows, discounted using the instrument's original effective interest rate. The carrying amount of the asset is reduced by this amount either directly or indirectly through the use of an allowance account.

b) AFS financial assets

The impairment loss is the difference between the original cost of the asset and its fair value at the measurement date, less any impairment losses previously recognized in the consolidated statements of (loss) income and comprehensive (loss) income. This amount represents the cumulative loss in AOCI that is reclassified to net (loss) income.

Impairment losses on financial assets carried at amortized cost and AFS financial assets are reversed in subsequent periods if the amount of the loss decreases and the decrease can be related objectively to an event occurring after the impairment was recognized. Impairment losses on AFS equity instruments are not reversed.

Leases

On January 1, 2018, the Company early adopted IFRS 16, Leases (see recently adopted accounting pronouncements). Prior to this date, all leases were classified as operating leases under IAS 17, Leases. For these leases, payments were recognized as general and administrative expenses in the consolidated statements of (loss) income on a straight-line basis over the lease term, and no corresponding asset or liability was recognized. Any lease obligations beyond the date of reporting were disclosed as commitments.

The following accounting policy applies to December 31, 2018 and December 31, 2019 and for the years then ended:

At the inception of a contract, the Company assesses whether a contract is, or contains, a lease. A contract is, or contains, a lease if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration. The Company assesses whether the contract involves the use of an identified asset, whether it has the right to obtain substantially all of the economic benefits from use of the asset during the term of the arrangement and if it has the right to direct the use of the asset. At inception or on reassessment of a contract that contains a lease component, the Company allocates the consideration in the contract to each lease component on the basis of their relative standalone prices. The Company does not recognize a right-of-use asset and lease obligation for low value leases as well as any leases with a term of less than 12 months.
As a lessee, the Company recognizes a right-of-use asset and a lease liability at the commencement date of a lease. The right-of-use asset is initially measured at cost, which is comprised of the initial amount of the lease liability adjusted for any lease payments made at or before the commencement date, plus any decommissioning and restoration costs, less any lease incentives received.
The right-of-use asset is subsequently depreciated from the commencement date to the earlier of the end of the lease term, or the end of the useful life of the asset. In addition, the right-of-use asset may be reduced due to impairment losses, if any, and adjusted for certain remeasurements of the lease liability.

A lease liability is initially measured at the present value of the lease payments that are not paid at the commencement date, discounted by the interest rate implicit in the lease, or if that rate cannot be readily determined, the incremental borrowing rate. Lease payments included in the measurement of the lease liability are comprised of:

fixed payments, including in-substance fixed payments, less any lease incentives receivable;
variable lease payments that depend on an index or a rate, initially measured using the index or rate as at the commencement date;
amounts expected to be payable under a residual value guarantee;
exercise prices of purchase options if we are reasonably certain to exercise that option; and
payments of penalties for terminating the lease, if the lease term reflects the lessee exercising an option to terminate the lease.

The lease liability is measured at amortized cost using the effective interest rate method. The effect of passage of time is recorded in the Company's profit and loss as accretion expense. It is remeasured when there is a change in future lease payments arising from a change in an index or rate, or if there is a change in our estimate or assessment of the expected amount payable under a residual value guarantee, purchase, extension or termination option.

When the lease liability is remeasured in this way, a corresponding adjustment is made to the carrying amount of the right-of-use asset or is recorded in profit or loss if the carrying amount of the right-of-use asset has been reduced to zero.

Variable lease payments not included in the initial measurement of the lease liability are charged directly to profit.

Extension and termination options

Extension and termination options are included in the majority of the Company's leases. These options are exercisable only by the Company and not by the lessor. In determining the lease term, management considers all facts and circumstances that create an economic incentive to exercise an extension option, or not exercise a termination option. Extension options (or periods after termination options) are only included in the lease term if the lease is reasonably certain to be extended (or not terminated). Potential undiscounted future cash outflows of \$36,204 (2018 – \$15,043) have not been included in the lease liability because it is not reasonably certain that the leases will be extended (or not terminated).

December 31, 2019, 2018 and 2017

(expressed in thousands of Canadian dollars)

Government financing and assistance

The Company has access to several government programs that are designed to assist content production in Canada. Government assistance in the form of federal and provincial production tax credits and other programs is recorded as a reduction of investments in content and service costs when eligible expenditures are made and there is a reasonable expectation of realization.

Finance income and costs

Net finance income comprises interest income on funds invested, interest expense on loans and borrowings, interest expense on interim production financing, and accretion expense on lease liabilities, the calculation of which is based on the effective interest rate method.

Interim production financing expense that is directly attributable to the production of a qualifying asset, such as an investment in content, is capitalized as part of the cost of that asset until such time as the asset is substantially complete and ready to use.

Interest income and expense are recognized using the effective interest rate method.

Foreign exchange gains and losses

Foreign exchange gains and losses are reported on a net basis.

Cash and cash equivalents

Cash and cash equivalents consist of cash on hand and balances with banks, Canadian money market funds and short-term investments with maturity dates of less than 90 days, net of cheques issued and outstanding at the reporting date. Cash equivalents can be readily converted into a known amount of cash and are subject to an insignificant risk of changes in value.

Employee benefits

Short-term employee benefits are expensed as the related service is provided. A liability is recognized for the amount expected to be paid if the Company has a present legal or constructive obligation to pay this amount as a result of past service provided by the employee and the obligation can be estimated reliably.

Share-based compensation

The Company grants stock options to certain officers and employees of the Company. Stock options vest over periods from four to eight years and expire after ten years. Each grant of stock options with different vesting terms is considered a separate award with its own vesting period and estimated grant date fair value. The participants in the plan may elect to receive cash equal to the difference between the grant date fair value and the exercise price. However, the Board of Directors has the right to reject such election and it is the Company's intention to settle the exercise of options by granting shares. The estimated grant date fair value of each vesting tranche is estimated using the Black-Scholes option pricing model. The non-cash compensation expense is

Boat Rocker Media Inc. Notes to Consolidated Financial Statements December 31, 2019, 2018 and 2017

(expressed in thousands of Canadian dollars)

recognized over each tranche's vesting period by increasing contributed surplus based on the number of awards expected to vest. The number of awards expected to vest is reviewed at least annually with any change to fair value recognized as compensation expense over the vesting period.

The Company grants restricted stock units (RSU) to certain employees, officers and directors of the Company. The fair value of RSUs is based on the closing stock price at the date of the grant. RSUs may vest at the time of grant, in which case compensation expense is recognized at the time of grant. RSUs may vest over a period of time, in which case compensation expense is recognized on a straight-line basis over the specified period.

Provisions

A provision is recognized if, as a result of a past event, the Company has a present legal or constructive obligation that can be estimated reliably, and it is probable that an outflow of economic benefits will be required to settle the obligation. Provisions are determined by discounting the expected future cash flows at a pre-tax rate that reflects current market assessments of the time value of money and the risks specific to the liability. The unwinding of the discount is recognized as a finance cost.

Income tax

Income tax expense comprises current and deferred income tax. Current tax and deferred tax are recognized in profit or loss except to the extent that they relate to a business combination, or items recognized directly in equity or in OCI.

Current tax is the expected tax payable or recoverable on the taxable income or loss for the period, using tax rates enacted or substantively enacted at the reporting date, and any adjustment to tax payable in respect of previous periods.

Deferred tax is recognized in respect of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes. Deferred tax is not recognized for the following temporary differences: the initial recognition of assets or liabilities in a transaction that is not a business combination and that affects neither accounting nor taxable profit or loss, and differences relating to investments in subsidiaries to the extent that it is probable that they will not reverse in the foreseeable future. In addition, deferred tax is not recognized for taxable temporary differences arising on the initial recognition of goodwill. Deferred tax is measured at the tax rates that are expected to be applied to temporary differences when they reverse, based on the laws that have been enacted or substantively enacted by the reporting date. Deferred tax assets and liabilities are offset if there is a legally enforceable right to offset current tax liabilities and assets, and they relate to income taxes levied by the same taxation authority on the same taxable entity, or on different tax entities, but they intend to settle current tax liabilities and assets on a net basis or their tax assets and liabilities will be realized simultaneously.

A deferred tax asset is recognized for unused tax losses and deductible temporary differences, to the extent that it is probable that future taxable profits will be available against which they can be utilized. Deferred tax assets are reviewed at each reporting date and are reduced to the extent that it is no longer probable that the related tax benefit will be realized.

December 31, 2019, 2018 and 2017

(expressed in thousands of Canadian dollars)

Use of estimates and judgments

The preparation of consolidated financial statements in conformity with IFRS requires management to make estimates, judgments and assumptions that affect the application of accounting policies and the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenue and expenses during the reporting periods. Estimates and judgments are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. Accounting estimates will, by definition, seldom equal the actual results.

The most significant estimates and judgments made by management in the preparation of the Company's consolidated financial statements include the following:

The methods and estimates of useful life needed to determine the appropriate amortization of investment in content depend on judgments with respect to many variables including the ability to license content to broadcasters, the availability of secondary markets, the impact of new media platforms, and the demand for merchandise and licensing of the related brand. The usage of content may differ materially and impact future amortization and net income.
Goodwill is tested for impairment if there is an indicator of impairment and annually for the Company's CGUs. Calculating the value in use of CGUs for goodwill impairment tests requires management to make estimates and assumptions with respect to future revenue and costs, as well as discount rates. Changes in any of the assumptions or estimates used in determining the fair values could impact the impairment analysis.
Distribution of certain of the Company's content is performed by third parties and given the uncertainty related to these sales, the details of each arrangement and collectibility of amounts, revenue is generally only recorded on receipt of the distribution report.
Measuring progress toward satisfaction of the Company's performance obligation in talent management arrangements included in representation revenue requires significant judgment. The Company fulfills its performance obligation and recognizes revenue as the performer completes a project. Generally, this is aligned with the performer's receipt of proceeds from these projects. However, judgment is required to evaluate whether the receipt of proceeds is aligned with the satisfaction of the Company's performance obligation and at what point it is highly probable that a reversal in recognition will not occur.
The amount of production tax credits the Company files for as costs are incurred, and the amounts ultimately recovered may differ. The expected timing of the receipt of production tax credits is subject to uncertainty and amounts have been classified as current or long-term based on the expected date of receipt.
The process of allocating consideration to the fair value of assets given, equity instruments issued and liabilities incurred or assumed as at the date of acquisition requires management to make significant estimates and assumptions including but not limited to the estimated fair values of tangible and intangible assets; probability of required payment under contingent consideration provisions; estimated income tax assets and liabilities and estimated fair value of pre-acquisition contingencies. While management uses its best estimates and assumptions as part of the purchase price allocation process to accurately value the assets acquired and liabilities assumed as at the business combination date, estimates and assumptions are inherently uncertain and subject to refinement. As a result, during the measurement period, which is the earlier of the date management receives the information it is looking for and one year from the business combination date, adjustments are recorded to the assets acquired and liabilities assumed, with the corresponding amounts offset to goodwill.
As described in note 4(d), the Company purchased 70% of the outstanding common shares of Insight Productions Ltd. (Insight) on May 17, 2018. The unanimous shareholder agreement of Insight sets out the terms whereby the Company can elect to purchase or is required to purchase the non-controlling interest in Insight. After the third anniversary of the acquisition date, the option is available to the seller to require the Company to purchase the remaining 30%, not less than 30%, for cash or common shares of the Company. The agreement sets out various scenarios in which this purchase can take place and these scenarios result in different valuations of the consideration to be paid. As described in note 4(a), the Company purchased 51% of the outstanding membership interests of Untitled on February 1, 2019. The Limited Liability Company agreement sets out the terms whereby the Company can elect to purchase or is required to purchase the non-controlling interest in Untitled. After the fifth anniversary of the acquisition date, the option is available to the seller to require the Company to purchase the remaining 49% of Untitled. The agreement sets out various scenarios in which this purchase can take place and these scenarios result in different valuations of the consideration to be paid. Assumptions made by management include the likelihood of each scenario for both Untitled and Insight, the timing of the scenarios, and other inputs to the valuation of the purchase price. Changes to the underlying assumptions may materially change the value of the put options as they are currently estimated.
The fair value measurement of certain financial assets requires the Company to assess the classification of the assets based on the contract from which the asset arises. In the case that the asset represents investments in third party entities that are not registered in the public markets, factors that are used to assess fair value include: the valuation indicated by the most recent equity offerings, management information presented at board meetings, and knowledge of the market in which the third party transacts. Changes in any of the assumptions or estimates used in determining the fair values could impact the valuation of these financial assets.
The application of IFRS 16 requires judgment as to whether a lease may be renewed at the end of its term. Valuation of the lease liability requires a discount rate to be selected. Changes to the underlying assumptions may materially change the value of both the right-of-use asset and the lease liability.
Valuation of the derivative liability component of the convertible debentures issued to the Company's controlling shareholder requires various inputs that are subject to management estimates. The Company uses the fair value method of accounting for derivative liabilities and such liabilities are remeasured at the reporting date with changes in fair value recorded in profit or loss in the period incurred. The fair value is estimated using a modified Black-Scholes option pricing model.
Although management believes the assumptions and estimates made in the past have been reasonable and appropriate, they are based in part on historical experience and information obtained from the management of the acquired companies and are inherently uncertain.

Changes in any of the assumptions or estimates used in determining the fair value of acquired assets and liabilities could impact the amounts assigned to assets, liabilities and goodwill in the purchase price allocation, which could also impact net income as expenses and impairments could change. Unanticipated events and circumstances may occur, which may affect the accuracy or validity of such assumptions, estimates or actual results.

The significant assumptions that affect these estimates and judgments in the application of accounting policies are noted throughout these consolidated financial statements.

Recently adopted accounting pronouncements

IFRIC 23, Uncertainty Over Income Tax Treatments (IFRIC 23)

On January 1, 2019, the Company adopted IFRIC 23. IFRIC 23 addresses uncertainty over how tax treatments should affect the accounting for income taxes including when and how the effect of uncertainty over income tax treatments should be included in the determination of taxable profit, tax bases, unused tax losses, unused tax credits and tax rates; the assumptions that an entity should make about the examination of tax treatments by taxation authorities; changes in facts and circumstances; whether uncertain tax treatments should be considered separately and disclosures. This IFRIC interpretation is effective for annual periods beginning on or after January 1, 2019. There was no material impact to the Company on adoption of this interpretation.

IFRS 9, Financial Instruments (IFRS 9)

On January 1, 2018, the Company adopted IFRS 9, which addresses the classification, measurement and derecognition of financial assets and financial liabilities, introduces new rules for hedge accounting and a new impairment model for financial assets. In accordance with the transitional provisions in IFRS 9, the Company adopted IFRS 9 on a modified retrospective basis and therefore comparative figures have not been restated.

Notes to Consolidated Financial Statements

December 31, 2019, 2018 and 2017

(expressed in thousands of Canadian dollars)

The following summarizes the significant changes in IFRS 9 compared to IAS 39:

Classification and measurement of financial assets

IFRS 9 contains three principal classification categories for financial assets: measured at amortized cost, FVOCI and FVTPL. The classification of financial assets under IFRS 9 is generally based on the business model in which a financial asset is managed and its contractual cash flow characteristics. Management reviewed and assessed the Company's existing financial assets as at January 1, 2018 based on the facts and circumstances that existed at that date and concluded that the initial application of IFRS 9 has had the following impact on the Company's financial assets as regards their classification and measurement:

financial assets classified as loans and receivables under IAS 39 that were measured at amortized cost continue to be measured at amortized cost under IFRS 9; and
investments in equity instruments that were accounted for at cost have been classified at either FVOCI or FVTPL, pursuant to the irrevocable election available in IFRS 9. Under IFRS 9, if accounted for as FVOCI, all realized and unrealized gains and losses are recognized permanently in OCI with no reclassification to profit or loss. If accounted for as FVTPL, all realized and unrealized gains and losses are recognized in profit or loss. Refer to note 6 for financial assets classified as FVOCI and FVTPL.

Impairment of financial assets

IFRS 9 introduced a single expected credit loss impairment model, which is based on changes in credit quality since initial recognition. The adoption of the expected credit loss impairment model did not have a significant impact on the carrying amounts of the Company's financial assets on the transition date given the Company transacts mainly with broadcasters and other organizations with strong credit ratings and the negligible historical level of customer default.

IFRS 15, Revenue from Contracts with Customers (IFRS 15)

On January 1, 2018, the Company adopted IFRS 15, which is based on the principle that revenue is recognized when control of a good or service is transferred to a customer. The Company adopted IFRS 15 using the modified retrospective approach applied to those contracts that were not completed as at January 1, 2018. There was no impact to opening retained earnings at January 1, 2018 from initially applying IFRS 15. Results for reporting periods beginning after January 1, 2018 are presented under IFRS 15, while prior period amounts have not been restated and continue to be reported under the accounting standards in effect for those periods.

Notes to Consolidated Financial Statements December 31, 2019, 2018 and 2017

(expressed in thousands of Canadian dollars)

Under IFRS 15, where the Company is acting as a principal in the distribution of content produced by a third party, the revenue is recognized as the gross amount received.

The adoption of IFRS 15 did not have a significant impact on the Company's consolidated financial statements, with the exception of adjustments to the distribution revenue associated third party producers.

The impact of adoption of IFRS 15 on the Company's consolidated financial statements as at December 31, 2018 was as follows:

	As reported \$	Balance without IFRS 15 \$	Impact of IFRS 15 \$
Revenue	164,845	164,508	337
Cost of sales	337	-	337
Operating income	16,684	16,684	-
Net income	7,768	7,768	-
Trade receivables	25,534	25,863	(329)
Contract assets	329	-	329
Total assets	389,370	389,370	-

• IFRS 16, Leases (IFRS 16)

On January 1, 2018, the Company adopted IFRS 16, permitted as an early adoption option along with IFRS 15. IFRS 16 provides a comprehensive model for the measurement, presentation and disclosure of leases and supersedes IAS 17, Leases.

The Company used the cumulative catch-up approach where it has recorded leases from the date of adoption forward and has not restated comparative information. The Company has recorded right-ofuse assets and lease liabilities of \$4,645 as at January 1, 2018. No adjustment was required to retained earnings on January 1, 2018 as a result of adoption.

As part of the initial application of IFRS 16, the Company has elected to apply the following practical expedients:

not recognize a right-of-use asset or lease liability for leases where the lease term ends within 12 months of the date of initial application;
not recognize a right-of-use asset or lease liability for low value leases;
reliance on previous assessments on whether leases are onerous;
the exclusion of initial direct costs for the measurement of the right-of-use asset at the date of initial application; and
the use of hindsight in determining the lease term where the contract contains options to extend or terminate the lease.

Notes to Consolidated Financial Statements

December 31, 2019, 2018 and 2017

(expressed in thousands of Canadian dollars)

The reconciliation of lease liabilities as at January 1, 2018 is:

	\$
Operating lease commitment as at December 31, 2017 Recognition exemption for short-term leases	5,568 (75)
Effect of discounting at the incremental borrowing rate	5,493 (848)
Lease liabilities from initial adoption of IFRS 16 Lease liabilities from finance leases previously recorded	4,645 -
Total lease liabilities as at January 1, 2018	4,645

The weighted average incremental borrowing rate for lease liabilities initially recognized as at January 1, 2018 was 6.00%.

New accounting standards issued but not yet adopted

The Company is currently evaluating the expected impact on its consolidated financial statements of the following pronouncements issued by the IASB to amend certain accounting standards:

COVID-19 related Rent Concessions (Amendment to IFRS 16)

On May 28, 2020, the IASB issued an amendment to IFRS 16, Leases, to provide an optional practical expedient for lessees so that rent concessions received as a direct consequence of the COVID-19 pandemic do not have to be accounted for as lease modifications under IFRS 16. Early adoption of the amendment on April 1, 2020 in accordance with the applicable transition provisions did not have a significant impact on the Company's consolidated financial statements.

Definition of a Business (Amendments to IFRS 3)

The amendments to IFRS 3, Business Combinations, narrow the definition of a business and clarify the distinction between a business combination and an asset acquisition. Prospective adoption of these amendments on January 1, 2020 did not impact the Company's consolidated financial statements.

Definition of Material (Amendments to IAS 1 and IAS 8)

The amendments to IAS 1, Presentation of Financial Statements, and IAS 8, Accounting Policies, Changes in Accounting Estimates and Errors, clarify the definition of "material". Prospective adoption of these amendments on January 1, 2020 did not have a significant impact on the Company's consolidated financial statements.

Interest Rate Benchmark Reform — Phase 2 (Amendments to IFRS 9, IAS 39, IFRS 7, IFRS 4 and IFRS 16) effective January 1, 2021;

December 31, 2019, 2018 and 2017

(expressed in thousands of Canadian dollars)

Onerous Contracts Cost of Fulfilling a Contract (Amendments to IAS 37), Reference to the Conceptual Framework (Amendments to IFRS 3), and Annual Improvements to IFRS Standards 2018–2020, which are effective January 1, 2022; and
Classification of Liabilities as Current or Non-current (Amendments to IAS 1) for which the effective date is January 1, 2023.

4 Business combinations

2019 Acquisitions

a) Untitled Entertainment LLC

On February 1, 2019, the Company completed the acquisition of 51% of the outstanding membership interests of Untitled Entertainment LLC (Untitled). Untitled is a talent management company based in Los Angeles, California and New York, New York that provides talent management services to a roster of celebrities and performers (talent).

The consideration consists of cash, a contingent cash payment and phantom share units, which track the value of the Company's common shares but whose value will be settled via a future cash payment. On the closing date, cash of approximately \$51,010 was paid, net of working capital and other adjustments. Noncontrolling interest of \$25,208 was recognized on acquisition.

Cash consideration of \$1,314 (US\$1,000) was contingently payable based on meeting a specified earnings before interest, taxes, depreciation and amortization (EBITDA) threshold for the year ended December 31, 2018. This threshold was met, and the payment will be paid on the anniversary date of five years following the closing date (February 1, 2024). The discounted value of this payment at February 1, 2019 is \$1,058.

In addition, 200,086 phantom shares were granted on closing that are contingent on future EBITDA thresholds being met. These phantom shares vest 33% if the December 31, 2019 EBITDA threshold is met, 33% if the December 31, 2020 EBITDA threshold is met, and 33% if the December 31, 2021 EBITDA threshold is met. There is also a catch-up provision that applies if the total EBITDA for those three years exceeds the total combined EBITDA threshold, all tranches shall vest, even if any individual year's EBITDA threshold was not met. These shares are designed to track the value of the Company's Series B non-voting shares, with one phantom share unit being equivalent to the value of one Series B non-voting share. The value of the vested phantom share units via tracking of the Company's Series B non-voting share value will be paid out in cash 180 days following the fifth anniversary date of the closing date (August 1, 2024). The discounted value of this payment at February 1, 2019 is \$3,889. The value included in the contingent consideration liability at December 31, 2019 is \$4,031.

The Untitled Limited Liability Company agreement sets out the terms whereby the Company can elect to purchase or is required to purchase the non-controlling interest in Untitled. After the fifth anniversary of the acquisition date, the option is available to the seller to require the Company to purchase the remaining 49% of Untitled. The put option has been valued using a discount rate of 19% for five years from the

December 31, 2019, 2018 and 2017

(expressed in thousands of Canadian dollars)

acquisition date and a financial liability of \$24,444 has been recorded at the acquisition date. At December 31, 2019, the present value of this liability was estimated to be \$29,381.

The goodwill acquired represents relationships with a roster of talent, the workforce, potential production opportunities, and certain synergies expected to be derived from access to this talent in the production of the Company's content. The goodwill is recorded in the representation CGU and is deductible for tax purposes.

The Company incurred transaction costs of \$508, which were included in general and administrative costs on the consolidated statements of (loss) income and comprehensive (loss) income.

Revenue of \$32,911 and net income of \$13,124 have been included in the consolidated statements of (loss) income and comprehensive (loss) income as a result of the acquisition of Untitled. Had Untitled been acquired on January 1, 2019, revenue of \$34,372 and net income of \$13,721 would have been included in the consolidated statements of (loss) income and comprehensive (loss) income.

b) Platform One Media, LLC

On August 31, 2019, the Company completed the acquisition of 100% of Platform One Media, LLC (Platform One). Platform One is a television production company based in Los Angeles, California. Fair value of the consideration transferred at the date of acquisition consisted of non-cash financial liabilities and contingent consideration. The non-cash financial liability recorded represents the seller's right to a variable number of Series D non-voting common shares of the Company valued at \$3,324 (US\$2,500).

The contingent consideration includes three earnouts that provide the seller with the right to a variable number of Series D non-voting common shares of the Company. The consideration and settlement dates of the earnouts are contingent on Platform One meeting certain operational criteria, including the receipt of signed copy of sales agreements with particular American broadcasters. The total consideration for contingent earnout share issuances was recorded at a fair value of \$18,662 (US\$14,037) on acquisition, using a discount rate of 5.15%.

The milestones attached to the first earnout of \$3,324 (US\$2,500) and the third earnout of \$6,648 (US\$5,000) have not been met as at December 31, 2019. The milestone attached to the second earnout of \$6,648 (US\$5,000) was met subsequent to December 31, 2019 and the earnout was settled on January 1, 2020 with 280,554 Series D non-voting common shares issued to the seller.

At December 31, 2019, the discounted value of the closing non-cash financial liability consideration payable was estimated to be \$3,256, which was subsequently issued to the sellers on January 1, 2020 and settled. At December 31, 2019, the discounted value of the contingent consideration payable relating to the right to be issued common shares was estimated to be \$15,339.

The goodwill acquired represents relationships with American broadcasters in the scripted market, the workforce and certain synergies expected to be derived from combining Platform One's operations with the Company's existing scripted business unit. The goodwill is recorded in the Scripted CGU and is deductible for tax purposes.

The Company incurred transaction costs of \$807, which were included in general and administrative costs on the consolidated statements of (loss) income and comprehensive (loss) income.

Net loss of \$5,028 has been included in the consolidated statements of (loss) income and comprehensive (loss) income as a result of the acquisition of Platform One. Had Platform One been acquired on January 1, net loss of \$11,928 would have been included in the consolidated statements of (loss) income and comprehensive (loss) income.

2018 Acquisitions

c) FremantleMedia Family and Kids

On January 24, 2018, the Company acquired certain assets from FremantleMedia Limited that comprised Fremantle's kids and family business unit (FMK).

The consideration was made up of \$8,207 paid at closing and up to \$340 of contingent consideration payable. The seller can earn up to 7.5% of producer fees and up to 5% of modified adjusted gross revenues (MAGR) on certain named development projects.

MAGR is defined as gross revenue received minus distribution commission earned by the Company, distribution expenses incurred by the Company, production costs incurred in the production, repayment of third party distribution advances and profit participants and producer fees and corporate overhead. The accrual for contingent consideration has been calculated by applying probabilities to each project and by discounting the cash to be paid to present value. Contingent consideration is remeasured at fair value at each reporting date and subsequent changes in the fair value are recognized in profit and loss.

The goodwill acquired represents the workforce and the increased ability to satisfy the European and Asian markets.

The Company incurred transaction costs of \$374, which were included in general and administrative costs on the consolidated statements of (loss) income and comprehensive (loss) income.

d) Insight Productions Ltd.

On May 17, 2018, the Company completed the acquisition of 70% of the outstanding common shares of Insight. Insight is a full-service television production company with experience producing scripted and factual television as well as live events.

The consideration consists of a cash payment at closing of \$6,014, a working capital adjustment of \$278, and up to \$6,241 of contingent consideration payable in two future instalments. The first tranche of contingent consideration is based on the production revenue earned by Insight within a specified range during the year ended December 31, 2018 and was payable 90 days after December 31, 2018.

The second tranche of contingent consideration is based on Insight achieving minimum specified EBITDA in the year ended December 31, 2019.

The accrual for contingent consideration has been calculated by applying probabilities to each tranche and by discounting the cash to be paid to present value. Contingent consideration is remeasured at fair value at each reporting date and is recognized in changes in fair value of contingent consideration on the consolidated statements of (loss) income and comprehensive (loss) income.

Based on the revenue earned by Insight compared to the range set in the acquisition agreement, the sellers earned \$4,237 for the first tranche of contingent consideration, which was paid in March 2019. The sellers also earned \$2,000 for the second tranche, half of which was paid subsequent to year-end and half of which is to be paid in the year ended December 31, 2021.

The unanimous shareholder agreement of Insight sets out the terms whereby the Company can elect to purchase or is required to purchase the non-controlling interest in Insight. The agreement sets out various scenarios in which this purchase can take place and these scenarios result in different valuations of the consideration.

After the third anniversary of the acquisition date, the option is available to the seller to require the Company to purchase not less than the remaining 30%, for cash or common shares of the Company. The put option has been valued using a discount rate of 13% for three years from the acquisition date and a financial liability has been recorded as \$4,129 at December 31, 2019 (2018 – \$3,385).

The goodwill acquired represents the strong relationships with Canadian broadcasters, the workforce and certain synergies expected to be derived from combining Insight's operations with the Company.

The Company incurred transaction costs of \$626, which were included in general and administrative costs on the consolidated statements of (loss) income and comprehensive (loss) income.

e) Matador Content LLC

On October 30, 2018, the Company completed the acquisition of 100% of the outstanding common shares of Matador Content LLC (Matador). Matador is a production service company based in New York, New York, and Los Angeles, California, that produces films, unscripted television, scripted television and digital programming.

The consideration consists of cash and non-voting shares of the Company to be issued at a future date as specified in the transaction agreement. On the closing date, an estimated 50% of the consideration was remitted to the sellers: cash of \$13,647 was paid and a contingent right to be issued shares with an estimated value of \$9,377 was granted. The grant of the right to be issued shares was contingent on Matador achieving a certain adjusted EBITDA target for the year ended December 31, 2018. Selling parties will be issued shares on either January 1, 2020 or January 1, 2024.

After the completion of specified audit procedures on Matador's results and an audit of the Company, the final consideration was determined during the year ended December 31, 2019. The Company's shares were valued at a multiple of the Company's adjusted EBITDA for the year ended December 31, 2018. During the year ended December 31, 2019, the Company made cash payments of \$20,889. Share capital of \$27,893 will be issued to the sellers in the future. The total discounted estimate of the value to be issued in shares is

Notes to Consolidated Financial Statements December 31, 2019, 2018 and 2017

(expressed in thousands of Canadian dollars)

\$24,842. Additionally, contingent consideration of \$378 remains at December 31, 2019 that would be payable in cash to the sellers if certain criteria is met.

The transaction agreement also specifies a calculation of the excess cash of Matador as at December 31, 2018. Excess cash was calculated at the completion of the aforementioned audit and excess cash of \$6,916 was paid to the seller during the year ended December 31, 2019.

The goodwill acquired represents relationships with American broadcasters in the unscripted market, the workforce and certain synergies expected to be derived from combining Matador's operations with the Company's existing unscripted business unit. As a result of the adjustments to the final consideration and other amounts in 2019 above, goodwill was adjusted from an initial amount of \$32,632 to \$39,599.

The Company incurred transaction costs of \$2,209 in 2018 and \$395 in 2019, which were included in general and administrative costs on the consolidated statements of (loss) income and comprehensive (loss) income during their respective fiscal year.

The following table summarizes the amounts paid or payable at the date of the acquisitions and the allocation of the purchase prices to the identifiable assets acquired and liabilities assumed based on management's estimate of the fair values:

	Platform		Total				Total
	One	Untitled	2019	FMK	Insight	Matador	2018
	\$	\$	\$	\$	\$	\$	\$
Assets acquired
Cash and cash equivalents	1,858	(332)	1,526	-	8,260	9,914	18,174
Accounts receivable	49	27	76	-	3,716	19,654	23,370
Production tax credits receivable	-	-	-	-	19,171	-	19,171
Prepaid expenses and other
assets	1,020	-	1,020	-	1,321	313	1,634
Investment in content	16,835	-	16,835	3,881	9,928	9,464	23,273
Trademarks	-	1,052	1,052	-	2,600	9,193	11,793
Talent relationships	-	48,633	48,633	-	-	-	-
Non-compete agreements	-	2,366	2,366	-	530	3,152	3,682
Property and equipment	21	-	21	-	185	3,866	4,051
Right-of-use asset Investment in associates	952 -	1,373 -	2,325 -	- -	1,936 351	8,930 -	10,866 351
Goodwill	13,676	29,721	43,397	4,537	3,738	39,599	47,874

Total assets	34,411	82,840	117,251	8,418	51,736	104,085	164,239

Liabilities assumed
Accounts payable and accrued
liabilities	7,744	302	8,046	-	10,550	19,525	30,075
Interim production financing	-	-	-	-	13,605	-	13,605
Loans and borrowings Lease liabilities	- 952	- 1,373	- 2,325	- -	- 1,936	1,422 11,347	1,422 13,283
Deferred revenue	7,053	-	7,053	-	10,534	7,784	18,318

Total liabilities	15,749	1,675	17,424	-	36,625	40,078	76,703

Net assets acquired before non
controlling interests	18,662	81,165	99,827	8,418	15,111	64,007	87,536
Non-controlling interests	-	(25,208)	(25,208)	-	(3,412)	-	(3,412)
Net assets acquired	18,662	55,957	74,619	8,418	11,699	64,007	84,124

Notes to Consolidated Financial Statements

December 31, 2019, 2018 and 2017

(expressed in thousands of Canadian dollars)

	Platform One \$	Untitled \$	Total 2019 \$	FMK \$	Insight \$	Matador \$	Total 2018 \$
Financed by
Cash	-	51,010	51,010	8,207	6,292	13,647	28,146
Financial liabilities	-	-	-	-	-	26,745	26,745
Non-cash financial liabilities	3,268	-	3,268	-	-	14,238	14,238
Contingent consideration	15,394	4,947	20,341	211	5,407	9,377	14,995

Total purchase consideration	18,662	55,957	74,619	8,418	11,699	64,007	84,124

The following table summarizes the movement in the contingent consideration liability:

	2019 \$	2018 \$
Opening balance	18,294	4,114
Additions from business combinations	20,341	14,995
Reversal of unearned contingent consideration	(700)	(1,467)
Cash payments	(6,296)	(333)
Movement from contingent consideration to financial liabilities	(9,550)	-
Foreign exchange (gain) loss	(58)	342
Accretion expense	1,069	643
Ending balance	23,100	18,294
Less: Current portion	5,106	8,575
Non-current portion	17,994	9,719

Consideration of \$807 was paid to sellers of Radical Sheep, acquired in 2016, \$333 was paid to sellers of Jam Filled, acquired in 2016, \$795 was paid to sellers of Proper, acquired in 2017, \$4,237 was paid to Insight sellers and \$124 was paid to Matador sellers during the year ended December 31, 2019. The majority of the conditions were met relating to the Matador acquisition during the year ended December 31, 2019 and accordingly, \$9,550 was reclassified to financial liabilities as a result. Of the estimated \$23,100 liability remaining as at December 31, 2019, \$15,303 relates to liabilities that will be settled by issuing shares rather than cash consideration.

The contingent consideration is estimated based on forecast results and may change on the resolution of the contingency. Contingent consideration for each acquisition has different key assumptions but may include probabilities of content being greenlit, forecasts of future sales of certain titles, estimated revenue and EBITDA of the acquired companies and appropriate discount rates.

Notes to Consolidated Financial Statements

December 31, 2019, 2018 and 2017

(expressed in thousands of Canadian dollars)

5 Investments in associates

	2019 \$	2018 \$
Investments in equity accounted investees Investment in The Old Telegram Building Inc. (a) Investment in Industrial Brothers Canada Ltd. (b) Investment in Insight co-production (c)	52 1,442 304	4 1,430 351
	1,798	1,785

a) In 2012, the Company invested a nominal amount to acquire 29.5% in outstanding common shares of The Old Telegram Building Inc. (OTBI). Concurrently, the Company loaned \$500 to OTBI for the acquisition and operation of the building. The loan to OTBI is recorded and due from related parties (note 20), is due on demand and is interest bearing. As at December 31, 2019, the receivable from OTBI was \$210 (2018 – \$210).

OTBI's principal place of business is Canada and its sole asset is a building at 595 Adelaide Street East, in which the Company is the principal tenant. During 2019, the carrying value of the investment in OTBI has been increased by \$48, being the Company's share of the income during the year (2018 – \$18; 2017 – \$81).

b) On December 9, 2015, the Company subscribed for common shares in Industrial Brothers Canada Ltd. (IB) for an aggregate consideration of \$480. In addition, the Company purchased common shares from existing shareholders for an aggregate consideration of \$720. The total investment of \$1,200 represents a 30% interest in the common shares of IB, a content creation and production company whose principal place of business is Canada.

During 2019, IB declared and paid a dividend to the Company of \$300 (2018 – \$150; 2017 – \$150), which has been recorded as a return of capital, reducing the investment. For the year ended 2019, IB recorded net income of \$1,042 (2018 – \$746; 2017 – \$1,019) and the Company recorded its share of the equity income of \$312 (2018 – \$224; 2017 – \$306) in the consolidated statements of (loss) income and comprehensive (loss) income and as an increase in the value of the investment.

The Company has a first option to co-develop, co-produce and distribute all content to be developed or produced by IB. In this regard, the Company has agreed to provide IB with \$150 per annum to be used by IB to develop projects. For all projects subsequently produced, all rights, title and interest in the project will be held by the Company, with fees being shared between the Company and IB. In addition, the Company will provide IB with office space and certain overhead for a nominal monthly fee. This agreement will continue for so long as the Company owns at least 17.5% of the outstanding common shares of IB.

c) Prior to the acquisition of Insight by the Company, Insight entered into an agreement with a third party to co-produce certain scripted content. This agreement constitutes a jointly controlled enterprise and as such the Company accounts for the agreement as an equity accounted investee and records its share of the equity income in the consolidated statements of (loss) income and comprehensive (loss) income and as an increase in the value of the investment. In the year ended December 31, 2019, the Company reduced the value of its investment by \$47.

Notes to Consolidated Financial Statements

December 31, 2019, 2018 and 2017

(expressed in thousands of Canadian dollars)

The following is summarized financial information for OTBI, IB and the Insight co-production based on their respective financial statements for the 2019 fiscal year-end:

			2019
	OTBI \$	IB \$	Insight co-production \$
Revenue	773	3,534	-
Profit (loss) from continuing operations	162	1,042	(56)
Total net income (loss) and
comprehensive income (loss)	162	1,042	(56)
Current assets	90	3,309	430
Non-current assets	6,532	124	-
Current liabilities	838	534	303
Non-current liabilities	6,116	1,845	-

The following is summarized financial information for OTBI, IB and the Insight co-production based on their respective financial statements for the 2018 fiscal year-end:

			2018
	OTBI \$	IB \$	Insight co-production \$
Revenue	782	3,635	-
Profit from continuing operations	58	746	-
Total net income and comprehensive
income	58	746	-
Current assets	137	3,141	204
Non-current assets	6,674	15	457
Current liabilities	893	479	310
Non-current liabilities	6,412	1,666	169

The following is summarized financial information for OTBI and IB based on their respective financial statements for the 2017 fiscal year-end:

		2017
	OTBI \$	IB \$
Revenue Profit from continuing operations Current assets Non-current assets Current liabilities Non-current liabilities Total comprehensive income	887 275 56 6,918 6 7,520 275	6,383 1,019 4,515 16 3,776 - 1,019

Notes to Consolidated Financial Statements

December 31, 2019, 2018 and 2017

(expressed in thousands of Canadian dollars)

6 Financial assets

	2019 \$	2018 \$
FVOCI Investment in Bustle Digital Group Media (formerly Independent Media Corp.) (a) Investment in Marco Polo Learning, Inc. (b) Investment in Toronto Arrows GP Inc. (c)	2,564 1,998 391	3,348 1,879 393
Total financial assets at FVOCI	4,953	5,620
FVTPL Investment in Creative Labs LP (d) Investment in Serial Box Publishing LLC (e) Note receivable from Serial Box Publishing LLC (e) Fair value of unsettled forward exchange contracts (f)	375 2,224 - 135	225 - 1,341 -
Total financial assets at FVTPL	2,734	1,566
Closing balance	7,687	7,186

The following table summarizes the movement of the financial assets:

	2019 \$	2018 \$
Opening balance	7,186	5,097
Investments made (d)(e)	680	1,186
Movement in the fair value of investments – profit and loss Movement in the fair value of investments – other	488	390
comprehensive (loss) income	(667)	513
Closing balance	7,687	7,186

a) On July 14, 2016, the Company acquired 2,678,571 Series A preferred shares of Independent Media Corp. (referred to here as the Outline) for \$2,341 (US\$1,800), which represents a 16.36% ownership on a fully diluted basis. In September 2018, the Company acquired additional 942,685 Series A-2X preferred shares of The Outline for \$643 (US\$500). The ownership decreased to 15.82% after the investment. The Outline is a digital publication whose principal place of business is the United States of America.

These preferred shares were convertible into common shares at the option of the holder without payment of additional consideration. The number of fully paid shares of common stock was determined by multiplying the number of preferred shares by the conversion price of US\$0.6720 for Series A and US\$0.5304 for Series A-2X. Each holder of preferred shares was entitled to cast the number of votes equal to the number of whole shares of common stock into which the preferred shares are convertible as at the record date. In the event of a liquidation, dissolution or winding up of The Outline or of a transaction that is deemed to be a liquidation event, holders of preferred shares were entitled to be paid out of the assets of the corporation available for distribution to its stockholders before any payment will be made to the holders of common stock at an amount equal to the greater of (i) number of preferred shares multiplied by

the respective conversion price plus dividends declared but unpaid; and (ii) the amount per preferred share that would have been payable had all preferred shares been converted into common stock immediately prior to the event.

During the year ended December 31, 2019, the Outline (Independent Media Corp.) was acquired by Bustle Digital Group (BDG) in exchange for \$5,389 (US\$4,137) of preferred shares of BDG. As a result of this transaction, Independent Media Corp. was amalgamated into Independent Media Holdings LLC, a holding company which exists to receive BDG shares (i.e. consideration for the sale of Outline). All common and preferred shares issued were cancelled and ceased to exist as each common and preferred share was converted into one unit of common or preferred membership interest in the LLC, the LLC existing to receive the share consideration of BDG. As a result of this conversion and via its proportional ownership in Independent Media Holdings LLC, the Company is entitled to a proportionate 435,487 BDG shares. The BDG shares represent the full value of the entity formerly known as the Outline/Independent Media, and these are the shares being valued in these consolidated financial statements.

As at December 31, 2019, the fair value of the shares has been determined to be \$2,564 (2018 – \$3,348) and an adjustment of \$(784) (2018 – \$363) has been made to the Company's AOCI.

b) On March 31, 2017, the Company acquired 215,342 Series A preferred shares of Marco Polo Learning, Inc. (MPL), a Delaware corporation, for \$1,729 (US\$1,300). Concurrently, the Company signed a production services agreement with MPL to produce an animated television series for a total production fee of \$3,724 (US\$2,800), of which \$1,729 (US\$1,300) was agreed to be settled as the consideration for the purchase of the preferred shares, \$133 (US\$100) was paid to the Company by MPL on signing the agreements and \$1,862 (US\$1,400) was paid by MPL into an escrow account with scheduled draws in order to fund the production.

As at December 31, 2019, the fair value of the shares has been determined to be \$1,998 (2018 – \$1,879) and an adjustment of \$119 (2018 – \$150) has been made to the Company's AOCI.

c) On November 1, 2018, the Company invested \$393 (US\$300) cash in Toronto Arrows GP Inc., for an 8.82% ownership. Toronto Arrows R.F.C. is Canada's first professional rugby union team that competes in Major League Rugby.

As at December 31, 2019, the fair value of the shares has been determined to be \$391 (2018 – \$393) using cost as a proxy and an adjustment of \$(2) has been made to the Company's AOCI.

d) On February 24, 2017, the Company purchased 75,000 limited partnership units (LP units) in Creative Labs LP, a Delaware limited partnership that creates content, for \$75 cash on the acquisition date, which resulted in an ownership of 3.2% of outstanding LP units. In March 2018, \$150 cash was paid to purchase a further 150,000 LP units, after which the ownership remained at 3.2%. During the year ended December 31, 2019, the Company purchased another 150,000 units with \$150 cash, bringing the total LP units owned to 375,000. The Company anticipates investing another \$125 over the next year. As at December 31, 2019 and 2018, the Company determined that the fair value of the LP units approximates their carrying value of \$375. As a result, the Company did not recognize any fair value adjustment on this investment during those years.

e) On August 7, 2017, the Company acquired a convertible note receivable from Serial Box Publishing LLC (Serial Box), a Delaware limited liability company that creates content, for \$951 (US\$750). The note receivable had a principal balance equal to the face of the note, a 0% coupon rate and maturity date of August 7, 2019. On February 19, 2019, Serial Box had a private equity raise in which the Company invested an additional \$530 (US\$400) for 264,270 common shares of Serial Box. Additionally, the full note receivable was converted into 649,745 common shares. As at December 31, 2019, the Company holds a total of 914,015 shares in Serial Box.

As at December 31, 2019, the fair value of the shares was determined to be \$2,224 (2018 – \$1,341). An adjustment of \$353 (2018 – \$390) has been made in the Company's consolidated statements of (loss) income and comprehensive (loss) income.

f) The Company periodically enters into foreign exchange contracts to manage its foreign exchange risk on foreign currencies. At the reporting date, the Company revalues its financial instruments denominated in a foreign currency at the prevailing exchange rates.

Summary of forward contracts at December 31, 2019:

Currency contracts	Quantity contracted in foreign currency	Quantity outstanding in foreign currency	Contract price \$	Ending rate \$	Gain (loss) \$	Contract ending date
			1.66	1.72	202
British pound sterling	3,509	3,509	US(1.26)	US(1.32)		US(155) June 30, 2020
			0.012	0.12	(67)
Japanese yen	301,736	301,736	US(0.009)	US(0.009)		US(52) May 8, 2020

					135
Total					US(103)

The Company did not hold any forward foreign exchange contracts as at December 31, 2018.

Notes to Consolidated Financial Statements

December 31, 2019, 2018 and 2017

(expressed in thousands of Canadian dollars)

7 Property and equipment

		Building and		Leasehold
	Land \$	fixtures \$	Equipment \$	improvement \$	Total \$
Cost December 31, 2017 Acquisition through business	3,214	14,272	7,602	1,480	26,568
combination (note 4) Additions Disposal	- - (864)	230 244 (2,205)	631 954 -	3,190 984 -	4,051 2,182 (3,069)
December 31, 2018 Acquisition through business	2,350	12,541	9,187	5,654	29,732
combination (note 4) Additions Impact of foreign exchange Disposal	- - - (2,350)	21 335 (15) (11,092)	- 2,264 (23) -	- 3,954 (145) -	21 6,553 (183) (13,442)
December 31, 2019	-	1,790	11,428	9,463	22,681
Accumulated amortization December 31, 2017 Amortization Disposal	- - -	1,029 830 (132)	3,591 2,376 -	447 274 -	5,067 3,480 (132)
December 31, 2018 Amortization Impact of foreign exchange Disposal	- - - -	1,727 860 (5) (1,371)	5,967 1,731 (1) -	721 1,193 (2) -	8,415 3,784 (8) (1,371)
December 31, 2019	-	1,211	7,697	1,912	10,820
Net book value December 31, 2018 December 31, 2019	2,350 -	10,814 579	3,220 3,731	4,933 7,551	21,317 11,861

On November 21, 2019, the Company disposed of the land and building at 772 Dovercourt Road for total proceeds, net of selling expenses and other deductions, of \$14,990. The Company recorded a gain of \$3,079 from the disposal.

On June 15, 2018, the Company disposed of the land and building at 22 Sackville Street for total proceeds of \$6,200. The Company recorded a gain of \$2,792 from the disposal, net of taxes paid of \$471.

During the year ended December 31, 2017, the Company recognized \$2,713 of amortization of property and equipment in the consolidated statements of (loss) income and comprehensive (loss) income.

Notes to Consolidated Financial Statements

December 31, 2019, 2018 and 2017

(expressed in thousands of Canadian dollars)

8 Investment in content

	Development \$	In production \$	Delivered \$	Acquired content \$	Total \$
Cost December 31, 2017 Acquisition through business	771	16,405	165,871	5,968	189,015
combination (note 4) Additions Reclassification	- 1,311 -	5,740 47,560 (42,776)	- - 42,776	17,533 841 -	23,273 49,712 -
December 31, 2018 Acquisition through business	2,082	26,929	208,647	24,342	262,000
combination (note 4) Additions Reclassification	3,555 246 -	13,280 91,614 (91,667)	- - 91,667	- 714 -	16,835 92,574 -
December 31, 2019	5,883	40,156	300,314	25,056	371,409
Accumulated depreciation December 31, 2017 Amortization charge	171 71	- -	141,701 43,368	793 2,908	142,665 46,347
December 31, 2018 Amortization charge	242 186	- -	185,069 58,361	3,701 8,472	189,012 67,019
December 31, 2019	428	-	243,430	12,173	256,031
Net book value December 31, 2018 December 31, 2019	1,840 5,455	26,929 40,156	23,578 56,884	20,641 12,883	72,988 115,378

The amount of interest capitalized during the year and included in delivered content is \$756 (2018 – \$1,556). The interest capitalized during the year and included in content in production is \$276 (2018 – \$246).

The Company expects \$63,046 of the net book value of its investments in content to be amortized during the year ended December 31, 2020, \$3,498 in 2021, \$3,951 in 2022, \$3,130 in 2023 and \$1,450 in 2024.

During the year ended December 31, 2017, the Company recognized \$49,526 of amortization of investment in content in the consolidated statements of (loss) income and comprehensive (loss) income.

Notes to Consolidated Financial Statements

December 31, 2019, 2018 and 2017

(expressed in thousands of Canadian dollars)

9 Intangible assets

				2019
	Trademarks \$	Non-compete agreements \$	Talent relationships \$	Total \$
Cost December 31, 2017 Acquisition through business	-	-	-	-
combination	11,793	3,682	-	15,475
December 31, 2018 Acquisition through business	11,793	3,682	-	15,475
combination (note 4)	1,052	2,366	48,633	52,051
December 31, 2019	12,845	6,048	48,633	67,526
Accumulated depreciation December 31, 2017	-	-	-	-
Amortization charge	610	167	-	777
December 31, 2018 Amortization charge	610 2,552	167 1,170	- 4,458	777 8,180
December 31, 2019	3,162	1,337	4,458	8,957
Net book value
December 31, 2018 December 31, 2019	11,183 9,683	3,515 4,711	- 44,175	14,698 58,569

The Company expects \$8,642 of the net book value of its other intangible assets to be amortized for each of the years ended December 31, 2020 to 2022, \$7,865 for the year ended December 31, 2023 and \$4,920 for the year ended December 31, 2024.

10 Accounts receivable

	2019 \$	2018 \$
Trade receivables	27,456	42,319
Goods and services tax recoverable – net	2,004	1,395
Short-term accounts receivable	29,460	43,714
Long-term accounts receivable	1,682	1,222
	31,142	44,936

Notes to Consolidated Financial Statements

December 31, 2019, 2018 and 2017

(expressed in thousands of Canadian dollars)

The aging of trade receivables is as follows:

	2019 \$	2018 \$
Unbilled accounts receivable Contract asset Less than 60 days Between 60 and 90 days	16,052 4,426 5,521 1,575	25,534 329 14,798 1,865
Over 90 days	1,564	1,015
	29,138	43,541

The Company does not have security over these balances. Trade receivables are provided for based on estimated recoverable amounts as determined by using a combination of historical default experience, any changes to credit quality and management estimates. The amount of expected credit losses in 2019 and 2018 was determined to be nominal.

11 Goodwill

	2019 \$	2018 \$
Opening balance	64,560	16,686
Acquisition of FMK	-	4,537
Acquisition of Insight	-	3,738
Acquisition of Matador	-	39,599
Acquisition of Untitled	29,721	-
Acquisition of Platform One	13,676	-
Closing balance	107,957	64,560

The following table presents the goodwill by CGU as at December 31, 2019 and 2018:

	2019 \$	2018 \$
Scripted Unscripted Kids and family Insight Animation services Representation	13,676 39,599 13,563 3,738 7,660 29,721	- 39,599 13,563 3,738 7,660 -
	107,957	64,560

Impairment testing

Goodwill is tested for impairment annually or more frequently if events or circumstances indicate that the asset might be impaired. The Company tested goodwill for impairment as at December 31, 2019 in accordance with the policy in note 3. During the year ended December 31, 2019, the Company determined that Insight represented its own distinct CGU and goodwill for this unit was assessed on a standalone basis during the year ended December 31, 2019.

In assessing the goodwill for impairment, the Company compares the carrying value of the CGU to the recoverable amount, where the recoverable amount is the higher of fair value less costs of disposal and the value in use. An impairment charge is recognized to the extent that the carrying value exceeds the recoverable amount. For the year ended December 31, 2019, the Company applied the value in use method for all of the CGUs.

The cash flows used in determining the value in use for the Company's CGUs were based on the following key assumptions:

Five-year projections based on management's expectations of content planned and greenlit, including the ability to distribute the content through global territories, as well as estimates of further seasons and projects in development in the next five years.
Estimates of revenue, segment profit, working capital and operating cash flows are based on historical results and future expectations of operating performance.
The weighted average cost of capital has been calculated at a pre-tax rate of 18.2% to 23.0%.
Cash flows beyond the five-year period are extrapolated using perpetuity growth rates of 3% or less.

The recoverable amount of the Scripted and Unscripted CGUs is sensitive to changes in market conditions and could result in changes in the carrying value of goodwill in the future.

Sensitivity analysis was performed for the Unscripted CGU by changing the following key assumptions: weighted average cost of capital rates, revenue growth and segment profit. To determine the impact on the recoverable amounts, the weighted average cost of capital rates was increased by 4.5% (a 100 basis point increase), the service revenue growth rates were decreased by 20% (a 100 basis point decrease) and segment service production profit margin decreased by 6.13% (a 100 basis point decrease). Each key assumption was changed independently while holding all other assumptions constant. These sensitivities help to determine the theoretical impairment losses that would be recorded.

An increase of the weighted average cost of capital of 4.5% (a 100 basis point increase), a decrease in the service revenue growth rate of 20% (a 100 basis point decrease) or a decrease in the segment service profit of 6.13% (a 100 basis point decrease) would not result in an impairment of the unscripted CGU, but would reduce the excess over the carrying value to \$4,687, \$6,175 and \$1,876, respectively. As each key assumption was changed independently, the results of the sensitivity analyses do not contemplate management's ability to mitigate against any adverse effects that may arise in the future.

Notes to Consolidated Financial Statements

December 31, 2019, 2018 and 2017

(expressed in thousands of Canadian dollars)

The most significant assumption used in the scripted CGU is the renewal and continuation of the current shows under development with major television studios. If those shows are cancelled, not renewed or the Company is not able to replace their production with new shows or content that is being developed, there could be an impairment in the Scripted CGU.

As the recoverable amount of the CGUs to which goodwill has been allocated was greater than its carrying value, the Company determined there were no impairments of goodwill as at December 31, 2019.

12 Share capital

Share capital class	Authorized	Outstanding 2019	Outstanding 2018	Outstanding 2017
Voting common shares Series A non-voting common	Unlimited	14,691,286	15,076,923	15,076,923
shares	Unlimited	-	-	-
Series B non-voting common shares	Unlimited	-	-	-
Series C non-voting common shares	Unlimited	-	-	-
Series C preferred shares Series D non-voting common	Unlimited	1,542,547	-	-
shares	Unlimited	-	-	-
Total	Unlimited	16,233,833	15,076,923	15,076,923

On March 22, 2019, the Company issued 1,156,910 Class C preferred shares to a third party for \$20,114 (US\$15,000). Concurrently and as part of the same transaction, 385,637 Series A non-voting common shares held by certain shareholders were cancelled and exchanged on a 1:1 basis for 385,637 Class C preferred shares. No additional consideration was paid as a result of this exchange, but the transaction resulted in a decrease to retained earnings of \$5,934.

The preferred shares are not characterized by any complex features such as redemption or fixed dividend features. The Company determined that these preferred shares should be treated as equity and have been valued at the fair value of consideration received (\$20,114 or \$17.30 per share).

13 Share-based payments

Stock options

Notes to Consolidated Financial Statements

December 31, 2019, 2018 and 2017

(expressed in thousands of Canadian dollars)

Stock option transactions were as follows:

	Number of shares under option	Weighted average exercise price per option \$
Balance – January 1, 2017 Granted Forfeit	287,500 264,500 (7,000)	4.93 9.34 9.50
Balance – December 31, 2017 Granted Forfeit	545,000 245,000 (30,000)	7.01 12.33 7.06
Balance – December 31, 2018 Granted Forfeit	760,000 222,500 -	8.72 17.27
Balance – December 31, 2019	982,500	10.66

As at December 31, 2019, 50,000 (2018 – 50,000) options were exercisable.

Weighted average number of options outstanding as at December 31, 2019

As at December 31, 2019, the weighted average number of options outstanding and their remaining contractual life is as follows:

Weighted average remaining contractual life (years)	Number outstanding – December 31, 2019	Exercise price \$
6.09	267,500	4.93
7.00	155,000	9.23
7.75	100,000	9.50
9.50	217,500	12.00
8.75	20,000	16.00
9.75	20,000	16.11
9.00	80,000	17.00
9.19	122,500	17.64
	982,500

The fair value of the stock options is amortized on a straight-line basis over the vesting periods of the options on a graded vesting basis. For the year ended December 31, 2019, the Company recognized stock compensation expense of \$721 in general and administrative costs (2018 – \$340; 2017 – \$239).

Notes to Consolidated Financial Statements

December 31, 2019, 2018 and 2017

(expressed in thousands of Canadian dollars)

The calculation of the fair value of options granted during 2019 and 2018 used the Black-Scholes option pricing model with the following weighted average assumptions:

			Options granted
	2019	2018	2017
Fair value of options at grant date Share price at grant date Exercise price Risk-free interest rate Volatility factor of the expected market	\$10.16 – \$11.13 \$16.11 – \$17.64 \$16.11 – \$17.64 5.95%	\$7.57 – \$10.00 \$12.00 – \$16.00 \$12.00 – \$16.00 5.95%	\$5.67 – \$5.83 \$9.23 – \$9.50 \$9.23 – \$9.50 5.00%
price of the Company's shares Expected option life	50.00% 10 years	50.00% 10 years	50.00% 10 years

Restricted share units

In January 2018, the Company authorized an RSU plan that allows the Company to grant RSUs to certain employees, officers and directors. During 2018, the Company awarded 313,800 units with a fair value of \$2,981 (\$9.50 per share). No RSUs were granted in the year ended December 31, 2019. These RSUs vested on the grant date and compensation expense of \$nil was recognized in the year ended December 31, 2019 (2018 – \$2,981; 2017 – \$nil).

14 Earnings (loss) per share

The following table reconciles the numerators and denominators of the basic and diluted earnings (loss) per share computation. No diluted earnings (loss) per share has been calculated for the year ended December 31, 2019 as the below would have an anti-dilutive effect given the Company is in a net loss position. Basic earnings (loss) per share calculation is as follows:

	2019	2018	2017
Numerator for basic (loss) earnings per share – net (loss) income attributable to owners	\$(23,707)	\$9,360	\$14,129
Denominator for basic (loss) earnings per share – weighted average common shares Basic net (loss) earnings per share	14,776,866 \$(1.60)	15,076,923 \$0.62	15,076,923 \$0.94

Notes to Consolidated Financial Statements

December 31, 2019, 2018 and 2017

(expressed in thousands of Canadian dollars)

Diluted (loss) earnings per share calculation is as follows:

	2019	2018	2017
Numerator for basic (loss) earnings per share – net (loss) income attributable to owners	\$(23,707)	\$9,360	\$14,129
Denominator for basic (loss) earnings per share – weighted average common shares Effect of share options on number of common shares	14,776,866 -	15,076,923 239,638	15,076,923 140,616
Effect of restricted share units Diluted weighted average common shares	- 14,776,866	72,903 15,389,464	- 15,217,539
Diluted net (loss) earnings per share	\$(1.60)	\$0.61	\$0.93
15 Interim production financing
		2019 \$	2018 \$
Interim production financing from Aver Media Finance, a division of BMO, with interest at prime plus 0.50%, secured by production tax
credits, specified production financing contracts and a general security agreement Interim production financing from Universal City Studios, with interest at		42,528	22,083
1.00%, secured by production tax credits and a first ranking security interest over all rights, title and interest in and to related production Interim production financing from Royal Bank of Canada, with interest at		15,695	25,202
prime plus 0.50%, secured by production tax credits, specified production financing contracts and a general security agreement Interim production financing from JP Morgan Chase Bank, with interest		20,460	14,027
at LIBOR plus 2.75%, secured by production tax credits, specified production financing contracts and a general security agreement		31,494	-
		110,177	61,312

Interim production financing is drawn by the Company in order to bridge the timing differences between the receipt of licence fees, distribution advances, government assistance and production tax credits and the funding of production costs. On collection of amounts owing, interim production financing is repaid by the Company. Amounts are classified as current as the interim financing is due on demand.

Notes to Consolidated Financial Statements

December 31, 2019, 2018 and 2017

(expressed in thousands of Canadian dollars)

16 Loans and borrowings

	2019 \$	2018 \$
Demand loan payable to BMO – Canadian dollar (Facility 2) Demand loan payable to BMO – US dollar (Facilities 5 and 7) Loan payable to BDC, 722 Dovercourt Road Loan payable to Royal Bank of Canada	21,800 66,645 - 729	21,070 16,347 8,640 1,375
Total before loan fees Loan fees – net of amortization	89,174 1,305	47,432 -
Less: Current portion	87,869 87,869	47,432 38,390
Long-term portion	-	9,042

Corporate credit facility

On October 30, 2018, the Company entered into an amended and restated offer of financing with the Bank of Montreal (BMO). The offer of financing was subsequently amended on February 1, 2019 and December 31, 2019 (collectively the Corporate Credit Facility). As at December 31, 2019, the Corporate Credit Facility is comprised of:

1) a \$5,000 demand revolver;
2) a \$21,460 demand term loan;
3) a \$3,500 treasury risk management facility;
4) a \$300 credit card facility;
5) a US\$37,110 demand term loan;
6) a US\$2,000 demand revolver (which is also available by way of letters of credit in US dollars up to a maximum of US\$1,650); and
7) a US\$13,000 demand term loan.

The Corporate Credit Facility is guaranteed by certain Canadian, US and UK subsidiaries of the Company. The Company and the guarantors have provided the lender with a first priority lien over all of their respective assets, subject to certain exclusions and permitted liens. The Company and certain of the guarantors also pledged 100% of the equity interests they hold in the capital of certain of their subsidiaries.

The demand term loans are uncommitted facilities due on demand. The amended agreement signed on February 1, 2019 made available US\$43,000, which comprises US\$30,000 of Facility 5 and US\$13,000 of Facility 7 and was drawn on the signing date. The term of this facility is 60 months and matures on February 1, 2024 and it bears interest at LIBOR plus 2.75%.

The amendment signed on February 1, 2019 set required covenants for all existing demand loans as follows:

Minimum Fixed Charge coverage ratio of not less than 1.10:1 to December 30, 2019 and not less than 1.25:1 from December 31, 2019 onwards; and
Maximum Net Leverage ratio was fixed at 3:1 from February 1, 2019 to June 29, 2019, 2.75:1 from June 30, 2019 to December 30, 2019 and 2.5:1 from December 31, 2019.

The amendment signed on December 31, 2019 amended interest rates to be based on the Company's Senior Funded Debt to EBITDA ratio. At a ratio of greater than 3:1, Facility 2 bears interest at CAD prime plus 2.5% and Facilities 5 and 6 bear interest at LIBOR plus 3.5%. The applicable rates decline depending on the Company's Senior Funded Debt: EBITDA ratio to a minimum interest rate of CAD prime plus 1% and LIBOR plus 2% should this ratio fall below 1.5:1.

This amendment also waived the testing of all covenants for the period from October 1, 2019 to December 30, 2020. As such, no covenants were in effect at December 31, 2019. Subsequent to December 31, 2019, a further amendment to the Corporate Credit Facility was signed and is described in note 32.

Management has assessed the above amendments and has determined that these amendments constitute a modification of loans and borrowings, which has resulted in a loss on modification of \$4,613. The loss was allocated \$1,149 to the loan described in a), \$323 to the loan described in b), \$1,655 to the loan described in c) and \$1,190 to loan fees.

Demand loan payable to BMO – Canadian dollar (BMO-CAD) (Facility 2)

On May 18, 2018, the Company entered into an agreement with BMO for a loan facility of \$21,460 that can be called on demand but that has a stated quarterly principal repayment schedule. The loan bears interest at the Canadian prime rate plus 2.5 % (2018 – 1.0%) and was used to fund the acquisition of Insight (note 4(d)).

Under the terms of the Offer of Financing (3rd Amended and Restated) with BMO dated October 30, 2018, the Company was required to comply with certain financial covenants. These covenants have been waived at December 31, 2019, and no covenants will be imposed until December 31, 2020. The basis of both ratios is adjusted EBITDA based on the Company's trailing 12-month results under IFRS. The modification of interest rate from Canadian prime rate plus 1% to plus 2.5% and the extension of the maturity date resulted in the recognition of a modification loss of \$1,149.

Demand loan payable to BMO – United States dollar (BMO-USD) (Facilities 5 and 7)

On October 30, 2018, the Company entered into an existing agreement with BMO for a loan facility of \$16,878 (US\$12,400) that can be called on demand but that has a stated quarterly principal repayment schedule. The loan bears interest at LIBOR plus 3.5% (2018 – 2.75%) and was used to fund the acquisition of Matador (note 4(e)). The modification of interest rate from LIBOR plus 2.75% to plus 3.5% and the extension of the maturity date resulted in the recognition of a modification loss of \$323.

On February 1, 2019, the Company amended its agreement to add a loan facility of \$56,459 (\$43,000) with BMO to fund its acquisition of Untitled. The loan was granted in the form of two facilities, a \$17,087 (US\$13,000) demand loan drawn by the Company and a \$39,432 (US\$30,000) demand loan drawn by a U.S. subsidiary of the Company. Subsequent to this amendment, Facilities 5 and 7 bear interest at LIBOR plus 3.5% and are due on demand. The modification resulted in the recognition of a modification loss of \$1,655.

Demand revolvers and treasury risk management facilities with BMO (Facilities 1, 3 and 6)

On May 18, 2018, the Company entered into an agreement with BMO for a demand revolving facility to borrow a maximum of \$5,000 and US\$2,000. The agreement also includes a treasury risk management facility subject to a limit of \$7,000. The revolving facility was undertaken to fund general working capital and corporate requirements and is payable on demand. The Canadian facility carries interest at the prime rate plus 2.5% (2018 – 0.75%) and the US facility carries interest at LIBOR plus 3.5% (2018 – 2.75%). The treasury risk facility was undertaken to facilitate the hedging of foreign exchange risk for up to one year and generates fees as determined by BMO's treasury department. As at December 31, 2019, the Company had not drawn on the revolving facilities (Facilities 1 and 6) or on the hedging facility (Facility 3).

Other loans and borrowings

Loan payable to Business Development Bank of Canada (BDC) for 772 Dovercourt Road, Toronto

The Company acquired land and building as part of the acquisition of Proper Productions on September 21, 2017. The existing mortgage from Roynat Capital was assigned to the Company as part of the acquisition. The Roynat Capital mortgage expired on December 15, 2017 and was extinguished in full. The Company entered into a new mortgage with BDC. The principal borrowed on December 15, 2017 was \$9,000 and the loan carried interest at BDC's variable rate minus 3.8% (2018 – 3.8%). The property was sold during the year ended December 31, 2019 and the residual principal balance of \$8,340 was repaid and discharged in full.

Loan payable to Royal Bank of Canada (RBC)

On the acquisition of Matador, the Company assumed a loan payable of \$1,375 (US\$1,009) that had been drawn to fund leasehold improvements at Matador's offices. The loan is payable over three years and bears interest at 5.84%. The loan is secured by a letter of credit from the Company.

Notes to Consolidated Financial Statements

December 31, 2019, 2018 and 2017

(expressed in thousands of Canadian dollars)

The following table summarizes the scheduled minimum principal repayments for all loans, excluding capitalized loan fees:

	BMO-CAD \$	BMO-USD \$	BMO-USD \$	RBC \$	Total \$
2020	1,609	1,212	4,201	570	7,592
2021	1,609	1,212	4,201	159	7,181
2022	2,146	1,615	5,602	-	9,363
2023	2,146	1,615	5,602	-	9,363
Thereafter	12,877	4,872	33,609	-	51,358
	20,387	10,526	53,215	729	84,857

17 Other financial liabilities

	2019 \$	2018 \$
Put option for 30% of non-controlling interest of Insight (note 4(d)) Put option for 49% of non-controlling interest of Untitled (note 4(a)) Provision for right to a variable number of shares, Platform One acquisition	4,129 29,381	3,654 -
(note 4(b)) Provision to repay third party for investment, Platform One acquisition	3,256	-
(note 4(b)) Provision for second cash tranche, Matador acquisition (note 4(e)) Provision for right to be issued shares, Matador acquisition (note 4(e))	6,772 - 24,842	- 27,580 14,685
Total Less: Current portion	68,380 14,412	45,919 31,234
Non-current portion	53,968	14,685

18 Convertible debentures

On September 3, 2019, the Company issued a secured, subordinated convertible debenture for \$9,858 (US\$7,500) to the United States Fire Insurance Company, an entity owned and controlled by the Company's controlling shareholder, Fairfax. An additional \$9,858 (US\$7,500) was issued to Fairfax shortly after, resulting in a principal balance of \$19,716 (US\$15,000) after issuance. The debenture bears interest at 8% per annum from issuance date until December 31, 2019 and 12% per annum thereafter. No interest has been paid by December 31, 2019, and \$458 (US\$352) of accrued interest is reflected on the consolidated statements of financial position. The debenture matures on April 30, 2020 but may be extended by Fairfax to July 31, 2020 at its discretion.

Fairfax may elect to convert the debenture into common shares at its discretion at any time. Fairfax has not exercised this option as of December 31, 2019. For a notice of conversion given by Fairfax prior to December 31, 2019, the applicable number of shares the amount outstanding would be converted into is based on a valuation of 10 times Company 2019 EBITDA. For a notice of conversion given between January 1, 2020 and April 29, 2020, the applicable number of shares the amount outstanding would be converted into is based on a valuation of 9 times Company 2019 EBITDA. For a notice of conversion on or after April 30, 2020, the applicable number of shares the amount outstanding would be converted into is based on a valuation of 7.5 times Company 2019 EBITDA.

The conversion feature has been recognized as a derivative liability carried at FVTPL. The derivative liability has been determined to be valued at \$1,380 (US\$986) at issuance date using a binomial partial differential equation valuation method, volatility of 43.37% and a credit spread of 20.59%. The derivative liability at December 31, 2019 has been valued at \$nil using a binomial partial differential equation valuation method, a volatility of 39.28% and a credit spread of 20%. Key inputs for both calculations include the Company's stock prices at inception and December 31, the Company's historical volatility and the Company's credit spread riskfree discount curve at inception and December 31. The interest rate is deterministic, and the Company will only consider exercising the redemption option starting from April 1, 2020. The \$1,380 (US\$986) movement in the derivative liability has been recognized in profit and loss. The amount of the liability at December 31 has been allocated to the principal component of the debenture at December 31, 2019, which is being recognized at amortized cost and carried using the effective interest rate, resulting in a total liability at December 31, 2019 of \$18,618 (US\$14,292).

19 Revenue

				2019
	Television \$	Kids and family \$	Representation \$	Total \$
Revenue
Production revenue	69,697	2,915	-	72,612
Distribution revenue	26,959	12,510	-	39,469
Service revenue	53,537	42,630	-	96,167
Representation revenue	-	-	35,917	35,917
Total revenue	150,193	58,055	35,917	244,165
Timing of revenue recognition
At a point in time	96,656	15,425	3,006	115,087
Over time	53,537	42,630	32,911	129,078
	150,193	58,055	35,917	244,165

Notes to Consolidated Financial Statements

December 31, 2019, 2018 and 2017

(expressed in thousands of Canadian dollars)

				2018
	Television \$	Kids and family \$	Representation \$	Total \$
Revenue Production revenue Distribution revenue Service revenue Representation revenue	48,074 28,656 30,618 -	6,101 10,373 36,202 -	- - - 4,821	54,175 39,029 66,820 4,821
Total revenue	107,348	52,676	4,821	164,845
Timing of revenue recognition At a point in time Over time	76,730 30,618	16,474 36,202	4,821 -	98,025 66,820
	107,348	52,676	4,821	164,845
				2017
	Television \$	Kids and family \$	Representation \$	Total \$
Revenue Production revenue Distribution revenue Service revenue Representation revenue	60,166 18,502 - -	7,431 5,134 36,617 -	- - - 1,200	67,597 23,636 36,617 1,200
Total revenue	78,668	49,182	1,200	129,050
Timing of revenue recognition At a point in time Over time	78,668	12,565	1,200	92,433
	-	36,617	-	36,617

During the year ended December 31, 2019, no customer accounted for more than 10% of consolidated revenue (2018 – two customers accounted for 31% of consolidated revenue; 2017 – three customers accounted for 42% of consolidated revenue).

Notes to Consolidated Financial Statements

December 31, 2019, 2018 and 2017

(expressed in thousands of Canadian dollars)

IFRS 15 accounts receivable, contract assets and deferred revenue and impact of adoption

			2019
	Unbilled trade receivables \$	Contract assets \$	Deferred revenue (contract liabilities) \$
Opening balance	25,534	329	54,034
Acquisitions through business combinations (note 4) Additions Amounts received or recognized in revenue	76 15,976 (25,534)	- 4,426 (329)	7,053 28,748 (48,473)
Closing balance	16,052	4,426	41,362
			2018
	Unbilled trade receivables \$	Contract assets \$	Deferred revenue (contract liabilities) \$
IAS 18 carrying amount – December 31, 2017 Impact of adoption of IFRS 15	8,055 -	- -	21,779 -
IFRS 15 carrying amount – January 1, 2018 Acquisitions through business combinations	8,055	-	21,779
(note 4) Additions Amounts received or recognized in revenue	23,559 1,975 (8,055)	620 - (291)	18,318 13,937 -
Closing balance	25,534	329	54,034

20 Related party transactions

Controlling shareholder

On December 31, 2017, 2018 and 2019, Fairfax was the Company's controlling shareholder. Fairfax's holdings are held by three intermediary entities, none of which individually holds a controlling position.

Notes to Consolidated Financial Statements

December 31, 2019, 2018 and 2017

(expressed in thousands of Canadian dollars)

Significant subsidiaries

The Company's principal subsidiaries include the following:

			Owned
Name of company	Jurisdiction	Function	by Company %
Boat Rocker Rights Inc.	Ontario	Television and media distribution	100.00
Boat Rocker Rights (US) Inc.	Ontario	Television and media distribution	100.00
Boat Rocker Rights (UK) LTD.	United	Television and media distribution
	Kingdom		100.00
Boat Rocker Rights (HK) LTD.	Hong Kong	Television and media distribution	100.00
Boat Rocker Digital Inc.	Ontario	Intellectual property exploitation	100.00
Boat Rocker Ventures Inc.	Ontario	Holding company	100.00
Boat Rocker Sports Inc.	Ontario	Holding company	100.00
Boat Rocker Media Inc. (US) Inc.	Delaware	Holding company	100.00
Boat Rocker Media Inc. (US) LLC	Delaware	Holding company	100.00
Temple Street Productions (US) Inc.	California	Intellectual property development and
		exploitation	100.00
Untitled Entertainment LLC	Delaware	Talent management	51.00
Proper Productions Inc.	Ontario	Holding company	100.00
2594931 Ontario Inc.	Ontario	Intellectual property development and
Temple Street Development	Ontario	exploitation Intellectual property exploitation	100.00
Corporation			100.00
Jam Filled Entertainment Inc.	Ontario	Animation studio	100.00
Insight Productions Ltd.	Ontario	Intellectual property development and
		exploitation	70.00
Matador Content LLC	New York	Production service exploitation	100.00
Hydronus Media Inc.	Ontario	Intellectual property development and
		exploitation	100.00
Bootjet Games Inc.	Ontario	Intellectual property development and
		exploitation	100.00
Untitled Newco Inc.	Delaware	Holding company	51.00
Ecosystem Pictures Inc.	California	Holding company	51.00
Platform One Media, LLC	Delaware	Television and media production	100.00
Platform One Media Productions LLC	Delaware	Holding company	100.00
5 Pebbles LLC	Delaware	Intellectual property development and
		exploitation	100.00
Salvos LLC	Delaware	Holding company	100.00
Rubigo LLC	Delaware	Holding company	100.00
Magister LLC	Delaware	Holding company	100.00

For all of the above listed subsidiaries, the Company exercises its control through voting interests.

Production company subsidiaries

In the normal course of business, the Company incorporates a single purpose entity for each season of each series of content through which it manages the costs of production and financing for that project. Once the production managed in each production company is completed and all of the related financing and production tax credits have been fully collected, the production company is amalgamated. As at December 31, 2019, the Company has 124 (2018 – 129; 2017 – 57) production companies that have been included in the Company's consolidated results. The decline is due to amalgamation of old or dormant entities, and no production companies have been disposed of.

Boat Rocker Media Inc. Notes to Consolidated Financial Statements December 31, 2019, 2018 and 2017

(expressed in thousands of Canadian dollars)

Two production companies, Ollie's Edible Adventures Canada Inc. and Ollie's Edible Adventures II Canada Inc., are 50% owned by the Company. As the Company exerts control over these entities, they are consolidated, and the non-controlling interest is disclosed in note 22.

Key management personnel

Key management includes directors and officers of the Company who are considered to be responsible for the operational, financial and strategic direction of the Company. The compensation earned by key management is as follows:

	2019	2018	2017
	\$	\$	\$
Salaries and employee benefits	2,780	3,502	3,228
Share-based compensation	311	179	124
Restricted share unit compensation	-	2,981	-
	3,091	6,662	3,352

Other transactions

As at January 1, 2018, the Company owned 83% of TSP Sackville Inc. (Sackville). On June 14, 2018, the Company purchased the non-controlling interest of 17% for a promissory note and amalgamated Sackville into the legal entity of Boat Rocker Media Inc. On June 15, 2018, the land and building owned by Sackville were sold to a third party for consideration of \$6,200. A loan with BDC related to Sackville was fully extinguished and the promissory note owing to the former shareholder was paid. The resulting net cash proceeds of \$2,699 were distributed to shareholders of the Company on a pro rata basis in July 2018 and were recognized as a reduction of retained earnings of \$2,699 in the year ended December 31, 2018.

As at December 31, 2019, receivable from related parties includes \$212 (2018 – \$258) in respect of amounts owed by directors, officers and equity accounted investees including OTBI and IB.

During the year ended December 31, 2019, the Company paid \$753 (2018 – \$579; 2017 –\$488) under the rental contract to OTBI (note 5(a)).

During the year ended December 31, 2019, the Company earned \$nil in revenue from IB and its subsidiaries for the use of various corporate resources (2018 – \$335; 2017 – \$199). As at December 31, 2019, the Company has a related party receivable from IB of \$2 (2018 – \$2).

During the year ended December 31, 2019, the Company issued a secured, subordinated convertible debenture for \$19,716 (US\$15,000) to the United States Fire Insurance Company, an entity owned and controlled by the Company's controlling shareholder, Fairfax. No interest has been paid by December 31, 2019, and \$458 (US\$352) of accrued interest is reflected on the consolidated statements of financial position.

No dividends were declared nor paid to the shareholders of the Company during the year ended December 31, 2019 (2018 – \$nil; 2017 – \$1,200).

Notes to Consolidated Financial Statements

December 31, 2019, 2018 and 2017

(expressed in thousands of Canadian dollars)

21 Leases

Right-of-use assets

The Company's significant lease arrangements are for office premises and equipment used in content and service production. As at December 31, 2019, \$26,734 (2018 – \$25,458) of right-of-use assets is recorded.

	2019 \$	2018 \$
Opening balance Acquisitions through business combinations (note 4) Additions Amortization	25,458 2,325 5,889 (6,938)	4,645 10,866 12,255 (2,308)
Net book value as at December 31	26,734	25,458

Lease liabilities

Minimum lease payments in respect of lease liabilities and the effect of discounting are as follows:

	2019 \$	2018 \$
Undiscounted minimum lease payments Less than 1 year 2 to 3 years 4 to 5 years Thereafter	7,260 10,973 8,141 10,921	4,570 4,707 4,522 22,449
Total Effect of discounting	37,295 (7,669)	36,248 (8,665)
Total present value of lease liabilities Less: Current portion	29,626 7,260	27,583 4,521
Long-term lease liabilities	22,366	23,062
Lease liabilities continuity
	2019 \$	2018 \$
Capital lease liabilities as at December 31, 2017 Impact of IFRS 16 adoption – January 1, 2018 Acquisition through business combinations (note 4) Additions Cash payments Accretion	- 27,583 2,325 5,431 (7,415) 1,702	- 4,645 13,283 11,417 (2,265) 503
Lease liabilities as at December 31 Less: Current portion	29,626 7,260	27,583 4,521
Long-term lease liabilities	22,366	23,062

The expense relating to variable lease payments not included in the measurement of lease obligation was \$2,419 (2018 – \$997). This consists of variable lease payments for operating costs, property taxes and insurance. Expenses related to short-term leases were \$511 (2018 – \$334). Total cash outflow for leases was \$9,834 (2018 – 3,262), including \$7,415 (2018 – \$2,265) of principal payments on lease obligations. Operating lease expense recorded in the consolidated statements of (loss) income and comprehensive (loss) income for the year ended December 31, 2017 under IAS 17 was \$1,516.

Included in additions above is a sale and leaseback transaction relating to the disposal of one of the Company's buildings, 772 Dovercourt Road (note 7). As a result of this transaction, the Company recognized a right-of-use asset of \$668 and a lease liability of \$848 and a gain on disposal of \$3,079.

22 Non-controlling interests

The following table presents the summarized financial information for each subsidiary that has non-controlling interests that are material to the Company. The amounts disclosed for each subsidiary are before intercompany eliminations.

Summarized statement of financial position:

		Ollie's Edible Adventures Canada Inc.		Ollie's Edible Adventures II Canada Inc.	Productions Ltd.	Insight	Untitled Entertainment LLC
	2019 \$	2018 \$	2019 \$	2018 \$	2019 \$	2018 \$	2019 \$	2018 \$
Current assets Current liabilities	134 7	69 191	20 3	213 105	36,849 45,671	13,925 7,742	2,969 2,735	- -
Current net assets (liabilities)	127	(122)	17	108	(8,822)	6,183	234	-
Non-current assets Non-current liabilities	472 -	1,878 1,114	890 -	2,649 1,607	11,697 400	26,226 29,576	59,474 -	- -
Non-curent net assets (liabilities)	472	764	890	1,042	11,297	(3,350)	59,474	-
Net assets Non-controlling interest	599	642	907	1,150	2,475	2,833	59,708	-
ownership	50%	50%	50%	50%	30%	30%	49%	-
Accumulated non controlling interests	242	263	209	423	3,132	3,224	24,429	-

Untitled typically pays out dividends on a monthly basis to the Company and the non-controlling interest owners proportional to their ownership interest. During the year ended December 31, 2019, \$5,330 of dividends were paid directly from Untitled to the non-controlling interest owners.

Summarized statement of (loss) income and comprehensive (loss) income:

		Ollie's Edible Adventures Canada Inc.				Ollie's Edible TSP Sackville Adventures II Inc. Canada Inc.					Productions Ltd.	Insight	Untitled Entertainment LLC
	2019 \$	2018 \$	2017 \$	2019 \$	2018 \$	2017 \$	2019 \$	2018 \$	2017 \$	2019 \$	2018 \$	2017 \$	2019 \$	2018 \$	2017 \$
Revenue	-	15	1,385	-	-	307	101	2,009	-	43,384	25,607	-	32,491	-	-
Net (loss) income for the year Non-controlling interest	(42)	440	212	-	-	-	(428)	1,150	-	(308)	(850)	-	9,286	-	-
ownership	50%	50%	50%	-	-	16.67%	50%	50%	50%	30%	30%	-	49%	-	-
Non-controlling interests share of net (loss) income	(21)	162	106	-	-	-	(214)	423	-	(92)	(188)	-	4,551	-	-

Summarized statement of cash flows:

		Ollie's Edible Adventures TSP Sackville Canada Inc.		Inc.	Ollie's Edible Adventures II Insight Canada Inc. Productions Ltd.				Untitled Entertainment LLC
	2019	2018	2017	2019	2018	2017	2019	2018	2017	2019	2018	2017	2019	2018	2017
	\$	\$	\$	\$	\$	\$	\$	\$	\$	\$	\$	\$	\$	\$	\$
Operating activities	14	241	(107)	-	-	119	(17)	(1,837)	279	(834)	1,587	-	14,201	-	-
Investing activities	-	-	(39)	-	-	(116)	-	-	-	-	-	-	(10,878)	-	-
Financing activities	12	(196)	(146)	-	-	3	(55)	1,607	279	(391)	(814)	-	(60)	-	-
Net increase (decrease) in cash and cash equivalents	26	45	(292)	-	-	6	(72)	(230)	558	(1,225)	773	-	3,263	-	-

Notes to Consolidated Financial Statements

December 31, 2019, 2018 and 2017

(expressed in thousands of Canadian dollars)

23 Government assistance

Additions to investment in content during the year ended December 31, 2019 have been reduced by \$42,827 (2018 – \$44,752) in respect of production tax credits and by \$642 (2018 – \$4,036) in respect of nonrecoupable contributions from the Canada Media Fund licence fee program.

24 Finance costs (income) – net

	2019	2018	2017
	\$	\$	\$
Interest income	(483)	(32)	(140)
Interest expense	7,196	2,109	1,365
Accretion expense – leases	1,702	503	-
	8,415	2,580	1,225

25 Financial instruments

Credit risk

Credit risk arises from cash and cash equivalents, as well as credit exposure to customers, including outstanding trade receivables. The Company manages credit risk on cash and cash equivalents by ensuring the counterparties are banks, governments and government agencies with high credit ratings.

The maximum exposure to credit risk for cash and cash equivalents and trade receivables approximates the amount recorded on the consolidated statements of financial position of \$90,410 as at December 31, 2019 (2018 – \$100,352).

Trade receivables are mainly with Canadian and American broadcasters as well as large international distribution companies. Management manages credit risk by regularly reviewing aged accounts receivable and performing an appropriate credit analysis.

Interest rate risk

The Company is exposed to interest rate risk arising from fluctuations in interest rates as its interim production financing and certain loans and borrowings bear interest at floating rates. Any changes in interest rates would increase or decrease production costs as interest owing on interim production financing is capitalized to investment in content.

With respect to interest rate risk on loans and borrowings, a 1% increase in the variable interest rate would have resulted in a \$667 increase to the Company's net loss before tax during the year ended December 31, 2019 (2018 – decrease to net income before tax of \$240; 2017 – decrease to net income before tax of \$119) and a decrease of 1% would have resulted in a decrease of \$667 in the Company's net loss before tax (2018 – \$240 increase in net income before tax; 2017 – \$119 increase in net income before tax).

Liquidity risk

The Company manages liquidity by forecasting and monitoring operating cash flows and through the use of interim production financing (note 15). As at December 31, 2019, the Company had cash and cash equivalents of \$59,268 (2018 – \$55,416). The Company maintains appropriate cash balances and has access to financial facilities to manage fluctuating cash flows.

Interim financing and loans and borrowings are classified by the Company as current in nature as they are due on demand; however, the Company does not expect that the full amounts will be repaid within 12 months and the expected repayment schedule is reflected in the financial maturity table below.

Currency risk

The Company's activities involve holding foreign currencies, incurring production costs and earning revenue denominated in foreign currencies. These activities result in exposure to fluctuations in foreign currency exchange rates. The Company periodically enters into foreign exchange contracts to manage its foreign exchange risk on non-Canadian dollar denominated contracts. At the reporting date, the Company revalues its financial instruments denominated in a foreign currency at the prevailing exchange rates.

Categories of financial instruments

As at December 31, 2019 and 2018, the Company's financial instruments consisted of the following:

	2019 \$	2018 \$

Financial assets
Measured at amortized cost
Trade and other receivables	31,142	44,936
Measured at FVTPL
Cash	59,268	55,416
Financial assets – investments (note 6)	2,734	1,566
Measured at FVOCI
Financial assets – investments (note 6)	4,953	5,620
Financial liabilities
Measured at amortized cost
Trade and other payables	53,761	57,644
Interim production financing	110,177	61,312
Loans and borrowings	87,869	47,432
Convertible debentures	18,618	-
Measured at FVTPL

Other financial liabilities (note 17)	68,380	45,919
Contingent consideration	23,100	18,294

Notes to Consolidated Financial Statements December 31, 2019, 2018 and 2017

(expressed in thousands of Canadian dollars)

Fair values

Financial instruments recorded at fair value on the consolidated statements of financial position are classified using a fair value hierarchy that reflects the significance of the inputs used in making the measurements. The fair value hierarchy has the following levels:

Level 1 valuation based on quoted prices observed in active markets for identical assets and liabilities;
Level 2 valuation techniques based on inputs that are quoted prices of similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; inputs other than quoted prices used in a valuation model that are observable for that instrument, and inputs that are derived principally from or corroborated by observable market data by correlation or other means; and
Level 3 valuation techniques with significant unobservable market inputs.

A financial instrument is classified to the lowest of the hierarchy for which a significant input has been considered in measuring fair value.

Fair value estimates are made at a specific point in time based on relevant market information. These are estimates and involve uncertainties and matters of significant judgment and cannot be determined with precision. Change in assumptions and estimates could significantly affect fair values.

The following table summarizes financial assets and liabilities measured at fair value in the consolidated statements of financial position and the level of inputs used to determine those fair values in the context of the hierarchy as defined above:

			2019			2018
	Level 1 \$	Level 2 \$	Level 3 \$	Level 1 \$	Level 2 \$	Level 3 \$
Financial assets Cash and cash equivalents	59,268	-	-	55,416	-	-
Other financial assets	-	-	7,687	-	-	7,186
	59,268	-	7,687	55,416	-	7,186
Financial liabilities
Contingent consideration	-	-	23,100	-	-	18,294
Other financial liabilities	-	-	68,380	-	-	45,919
	-	-	91,480	-	-	64,213

Notes to Consolidated Financial Statements

December 31, 2019, 2018 and 2017

(expressed in thousands of Canadian dollars)

The following table summarizes the changes in Level 3 instruments for the year ended December 31, 2019:

	Other financial assets \$	Other financial liabilities \$
Opening balance	7,186	(45,919)
Acquisitions through business combinations (note 4)	-	(3,268)
Additions	680	(44,709)
Payments	-	27,344
Gains (losses) recognized in income	488	(2,986)
(Losses) gains recognized in OCI	(667)	1,158
Closing balance	7,687	(68,380)

The Company's accounts receivable, accounts payable and accrued liabilities, interim production financing and loans and borrowings are carried at amortized cost, which approximates fair value.

The following table summarizes the quantitative information about the significant unobservable inputs used in Level 3 fair value measurements:

Financial instruments	Fair value \$	Unobservable inputs	Range of inputs \$	Impact of inputs
Other financial assets Investment in Independent Media Corp.	2,564	Private raise share price	5.89 per share	A 10% change in share price would increase/ decrease fair value by \$257
Investment in Marco Polo Learning, Inc.	1,998	Private raise share price	9.28 per share	A 10% change in share price would increase/ decrease fair value by \$200
Investment in Serial Box Publishing LLC	2,224	Private raise share price	2.43 per share	A 10% change in share price would increase/ decrease fair value by \$222
Other financial liabilities Insight's call option	4,129	Expected future EBITDA	3,427	A 10% change in EBITDA would increase/decrease fair value by \$412
		Discount rates	13%	A change in discount rate by 100 basis points would increase/ decrease fair value by \$82
Matador's purchase consideration	24,842	Expected 2018 EBITDA	6,853	A 10% change in EBITDA would increase/decrease fair value by \$5,284
Untitled put option	29,381	Growth rate	13.8%	A change in growth rate by 100 basis points would increase/ decrease fair value by \$1,450

Notes to Consolidated Financial Statements

December 31, 2019, 2018 and 2017

(expressed in thousands of Canadian dollars)

The following table summarizes the fair value and carrying value of other financial assets and financial liabilities that are not recognized at fair value on a recurring basis on the consolidated statements of financial position:

	2019			2018
	Carrying amount \$	Fair value \$	Carrying amount \$	Fair value \$
Interim production financing Loans and borrowings Convertible debentures	110,177 87,869 18,618	110,177 83,551 19,287	61,312 47,432 -	61,312 47,432 -

Maturity analysis for financial liabilities

					2019
	Less than 1 year \$	1 to 3 years \$	4 to 5 years \$	After 5 years \$	Total \$
Accounts payable and accrued
liabilities	51,564	2,197	-	-	53,761
Interim production financing	36,539	48,444	12,597	12,597	110,177
Contingent consideration	5,318	14,027	6,133	-	25,478
Loans and borrowings	7,592	16,543	60,722	-	84,857
Convertible debentures	19,998	-	-	-	19,998
Lease liabilities	7,260	10,973	8,141	10,921	37,295
Other financial liabilities	14,414	12,631	106,261	-	133,306
	142,685	104,815	193,854	23,518	464,872

					2018
	Less than 1 year \$	1 to 3 years \$	4 to 5 years \$	After 5 years \$	Total \$
Accounts payable and accrued
liabilities	56,337	1,307	-	-	57,644
Interim production financing	22,876	38,436	-	-	61,312
Contingent consideration	7,007	7,311	-	6,944	21,262
Loans and borrowings	5,165	24,215	11,713	7,200	48,293
Lease liabilities	4,570	4,707	4,522	22,449	36,248
Other financial liabilities	23,732	12,170	-	10,544	46,446
	119,687	88,146	16,235	47,137	271,205

Notes to Consolidated Financial Statements

December 31, 2019, 2018 and 2017

(expressed in thousands of Canadian dollars)

26 Income taxes

	2019	2018	2017
	\$	\$	\$
Current income tax expense	8,984	6,913	5,053
Deferred income tax (recoveries) expense	(7,917)	(2,840)	776
Income tax expense	1,067	4,073	5,829

The provision for (recovery of) income tax differs from the amount that would have resulted by applying the combined federal and Ontario statutory income tax rate of 26.5%. The reconciliation of income tax expense computed at the statutory rate to income tax expense recognized in the period is:

	2019 \$	2018 \$	2017 \$
Income tax (recovery) expense based on
combined federal and provincial tax
rate of 26.5%	(4,893)	3,614	5,317
Income taxes increased (decreased) by
Non-deductible expenses	2,019	110	344
Stock-based compensation	191	790	-
Differences on foreign operations	(1,003)	(97)	-
Losses and other deductions for
which no benefit is recognized	4,516	-	(43)
Prior year true ups/other	237	(344)	211

	1,067	4,073	5,829

The movement in the net deferred income tax asset (liability) was as follows:

	December 31, 2017 \$	(Charged) credited to consolidated statements of (loss) income \$	December 31, 2018 \$
Property and equipment	45	626	671
Investment in content	(5,883)	1,376	(4,507)
Investment in equity accounted investees	(56)	(67)	(123)
Other financial assets	-	(103)	(103)
Loss carry-forwards	1,329	1,691	3,020
Other intangible assets	-	1,272	1,272
Reserves	-	(2,069)	(2,069)
Other	(86)	113	27
	(4,651)	2,839	(1,812)

Notes to Consolidated Financial Statements

December 31, 2019, 2018 and 2017

(expressed in thousands of Canadian dollars)

	December 31, 2018	(Charged) credited to consolidated statements of (loss) income	December 31, 2019
	\$	\$	\$
Property and equipment Investment in content Investment in equity accounted investees Other financial assets Deferred revenue Loss carry-forwards Other intangible assets Reserves Unrecognized deferred tax assets Other	671 (4,507) (123) (103) - 3,020 1,272 (2,069) - 27	749 (2,371) (43) 2,145 1,142 8,279 3,286 - (4,516) (583)	1,420 (6,878) (166) 2,042 1,142 11,299 4,558 (2,069) (4,516) (556)
	(1,812)	8,088	6,276
Deferred income tax assets Deferred income tax liabilities			6,276 -

In assessing the value of deferred tax assets, the Company's management considers if it is probable that taxable profit will be available against which the deductible temporary differences and unused tax losses can be utilized. Available evidences considered by the Company include, but are not limited to, the Company's historic operating results, projected future operating results and changing business and market circumstances. As at December 31, 2019, the Company has determined that, based on its projected future operating results in fiscal 2020 and beyond, realization of certain deferred tax assets is not probable and as a result it has not recognized deferred tax assets of \$4,516 (2018 – \$nil). This has been recorded as an income tax expense in the consolidated statements of (loss) income and comprehensive (loss) income.

Deferred income tax liabilities have not been recognized for the withholding tax and other taxes on the unremitted earnings of certain subsidiaries as these amounts will not be distributed in the foreseeable future.

As at December 31, 2019, the Company had the following Canadian income tax attributes to carry forward:

	Amount \$	Expiry date
Canadian non-capital losses	17,417	2026 to 2039
American non-capital losses	23,311	No expiry

Notes to Consolidated Financial Statements

December 31, 2019, 2018 and 2017

(expressed in thousands of Canadian dollars)

27 Expenses by nature

		2019 \$	2018 \$	2017 \$
Amortization of investment in content		59,823	44,212	49,320
Amortization of acquired program intangibles		7,196	2,137	206
Distribution costs		4,754	1,461	910
Participation costs		14,763	16,527	12,638
Service costs		71,040	45,780	26,301
Production, distribution and service costs		157,576	110,117	89,375
Salaries and employee benefits		49,945	23,912	10,910
Overhead costs		19,875	11,829	5,401
General and administrative costs		69,820	35,741	16,311
Amortization of property and equipment		3,784	3,477	2,713
Amortization of right-of-use assets		6,938	2,308	-
Amortization of other intangible assets		8,267	777	-
	Amortization of property and equipment, right of-use assets and other intangible assets	18,989	6,562	2,713
28	Supplementary cash flow information
		2019	2018	2017
		\$	\$	\$
Decrease (increase) in accounts receivable Decrease (increase) in long-term accounts		14,624	(7,765)	(385)
receivable		(460)	(7,326)	1,676
Decrease (increase) in tax credits receivable		300	(3,174)	(6,240)
	Decrease (increase) in related party receivable	46	(13)	515
	(Increase) decrease in prepaid expenses and
deposits	(Decrease) increase in accounts payable and	(1,231)	391	1,110
	accrued liabilities excluding participation
accruals		(20,882)	8,747	2,710
Increase (decrease) in participation accruals		14,571	(9,616)	4,143
Decrease in other financial liabilities		(2,003)	-	-
Increase in income taxes payable		974	2,787	3,395
(Decrease) increase in deferred revenue		(19,451)	13,972	(16,898)
		(13,512)	(1,997)	(9,974)

Notes to Consolidated Financial Statements

December 31, 2019, 2018 and 2017

(expressed in thousands of Canadian dollars)

The following table summarizes the change in the Company's liabilities arising from financing activities for the year ended December 31, 2019, 2018 and 2017.

	Lease liabilities \$	Long term debt \$	Convertible debt \$	Interim production financing \$
December 31, 2018 Acquisitions through business	27,583	47,432	-	61,312
combinations (note 4)	2,325	-	-	-
Additions	5,431	-	-	-
Payments	(7,415)	(19,506)	-	(34,280)
Proceeds Mark-to-market on derivative	- -	55,626 -	19,998 (1,380)	83,145 -
Loss on modification of long-term
debt	-	4,317	-	-
Accretion	1,702	-	-	-
December 31, 2019	29,626	87,869	18,618	110,177
	Lease	Long term	Convertible	Interim production
	liabilities \$	debt \$	debt \$	financing \$
December 31, 2017	-	11,357	-	40,482
Impact of IFRS 16 adoption, January 1, 2018	4,645	-	-	-
Acquisitions through business combinations (note 4)	13,283	1,422	-	13,605
Additions	11,417	-	-	-
Payments	(2,265)	(37,418)	-	(37,906)
Proceeds	-	2,765	-	45,131
Accretion	503	-	-	-
December 31, 2018	27,583	47,432	-	61,312
	Lease liabilities \$	Long term debt \$	Convertible debt \$	Interim production financing \$
December 31, 2016	-	2,974	-	53,778
Additions Payments	- -	- (617)	- -	- (56,418)
Proceeds	-	9,000	-	43,122
Accretion	-	-	-	-
December 31, 2017	-	11,357	-	40,482

Notes to Consolidated Financial Statements

December 31, 2019, 2018 and 2017

(expressed in thousands of Canadian dollars)

29 Commitments and contingencies

The Company enters into contracts with third party producers whereby it commits to funding the production of content through a distribution advance that may be payable in instalments over the production term contingent on completion of certain milestones. Future payments related to these commitments as at December 31, 2019 are as follows:

	\$
2020 2021 2022	16,177 333 1,330
	17,840

In addition, the Company is required to pay its proportionate share of all costs and expenses of maintaining the premises.

The Company has guaranteed the loan payable to BDC in the principal amount of \$6,116 (2018 – \$6,411) on the books of OTBI. The security provided by the Company includes a general security agreement and an assignment of the Company loan to OTBI in the amount of \$nil (2018 – \$210). In addition, certain shareholders of the Company have provided joint and several guarantees for 20% of the outstanding loan. No fees have been charged for providing these guarantees.

Subsequent to year-end, a subsidiary of the Company, Insight Productions Ltd., was served with a class action lawsuit regarding allegations of non-compliance with Ontario's Employment Standard Act. The suit is seeking \$35,000 in damages. The Company believes that the suit is without merit and it is not probable that the Company will have to make payments in regard to this action. As such, no provision relating to this matter has been recorded at December 31, 2019.

From time to time, the Company may be subject to contingencies. Management believes that the level of insurance purchased adequately covers such contingencies that may arise and as such they are not expected to have any impact on financial results.

30 Capital disclosures

The Company's objectives when managing capital are to provide an adequate return to shareholders, safeguard its assets, maintain a competitive cost structure and continue as a going concern in order to pursue the development, production, distribution and licensing of its content. As at December 31, 2019, cash includes \$23,720 (2018 – \$25,375) that is required for the funding of productions-in-progress and is not available for other uses. The Company does not consider interim production financing to be part of its capital management programs as these loans are specific to individual productions and are repaid by funds earmarked to the individual productions such as production tax credits and other forms of support. The Company has not declared or paid dividends during the years ended December 31, 2019 and 2018. The balance of the Company's cash is being used to maximize ongoing development and growth effort.

Notes to Consolidated Financial Statements

December 31, 2019, 2018 and 2017

(expressed in thousands of Canadian dollars)

	2019 \$	2018 \$
Cash Cash equivalents Total loans and borrowings	59,268 - (87,869)	55,091 325 (47,432)
Net capital	(28,601)	7,984
Total capital and reserves attributable to owners	48,394	74,205

To facilitate the management of its capital structure, the Company prepares annual expenditure operating budgets that are updated as necessary depending on various factors including industry conditions and operating cash flows. The annual and updated budgets are reviewed by the Board of Directors.

31 Segment information

The Company determined its reportable segments based on the nature of their operations and the way in which information is reported and used by the Company's chief operating decision makers (CODM), being the Chief Executive Officer and the President, Boat Rocker Studios.

The Company has three reportable segments: i) Television, ii) Kids and Family, and iii) Representation.

The Television segment operates under the following brands: Temple Street, Proper Productions (Proper), Insight Productions, Matador Content and Platform One. This segment earns revenue from the creation and distribution of scripted and unscripted television content.

The Kids and Family segment includes the Company's Kids and Family studio, the content and employees acquired from Fremantle Media's kids and family business unit, and the Jam Filled Entertainment animation studio. This segment earns revenue from the creation and distribution of primarily scripted television content aimed at the kids and family demographic.

The Representation segment comprises the content and brands owned by third parties and managed by the Company, along with the management of talent. This segment earns revenue from the distribution of third party catalog along with Untitled Entertainment's talent management.

Corporate and shared services is a cost center that recognizes direct and indirect expenses, including Toronto head office charges such as rent and facilities, and costs associated with shared departments and corporate functions.

The Company measures segment performance based on revenues reported in accordance with IFRS and segment profit and loss. Segment profit is defined as segment gross revenues less segment direct and indirect expenses. Segment profit excludes corporate shared services direct and indirect expenses, share-based compensation and purchase accounting and related adjustments.

Notes to Consolidated Financial Statements

December 31, 2019, 2018 and 2017

(expressed in thousands of Canadian dollars)

					2019
	Television \$	Kids and family \$	Representation \$	Corporate \$	Total \$
Revenue	150,193	58,055	35,917	-	244,165
Expenses Production, distribution and service costs General and administrative costs	120,679 21,220	34,712 4,868	2,185 20,067	- 23,665	157,576 69,820
	8,294	18,475	13,665	(23,665)	16,769
Amortization of property and equipment, right-of-use assets and other intangible assets (note 27) Gain on disposal of property and equipment (notes 7 and 21) Finance costs, net (note 24) Foreign exchange gain Loss on loan modification (note 16) Share of income of equity accounted investees (note 5) Change in fair value of financial assets (notes 6 and 18) Change in fair value of other financial liabilities Change in fair value of contingent consideration					18,989 (3,079) 8,415 (307) 4,317 (360) (1,868) 8,710 368
Loss before income taxes Current income taxes Deferred income taxes					(18,416) 8,984 (7,917)
Net loss for the year					(19,483)

2018

	Television \$	Kids and family \$	Representation \$	Corporate \$	Total \$
Revenue	107,348	52,676	4,821	-	164,845
Expenses Production, distribution and service costs General and administrative costs	79,573 9,717	29,753 3,319	791 1,681	- 21,024	110,117 35,741
	18,058	19,604	2,349	(21,024)	18,987
Amortization of property and equipment, right-of-use assets and other intangible assets (note 27) Gain on disposal of property and equipment (notes 7 and 21) Finance costs, net (note 24) Foreign exchange gain Share of income of equity accounted investees (note 5)					6,562 (2,792) 2,580 (2) (242)
Change in fair value of financial assets (notes 6 and 18) Change in fair value of other financial liabilities Change in fair value of contingent consideration					(390) 265 (824)
Income before income taxes Current income taxes Deferred income taxes					13,830 6,913 (2,840)
Net income for the year					9,757

Notes to Consolidated Financial Statements

December 31, 2019, 2018 and 2017

(expressed in thousands of Canadian dollars)

					2017
	Television \$	Kids and family \$	Representation \$	Corporate \$	Total \$
Revenue	78,668	49,182	1,200	-	129,050
Expenses Production, distribution and service costs General and administrative costs	56,551 2,952	32,484 1,136	340 443	- 11,780	89,375 16,311
	19,165	15,562	417	(11,780)	23,364
Amortization of property and equipment, right-of-use assets and other intangible assets (note 27) Finance costs, net (note 24) Foreign exchange gain Share of income of equity accounted investees (note 5) Change in fair value of contingent consideration					2,713 1,225 (26) (387) (225)
Income before income taxes Current income taxes Deferred income taxes					20,064 5,053 776
Net income for the year					14,235

Revenue by geographic location, based on the location of customers is as follows:

	2019 \$	2018 \$	2017 \$
Revenue by geographic region:
Canada	93,537	83,416	48,287
United States	121,187	27,364	51,135
United Kingdom	23,315	33,889	24,205
Other	6,125	20,176	5,423

	244,165	164,845	129,050

No other foreign country individually comprises greater than 10% of total revenue.

Based on the nature of the Company's production, distribution and service revenue and the large dollar value of certain transactions, it is not unusual that one or more customers in any reporting period may represent greater than 10% of the Company's total revenue for that period. During the year ended December 31, 2019, no single customer represented for more than 10% of total revenue. (2018 – two customers accounted for a combined 31% of total revenue; 2017 – three customers accounted for a combined 42% of total revenue).

Notes to Consolidated Financial Statements

December 31, 2019, 2018 and 2017

(expressed in thousands of Canadian dollars)

Non-current assets by geographic region are as follows:

	2019 \$	2018 \$
Non-current assets by geographic region: Canada United States Other	334,193 13,727 929	234,383 14,008 261
	348,849	248,651

32 Subsequent events

Subsequent to December 31, 2019, the World Health Organization characterized COVID-19 as a global pandemic. Since that time, several preventative measures have been implemented in Canada, including shelterin-place orders and the closure of the border between Canada and the United States to non-essential travel.

The Company has been impacted by COVID-19 in a number of ways. Employees have transitioned to workfrom-home and IT security and software have been upgraded to ensure the Company's information is protected. For all of the Company's productions, safety protocols for cast and crew are paramount and must be in place before production can begin. An internal task force was set up to understand and implement COVID-19 health and safety requirements on the Company's productions, following standards set by public health, applicable unions and guilds, local production associations and clients. Live action content productions in the Scripted, Unscripted and Insight CGUs have been halted or delayed, impacting cash inflows from broadcasters and delaying the delivery of greenlit content, negatively impacting 2020 revenue. Productions have since resumed under stricter guidelines in accordance with government and industry standards. This hiatus has also negatively affected the results of the Company's talent management business, which earns a commission as talent earns salary. The Company's Kids and Family and Animation CGUs continue to provide services as the workforce has successfully transitioned to working from home.

As a result of the COVID-19-associated protocols, the Company has incurred increased production costs that were not included in the pre-COVID-19 production budgets, such as shorter workdays for certain union crew, personal protective equipment and other safety measures. These protocols and costs are crucial to protect cast and crew and ensure that production continues without further delay or risk of the spread of COVID-19 on sets.

The bank that provides interim financing to the Company has implemented stricter conditions for the draws of funding given the risk that a production may be shut down if there is a COVID-19 outbreak on the set. As a result, in some cases, production companies cannot draw funds that would pay the Company its earned executive producer fees until after principal photography has been completed.

The Company has accessed funds from the Canada Emergency Wage Subsidy (CEWS) and has collected \$1,086 relating to its productions in 2020 that has been reflected as a reduction of investment of content, \$1,516 has been collected relating to corporate salaries, which has been reflected as a reduction of operating expenses, and \$6,046 has been collected relating to service costs, which has been reflected as a reduction of service expenses. \$3,409 of this funding represents the collection of accelerated tax credits that would have been collected independently of the CEWS, but which has been collected sooner under this program in order to provide for additional cash inflow in 2020.

The full extent to which COVID-19 continues to impact the Company's business will depend on future developments, which are highly uncertain and cannot be predicted at this time. These developments include the severity and scope of the outbreak and the actions taken to contain or treat the pandemic.

On January 1, 2020, the second earnout associated with the purchase and sale agreement for Platform One was determined to be met, and on this date, 418,739 Series D non-voting common shares with a value of \$6,648 (US\$5,000) were issued to the seller. Refer to note 4(b).

On July 20, 2020, the Company entered into a financing agreement with BMO, which amends the loans and borrowings described in note 16. The amendment introduces an additional demand loan facility of US\$10,000, or the Canadian dollar equivalent, on the funding date, repayable at 5% of the principal balance per quarter over ten quarters commencing September 30, 2020, with the residual 50% principal balance due on the earlier of an acceleration event, defined as the earlier of demand and an event of default including a change of control, and December 31, 2022. The new facility bears interest at the Canadian prime rate plus 3%. These funds were accessed with government support from the Export Development Bank of Canada, which guaranteed 75% of the loan.

The amendment waives the testing of financial covenants for all borrowings under the credit agreement with the lenders until June 2021 and requires the Company to meet certain minimum quarterly EBITDA amounts. Mandatory prepayments will also be required should an acceleration event occur, such as an equity raise.

In addition, on July 20, 2020, the Company's controlling shareholder, Fairfax, executed a commitment letter to fund an equity injection of at least \$10,000 and up to \$25,000 by December 31, 2020. The equity injection of \$10,000 was required by the amended financing agreement with BMO and the additional \$15,000 is available to fund operations, as required by the Company, which would be sufficient cash flows to meet the Company's obligations as they fall due for the remainder of the year.

On November 16, 2020, the Company amended its convertible debentures described in note 18 such that the conversion ratio for the debenture is based on a price per share of \$10.33 and the maturity date is the earlier of the closing of an initial public offering and January 1, 2021.

On November 17, 2020, the Company issued \$7,087 of notes receivable to certain shareholders. On November 18, 2020 the Company issued 686,091 Series A non-voting common shares to the same shareholders in exchange for \$7,087 cash. The notes receivable are non-interest bearing and are due on the earlier of an initial public offering and January 1, 2021.

On November 17, 2020, the Company sold its investment in The Old Telegram Building Inc. to certain shareholders in exchange for notes receivable of \$1,358. The notes receivable are non-interest bearing and are due on the earlier of an initial public offering and January 1, 2021.

On December 1, 2020, the Company issued a secured, subordinated convertible debenture for \$25,000 to an entity owned and controlled by the Company's controlling shareholder, Fairfax. The debenture bears interest at 8% per annum. An additional convertible debenture of \$15,000 at the same terms was issued on February 1, 2021 to the same Fairfax entity . Unless an event of default occurs, Fairfax will make additional advances at the same terms of up to \$15,000 on June 1, 2021, and up to \$20,000 on September 1, 2021. The debenture matures on March 31, 2022. Fairfax may elect to convert the debenture into common shares at its discretion at any time, and must convert on the closing of an initial public offering of the Company. The applicable number of shares the amount outstanding would be converted into is based on a conversion ratio agreed to between the Company and Fairfax.

On February 12, 2021, the Company filed a preliminary prospectus with the Ontario Securities Commission.

Interim Condensed Consolidated Financial Statements (unaudited)

For the three and nine months ended September 30, 2020 and 2019

Interim Consolidated Statements of Financial Position

(Unaudited)

(expressed in thousands of Canadian dollars)

	September 30, 2020	December 31, 2019
Assets	\$	\$
Current assets
Cash	75,553	59,268
Accounts receivable	27,494	29,460
Receivable from related parties (note 16)	—	212
Production tax credits receivable	32,807	73,337
Prepaid expenses and deposits	17,414	5,017
Total current assets	153,268	167,294
Long-term accounts receivable	4,944	1,682
Long-term production tax credits receivable	56,911	10,907
Investment in content (note 5)	192,147	115,378
Intangible assets	52,088	58,569
Property and equipment	10,603	11,861
Right-of-use assets (note 15)	30,111	26,734
Investment in equity accounted investees	696	1,798
Financial assets	7,751	7,687
Deferred income tax assets	12,433	6,276
Goodwill (note 6)	94,998	107,957
Total assets	615,950	516,143
Liabilities
Current liabilities
Accounts payable and accrued liabilities	54,325	53,761
Income taxes payable	8,586	6,844
Current portion of contingent consideration (note 20)	4,639	5,106
Interim production financing (note 10)	128,975	110,177
Loans and borrowings (note 11)	99,481	87,869
Convertible debentures (note 13)	22,429	18,618
Current portion of lease liabilities (note 15)	9,858	7,260
Other current financial liabilities (note 12)	—	14,412
Fair value of unsettled forward exchange contracts	576	—
Current portion of deferred revenue (note 19)	120,518	41,362
Total current liabilities	449,387	345,409
Long-term contingent consideration (note 20)	11,588	17,994
Long-term lease liabilities (note 15)	23,986	22,366
Other long-term financial liabilities (note 12)	61,528	53,968
Long-term deferred revenue (note 19)	17,273	—
Total liabilities	563,762	439,737
Shareholders' Equity
Equity attributable to owners of Boat Rocker Media Inc.	23,187	48,394
Non-controlling interests	29,001	28,012
Total shareholders' equity	52,188	76,406
Total shareholders' equity and liabilities	615,950	516,143
Commitments and contingencies (note 25)

Subsequent events (note 27)

On Behalf of the Board of Directors

___________________________________ Director _______________________________Director

Interim Consolidated Statements of Changes in Equity (Unaudited)

(expressed in thousands of Canadian dollars, except share amounts)

	Number of common shares	Number of preferred shares	Share capital \$	Contributed surplus \$	Accumulated other comprehensive income (loss) \$	Retained earnings \$	Other equity \$	Equity attributable to owners of Boat Rocker Media Inc. \$	Non controlling interests \$	Total equity \$
Balance – December 31,
2018	15,076,923	—	32,715	3,657	(1,468)	42,686	(3,385)	74,205	3,910	78,115
Net income (loss)	—	—	—	—	—	(16,601)	—	(16,601)	3,322	(13,279)
Issuance of preferred shares	—	1,156,910	20,114	—	—	—	—	20,114	—	20,114
Exchange of common shares for preferred shares (note 7)	(385,637)	385,637	5,934	—	—	(5,934)	—	—	—	—
Shared-based compensation (note 8)	—	—	—	479	—	—	—	479	—	479
Acquisition of Untitled (note 4(a))	—	—	—	—	—	—	—	—	25,208	25,208
Put option of Untitled (note 4(a))	—	—	—	—	—	—	(24,444)	(24,444)	—	(24,444)
Dividends distributed to non controlling interests	—	—	—	—	—	—	—	—	(3,529)	(3,529)
Translation reserves	—	—	—	—	115	—	—	115	—	115
Balance – September 30, 2019	14,691,286	1,542,547	58,763	4,136	(1,353)	20,151	(27,829)	53,868	28,911	82,779
Balance – December 31,
2019	14,691,286	1,542,547	58,763	4,378	37	13,045	(27,829)	48,394	28,012	76,406
Net income (loss)	—	—	—	—	—	(46,522)	—	(46,522)	2,978	(43,544)
Issuance of common shares (note 7)	917,554	—	19,981	—	—	—	—	19,981	—	19,981
Cancellation of preferred shares/ issuance of common shares (note 7)	14,665	(58,660)	10	—	—	(10)	—	—	—	—
Shared-based compensation (note 8)	—	—	—	3,020	—	—	—	3,020	—	3,020
Movement in the fair value of financial assets through OCI	—	—	—	—	137	—	—	137	—	137
Dividends distributed to non controlling interests	—	—	—	—	—	—	—	—	(1,989)	(1,989)
Translation reserves	—	—	—	—	(1,823)	—	—	(1,823)	—	(1,823)
Balance – September 30,
2020	15,623,505	1,483,887	78,754	7,398	(1,649)	(33,487)	(27,829)	23,187	29,001	52,188

Interim Consolidated Statements of Loss (Unaudited)

(expressed in thousands of Canadian dollars)

	Three months ended September 30,			Nine months ended September 30,
	2020	2019	2020	2019
	\$	\$	\$	\$
Revenue (note 14)	78,009	51,001	171,189	184,730
Expenses
Production, distribution and service costs	58,255	32,195	119,734	122,297
General and administrative costs	18,535	17,168	50,714	47,361
Amortization of property and equipment, right-of-use assets and other intangible assets	4,736	4,687	13,817	13,993
Impairment expense (note 6)	12,959	—	12,959	—
Finance costs, net (note 18)	2,404	2,237	7,860	6,299
Foreign exchange (gain) loss	(1,584)	1,561	482	1,343
Loss on loan modification (note 11)	342	—	342	—
Share of income (loss) of equity accounted investees	—	120	—	(190)
Change in fair value of financial assets	395	(27)	374	(390)
Change in fair value of other financial liabilities	3,359	2,002	6,951	6,703
Change in fair value of contingent consideration	—	(10)	880	384
Loss before income taxes	(21,392)	(8,932)	(42,924)	(13,070)
Current income tax expense (recoveries) (note 22)	2,510	(3,781)	6,874	5,325
Deferred income tax (recoveries) expense (note 22)	(912)	4,462	(6,254)	(5,116)
Net loss for the period	(22,990)	(9,613)	(43,544)	(13,279)
Net (loss) income attributable to
Owners of Boat Rocker Media Inc.	(24,377)	(10,267)	(46,522)	(16,601)
Non-controlling interests	1,387	654	2,978	3,322
	(22,990)	(9,613)	(43,544)	(13,279)
Loss per share attributable to common owners of Boat Rocker Media Inc. (note 9)
Basic loss per share	(1.56)	(0.70)	(2.98)	(1.12)
Diluted loss per share	(1.56)	(0.70)	(2.98)	(1.12)

	Three months ended September 30,		Nine months ended September 30,
	2020	2019	2020	2019
	\$	\$	\$	\$
Net loss for the period	(22,990)	(9,613)	(43,544)	(13,279)
Other comprehensive income (loss)
Items that may be reclassified to income (loss)
Cumulative translation adjustments on foreign operations	1,688	(2,140)	(1,823)	115
Items that will not be reclassified to income (loss)
Movement in fair value of financial assets	137	—	137	—
Other comprehensive income (loss) for the period	1,825	(2,140)	(1,686)	115
Comprehensive loss for the period	(21,165)	(11,753)	(45,230)	(13,164)
Comprehensive (loss) income attributable to
Owners of Boat Rocker Media Inc.	(22,552)	(12,407)	(48,208)	(16,486)
Non-controlling interests	1,387	654	2,978	3,322
	(21,165)	(11,753)	(45,230)	(13,164)

Boat Rocker Media Inc. Interim Consolidated Statements of Cash Flows

(Unaudited)

(expressed in thousands of Canadian dollars)

2020 2019 \$ \$ Cash provided by (used in) Operating activities (43,544) Net loss Adjustments for non-cash items: 2,158 Amortization of property and equipment 5,178 Amortization of right-of-use assets (note 15) 46,561 Amortization of investment in content (note 5) 6,481 Amortization of other intangible assets 12,959 Impairment expense (note 6) 3,020 Share-based compensation expense (note 8) 7,860 Finance cost (note 18) 342 Loss on loan modification — Share of income on equity accounted investees 6,874 Current income tax expense (6,254) Deferred income tax (recoveries) expense 374 Change in the fair value of financial assets 6,951 Change in the fair value of other financial liabilities 880 Change in fair value of contingent consideration (123,330) Additions to investment in content (note 5) (5,796) Cash interest paid (4,880) Cash income taxes paid




	(13,279)

	2,856
	5,118
	54,233
	6,019
	—
	479
	6,299
	—
	(190)
	5,325
	(5,116) (390)
	6,703
	384
	(48,510)
	(4,566)
	(5,532)
	3,576
80,749 Change in non-cash balances related to operations (note 24)
Cash provided by (used in) operating activities (3,417)	13,409
Financing activities
103,418 Proceeds from interim production financing	33,269
(85,086) Repayments from interim production financing	(31,790)
13,500 Proceeds from loans and borrowings	50,710
(2,917) Repayments of loans and borrowings	(3,438)
— Proceeds from issuance of convertible debentures	19,999
(5,895) Repayment of lease liabilities	(5,222)
(1,989) Distributions paid to non-controlling interest shareholders	(3,529)
Proceeds from share issuance —	20,114
Cash provided by financing activities 21,031	80,113
Investing activities
(986) Acquisition of property and equipment	(6,020)
— Acquisition of financial assets	(680)
1,494 Dividends received from equity accounted investees	300
(1,564) Payment of contingent consideration at date of acquisition	(5,377)
Acquisition of Untitled Entertainment LLC – net of cash of \$nil (note 4(a)) —	(51,342)
Acquisition of Platform One – net of cash acquired of \$1,858 (note 4(b)) —	1,858
Cash used in investing activities (1,056)	(61,261)
Foreign exchange on cash held in foreign currency (273)	612
16,285 Increase in cash	32,873
Cash – Beginning of period 59,268	55,416
Cash – End of period 75,553	88,289

(expressed in thousands of Canadian dollars)

1 Corporate information and developments

Boat Rocker Media Inc. (the Company) is an independent, integrated global entertainment company that creates and produces television and film content across many genres, distributes content worldwide, and represents on-screen talent and third party intellectual property (IP) owners. The Company was incorporated in and is domiciled in Canada and the address of the Company's registered office is 310 King Street East, Toronto, Ontario M5A 1K6. The Company's controlling shareholder is Fairfax Financial Holdings Ltd. (Fairfax).

In early 2020, the World Health Organization characterized COVID-19 as a global pandemic. Since that time, several preventative measures have been implemented in the countries where the Company operates, including shelter-in-place orders and the closure of the border between Canada and the United States to non-essential travel. Live action content production in the scripted, unscripted and Insight CGUs were halted, impacting cash inflows from broadcasters and delaying the delivery of greenlit content, negatively impacting revenue. This hiatus has also negatively affected the results of the representation operations which earns a commission as talent earns salary. The Company's kids and family and animation CGUs continue to provide services as the workforce has successfully transitioned to working from home. The extent to which COVID-19 continues to impact the Company's business will depend on future developments, which are highly uncertain and cannot be predicted at this time. These developments include the continued severity and scope of the outbreak and the actions taken to contain or treat the pandemic. Most importantly, it is only when the orders and lock downs are lifted that the Company can more fully resume certain important aspects of its business.

2 Basis of preparation and statement of compliance

These unaudited interim condensed consolidated financial statements have been prepared in accordance with International Financial Reporting Standards as issued by the International Accounting Standards Boards ("IFRS") applicable to the preparation of condensed interim financial statements, including International Accounting Standard (IAS) 34, Interim Financial Reporting, and do not include all of the information required for annual financial statements. These unaudited interim condensed consolidated financial statements should be read in conjunction with the Company's annual consolidated financial statements for the years ended December 31, 2019 and 2018, which have been prepared in accordance with IFRS. Changes to the Company's accounting policies from those disclosed in its consolidated financial statements for the years ended December 31, 2019 and 2018 are described in Note 3.

These unaudited interim condensed consolidated financial statements are presented in Canadian dollars, which is the Company's functional currency and dollar amounts have been rounded to the nearest thousand, except per share amounts.

These unaudited interim condensed consolidated financial statements were authorized for issue by the Board of Directors on February XX, 2021.

(expressed in thousands of Canadian dollars)

Assessment of Liquidity and Management's Plans

As at September 30, 2020, the Company has \$75,553 of cash on hand. The Company has a significant working capital deficiency of \$296,119 at September 30, 2020 (December 31, 2019 - \$178,115). Certain liabilities that are classified as current, including amounts within interim production financing and loans and borrowings, are not expected to be settled within the next twelve months. Furthermore, management notes that the current portion of deferred revenue of \$120,518 at September 30, 2020 (December 31, 2019 - \$41,362) relates mainly to production contracts in progress where the cash toward fulfilling the obligation has already been expended.

As at September 30, 2020, the Company's earnings were lower than the target under the terms of its demand term loan and was in breach of this covenant (refer to Note 11), which was waived by the lender subsequent to quarter end. Accordingly, all debt, which was already due on demand, is classified as current on the consolidated statement of financial position. As the Company's Corporate Credit Facility is due on demand, it is classified as current on the consolidated statement of financial position.

The Company has experienced significant reductions in revenue in 2020 when compared to 2019, which has impacted its cash flows from operations. The Company incurred a net loss in the nine months ended September 30, 2020 of \$43,778 (year ended December 31, 2019 – \$19,483). Revenue has declined due primarily to the impact of COVID-19 in delaying television production, as noted in Note 1. This decline in revenue has directly impacted the Company's net income and its ability to generate cash flows from operations.

In accordance with IAS 1, Presentation of Financial Statements, management is required to consider whether the conditions noted above give rise to material uncertainties which may cast significant doubt upon the Company's ability to meet its obligations, taking into account all available information about the future, which is at least, but is not limited to twelve months from the end of the financial statement reporting period, and if so, whether management's plans to negate these conditions will alleviate this significant doubt.

The productions that will be greenlit and produced in a particular period;
The financing plan of each production;
The timing of the production period and the cash outflows of production spend;
The timing of collection of the associated accounts receivable and production tax credits receivable; and
The ability to draw on interim production financing to bridge the timing difference between production cash inflows and outflows.

(expressed in thousands of Canadian dollars)

Subsequent to September 30, 2020, the Company has formally approved the budget for 2021 and the forecast for 2022 which supports management's strategy to meet the Company's financial obligations as they come due, maintain liquidity, and improve the working capital position. In addition, on December 1, 2020, the Company issued a secured, subordinated convertible debenture for \$25,000 to an entity owned and controlled by the controlling shareholder, Fairfax. On February 1, 2021, the Company issued a further secured, subordinated convertible debenture for \$15,000 to the same Fairfax entity. These debentures allow for further advances of \$35,000 to be made in 2021 (refer to Note 28). Management cannot make assurances that the assumptions used to estimate the Company's liquidity requirements may not change because while it is management's intention to execute on its budget, the future impact of COVID-19 on the business is uncertain. Failure to execute the Company's business plan due to future shutdowns as a result of COVID-19 could have a material impact on these assumptions and judgements.

Based on the actions and assumptions described above, management has concluded that the 2021 budget and 2022 forecast can be effectively implemented. There are several investments, capex and growth initiatives in the business plan that can be altered or halted to increase cash inflows or reduce cash outflows in the event this is required, including but not limited to cost reductions, limiting external development expenditure, marketing spend and ownership of certain intellectual property. This, combined with the Company's ability to utilize the proceeds from the convertible debenture issuance described above, will in management's view allow the Company sufficient liquidity to satisfy its obligations for at least but not limited to, the next twelve months. Accordingly, management has concluded that there are no material uncertainties that may cast significant doubt about the Company's ability to continue as a going concern.

3 Summary of significant accounting policies

Use of estimates and judgments

The preparation of these unaudited interim condensed consolidated financial statements in conformity with IFRS requires management to make estimates, judgments and assumptions that affect the application of accounting policies and the reported amounts of assets and liabilities, disclosure of contingent liabilities and the reported amounts of revenue and expenses. Estimates and judgments are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. Accounting estimates will, by definition, seldom equal the actual results.

The significant estimates and judgments made by management in applying the Company's accounting policies and key sources of estimation uncertainty are the same as those described in the Company's consolidated financial statements for the years ended December 31, 2019, 2018 and 2017.

Given the impact of the COVID-19 pandemic, the Company has identified recognition of expected credit losses as an additional area of significant estimate and judgment during the nine months ended September 30, 2020. The Company recognizes a loss allowance for expected credit losses on financial assets that are measured at

(expressed in thousands of Canadian dollars)

amortized cost. At each reporting date, the Company measures the loss allowance for the financial asset at an amount equal to the lifetime expected credit losses if the credit risk on the financial asset has increased significantly since initial recognition The Company applies the simplified approach in calculating lifetime expected credit losses on accounts receivable.

Additionally, as described in Note 2, management has considered the liquidity concerns of the Company in its assessment of its ability to continue to operate the Company as a going concern. The preparation of the Company's 2021 budget and 2022 forecast include significant estimates and judgments with respect to future cash flow generated from revenue. While management believes such estimates and judgements to be reasonable, they are inherently subject to uncertainty.

Recently adopted accounting pronouncements

• COVID-19-related Rent Concessions (Amendment to IFRS 16)

On May 28, 2020 the IASB issued an amendment to IFRS 16 Leases to provide an optional practical expedient for lessees so that rent concessions received as a direct consequence of the COVID-19 pandemic do not have to be accounted for as lease modifications under IFRS 16. Early adoption of the amendment on April 1, 2020 in accordance with the applicable transition provisions did not have a significant impact on the company's unaudited interim condensed consolidated financial statements.

• Definition of a Business (Amendments to IFRS 3)

The amendments to IFRS 3 Business Combinations narrow the definition of a business and clarify the distinction between a business combination and an asset acquisition. Prospective adoption of these amendments on January 1, 2020 did not impact the Company's unaudited interim condensed consolidated financial statements.

• Definition of Material (Amendments to IAS 1 and IAS 8)

The amendments to IAS 1 Presentation of Financial Statements and IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors clarify the definition of "material". Prospective adoption of these amendments on January 1, 2020 did not have a significant impact on the Company's unaudited interim condensed consolidated financial statements.

New accounting standards issued but not yet adopted

The Company is currently evaluating the expected impact on its consolidated financial statements of the following pronouncements issued but not yet adopted:

Interest Rate Benchmark Reform Phase 2 (Amendments to IFRS 9, IAS 39, IFRS 7, IFRS 4 and IFRS 16), effective January 1, 2021;
Onerous Contracts Cost of Fulfilling a Contract (Amendments to IAS 37), Reference to the Conceptual Framework (Amendments to IFRS 3), and Annual Improvements to IFRS Standards 2018–2020, which are effective January 1, 2022; and

(expressed in thousands of Canadian dollars)

In the three and nine months ended September 30, 2019, the Company incurred transaction costs of \$751 which were included in general and administrative costs on the consolidated statements of loss and comprehensive loss.

For the three and nine months ended September 30, 2019, net loss of \$790 has been included in the consolidated statements of loss and comprehensive loss as a result of the acquisition of Platform One. Had Platform One been acquired January 1, 2019, for the nine months ended September 30, 2019, net loss of \$5,984 would have been included in the consolidated statements of loss and comprehensive loss.

(expressed in thousands of Canadian dollars)

	Platform One \$	Untitled \$	Total \$
Assets acquired
Cash and cash equivalents	1,858	(332)	1,526
Accounts receivable	49	27	76
Prepaid expenses and other assets	1,020	—	1,020
Investment in content	16,835	—	16,835
Trademarks	—	1,052	1,052
Talent relationships	—	48,633	48,633
Non-compete agreements	—	2,366	2,366
Property and equipment	21	—	21
Right-of-use asset	952	1,373	2,325
Goodwill	13,676	29,721	43,397
Total assets	34,411	82,840	117,251
Liabilities assumed
Accounts payable and accrued liabilities	7,744	302	8,046
Lease liabilities	952	1,373	2,325
Deferred revenue	7,053	—	7,053
Total liabilities	15,749	1,675	17,424
Net assets acquired before non-controlling interests	18,662	81,165	99,827
Non-controlling interests	—	(25,208)	(25,208)
Net assets acquired	18,662	55,957	74,619
Financed by:
Cash	—	51,010	51,010
Non-cash financial liabilities	3,268	—	3,268
Contingent consideration	15,394	4,947	20,341
Total purchase consideration	18,662	55,957	74,619

The above purchase price allocations were final as of September 30, 2020, with no changes recorded from the initial amounts.

Notes to the Interim Condensed Consolidated Financial Statements

Three and nine months ended September 30, 2020 and 2019

(Unaudited)

(expressed in thousands of Canadian dollars)

5 Investment in content

	Development	In production	Delivered	Acquired content	Total
	\$	\$	\$	\$	\$
Cost
December 31, 2018	2,082	26,929	208,647	24,342	262,000
Acquisition through business combination (note 4)	3,555	13,280	—	—	16,835
Additions	246	91,614	—	714	92,574
Reclassification	—	(91,667)	91,667	—	—
December 31, 2019	5,883	40,156	300,314	25,056	371,409
Additions	2,055	119,145	—	2,130	123,330
Reclassification	1,122	(15,203)	14,081	—	—
September 30, 2020	9,060	144,098	314,395	27,186	494,739
Accumulated depreciation
December 31, 2018	242	—	185,069	3,701	189,012
Amortization charge	186	—	58,361	8,472	67,019
December 31, 2019	428	—	243,430	12,173	256,031
Amortization charge	—	—	43,755	2,806	46,561
September 30, 2020	428	—	287,185	14,979	302,592
Net book value
December 31, 2019	5,455	40,156	56,884	12,883	115,378
September 30, 2020	8,632	144,098	27,210	12,207	192,147

The amount of interest capitalized during the nine months ended September 30, 2020 and included in delivered content is \$347 ( December 31, 2019 – \$756). The interest capitalized during the nine months ended September 30, 2020 and included in content in production is \$1,813 ( December 31, 2019 – \$276).

Notes to the Interim Condensed Consolidated Financial Statements Three and nine months ended September 30, 2020 and 2019

(Unaudited)

(expressed in thousands of Canadian dollars)

6 Goodwill

	September 30, 2020	December 31, 2019
	\$	\$
Opening balance	107,957	64,560
Acquisition of Untitled	—	29,721
Acquisition of Platform One	—	13,676
Impairment of Unscripted CGU	(12,959)	—
Closing balance	94,998	107,957

Impairment testing

Goodwill is tested for impairment annually as at December 31 or more frequently if events or circumstances indicate that the asset might be impaired. In third quarter of fiscal 2020, management identified that there were indications of impairment associated with the Unscripted cash generating unit ("CGU"), given the pervasive economic impact of COVID-19 on unscripted television productions where actual operating results and financial projections fell short of previous estimates and projections. Accordingly, the Company tested goodwill of this CGU for impairment as at September 30, 2020.

In assessing the goodwill for impairment, the Company compares the carrying value of the CGU to the recoverable amount, where the recoverable amount is the higher of fair value less costs of disposal and the value in use. An impairment charge is recognized to the extent that the carrying value exceeds the recoverable amount. For the period ended September 30, 2020, the Company applied the value in use method.

Based on the analysis of the Unscripted CGU, it was determined that the carrying value exceeded the value in use and therefore an impairment of \$12,959 was recorded at September 30, 2020.

The cash flows used in determining the value in use for the Unscripted CGU were based on the following key assumptions:

Five-year projections based on management's expectations of content planned and greenlit, including the ability to distribute the content through global territories, as well as estimates of further seasons and projects in development in the next five years.
Estimates of revenue, direct and indirect operating costs are based on historical results and future expectations of operating performance. Revenue from production and services were estimated for the next 12-24 months based on a slate of programs and content currently in ongoing production and greenlit and planned to begin. Additionally, programs and content in discussions with third parties or forecasted with reasonable certainty to proceed in this period have been included. Using these estimates as a basis, revenues beyond 2021 were estimated using an average growth rate of 3.0%. Service and production costs

(expressed in thousands of Canadian dollars)

were estimated based on known license fees, production service agreements and budgeted costs, consistent with historical and recent experience. Gross profit margins on production and service revenues were estimated at between 13.0% and 25.5% for the following twelve months, growing to between 14.9% and 28.3% over the following four years.

The weighted average cost of capital has been calculated at a pre-tax rate of 25.2%.
Cash flows beyond the five-year period are extrapolated using a terminal growth rate of 1.0%.

The recoverable amount of the Unscripted CGU is sensitive to changes in market conditions and could result in changes in the carrying value of goodwill in the future.

Sensitivity analysis was performed for the Unscripted CGU by changing the following key assumptions: weighted average cost of capital rates, revenue growth and production and service expenses. To determine the impact on the recoverable amounts, the weighted average cost of capital rates were increased by 1.0% (a 100 basis point increase), the service and production revenue growth rates were decreased by 1.0% (a 100 basis point decrease) and gross profit margin decreased by 1.0% (a 100 basis point decrease). Each key assumption was changed independently while holding all other assumptions constant. These sensitivities help to determine the theoretical impairment losses that would be recorded.

An increase of the weighted average cost of capital of 1.0% (a 100 basis point increase), a decrease in the service revenue growth rate of 1.0% (a 100 basis point decrease) or a decrease in the gross profit margin of 1.0% (a 100 basis point decrease) would result in a further impairment of the Unscripted CGU in the amount of \$2,001, \$3,080 and \$3,464 respectively. As each key assumption was changed independently, the results of the sensitivity analyses do not contemplate management's ability to mitigate against any adverse effects that may arise in the future.

The most significant assumption used in the Unscripted CGU is the future cash flows associated with the assumed renewal and continuation of the current shows under development with major television studios. If those shows are cancelled, not renewed or the Company is not able to replace their production with new shows or content that is being developed, there could be a further significant impairment in the Unscripted CGU.

(expressed in thousands of Canadian dollars)

The following table presents the goodwill by CGU as at September 30, 2020 and December 31, 2019:

	September 30, 2020	December 31, 2019
	\$	\$
Scripted	13,676	13,676
Unscripted	26,640	39,599
Kids and family	13,563	13,563
Insight	3,738	3,738
Animation services	7,660	7,660
Representation	29,721	29,721
	94,998	107,957

7 Share capital

		Outstanding
	Authorized	September 30, 2020	December 31, 2019
Voting common shares	Unlimited	14,705,951	14,691,286
Series A non-voting common shares	Unlimited	—	—
Series B non-voting common shares	Unlimited	498,815	—
Series C non-voting common shares	Unlimited	—	—
Series D non-voting common shares	Unlimited	418,739	—
Class C preferred shares	Unlimited	1,483,887	1,542,547
Total	Unlimited	17,107,392	16,233,833

On January 1, 2020, the Company issued 418,739 Series D non-voting common shares related to the acquisition of Platform One (note 4).

On January 1, 2020, the Company issued 498,815 Series B non-voting common shares related to the acquisition of Matador Content LLC (Matador).

On March 22, 2019, the Company issued 1,156,910 Class C preferred shares to a third party for \$20,114 (US\$15,000). Class C preferred shares hold the same features as non-voting common shares except they have first preference on a liquidation event. Concurrently and as part of the same transaction, 385,637 Series A nonvoting common shares held by certain shareholders were cancelled and exchanged on a 1:1 basis for 385,637 Class C preferred shares. No additional consideration was paid as a result of this exchange, but the transaction

(expressed in thousands of Canadian dollars)

resulted in a decrease to retained earnings of \$5,934. The Company determined that these preferred shares should be classified as equity and have been recorded at the fair value of consideration received (\$20,114 or \$17.30 per share). Additionally, on January 1, 2020, based on a remeasurement clause the number of Class C preferred shares was reduced by 58,660 shares.

On January 1, 2020, based on a remeasurement clause in the acquisition agreement of Matador, an additional 14,665 voting common shares were issued to one of the former shareholders of Matador. This true-up resulted in a decrease to retained earnings of \$10.

8 Share-based payments

Stock options

In January 2016, the Company authorized a share-based payment arrangement that allows the Company to grant stock options to certain employees, officers and directors. The plan reserves for issuance of up to 7.5% of the number of shares in the capital of the Company to be issued and outstanding. The participants in the plan may elect to receive cash equal to the difference between the grant date fair value and the exercise price. However, the Board of Directors has the right to reject such election and it is the Company's intention to settle the exercise of options by granting Class A non-voting shares. Options are priced at the most recent valuation of the Company. During the nine months ended September 30, 2020, 366,500 (2019 – 202,500) stock options were granted. There were no stock option granted during the three months ended September 30, 2020 (2019 nil). Stock options granted vest over periods from four to eight years and expire ten years from the date of grant, except 50,000 options granted in 2016 that vested on the grant date. During the nine months ended September 30, 2020, 60,645 options were forfeited (2019 – nil). There were no stock options forfeited during the three months ended September 30, 2020 (2019 - nil).

Stock option transactions for the nine months ended September 30, 2020 were as follows:

	Number of shares under option	Weighted average exercise price per option
		\$
Balance – December 31, 2019	982,500	10.66
Granted	366,500	16.11
Forfeit	(60,645)	10.29
Balance – September 30, 2020	1,288,355	12.23

As at September 30, 2020, 149,928 (2019 –50,000) options were exercisable.

The fair value of the stock options is recognized on a graded vesting basis over the vesting periods of the options. For the three and nine months ended September 30, 2020, the Company recognized share-based compensation expense of \$2,478 and \$3,020 (2019 – \$265 and \$479), respectively in general and administrative costs.

(expressed in thousands of Canadian dollars)

The calculation of the fair value of options granted during the nine months ended September 30, 2020 and 2019 used the Black-Scholes option pricing model with the following weighted average assumptions:

	Options granted
	2020		2019
Fair value of options at
grant date	10.16	10.16	–	11.13
Share price at grant date	16.11	16.11	–	17.64
Exercise price	\$16.11	\$16.11	–	\$17.64
Risk-free interest rate	1.65%			5.95%
Volatility factor of the expected market price of
the Company's shares	50%			50%
Expected option life	10 years			10 years

Notes to the Interim Condensed Consolidated Financial Statements Three and nine months ended September 30, 2020 and 2019 (Unaudited)

(expressed in thousands of Canadian dollars)

9 Loss per share

The following table reconciles the numerators and denominators of the basic and diluted loss per share computation. No diluted loss per share has been calculated for the three and nine months ended September 30, 2020 as the effect would be anti-dilutive. Basic loss per share calculation is as follows:

	Three months ended			Nine months ended
	September 30,		September 30,
	2020		2019	2020	2019
Numerator for basic loss per share – net loss attributable to owners \$ Denominator for basic loss per share – weighted average common shares	(24,377) \$ 15,623,505		(10,267) \$ 14,691,286	(46,522) \$ 15,623,505	(16,601) 14,805,706
Basic loss per share \$	(1.56) \$		(0.70) \$	(2.98) \$	(1.12)
	2020		Diluted loss per share calculation is as follows: Three months ended September 30, 2019	Nine months ended September 30, 2020	2019
Numerator for basic loss per share – net loss attributable to owners Denominator for basic loss per share – weighted average common shares Effect of share options on number of common shares Effect of restricted share units	\$ (24,377) \$ 15,623,505	— —	(10,267) \$ 14,691,286 — —	(46,522) \$ 15,623,505 — —	(16,601) 14,805,706 — —
Diluted weighted average common shares	15,623,505		14,691,286	15,623,505	14,805,706
Diluted net loss per share	\$ (1.56) \$		(0.70) \$	(2.98) \$	(1.12)

Notes to the Interim Condensed Consolidated Financial Statements Three and nine months ended September 30, 2020 and 2019

(Unaudited)

(expressed in thousands of Canadian dollars)

10 Interim production financing

	September 30, 2020	December 31, 2019
	\$	\$
Interim production financing from Aver Media Finance, a division of Bank of Montreal, with interest at prime plus 0.50%, secured by production tax credits, specified production financing contracts and a general security agreement	30,090	42,528
Interim production financing from Universal City Studios, with interest at 1.00%, secured by production tax credits and a first ranking security interest over all rights, title and interest in and to related production	15,695	15,695
Interim production financing from Royal Bank of Canada, with interest at prime plus 0.50%, secured by production tax credits, specified production financing contracts and a general security agreement	16,708	20,460
Interim production financing from JP Morgan Chase Bank, with interest at LIBOR plus 2.75%, secured by production tax credits, specified production financing contracts and a general security agreement	66,482	31,494
	128,975	110,177

Notes to the Interim Condensed Consolidated Financial Statements Three and nine months ended September 30, 2020 and 2019

(Unaudited)

(expressed in thousands of Canadian dollars)

11 Loans and borrowings

	September 30, 2020	December 31, 2019
	\$	\$
Demand loan payable to Bank of Montreal – Canadian dollar (prime+ 3.0%) (Facility 2)	20,969	21,800
Demand loan payable to Bank of Montreal – US dollar
(LIBOR+4.0%) (Facilities 5 & 7)	65,949	66,645
Demand loan payable to Bank of Montreal – Canadian dollar (prime+ 3.0%) (Facility 8)	12,709	—

Loan payable to Royal Bank of Canada	273	729
Total before loan fees	99,900	89,174
Loan fees, net of amortization	(419)	(1,305)
	99,481	87,869
Less: Current portion	99,481	87,869
Long-term portion	—	—

On October 30, 2018, the Company entered into an amended and restated offer of financing with the Bank of Montreal ("BMO"). The offer of financing was subsequently amended on February 1, 2019, December 31, 2019 and July 20, 2020 (collectively the "Corporate Credit Facility"). The Corporate Credit Facility is comprised of:

1. a \$5,000 demand revolver;
1. a \$21,460 demand term loan;
1. a \$3,500 treasury risk management facility;
1. a \$300 credit card facility;
1. a US\$37,110 demand term loan;
1. a US\$2,000 demand revolver (which is also available by way of letters of credit in US dollars up to a maximum of US\$1,650);
1. a US\$13,000 demand term loan; and
1. a \$13,378 demand term loan.

The Corporate Credit Facility is guaranteed by certain Canadian, US and UK subsidiaries of Boat Rocker. The Company and the guarantors have provided the lender with a first priority lien over all of their respective assets, subject to certain exclusions and permitted liens. The Company and certain of the guarantors also pledged 100% of the equity interests they hold in the capital of certain of their subsidiaries.

Facility 8 was introduced in the amended agreement on July 20, 2020 and is repayable at 5% of the principal balance per quarter over ten quarters commencing September 30, 2020, with the residual 50% principal

(expressed in thousands of Canadian dollars, unaudited)

balance due on the earlier of an acceleration event, defined as the earlier of demand and an event of default including a change of control, and December 31, 2022. The new facility bears interest at the Canadian prime rate plus 3%. The Export Development Bank of Canada guaranteed 75% of the loan as part of its suite of programs put in place to support Canadian businesses during the pandemic.

The demand term loans are uncommitted facilities due on demand. As at July 20, 2020, the amendment includes no requirement for testing financial ratio covenants, however, sets a target earnings before interest, taxes, depreciation and amortization for certain legal entities over which BMO has security for the three months ended September 30 and December 31, 2020, March 31, 2021 and June 30, 2021. For the three months ended September 30, 2020, the Company did not reach the target earnings before interest, taxes, depreciation and amortization and was in breach of this covenant. As the Corporate Credit Facility is due on demand, it is classified as current on the consolidated statement of financial position.

Management has assessed the above amendments and has determined that these amendments constitute a modification of debt, which has resulted in a loss on modification of \$342 for the three and nine months ended September 30, 2020. The loss was recorded on the demand loans payable to BMO.

	September 30, 2020 \$	December 31, 2019 \$
Put Option for 30% non-controlling interest of Insight	4,526	4,129
Put Option for 49% of non-controlling interest of Untitled (note 4)	34,404	29,381
Provision for right to a variable number of shares, Platform One Acquisition	—	3,256
Provision to repay investment, Platform One Acquisition	7,228	6,772
Provision for right to be issued shares, Matador acquisition	15,370	24,842
Total	61,528 6	68,380 1
Less: Current portion	—	14,412

Non-current portion	61,528	53,968

12 Other Financial Liabilities

The movement in the period ended September 30, 2020 is attributable to changes in the fair value, foreign exchange impacts, and the settlement of liabilities. On January 1, 2020, the Company issued non-voting

(expressed in thousands of Canadian dollars)

common shares to settle \$3,256 and \$10,233 of liabilities related to the Platform One and Matador acquisitions, respectively (note 7).

13 Convertible debentures

On September 3, 2019, the Company issued a secured, subordinated convertible debenture for \$9,858 (\$7,500 USD) to the United States Fire Insurance Company, an entity owned and controlled by the Company's controlling shareholder, Fairfax. An additional \$9,858 (\$7,500 USD) was issued to Fairfax shortly after, resulting in a principal balance of \$19,716 (\$15,000 USD) after issuance. The debenture bears interest at 8% per annum from issuance date until December 31, 2019 and 12% per annum thereafter. No interest has been paid by September 30, 2020, and \$2,348 (\$1,754 USD) of accrued interest is reflected on the unaudited interim condensed consolidated statement of financial position. The debenture originally matured on April 30, 2020 but was extended by Fairfax to July 31, 2020 at its discretion. Subsequent to September 30, 2020, the debenture was again extended to the earlier of January 1, 2021 or an initial public offering. The debenture continues to accrue interest at 12% per annum.

Fairfax may elect to convert the debenture into common shares at its discretion at any time, and Fairfax must convert the debenture on the revised maturity date. Fairfax has not exercised this option as of September 30, 2020. For a notice of conversion given by Fairfax prior to or on the maturity date, the applicable number of shares the amount outstanding would be converted into is based on \$10.33 per share for each \$1 USD of unpaid principal balance and accrued interest outstanding as of the maturity date or date of conversion.

The conversion feature has been recognized as a derivative liability carried at FVTPL. The derivative liability has been valued at \$1,380 (\$986 USD) at issuance date using a binomial partial differential equation valuation method, volatility of 43.37% and a credit spread of 20.59%. The derivative liability at September 30, 2020 and December 31, 2019 has been valued at \$nil using a binomial partial differential equation valuation method, a volatility of 39.28 % and a credit spread of 20%. Key inputs for both calculations include the Company's stock prices at inception, December 31, 2019 and September 30, 2020, the Company's historical volatility and the Company's credit spread risk-free discount curve at inception, December 31, 2019 and September 30, 2020. The amount of the liability as at September 30, 2020 has been allocated to the principal component of the debenture at September 30, 2020, which is being recognized at amortized cost and carried using the effective interest rate, resulting in a total liability at September 30, 2020 of \$22,429 (December 31, 2019-\$18,618).

Notes to the Interim Condensed Consolidated Financial Statements Three and nine months ended September 30, 2020 and 2019

(Unaudited)

(expressed in thousands of Canadian dollars)

14 Revenue

Disaggregation of revenue from contracts with customers

	Three months ended September 30, 2020
	Television	Kids & Family	Representation	Total
	\$	\$	\$	\$
Production revenue	8,167	7,359	—	15,526
Distribution revenue	4,679	5,034	—	9,713
Service revenue	36,583	11,145	—	47,728
Representation revenue	—	—	5,042	5,042
	49,429	23,538	5,042	78,009
Timing of revenue recognition
At a point in time	12,846	12,393	1,068	26,307
Over time	36,583	11,145	3,974	51,702
	49,429	23,538	5,042	78,009

	Three months ended September 30, 2019
	Television	Kids & Family	Representation	Total
	\$	\$	\$	\$
Production revenue	12,342	—	—	12,342
Distribution revenue	7,200	1,113	—	8,313
Service revenue	9,003	11,153	—	20,156
Representation revenue	—	—	10,190	10,190
	28,545	12,266	10,190	51,001
Timing of revenue recognition
At a point in time	19,542	1,113	1,330	21,985
Over time	9,003	11,153	8,860	29,016
	28,545	12,266	10,190	51,001

Notes to the Interim Condensed Consolidated Financial Statements

Three and nine months ended September 30, 2020 and 2019

(Unaudited)

(expressed in thousands of Canadian dollars)

	Nine months ended September 30, 2020
	Television	Kids & Family	Representation	Total
	\$	\$	\$	\$
Production revenue	39,399	10,095	—	49,494
Distribution revenue	9,541	8,474	—	18,015
Service revenue	56,107	28,589	—	84,696
Representation revenue	—	—	18,984	18,984
	105,047	47,158	18,984	171,189
Timing of revenue recognition
At a point in time	48,940	18,569	1,411	68,920
Over time	56,107	28,589	17,573	102,269
	105,047	47,158	18,984	171,189

	Nine months ended September 30, 2019
	Television	Kids & Family	Representation	Total
	\$	\$	\$	\$
Production revenue	58,079	242	—	58,321
Distribution revenue	25,859	6,091	—	31,950
Service revenue	35,424	34,645	—	70,069
Representation revenue	—	—	24,390	24,390
	119,362	40,978	24,390	184,730
Timing of revenue recognition
At a point in time	83,938	6,333	2,127	92,398
Over time	35,424	34,645	22,263	92,332
	119,362	40,978	24,390	184,730

Notes to the Interim Condensed Consolidated Financial Statements Three and nine months ended September 30, 2020 and 2019 (Unaudited)

(expressed in thousands of Canadian dollars)

15 Leases

Right-of-use assets

The Company's significant lease arrangements are for office premises and equipment used in content and service production.

	September 30, 2020	December 31, 2019
	\$	\$
Opening balance	26,734	25,458
Acquisitions through business combinations	—	2,325
Additions	8,555	5,889
Less: Amortization	(5,178)	(6,938)
Net book value at closing balance	30,111	26,734

Lease liabilities

	September 30, 2020	December 31, 2019
	\$	\$
Opening balance	29,626	27,583
Acquisitions through business combinations (note 4)	—	2,325
Additions	8,721	5,431
Cash payments	(5,895)	(7,415)
Accretion	1,392	1,702
Lease liabilities	33,844	29,626
Less: Current portion	9,858	7,260
Long-term lease liabilities	23,986	22,366

During the nine months ended September 30, 2020, the Company entered into three office leases, with one in Canada and two in United States. The term of these leases range from 5 to 6 years. The total right-of-use assets recorded from these leases totaled \$7,993. In addition, the Company entered into an equipment lease with a right-of-use asset for \$562.

(expressed in thousands of Canadian dollars)

16 Related party transactions

As at September 30, 2020, receivable from related parties includes \$nil (December 31, 2019 – \$212) in respect of amounts owed by directors, officers and equity accounted investees.

During the three and nine months ended September 30, 2020, the Company expensed \$176 and \$527 (2019 – \$196 and \$486), respectively, under a rental contract to the Old Telegram Building Inc. (OTBI), an equity accounted investee. On November 17, 2020, the Company sold its investment in The Old Telegram Building Inc. to certain shareholders in exchange for notes receivable of \$1,358. The notes receivable are non-interest bearing and are due on the earlier of an initial public offering and January 1, 2021.

As at September 30, 2020, the Company has a related party receivable from an equity method investee, Industrial Brothers Canada Ltd. (IB) and its subsidiaries of \$nil (December 31, 2019– \$2).

During the year ended December 31, 2019, the Company issued secured, subordinated convertible debentures for \$19,716 (\$15,000 USD) to the United States Fire Insurance Company, an entity owned and controlled by the Company's controlling shareholder, Fairfax. No interest has been paid as at September 30, 2020 and \$2,348 or US\$1,754 (December 31 2019 - \$458 or US\$352) of accrued interest is reflected on the unaudited interim consolidated statements of financial position. Refer to note 27 for subsequent events with the Company and Fairfax as a controlling shareholder.

17 Government assistance

Additions to investment in content during the nine months ended September 30, 2020 have been reduced by \$31,677 (December 31, 2019 – \$42,827) in respect of production tax credits and by \$nil (December 31, 2019 – \$642) in respect of non-recoupable contributions from the Canada Media Fund licence fee program.

In response to COVID-19, the Government of Canada announced the Canada Emergency Wage Subsidy (CEWS) program in April 2020. CEWS provides a wage subsidy on eligible remuneration, subject to limits per employee, and based on certain eligibility criteria. The Company determined that it qualified for the program and accordingly has applied for the CEWS retroactively to March 15, 2020.

For the three and nine months ended September 30, 2020, the Company has recognized \$3,120 and \$9,250 of subsidies, respectively, as a reduction to related expenses recognized in production, distribution and service costs and general and administrative costs in the unaudited interim consolidated statements of loss and comprehensive loss. The Company intends to continue its participation in the CEWS program, subject to continuing to meet the eligibility requirements.

Notes to the Interim Condensed Consolidated Financial Statements Three and nine months ended September 30, 2020 and 2019 (Unaudited)

(expressed in thousands of Canadian dollars, unaudited)

18 Finance costs, net

		Three months ended September 30,		Nine months ended September 30,
	2020	2019		2019
	\$	\$	\$	\$
Interest income	(124)	(278)	(343)	(398)
Interest expense	2,024	2,079	6,811	5,410
Accretion expense – leases	504	436	1,392	1,287
	2,404	2,237	7,860	6,299

19 Deferred revenue

	September 30, 2020	December 31, 2019
	\$	\$
Production contracts revenue	120,616	33,364
Service contracts revenue	15,834	7,622
Merchandising contracts revenue	1,341	376
Total	137,791	41,362
Less: Current portion	(120,518)	(41,362)
Non-current portion	17,273	—

During the nine months ended September 30, 2020, the Company entered into several new production and service contracts for the creation of new program content for which payments were received and production services were not complete as at September 30, 2020. One of these programs is expected to deliver in the fourth quarter of fiscal 2021 and has therefore been classified as non-current. All other programs are expected to be complete and delivered by the end of the third quarter of fiscal 2021.

Notes to the Interim Condensed Consolidated Financial Statements Three and nine months ended September 30, 2020 and 2019 (Unaudited)

(expressed in thousands of Canadian dollars)

20 Contingent consideration

The Company has liabilities relating to contingent consideration that arose as part of its business combinations. The following table summarizes the movements in contingent consideration for the nine months ended September 30, 2020:

	September 30, 2020
	\$
Opening balance	23,100
Reversal of unearned contingent consideration	(170)
Cash payments	(1,564)
Settlement in shares	(6,499)
Foreign exchange (gain) loss	310
Change in fair value	1,050
Ending balance	16,227
Less: Current portion	4,639
Non-current portion	11,588

On January 1, 2020, the Company issued non-voting common shares to settle \$6,499 of liabilities related to the Platform One acquisition (note 7).

21 Financial instruments

Interest rate risk

With respect to interest rate risk on loans and borrowings, a 1% increase in the variable interest rate would have resulted in a \$1,329 increase to the Company's net loss before tax during nine months ended September 30, 2020 (year ended December 31, 2019 – increase to net loss before tax of \$667) and a decrease of 1% would have resulted in a decrease of \$1,329 in the Company's net loss before tax (December 31, 2019 – decrease to net loss before tax of \$667).

(expressed in thousands of Canadian dollars)

Liquidity risk

The Company manages liquidity by forecasting and monitoring operating cash flows and through the use of interim production financing (note 10). As at September 30, 2020, the Company had cash of \$75,553 (December 31, 2019 – \$59,268). The Company maintains appropriate cash balances and has access to financial facilities to manage fluctuating cash flows. In addition, although the Company was in breach of its covenant on its loans and borrowings as at September 30, 2020 (see note 11), it has sufficient funds from operations as well as committed financing from its controlling shareholder, Fairfax, to fulfill its ongoing financial obligations.

Fair values

Level 1 valuation based on quoted prices observed in active markets for identical assets and liabilities;
Level 2 valuation techniques based on inputs that are quoted prices of similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; inputs other than quoted prices used in a valuation model that are observable for that instrument, and inputs that are derived principally from or corroborated by observable market data by correlation or other means; and
Level 3 valuation techniques with significant unobservable market inputs.

A financial instrument is classified to the lowest of the hierarchy for which a significant input has been considered in measuring fair value.

(expressed in thousands of Canadian dollars)

The following table summarizes financial assets and liabilities measured at fair value and included in the unaudited interim consolidated statements of financial position and the level of inputs used to determine those fair values in the context of the hierarchy as defined above:

	September 30, 2020				December 31, 2019
	Level 1	Level 2	Level 3	Level 1	Level 2	Level 3
	\$	\$	\$	\$	\$	\$
Financial assets
Cash	75,553	—	—	59,268	—	—
Other financial assets	—	—	7,751	—	—	7,687
	75,553	—	7,751	59,268	—	7,687
Financial liabilities
Contingent consideration	—	—	16,227	—	—	23,100
Other financial liabilities	—	—	61,529	—	—	68,380
Fair value of unsettled forward exchange contracts	—	576	—	—	—	—
	—	576	77,756	—	—	91,480

The following table summarizes the changes in Level 3 financial instruments for the nine months ended September 30, 2020:

	Other financial assets	Other financial liabilities
	\$	\$
Opening balance - January 1, 2020	7,687	(68,380)
Payments	—	3,249
Settlement through share issuance	—	10,234
Change in fair value through net income/loss	(73)	(1,312)
Change in fair value through OCI	137	(5,320)
Closing balance - September 30, 2020	7,751	(61,529)

The Company's accounts receivable, accounts payable and accrued liabilities, interim production financing, current portion of loans and borrowings and current portion of lease liabilities are carried at amortized cost, which approximates fair value.

(expressed in thousands of Canadian dollars)

The following table summarizes the quantitative information about the significant unobservable inputs used in Level 3 fair value measurements:

Financial instruments	Fair value	Unobservable inputs	Range of inputs	Impacts of inputs
	\$		\$
Other financial assets
Investment in Bustle Digital Group.	2,635	Private raise share price	6.05 per share	A 10% change in share price would increase/ decrease fair value by \$264
Investment in Marco Polo Learning, Inc.	2,053	Private raise share price	9.53 per share	A 10% change in share price would increase/ decrease fair value by \$205
Investment in Serial Box Publishing LLC	2,286	Private raise share price	2.50 per share	A 10% change in share price would increase/ decrease fair value by \$229
Other financial liabilities
Insight's call option	4,526	Expected future EBITDA	3,427	A 10% change in EBITDA would increase/decrease fair value by \$453
		Discount rates	13 %	A change in discount rate by 100 basis points would increase/ decrease fair value by \$62
Untitled put option	34,404	Growth rate	13.8 %	A change in growth rate by 100 basis points would increase/ decrease fair value by \$1,538

(expressed in thousands of Canadian dollars)

The following table summarizes the fair value and carrying value of other financial assets and financial liabilities that are not recognized at fair value on a recurring basis in the consolidated statements of financial position:

September 30, 2020		December 31, 2019
Carrying amount	Fair value	Carrying amount	Fair value
\$	\$	\$	\$
128,975	128,975	110,177	110,177
99,481	97,079	87,869	83,551
22,429	22,429	18,618	19,287

22 Income taxes

	Nine months ended September 30,
	2020	2019
	\$	\$
Income tax expense (recovery) based on combined federal and
provincial tax rate of 26.5%	(11,374)	(3,463)
Income taxes increased (decreased) by
Non-deductible expenses	933	1,569
Stock-based compensation	800	127
Differences on foreign operations	(1,014)	(752)
Losses and other deductions for which no benefit is
recognized	11,424	2,551
Prior year true ups / other	(149)	177
	620	209

As at September 30, 2020, the Company has determined that based on its projected future operating results in fiscal 2020 and beyond, realization of certain deferred tax assets is not probable and as a result has not recognized deferred tax assets of \$15,940 relating to its US operations (December 31, 2019 - \$4,516).

Notes to the Interim Condensed Consolidated Financial Statements Three and nine months ended September 30, 2020 and 2019

(Unaudited)

(expressed in thousands of Canadian dollars)

23 Expenses by nature

	Three months ended September 30,		Nine months ended September 30,
	2020	2019	2020	2019
	\$	\$	\$	\$
Amortization of investment in content	11,758	10,692	44,353	47,876
Amortization of acquired program intangibles	719	757	2,208	6,357
Distribution costs	2,081	2,202	3,912	3,665
Participation costs	3,176	4,700	6,294	13,111
Service costs	40,521	13,844	62,967	51,288
Production, distribution and service costs	58,255	32,195	119,734	122,297
Salaries and employee benefits	13,764	11,587	41,151	33,278
Overhead costs	4,771	5,581	9,563	14,083
General and administrative costs	18,535	17,168	50,714	47,361
Amortization of property and equipment	702	807	2,158	2,856
Amortization of right-of-use assets	1,874	1,720	5,178	5,118
Amortization of other intangible assets	2,160	2,160	6,481	6,019
Amortization of property and equipment, right of-use assets and other intangible assets	4,736	4,687	13,817	13,993

Notes to the Interim Condensed Consolidated Financial Statements Three and nine months ended September 30, 2020 and 2019

(Unaudited)

(expressed in thousands of Canadian dollars)

24 Supplementary cash flow information

	Nine months ended September 30,
	2020	2019
	\$	\$
Decrease (increase) in accounts receivable	(1,372)	21,503
Increase in long-term accounts receivable	(14,082)	1,222
Decrease in tax credit receivables	8,635	16,986
Decrease in related party receivable	211	(112)
Increase in prepaid expenses and deposits	(12,397)	(685)
Increase (decrease) in accounts payable and accrued liabilities, excluding participation accruals	1,843	(23,281)
Increase in participation accruals	369	13,778
Increase (decrease) in other financial liabilities	1,299	(1,356)
Increase (decrease) in income taxes payable	(183)	1,953
Increase (decrease) in deferred revenue	96,426	(26,432)
	80,749	3,576

25 Commitments and contingencies

Future payments related to these commitments as at September 30, 2020 are as follows:

	\$

Remainder of 2020	3,706
2021	3,579
2022	2,739
2023	—
2024	—
	10,024

The Company has guaranteed a loan payable to BDC in the principal amount of \$7,657 (December 31, 2019 – \$6,116) on the books of OTBI.

(expressed in thousands of Canadian dollars)

A subsidiary of the Company, Insight Productions Ltd., has been served with a class action lawsuit regarding allegations of non-compliance with Ontario's Employment Standard Act. The suit is seeking \$35,000 in damages. The Company believes that the suit is without merit and it has valid defenses. As a result, and given that the plaintiff has not filed any certification materials, the Company cannot estimate any potential liability in regard to this action. As such, no provision relating to this matter has been recorded at September 30, 2020.

26 Capital disclosures

The Company's objectives when managing capital are to provide an adequate return to shareholders, safeguard its assets, maintain a competitive cost structure and continue as a going concern in order to pursue the development, production, distribution and licensing of its content. As at September 30, 2020, cash includes \$27,132 (December 31, 2019 - \$29,186) of cash that is required for the funding of productions in progress and is not available for other uses. The Company does not consider interim production financing to be part of its capital management programs as these loans are specific to individual productions and are repaid by funds earmarked to the individual productions such as production tax credits and other forms of support. The Company has not declared or paid dividends during the three and nine months ended September 30, 2020. The balance of the Company's cash is being used to maximize ongoing development and growth effort.

	September 30,	December 31, 2019
	\$	\$
Cash Total long-term debt	75,553 (99,481)	59,268 (87,869)
Net capital	(23,928)	(28,601)
Total capital and reserves attributable to owners	23,187	48,394

Boat Rocker Media Inc. Notes to Condensed Consolidated Financial Statements Three and nine months ended September 30, 2020 and 2019

(expressed in thousands of Canadian dollars, unaudited)

27 Segment information

The Company has three reportable segments: i) Television, ii) Kids & Family, and iii) Representation.

The Kids & Family segment includes the Company's Kids & Family studio, the catalog of content acquired from FremantleMedia's kids and family business unit, and the Jam Filled Entertainment animation studio. This segment earns revenue from the creation and distribution of primarily scripted television content aimed at the kids and family demographic.

The Representation segment includes brand and management services provided to talent and IP representation and licensing sales services to IP owners for which it earns a pre-negotiated commission from its clients. These activities are driven by Untitled Entertainment's talent management group.

Corporate and Shared Services is a cost center that recognizes direct and indirect expenses, including Toronto head office charges such as rent and facilities, and costs associated with shared departments and corporate functions.

The Company measures of segment performance based on revenues reported in accordance with IFRS and segment profit and loss. Segment profit is defined as segment gross revenues less segment direct and indirect expenses. Segment profit excludes corporate shared services direct and indirect expenses, share-based compensation, and purchase accounting and related adjustments.

Notes to the Interim Condensed Consolidated Financial Statements

Three and nine months ended September 30, 2020 and 2019

(Unaudited)

(expressed in thousands of Canadian dollars)

			Three months ended September 30, 2020
	Television	Kids & Family	Representation	Corporate	Total
	\$	\$	\$	\$	\$
Revenue	49,429	23,538	5,042	—	78,009
Expenses
Production, distribution and service costs	42,074	15,322	859	—	58,255
General and administrative costs	6,029	2,533	2,933	7,040	18,535
	1,326	5,683	1,250	(7,040)	1,219
Amortization of property and equipment, right-of-use assets and intangible assets					4,736
Impairment expense (note 6)					12,959
Finance costs, net (note 18)					2,404
Foreign exchange (gain) loss					(1,584)
Loss on loan modification (note 11)					342
Change in fair value of financial assets					395
Change in fair value of other financial
liabilities					3,359
Loss before income taxes					(21,392)
Current income taxes					2,510
Deferred income tax recoveries					(912)
Net loss for the period					(22,990)

Three months ended September 30, 2019

	Television	Kids & Family	Representation	Corporate	Total
	\$	\$	\$	\$	\$

Revenue	28,545	12,266	10,190	—	51,001
Expenses
Production, distribution and service costs	22,716	8,428	1,051	—	32,195
General and administrative costs	4,477	1,029	5,328	6,334	17,168
	1,352	2,809	3,811	(6,334)	1,638
Amortization of property and equipment, right-of-use assets and intangible assets					4,687
Finance costs, net (note 18)					2,237
Foreign exchange (gain) loss					1,561
Share of income (loss) of equity accounted					120
Change in fair value of financial assets					(27)
Change in fair value of other financial liabilities					2,002
Change in fair value of contingent consideration					(10)
Loss before income taxes					(8,932)
Current income taxes					(3,781)
Deferred income taxes					4,462
Net loss for the period					(9,613)

Notes to the Interim Condensed Consolidated Financial Statements

Three and nine months ended September 30, 2020 and 2019

(Unaudited)

(expressed in thousands of Canadian dollars)

			Nine months ended September 30, 2020
	Television	Kids & Family	Representation	Corporate	Total
	\$	\$	\$	\$	\$
Revenue	105,047	47,158	18,984	—	171,189
Expenses
Production, distribution and service costs	93,622	25,061	1,051	—	119,734
General and administrative costs	18,147	5,087	12,231	15,249	50,714
	(6,722)	17,010	5,702	(15,249)	741
Amortization of property and equipment,					13,817
Impairment expense (note 6)					12,959
Finance costs, net (note 18)					7,860
Foreign exchange (gain) loss					482
Loss on loan modification (note 11)					342
Change in fair value of financial assets					374
Change in fair value of other financial liabilities					6,951
Change in fair value of contingent consideration					880
Loss before income taxes					(42,924)
Current income taxes					6,874
Deferred income tax recoveries					(6,254)
Net loss for the period					(43,544)

Nine months ended September 30, 2019

	Television \$	Kids & Family \$	Representation \$	Corporate \$	Total \$
Revenue	119,362	40,978	24,390	—	184,730
Expenses
Production, distribution and service costs	95,459	25,438	1,400	—	122,297
General and administrative costs	13,342	2,347	12,468	19,204	47,361
	10,561	13,193	10,522	(19,204)	15,072
Amortization of property and equipment,					13,993
Finance costs, net (note 18)					6,299
Foreign exchange (gain) loss					1,343
Share of income (loss) of equity accounted					(190)
Change in fair value of financial assets					(390)
Change in fair value of other financial liabilities					6,703
Change in fair value of contingent consideration					384
Loss before income taxes					(13,070)
Current income taxes					5,325
Deferred income taxes					(5,116)
Net loss for the period					(13,279)

(expressed in thousands of Canadian dollars)

Revenue by geographic region, based on the location of customers is as follows:

	Three months ended September 30,			Nine months ended September 30,
	2020	2019	2020	2019
	\$	\$	\$	\$
Revenue by geographic region:
Canada	10,910	14,002	33,015	72,052
United States	58,720	28,576	120,872	85,313
United Kingdom	5,656	7,288	13,045	22,486
Other	2,723	1,135	4,257	4,879
	78,009	51,001	171,189	184,730

No other foreign country individually comprises greater than 10% of total revenue.

Based on the nature of the company's production, distribution and service revenue and the large dollar value of certain transactions, it is not unusual that one or more customers in any reporting period may represent greater than 10% of the company's total revenue for that period. During the three months ended September 30, 2020, three customers accounted for 65% of total revenue (2019 - two customers accounted for 35% of total revenue). During the nine months ended September 30, 2020, two customers accounted for 32% of total revenue (2019 two customers accounted for 22% of total revenue).

Non-current assets by geographic region are as follows:

	September 30, 2020	December 31, 2019
	\$	\$
Non-current assets by geographic region:
Canada	444,028	334,193
United States	17,933	13,727
Other	721	929
	462,682	348,849

Non-current assets held outside of Canada include property and equipment and right-of-use assets.

(Unaudited)

(expressed in thousands of Canadian dollars)

28 Subsequent events

On November 16, 2020, the Corporation amended its convertible debenture described in Note 13 such that the conversion ratio for the debenture is based on a price per share of \$10.33 and the maturity date is the earlier of the closing of an initial public offering and January 1, 2021.

On November 17, 2020, the Company issued \$7,087 of notes receivable to certain shareholders. On November 18, the Company issued 686,091 series A non-voting common shares to the same shareholders in exchange for \$7,087 cash. The notes receivable are non-interest bearing and are due on the earlier of an initial public offering and January 1, 2021.

On December 1, 2020, the Company issued a secured, subordinated convertible debenture for \$25,000 to an entity owned and controlled by the controlling shareholder, Fairfax. The debenture bears interest at 8% per annum. An additional convertible debenture of \$15,000 at the same terms was issued on February 1, 2021 to the same Fairfax entity. Unless an event of default occurs, Fairfax will make additional advances at the same terms of up to \$15,000 on June 1, 2021, and up to \$20,000 on September 1, 2021. The debenture matures on March 31, 2022. Fairfax may elect to convert the debenture into common shares at its discretion at any time, and must convert on the closing of an initial public offering of the Company. The applicable number of shares the amount outstanding would be converted into is based on a conversion ratio agreed to between the Company and Fairfax.

On February 12, 2021, the Company filed a preliminary prospectus with the Ontario Securities Commission.

MANAGEMENT'S DISCUSSION AND ANALYSIS

The following Management's Discussion and Analysis ("MD&A") for Boat Rocker Media Inc. ("Boat Rocker" or the "Company") provides information concerning the Company's financial condition and results of operations. This MD&A should be read in conjunction with the Company's:

unaudited interim condensed consolidated financial statements and accompanying notes for the three and nine months ended September 30, 2020 and 2019 ("interim financial statements"); and
audited consolidated financial statements and accompanying notes ("annual financial statements") for the years ended December 31, 2019, 2018 and 2017.

This disclosure is effective as of February 17, 2021.

Some of the information contained in this MD&A contains forward-looking statements that are based on estimates and judgements and involve risks and uncertainties. See "Caution Regarding Forward-Looking Statements" and "Risk Factors" for a discussion of the uncertainties, risks and assumptions associated with these statements. Actual results may differ materially from those indicated in the forward-looking statements as a result of various factors, including those described in "Risk Factors" and elsewhere in this MD&A. Capitalized terms used in this MD&A and not otherwise defined shall have the meanings attributed to them in the Glossary of Terms ("Glossary") section of the Company's prospectus dated February 17, 2021.

Basis of Presentation

The interim and annual financial statements of the Company have been prepared in accordance with International Financial Reporting Standards ("IFRS") and the interim financial statements have been prepared in accordance with IAS 34 (Interim Financial Reporting). However, certain financial measures contained in this MD&A are non-IFRS measures and are discussed further in "Non-IFRS Measures" below. All financial information is presented in Canadian dollars unless otherwise indicated.

Business Overview

Boat Rocker is an independent, integrated global entertainment company that harnesses the power of creativity and commerce to tell stories and build iconic brands for audiences around the world. The Company creates and produces television and film content across all major genres, distributes thousands of hours of content worldwide (both its own and a represented third-party library), and represents leading onscreen talent and celebrities. Boat Rocker leverages its intellectual property ("IP") to create global entertainment brands that transcend television, resulting in multiple points of audience engagement. Examples include Being Erica, The Next Step, Danger Mouse and Orphan Black, all of which are worldwide brands, generating significant recurring revenue for the Company. Over the course of its 17 year history, the Company has developed and assembled what management believes is a unique set of creative and commercial capabilities. These include creation and development, production, animation, distribution, franchise and brand management, and talent management. Boat Rocker continues to add to, improve, and expand its capabilities to ensure that it meets the needs of its partners, creators, and stakeholders in an everevolving entertainment landscape.

Management believes that Boat Rocker is differentiated as a result of how its creative and commercial capabilities are applied to shorten the distance between each of the three steps in the Company's value creation process: Source the IP, Assess the IP, and Monetize the IP. For further details refer to "The Business of the Company – How Boat Rocker Shortens the Distance" in the Company's prospectus dated February 17, 2021.

Boat Rocker reports the financial results of its business in three segments: "Television" (including live action scripted and unscripted content production and owned IP distribution, but excluding kids and family content), "Kids and Family" (including kids and family live action scripted and unscripted content, all animated content, owned IP distribution, and brand and merchandising), and "Representation" (including brand and management services to talent and IP representation services to third-party IP owners).

Over the past several years, the Company has acquired several assets and businesses described below:

On September 21, 2017, the Company completed the acquisition of the key production and distribution assets of Proper Television Inc. and its distribution arm Proper Rights Inc. (together, "Proper"). Proper forms part of Boat Rocker's Television reporting segment and its primary business activities are the development and production of unscripted content.
On January 24, 2018, in connection with the International Kids and Family Acquisition (as defined in the Company's prospectus dated February 17, 2021), the Company acquired the IP in respect of two kids and family productions and assumed the employment of nine employees located in London, U.K., two employees in Hong Kong, and one employee in the U.S. These components form part of Boat Rocker's Kids and Family reporting segment.
On May 17, 2018, the Company acquired 70% of the outstanding common shares of Insight, a television production company with extensive experience producing unscripted video content as well as live events. Insight forms part of Boat Rocker's Television reporting segment.
On October 30, 2018, the Company acquired 100% of the units of Matador, a production company based in New York, NY and Los Angeles, CA that produces scripted and unscripted video content, digital programming and documentary films. Matador forms part of Boat Rocker's Television reporting segment.
On February 1, 2019, the Company acquired 51% of the outstanding membership interests in Untitled Entertainment LLC ("Untitled Entertainment"), a talent management company based in Los Angeles, CA and New York, NY, that provides talent management services to a roster of actors and celebrities. Untitled Entertainment forms part of Boat Rocker's Representation reporting segment.
On August 31, 2019, the Company completed its acquisition of 100% of Platform One Media, LLC ("Platform One Media") (renamed Boat Rocker Studios, Scripted, LLC, effective January 1, 2021), a production company based in Los Angeles, California. Platform One Media's focus is on producing premium scripted dramas and as such is included in Boat Rocker's Television segment. Upon acquisition, two scripted series and one pilot had been ordered and commissioned by buyers; the pilot episode was delivered in 2020. Until delivery of the two scripted series, expected to begin in 2021, Platform One Media will incur operating expenses but earn no revenue from these series.

Factors Affecting the Company's Performance

Revenue

Boat Rocker generates revenue in four ways:

Production Revenue. Represents revenue derived from the production of video content (as defined in the Glossary) owned in whole or in part by the Company. These revenues generally consist of license fees (sometimes referred to as pre-sales) paid by buyers (as defined in the Glossary) and/or minimum guaranteed payments paid by distributors pursuant to license or distribution agreements entered into prior to the commencement of production and used by the Company to fund production expenses. In certain instances, the distributor licensing the rights in and to the content may be related or affiliated with the Company (i.e. if the Company is acting as a distributor of its own content). The Company will generally not commence the production of video content until it has secured sufficient funding to cover the production expenses associated with producing such video content. Production revenue is recognized when all performance obligations are met, the buyer has access to the video content, and the license period associated with the contract has begun. For further details refer to Critical Accounting Policies, Estimates, and Judgments. Production revenue is recorded in the Television and Kids and Family reporting segments.

Service Revenue. Represents revenue derived from the production of video content owned by a third-party buyer or IP owner (e.g. another production company which engages the Company to provide production services, as is often the case for the Company's animation division). Typically, the buyer or IP owner pays for the full costs of production plus an agreed upon premium or production services fee to the Company pursuant to a production services agreement. These revenues are generally received by the Company in regular installments over the course of work rendered. Depending on the type of video content, the duration of the service contract can vary from 1 to 12 months in the case of live-action, to 12 to 24 months in the case of animation. Service revenue is recognized over time based on the proportion of costs incurred in the current period over the total expected costs of the production. For further details refer to Critical Accounting Policies, Estimates, and Judgments. Service revenue is recorded in the Television and Kids and Family reporting segments.

Distribution Revenue. Represents revenue earned from licensing the Company's fully produced video content to buyers around the world, as well as revenue earned from the sale of retail merchandise and other licensing activities relating to Boat Rocker-owned IP. Boat Rocker may act as its own distribution agent or the Company may employ third-party distribution agents to distribute its video content in all or certain territories. When any given license period ends, the associated rights can be renewed by the same buyer or sold onward to new buyers in each territory, potentially leading to a continuing revenue stream. Distribution revenue is recognized when the buyer has access to the video content and the license period associated with the contract has begun. For further details refer to Critical Accounting Policies, Estimates, and Judgments. Distribution revenue is recorded in the Television and Kids and Family reporting segments.

Representation Revenue. Consists of revenue derived from providing two types of service: brand and management services provided to talent and IP representation services to third-party IP owners. In both cases, the Company is earning a pre-negotiated commission from its clients. The Company represents many A-list stars as well as the video content and brands of several large video content producers. For further details refer to Critical Accounting Policies, Estimates, and Judgments. Representation revenue is recorded in the Representation reporting segment.

Production, Distribution and Service Expenses

Production, distribution and service expenses represent direct expenses incurred in the development, production and distribution of content.

Production Expenses. Represent the cost of developing and producing video content owned in whole or in part by the Company, including salaries of cast and crew (including animators if applicable), location costs, set design, etc. On some projects, production expenses are partially offset by federal, provincial and state film and television tax credits. The net expenses are capitalized while the project is in production and then recognized as expenses through the process of amortization.

Service Expenses. Represent the cost of developing and producing video content owned by third-party buyers and IP Owners, including salaries of cast and crew (including animators if applicable), location costs, set design, etc. On some projects, production expenses are partially offset by federal, provincial and state film and television tax credits. The expenses are recognized on the consolidated statement of income as incurred.

Distribution Expenses. Represent expenses related to the marketing and delivery of video content to thirdparty buyers and include versioning, dubbing, shipping, certain sales marketing and materials, and participation expenses. Participation expenses represent profit participation contractually owing to thirdparties (including, for example, writers, actors and financiers) from distribution revenues.

General and Administrative Expenses

General and administrative expenses represent personnel expenses, facilities, marketing, travel, professional fees, information technology and other overhead costs directly incurred by the segment or by corporate and shared services.

Amortization of Property and Equipment, Right-of-use Assets and Other Intangible Assets

Amortization expense consists of the amortization of property and equipment, right-of-use assets and other intangible assets that arose on the acquisition of certain businesses. Other intangible assets include trademarks, non-compete agreements and talent relationships. This amortization expense does not include the amortization of production costs, which is recognized in production, distribution and service expenses.

Finance Costs, Net

Finance costs, net of interest income, has several sources. First, interest expense is incurred from the Company's financing activities which include corporate loans and borrowings, interim production financing and issued convertible debentures. When the Company borrows from various banks to finance the production of video content, interest expense incurred up to the quarter of delivery is included within the costs of production. After delivery, interest incurred on the interim production financing is included in interest expense.

Second, interest expense also includes accretion expense. Financial liabilities are initially recognized at fair value, which may be different from their settlement amounts. Lease liabilities are initially recognized at the present value of future lease payments. The difference between the carrying values at initial recognition and the amounts to be paid at settlement dates is recognized in profit and loss over the term of the liability as accretion expense using the effective interest rate method.

Foreign Exchange Gains and Losses

Foreign exchange gains and losses arise when transactions are recognized in a currency other than the functional currency of a particular legal entity. A transaction may be settled at a different foreign exchange rate than the date it was recorded, causing a gain or loss.

Other Gains and Losses

Other gains and losses include the loss on loan modification, the Company's share of equity investment income, the change in the fair value of financial assets, financial liabilities and contingent consideration, and the gain on the sale of property.

COVID-19 Pandemic Update

In light of the COVID-19 pandemic, the content production industry experienced a temporary pause on live action production, which impacted Boat Rocker's Television segment in both the scripted and unscripted production groups. As a result, the expected delivery dates of several Boat Rocker series have been delayed, shifting a substantial portion of expected revenue from 2020 into 2021. For example, production on the Company's drama, Invasion, for Apple TV+ was suspended for several months in the spring of 2020, and then restarted, with expected delivery pushed into 2021. Similarly, production on the drama, Rust, for Showtime was suspended just days before it was scheduled to commence in the spring of 2020, and now has a new production start date set for the first quarter of 2021. Production of the second season of the teen drama, Get Even, was also pushed into 2021 to avoid pandemic-related challenges and costs. Talent clients in the Representation segment were also negatively impacted by the pandemic-related temporary shutdowns and restrictions imposed in 2020. However, production of the Company's animated content remained stable as Boat Rocker effectively and quickly transitioned its animation teams to work-from-home. In a two-week time frame, the Company moved all of its employees to work-from-home, including 425 employees in its animation department. Since March 2020, the Company has remotely hired and on-boarded over 200 additional employees to support its on-going animation productions.

The Company has worked with its buyers to push production start dates, re-work and re-budget projects to mitigate pandemic-related costs, and restart projects as soon as practicable. The Company has also made claims under insurance policies for COVID-19 related costs in the aggregate amount of approximately \$29 million (subject to deductibles), but there is no assurance that it will receive any proceeds from such claims and in many cases, even if those claims are successful, the Company's buyers are entitled to the insurance claim proceeds. In respect of the Company's live action productions, Boat Rocker was able to continue to edit and post-produce video content that was shot pre-shutdown by moving post-production crews to workfrom-home and, in doing so, Boat Rocker succeeded in delivering its programming to its buyers on pre-COVID-19 schedules throughout the spring and summer of 2020. The Company also continued development activities on live action productions, such as writing and casting, through virtual writers rooms and casting sessions. As jurisdictions began to ease restrictions, Boat Rocker's scripted and unscripted teams worked diligently to pioneer what management believes are leading COVID-19 protocols, which allowed several of the Company's series to resume production once local restrictions were eased. In addition, Boat Rocker stood alongside the buyers of its premium dramas, Invasion and Rust, by underwriting a portion of the additional costs associated with delaying and remounting the production of those series in a more expensive pandemic environment, thereby confirming the Company as a reliable partner to its buyers. By fall 2020, a majority of Boat Rocker's delayed shows had resumed production, including Invasion. Rust is scheduled to commence production in the first quarter of 2021.

The Company incurred increased production costs as a result of the COVID-19-associated health and safety protocols that were not included in the pre-COVID-19 production budgets. Boat Rocker's expectation is that for new programming, the incremental COVID-19 costs will be included in production budgets from the outset and will be included in program budgets and borne by all financiers of the programming consistent with all other production costs, and as such, will not negatively impact the Company's profitability on such shows.

Canada Revenue Agency accelerated the funding of film and television tax credits which has allowed the Company to collect tax credits on a faster turnaround as compared to historical experience.

A wage cut was implemented for much of Boat Rocker's workforce during the three months ended June 30, 2020. It was applied for approximately twelve weeks and was tiered so as to ensure that the bulk of the cuts were borne by those with the highest salaries. Reduced travel and trade show participation have also led to operating expense savings.

Boat Rocker has accessed funds from the Canada Emergency Wage Subsidy ("CEWS") and has collected \$8.6 million as of September 30, 2020. Of the total, \$1.1 million has been reflected as a reduction of production costs in investment in content, \$6.0 million has been recorded as a reduction in service expenses, and \$1.5 million has been recorded as a reduction in general and administrative expenses. Subsequent to September 30, 2020, the Company collected a further \$5.3 million in CEWS. The Company also accessed government assistance in the form of a grant from the Ministry of Heritage administered by the Canada Media Fund of \$0.6 million in the three months ended September 30, 2020. The Company is currently assessing its eligibility for the wage subsidy and the Canada Emergency Rent Subsidy in subsequent periods. Boat Rocker is not eligible for funds provided by the CAREs ACT in the U.S.

In July 2020, as a result of the impact of COVID-19 on the business of the Company, Boat Rocker amended its banking facility with a Canadian chartered bank (the "Bank") and drew \$13.4 million on an additional demand loan facility repayable at 5% of the principal balance per quarter over ten quarters commencing September 30, 2020, with the residual 50% principal balance due on the earlier of an acceleration event, defined as the earlier of demand and an event of default, and December 31, 2022. The Export Development Bank of Canada guaranteed 75% of the loan as part of its suite of programs put in place to support Canadian businesses during the pandemic. The new facility bears interest at the Canadian prime rate plus 3%, consistent with the Company's typical rate of borrowing.

OUTLOOK

The global demand for video content continues to experience robust growth. Using Boat Rocker's creative and commercial capabilities, the Company aims to capitalize on this growing demand with the goal of growing our recurring revenue streams, in large part, through the creation of entertainment brand franchises. Where applicable, the Company intends to retain optimal rights to its internally created video content. The Company will continue to integrate our creative and commercial capabilities across our segments and strengthen our value creation process, by sourcing, assessing and monetizing IP. Boat Rocker's strong partnerships with buyers (Showtime, Bell Media, Corus Entertainment) and OTT platforms (Apple TV+, Netflix, Amazon Prime Video), talent and creators positions the Company to continue to produce premium scripted, unscripted, animated and live-action content for domestic and international audiences alike.

In our Television segment, scripted and unscripted production is continuing albeit at a slower and more costly pace than pre-COVID-19. In all parts of the world where the Company is currently filming, recent government responses to the second wave of the pandemic have not resulted in the halting of production and the Company is cautiously optimistic in the near term that the Company's shows that are currently in production, and are adhering to strict safety protocols, will be completed based on the updated schedules. The drama, Invasion (Season 1), for Apple TV+ has completed its recent shoot in the United Kingdom and the Company expects to be in production on the drama, Rust (Season 1) for Showtime, in the U.S., in the first quarter of 2021. An unscripted service production, Go-Big Show (Season 1) has begun airing on TBS in the January 2021 and The Great Canadian Baking Show (Season 4) on the CBC and MasterChef Canada (Season 7) on CTV are scheduled to air in the three months ended March 31, 2021.

Jam Filled Entertainment, our animation studio, within the Kids and Family reporting segment, continues to see demand for its services with 8 shows currently in production across Toronto, Ottawa and Halifax. The Company expects that Jam Filled Entertainment will continue to work at capacity and work with its partners to drive a fulsome slate throughout 2021 including producing 2 series for Netflix and 3 series for Nickelodeon. Dino Ranch, our new kids and family series for Disney Junior, is currently in production and delivering episodes throughout 2021. The show premiered on Disney in the US and on CBC in Canada in January 2021. The Company believes that Dino Ranch has very strong commercial prospects, which has been further validated through discussions with our external partners and through our global toy partner Jazwares. The Company expects to have merchandise and licensing products ready for retail markets in the three months ended December 31, 2021.

The Company expects to see a waning of the impact of COVID-19 on the Representation reporting segment throughout 2021. COVID-19 has had a neutral effect on commissions charged by the Company from the representation of third party IP and brands, but at the peak of the COVID-19 related lockdowns during the spring and summer of 2020, revenue from talent management was significantly reduced as compared to previous years as live action production was paused. In the second half of 2020, film and television production resumed across the industry and, as a result, revenue from talent management began to rebound. Boat Rocker expects this recovery to continue in Q1 2021 and beyond. Any future COVID-19 related lockdowns would likely negatively impact this recovery, but to date, in most jurisdictions in which clients of Untitled Entertainment are filming, there are exemptions from the lockdown for film and television production. The Company's talent clients are getting back to work as projects that they star in and/or produce, return to production. The ramp-up is slow but the Company believes it will pick up towards the second half of 2021.

Boat Rocker has a track record of targeting, assessing and acquiring companies and assets across a wide range of transactions. Since 2015, Boat Rocker has successfully targeted, acquired, and, where whollyowned, integrated nine companies and acquired minority interests in several others. The Company will continue to actively look for opportunities to expand its creative and commercial capabilities through acquisitions.

As at September 30, 2020, the Company has a strong slate of video content already greenlit (as defined in the Glossary) or in production for delivery during the three months ended December 31, 2020 and for the year ended December 31, 2021, specifically:

a. The Television segment is currently in-production or greenlit on a number of shows including Invasion for Apple TV+, Rust for Showtime, Beacon 23 for Spectrum and AMC Networks, Dear….Season 2 for Apple TV+, Big Brother Canada for Corus); and
b. The Kids and Family segment is currently in-production or greenlit on a number of shows, most notably Dino Ranch, Get Even (season 2), Bubble Guppies (season 5), and Daniel Spellbound.

Non-IFRS Measures

This MD&A makes reference to certain non-IFRS measures. These measures are not recognized measures under IFRS, do not have a standardized meaning prescribed by IFRS and are therefore unlikely to be comparable to similar measures presented by other companies. Rather, these measures are provided as additional information to complement those IFRS measures by providing further understanding of the Company's results of operations from management's perspective. Accordingly, they should not be considered in isolation nor as a substitute for analysis of the Company's financial information reported under IFRS.

The Company's management uses non-IFRS measures in order to facilitate operating performance comparisons from period to period, to prepare annual operating budgets, and to determine components of management compensation. The non-IFRS measures the Company uses include: "Adjusted EBITDA", "Adjusted EBITDA Margin", "Free Cash Flow", and "Net Debt".

Adjusted EBITDA is defined as earnings before interest, taxes, depreciation and amortization ("EBITDA") adjusted for amortization of non-cash program intangibles, change in fair value of financial liabilities, change in fair value of contingent consideration, share-based compensation, transaction and reorganization costs, goodwill impairment, loss on debt modifications and gain or loss on sale of assets. Adjusted EBITDA is used by management as a measure of the Company's profitability. For further details refer to Reconciliation Tables – Adjusted EBITDA section of this MD&A.

Adjusted EBITDA Margin is defined as Adjusted EBITDA divided by revenue. Management uses Adjusted EBITDA Margin to monitor variances in Adjusted EBITDA in comparison to variances in revenue.

Cash Available for Use is defined as the total cash and cash equivalents of the Company less Cash Required for Use in Productions. Cash Available for Use funds ongoing working capital requirements, principal and interest payments on corporate demand loans as well as ongoing development and growth efforts and thus is an important liquidity measure that management uses to monitor the business on an ongoing basis. This measure does not have a standardized meaning and as such may not be comparable to other companies. For further details, refer to the cash section of the Boat Rocker MD&A.

Cash Required for Use in Productions is defined as cash required for the funding of productions in progress that is not considered by the Company to be available for other uses. The cash is not legally restricted and has not been classified as Restricted Cash on the consolidated statement of financial position. This cash has been provided by buyers and third-party IP owners that have engaged the Company to provide services, as well as banks with whom Boat Rocker has contracted to provide interim production financing. Management uses the amount of Cash Required for Use in Productions to determine the Company's Cash Available for Use. This measure does not have a standardized meaning and as such may not be comparable to other companies.

Free Cash Flow is defined as cash flow provided by operations adjusted for changes in interim production financing, payments of lease liabilities and distributions to non-controlling interests. Where these types of cash flows are excluded from cash provided by operations, management believes they add value to evaluating the ability of the business to generate cash flow. In particular, interim production financing is crucial to the funding of productions and thus has been included in the calculation of Free Cash Flow. Similarly, repayment of lease liabilities and distributions made to non-controlling shareholders have also been included as management considers these to be operating cash flows. For further details refer to Free Cash Flow section of this MD&A.

Net Debt is defined as the carrying value of loans and borrowings (excluding interim production financing and convertible debentures), adjusted for the loss on loan modification and loan fees, plus lease liabilities, less Cash Available for Use. Net Debt represents obligations the Company has to fund from its earnings and is viewed by management as a consistent measure of the Company's liquidity position. In contrast, interim production financing is drawn to bridge the timing between cash inflows from the license fees and production service fees of the buyer, the film and television tax credits earned on valid production expenses, and cash outflows of the production expenses. Interim production financing for a particular production is expected to be repaid from the license fees and film and television tax credits of that same production in the ordinary course of business. As such, interim production financing is excluded from management's calculation of Net Debt. The Company does not include other liabilities in the Net Debt calculation such as: other financial liabilities that are based on estimates and probabilities, rather than specific amounts owing and may not be payable in cash. For further details, refer to Cash and Indebtedness sections of this MD&A.

The use of the non-IFRS measures described above is with the intent of providing investors with supplemental measures of the Company's operating performance and thus highlight trends in its core business that may not otherwise be apparent when relying solely on IFRS financial measures, in addition to providing a greater understanding of the Company's liquidity position and available financial resources. The Company also believes that securities analysts, investors and other interested parties frequently use non-IFRS measures in the evaluation of issuers.

SELECTED FINANCIAL INFORMATION

The following table provides selected financial information of the Company for the three and nine months ended September 30, 2020 and 2019, as well as the years ended December 31, 2019, 2018 and 2017:

	3 months		3 months			9 months 9 months		12 months		12 months		12 months
		Sep 30, 2020	Sep 30, 2019		Sep 30, 2020		Sep 30, 2019		Dec 31, 2019		Dec 31, 2018		Dec 31, 2017

Revenue	\$	78,009	\$	51,001	\$	171,189	\$	184,730	\$	244,165	\$	164,845		\$ 129,050
Net (loss) income	\$	(22,990)	\$	(9,613)		\$ (43,544)		\$ (13,279)		\$ (19,483)	\$	9,757	\$	14,235
Net (loss) income
attributable to non
controlling interests	\$	1,387	\$	654	\$	2,978	\$	3,322	\$	4,224	\$	397	\$	106
Net (loss) income
attributable to shareholders	\$	(24,377)		\$ (10,267)		\$ (46,522)		\$ (16,601)		\$ (23,707)	\$	9,360	\$	14,129
Adjusted EBITDA*	\$	6,034	\$	2,454	\$	6,019	\$	25,371	\$	32,469	\$	32,014	\$	26,581

								Sep 30, 2020		Dec 31, 2019		Dec 31, 2018		Dec 31, 2017
Total cash and cash
equivalents							\$	75,553	\$	59,268	\$	55,416	\$	18,662
Total assets							\$	615,950	\$	516,143	\$	395,529		\$ 179,920
Loans and borrowings							\$	99,481	\$	87,869	\$	47,432	\$	11,357
Lease liabilities							\$	33,844	\$	29,626	\$	27,583	\$	—
Total non-current liabilities							\$	114,375	\$	94,328	\$	59,316	\$	17,731

	9 months		9 months Sep 30, 2019		12 months		12 months		12 months Dec 31, 2017
	Sep 30, 2020				Dec 31, 2019		Dec 31, 2018
Cash provided by (used in) operating activities	\$	(3,417)	\$	13,409	\$	(33,780)	\$	7,393	\$	22,010
Cash provided by (used in) financing activities	\$	21,031	\$	80,113	\$	112,352	\$	36,914		\$ (13,058)
Cash provided by (used in) investing activities	\$	(1,056)		\$ (61,261)		\$ (75,067)	\$	(7,323)	\$	(15,770)
Free cash flow*	\$	7,031	\$	6,137	\$	2,340	\$	12,353	\$	8,714

Net debt* \$ 103,791 \$ 85,297 \$ 57,732 \$ 1,735

*previously defined as a non-IFRS measure

RESULTS OF OPERATIONS

Periods ending September 30, 2020 compared to September 30, 2019

The following table summarizes Boat Rocker's consolidated results of operations for the three months and nine months ended September 30, 2020 and 2019:

		Three months ended				Nine months ended
		September 30,		Increase (Decrease)		September 30,	Increase (Decrease)
	2020	2019	Amount	Percent	2020	2019	Amount	Percent
				(Amounts in thousands)
Revenue
Television	\$ 49,429	\$ 28,545	\$ 20,884	73%	\$ 105,047	\$ 119,362	\$ (14,315)	(12)%
Kids and Family	23,538	12,266	\$ 11,272	92%	47,158	40,978	\$ 6,180	15%
Representation	5,042	10,190	\$ (5,148)	(51)%	18,984	24,390	\$ (5,406)	(22)%
Total revenue	\$ 78,009	\$ 51,001	\$ 27,008	53%	\$ 171,189	\$ 184,730	\$ (13,541)	(7)%
Expenses:
Production, distribution and	58,255	32,195	\$ 26,060	81%	119,734	122,297	\$ (2,563)	(2)%
General and administrative	18,535	17,168	\$ 1,367	8%	50,714	47,361	\$ 3,353	7%
Amortization of property and
equipment, right-of-use assets and
other intangible assets	4,736	4,687	49	1%	\$ 13,817	\$ 13,993	(176)	(1)%
Finance costs, net	2,404	2,237	167	7%	\$ 7,860	\$ 6,299	1,561	25%
Foreign exchange (gain)/loss	(1,584)	1,561	(3,145)	(201)%	\$ 482	\$ 1,343	(861)	(64)%
Impairment expense	12,959	—	12,959	NA	12,959	—	12,959	NA
Other (gains)/losses	4,096	2,085	2,011	96%	8,547	6,507	2,040	31%
Loss before income taxes	\$ (21,392)	\$ (8,932)	(12,460)	(139)%	\$ (42,924)	\$ (13,070)	(29,854)	(228)%
Income tax expenses	1,598	681	917	135%	\$ 620	\$ 209	411	197%
Net loss	\$ (22,990)	\$ (9,613)	\$ (13,377)	(139)%	\$ (43,544)	\$ (13,279)	\$ (30,265)	(228)%
Net income attributable to non controlling interests	\$ 1,387	\$ 654	733	112%	\$ 2,978	\$ 3,322	(344)	(10)%
Net loss attributable to shareholders of the Company	\$ (24,377)	\$ (10,267)	(14,110)	137%	\$ (46,522)	\$ (16,601)	(29,921)	180%
Other Financial Information:
Adjusted EBITDA*	\$ 6,034	\$ 2,454	3,580	146 % \$	6,019	\$ 25,371	(19,352)	(76%)

*previously defined as a non-IFRS measure

Revenue. In the three months ended September 30, 2020, revenue was \$78.0 million compared to \$51.0 million in the same period of 2019, an increase of \$27.0 million or 53%. The main driver of the positive variance was revenue recognized in the Television segment for the first season of an unscripted service production called Go-Big Show, for buyer TBS. Principal photography was completed during the threemonth period ended September 30, 2020, resulting in the recognition of the associated service revenue.

Revenue for the nine months ended September 30, 2020 was \$171.2 million compared to \$184.7 million for 2019, a decrease of \$13.5 million or 7%. While 2020 included revenue noted above for Go-Big Show, several productions delivered in 2019 had no subsequent season in 2020, including the final season of the scripted drama Killjoys (Season 5) delivered in early 2019 and The Amazing Race Canada (Season 7) delivered in the three months ended September 30, 2019. Season 8 of The Amazing Race Canada was not delivered in the same period of 2020 due to delays in production related to COVID-19.

Production, distribution and service expenses. Production, distribution and service expenses for the three months ended September 30, 2020 were \$58.3 million compared to \$32.2 million for the same period of 2019, an increase of \$26.1 million or 81%, mainly due to the service expenses of Go-Big Show in the period.

Production, distribution and service expenses for the nine months ended September 30, 2020 were \$119.7 million compared to \$122.3 million for the same period of 2019, a decrease of \$2.6 million or 2%. Expenses decreased by a lower percentage than revenue reflecting an increased cost of the productions delivered and services performed in 2020 relative to 2019.

General and administrative expenses. In the three months ended September 30, 2020, general and administrative expenses were \$18.5 million, compared to \$17.2 million in the same period of 2019, an increase of \$1.4 million or 8%.

As noted, Platform One Media was acquired in August 2019 and will continue to incur expenses without any related production margin until the expected delivery of two premium scripted dramas in the second half of 2021. During the three months ended September 30, 2020, Platform One Media general and administrative expenses were \$2.2 million compared to \$0.7 million in the same period of 2019, creating a negative variance of \$1.5 million.

The Company also incurred expenses to support a franchise and brand management team and related marketing costs without any related revenue. During the three months ended September 30, 2020, general and administrative expenses related to the franchise and brand management team were \$0.4 million compared to \$0.2 million in the same period of 2019, creating a negative variance of \$0.2 million.

In the nine months ended September 30, 2020, general and administrative expenses were \$50.7 million, compared to \$47.4 million in the same period of 2019, an increase of \$3.4 million or 7%.

During the nine months ended September 30, 2020, Platform One Media general and administrative expenses were \$6.1 million compared to \$0.7 million in the same period of 2019, creating a negative variance of \$5.4 million.

During the nine months ended September 30, 2020, general and administrative expenses related to the franchise and brand management team were \$1.1 million compared to \$0.4 million in the same period of 2019, creating a negative variance of \$0.7 million.

These negative variances have been offset in the nine months ended September 30, 2020 by government assistance in the form of a grant from the Ministry of Heritage administered by the Canada Media Fund of \$0.6 million and \$1.5 million of CEWS funds recognized in general and administrative expenses.

Amortization expense. Amortization expense consists of the amortization of property and equipment, right-of-use assets and other intangible assets. The following table presents the breakdown of amortization expense for the three and nine months ended September 30, 2020 and 2019:

		Three months ended	Increase		Nine months ended	Increase
		September 30,	(Decrease)		September 30, (Decrease)
	2020	2019		2020	2019
			(Amounts in thousands)
Expenses:
Amortization of property and
equipment	702	807	(105)	2,158	2,856	(698)
Amortization of right-of-use assets	1,874	1,720	154	5,178	5,118	60
Amortization of intangible assets	2,160	2,160	—	6,481	6,019	462
Amortization expense	\$ 4,736	\$ 4,687	\$ 49	\$ 13,817	\$ 13,993	\$ (176)

Finance costs, net. The following table presents the breakdown of net finance costs for the three and nine months ended September 30, 2020 and 2019:

	Three months ended		Increase		Nine months ended
	September 30,		(Decrease)	September 30,		(Decrease)
	2020	2019		2020	2019
				(Amounts in thousands)
Expenses:
Interest income	(124)	(278)	154	(343)	(398)	55
Interest expense	2,024	2,079	(55)	6,811	5,410	1,401
Accretion expense	504	436	68	1,392	1,287	105
Finance costs, net	\$ 2,404	\$ 2,237	\$ 167	\$ 7,860	\$ 6,299	\$ 1,561

Interest expense in the 2020 and 2019 periods was incurred on the following liabilities: 1) interim production financing from various banks to finance the production of video content, 2) demand loans advanced to the Company by the Bank, 3) convertible debentures issued to the Company's majority shareholder, Fairfax Financial Holdings Inc. ("Fairfax"), and 4) a mortgage that was extinguished in November 2019.

In the three months ended September 30, 2020 and 2019, interest expense was consistent at approximately \$2.0 million. In the nine months ended September 30, 2020, interest expense was \$6.8 million compared to \$5.4 million in the same period of 2019. The increase reflects the increased borrowing in the form of the convertible debentures issued in September 2019 and the demand loan from the Bank in August 2020. The convertible debentures incur non-cash interest.

With respect to interim production financing, interest expense from the initial draw to the quarter of delivery is included in the individual production budget and after delivery is included in interest expense. In the three months ended September 30, 2020, the Company expensed \$0.3 million on interest from interim production financing, compared to \$0.3 million in the same period of 2019. In the nine months ended September 30, 2020, the Company expensed \$1.0 million on interest from interim production financing, compared to \$0.8 million in the same period of 2019.

Lease liabilities are initially recognized at the present value of future lease payments. The difference between the carrying values at initial recognition and the amounts to be paid at settlement dates is recognized in profit and loss over the term of the liability as accretion expense using the effective interest rate method. In the three months ended September 30, 2020, accretion expense was \$0.5 million compared to \$0.4 million in the same period of 2019. In the nine months ended September 30, 2020, accretion expense was \$1.4 million, compared to \$1.3 million in the same period of 2019. The increase is primarily attributable to several new lease obligations undertaken in 2020 which resulted in increased accretion expense on the lease liabilities.

Foreign exchange gains and losses. Foreign exchange gains and losses arise when transactions are recognized in a currency other than the functional currency of a particular legal entity. For example, a foreign exchange gain or loss may occur when a transaction in U.S. dollars is recorded in a Canadian dollar functional currency entity or a transaction in U.S. dollars is recorded in an entity with pounds sterling as the functional currency. A portion of the Company's demand loan is denominated in U.S. dollars and is revalued at the spot rate on each reporting date. In the three months ended September 30, 2020, the Company recognized a foreign exchange gain of \$1.6 million compared to a foreign exchange loss of \$1.6 million in the three months ended September 30, 2019. In the nine months ended September 30, 2020, the Company recognized a foreign exchange loss of \$0.5 million compared to the foreign exchange loss of \$1.3 million in the nine months ended September 30, 2019.

Goodwill impairment. Goodwill is tested for impairment annually as at December 31 or more frequently if events or circumstances indicate that the asset might be impaired. During the three months ended September 30, 2020, management identified that there were indications of impairment associated with the Unscripted cash generating unit ("CGU"), given the pervasive economic impact of COVID-19 on unscripted television productions where actual operating results and financial projections fell short of previous estimates and projections. Accordingly, the Company tested goodwill of this CGU for impairment as at September 30, 2020.

In assessing the goodwill for impairment, the Company compares the carrying value of the CGU to the recoverable amount, where the recoverable amount is the higher of fair value less costs of disposal and the value in use. An impairment charge is recognized to the extent that the carrying value exceeds the recoverable amount. For the period ended September 30, 2020, the Company applied the value in use method.

Based on the analysis of the Unscripted CGU, it was determined that the carrying value exceeded the value in use and therefore an impairment of \$13.0 million was recorded at September 30, 2020.

The cash flows used in determining the value in use for the Unscripted CGU were based on the following key assumptions:

Five-year projections based on management's expectations of content planned and greenlit, including the ability to distribute the content through global territories, as well as estimates of further seasons and projects in development in the next five years.
Estimates of revenue, direct and indirect operating costs are based on historical results and future expectations of operating performance. Revenue from production and services were estimated for the next 12-24 months based on a slate of programs and content currently in ongoing production

and greenlit and planned to begin. Additionally, programs and content in discussions with third parties or forecasted with reasonable certainty to proceed in this period have been included. Using these estimates as a basis, revenues beyond 2021 were estimated using an average growth rate of 3.0%. Service and production costs were estimated based on known license fees, production service agreements and budgeted costs, consistent with historical and recent experience. Gross profit margins on production and service revenues were estimated at between 13.0% and 25.5% for the following twelve months, growing to between 14.9% and 28.3% over the following four years.

The weighted average cost of capital has been calculated at a pre-tax rate of 25.2%.
Cash flows beyond the five-year period are extrapolated using a terminal growth rate of 1.0%.

The recoverable amount of the Unscripted CGU is sensitive to changes in market conditions and could result in changes in the carrying value of goodwill in the future.

An increase of the weighted average cost of capital of 1.0% (a 100 basis point increase), a decrease in the service revenue growth rate of 1.0% (a 100 basis point decrease) or a decrease in the gross profit margin of 1.0% (a 100 basis point decrease) would result in a further impairment of the Unscripted CGU in the amount of \$2,001, \$3,080 and \$3,464, respectively. As each key assumption was changed independently, the results of the sensitivity analyses do not contemplate management's ability to mitigate against any adverse effects that may arise in the future.

For further details refer to Critical Accounting Policies, Estimates, and Judgments.

Other gains and losses. The following table presents the breakdown of other gains and losses for the three and nine months ended September 30, 2020 and 2019:

	Three months ended		Increase	Nine months ended		Increase
	September 30,		(Decrease)	September 30,		(Decrease)
	2020	2019		2020	2019
			(Amounts in thousands)
Loss on loan modification	\$ 342	\$ —	\$ 342	\$ 342	\$ —	\$ 342
Share of equity investee income	—	120	(120)	—	(190)	190
Change in fair value of financial assets	395	(27)	422	374	(390)	764
Change in fair value of other financial liabilities	3,359	2,002	1,357	6,951	6,703	248
Change in fair value of contingent consideration	—	(10)	10	880	384	496
Other gains and losses	\$ 4,096	\$ 2,085	\$ 2,011	\$ 8,547	\$ 6,507	\$ 2,040

Other gains and losses for the three months ended September 30, 2020 was a loss of \$4.1 million compared to a loss of \$2.1 million for the three months ended September 30, 2019, a change of \$2.0 million. Other gains and losses for the nine months ended September 30, 2020 was a loss of \$8.5 million compared to a loss of \$6.5 million for the nine months ended September 30, 2019, a change of \$2.0 million. The fair value of financial assets, financial liabilities and contingent consideration is recalculated at each reporting date and gains and losses can result from changes in estimates, probabilities, foreign currency rates. In addition, where liabilities are recorded using the effective interest method, the fair value will change due to the time value of money.

Income tax expense. For the nine months ended September 30, 2020, total income tax expense of \$0.6 million represented an effective tax rate of 1.4% on the loss before taxes of \$42.9 million, as compared to \$0.2 million, or an effective tax rate of 1.6% on the loss before taxes of \$13.1 for the same period of 2019. The Company's statutory tax rate is 26.5% for each of these periods. The significant difference in statutory rates is due primarily to losses and other deductions in U.S. subsidiaries for which no tax benefit was recognized, amounting to an impact of \$11.4 million on the effective tax rate for the nine months ended September 30, 2020 and \$2.6 million for the same period in 2019. Additionally, share-based compensation and other non-deductible expenses amounted to a \$1.7 million impact on the effective tax rate in both the nine months ended September 30, 2020 and 2019. These items were partially offset by the impact of lower tax rates in foreign jurisdictions.

Net loss attributable to shareholders of the Company. Net loss attributable to shareholders of the Company for the three months ended September 30, 2020 was \$24.4 million, compared to \$10.3 million in 2019, an increase of \$14.1 million. The increased loss was mainly driven by the goodwill impairment of \$13.0 million.

Net loss attributable to shareholders of the Company for the nine months ended September 30, 2020 was \$46.5 million, compared to \$16.6 million in 2019, an increase of \$29.9 million. The increased loss was mainly driven by the impact of the COVID-19 delays and shut downs on revenue and expenses as described above, the lack of recurring revenue due to certain productions having their last season in 2019, and goodwill impairment of \$13.0 million.

Adjusted EBITDA.* Adjusted EBITDA for the three months ended September 30, 2020 was \$6.0 million, compared to \$2.5 million in 2019, an increase of \$3.6 million or 146%. Adjusted EBITDA for such 2020 period included \$2.5 million of costs incurred at Platform One Media and the franchise and brand management team as compared to \$0.9 million in the prior year period for these same costs.

Adjusted EBITDA for the nine months ended September 30, 2020 was \$6.0 million, compared to \$25.4 million in 2019, a decrease of \$19.4 million. Adjusted EBITDA for such 2020 period included \$7.2 million of costs incurred at Platform One Media and the franchise and brand management team as compared to \$1.1 million in the prior year period for these same costs.

Segment Results of Operations

The Company manages and reports operating results through three segments: Television, Kids and Family, and Representation, which are described in detail below. The Company's primary measure of segment performance is segment profit and loss, which is defined as segment gross revenues less segment direct and indirect expenses. Segment profit excludes corporate shared services direct and indirect expenses, sharebased compensation, and purchase accounting and related adjustments. The Company believes the presentation of segment profit and loss is relevant and useful for investors because it allows investors to view segment performance in a manner similar to the primary method used by the Company's management and enables them to understand the fundamental performance of the Company's reporting segments.

Television

The Television segment produces two types of video content under several brands: scripted (Temple Street and Platform One Media) and unscripted (Proper, Insight and Matador). The Platform One Media acquisition took place on August 31, 2019 and the tables below include the Platform One Media results from that date forward. In some instances, variances for results excluding Platform One Media in both 2020 and 2019 are discussed in order to improve comparison as 2019 includes only one month of Platform One Media results.

The following table presents the Television segment revenue and segment profit (loss) for the three and nine months ended September 30, 2020 and 2019:

		Three months ended				Nine months ended
		September 30,		Increase (Decrease)		September 30,		Increase (Decrease)
	2020	2019	Amount	Percent	2020	2019	Amount	Percent
Television Segment:					(Amounts in thousands)
Revenue
Production	\$ 8,167	\$ 12,342	\$ (4,175)	(34%)	\$ 39,399	\$ 58,079	\$ (18,680)	(32%)
Distribution	4,679	7,200	(2,521)	(35%)	9,541	25,859	(16,318)	(63%)
Service	36,583	9,003	27,580	306%	56,107	35,424	20,683	58%
Total revenue	\$ 49,429	\$ 28,545	\$ 20,884	73%	\$ 105,047	\$ 119,362	\$ (14,315)	(12%)
Expenses
Production, distribution and service	42,074	22,716	19,358	85%	93,622	95,459	(1,837)	(2%)
General and administrative	6,029	4,477	1,552	35%	18,147	13,342	4,805	36%
	\$ 48,103	\$ 27,193	\$ 20,910	77%	\$ 111,769	\$ 108,801	\$ 2,968	3%
Segment profit (loss)	\$ 1,326	\$ 1,352	\$ (26)	(2%)	\$ (6,722)	\$ 10,561	\$ (17,283)	(164%)

Revenue. Production revenue in the three months ended September 30, 2020 was \$8.2 million, in comparison to \$12.3 million in the same period of 2019, a decrease of \$4.2 million with three productions delivered in each of the periods. Wall of Chefs (Seasons 1 and 2) was delivered in the three months ended September 30, 2020 to Food Network Canada. During the same period of 2019, The Amazing Race Canada (Season 7) was delivered to CTV Television Network.

Production revenue in the nine months ended September 30, 2020 was \$39.4 million, in comparison to \$58.1 million in the same period of 2019, a decrease of \$18.7 million. Nine productions were delivered in the 2020 period while 11 productions were delivered in the same period of 2019. The mix of productions delivered in the two periods varied. Season 5 of the scripted drama Killjoys (10 episodes), was delivered during 2019 while a scripted pilot was delivered during 2020, resulting in a reduction in scripted revenue. Unscripted production revenue also experienced a negative variance driven by the delay in delivery of subsequent seasons of several shows delivered in the same period of 2019, and certain shows had their final seasons in 2019 and were thus non-recurring in 2020. Similar to the delay mentioned above, MasterChef Canada (Season 7) was delayed and is expected to be delivered in the first half of 2021.

Distribution revenue for the three months ended September 30, 2020 was \$4.7 million in comparison to distribution revenue in the same period of 2019 of \$7.2 million, a decrease of \$2.5 million. For the nine months ended September 30, 2020, distribution revenue was \$9.5 million in comparison to \$25.9 million in the same period of 2019, a decrease of \$16.3 million. Distribution revenue consists of sales of Television segment library video content by the Company's internal sales team as well as sales by third-party distributors of content created by the Company. The Company earns distribution revenue twice per year, in March and in September, from BBC Worldwide, the third-party distributor of the successful title Orphan Black (Seasons 1-5). Orphan Black is an example of a title that has created a long-tail revenue stream by generating revenue over a number of years after delivery of the initial production. Revenue earned from BBC Worldwide decreased in 2020 compared to 2019.

Service revenue in the Television segment consists of unscripted service production for both Canadian and U.S. buyers. For the three months ended September 30, 2020, service revenue was \$36.6 million in comparison to \$9.0 million in the same period of 2019. The increase of \$27.6 million was mainly due to the Go-Big Show (Season 1) for TBS, shot during the three months ended September 30, 2020. The increase in service revenue for the nine months ended September 30, 2020 compared to the same period of 2019 is \$20.7 million is also primarily attributable to the same production.

Production, distribution and service expenses. Production, distribution and services expenses for the three months ended September 30, 2020 were \$42.1 million. The increase of \$19.4 million compared to the same period of 2019 was primarily related to the Go-Big Show (Season 1).

Production distribution and service expenses for the nine months ended September 30, 2020 were \$93.6 million, a decrease from \$95.5 million in the same period of 2019.

General and administrative expenses. General and administrative expenses for the three months ended September 30, 2020 increased by \$1.6 million compared to the same period of 2019. Platform One Media was acquired in August 2019 and will continue to incur expenses without any related production margin until the expected delivery of two premium scripted dramas in the second half of 2021. During the three months ended September 30, 2020, Platform One Media general and administrative expenses were \$2.2 million compared to \$0.7 million in the same period of 2019, creating a negative variance of \$1.4 million.

In the nine months ended September 30, 2020, general and administrative expenses were \$18.1 million compared to \$13.3 million in the same period of 2019, an increase of \$4.8 million. During the nine months ended September 30, 2020, Platform One Media general and administrative expenses were \$6.1 million compared to \$0.7 million in the same period of 2019, creating a negative variance of \$5.4 million.

Segment profit and loss. For the three months ended September 30, 2020, segment profit in the Television segment was \$1.3 million, compared to \$1.4 million in the same period of 2019.

For the nine months ended September 30, 2020, the Television segment incurred loss of \$6.7 million, compared to profit of \$10.6 million in the same period of 2019, a decrease of \$17.3 million.

Kids and Family

Boat Rocker's Kids and Family segment includes its Kids and Family studio, a co-production agreement with an investment in an equity-accounted entity, Industrial Brothers, the International Kids & Family Acquisition, and the Jam Filled Entertainment animation studio.

The following table presents the Kids and Family segment revenue and segment profit for the three months and nine months ended September 30, 2020 and 2019:

		Three months ended September 30,	Increase (Decrease)		Increase (Decrease)
	2020	2019	Amount	Percent	2020	2019	Amount	Percent
Kids and Family Segment: Revenue					(Amounts in thousands)
Production	\$ 7,359	\$ —	\$ 7,359	N/A	\$ 10,095	\$ 242	\$ 9,853	4071%
Distribution	5,034	1,113	3,921	352%	8,474	6,091	2,383	39%
Service	11,145	11,153	(8)	—%	28,589	34,645	(6,056)	(17%)
Total revenue	\$ 23,538	\$ 12,266	\$ 11,272	92%	\$ 47,158	\$ 40,978	\$ 6,180	15%
Expenses
Production, distribution and service	15,322	8,428	6,894	82%	25,061	25,438	(377)	(1%)
General and administrative	2,533	1,029	1,504	146%	5,087	2,347	2,740	117%
	\$ 17,855	\$ 9,457	\$ 8,398	89%	\$ 30,148	\$ 27,785	\$ 2,363	9%
Segment profit	\$ 5,683	\$ 2,809	\$ 2,874	102%	\$ 17,010	\$ 13,193	\$ 3,817	29%

Revenue. Production revenue in the three months ended September 30, 2020 was \$7.4 million compared to \$nil in the same period of 2019. The following three productions were delivered during the 2020 period: Remy and Boo (Season 1) for NBC Universal Kids, Get Even (Season 1) for Netflix, and Kingdom Force (Season 1) for CBC. An additional production was delivered in the previous six months of 2020: The Next Step (Season 7) resulting in production revenue of \$10.1 million for the nine months ended September 30, 2020, compared to \$0.2 million in the same period of 2019.

Distribution revenue in both the three months and nine ended September 30, 2020 increased over the comparable period of 2019. The increases reflect increased Kids and Family video content available for sale. Distribution revenue for the three months ended September 30, 2020 was \$5.0 million in comparison to distribution revenue in the same period of 2019 of \$1.1 million, an increase of \$3.9 million. Sales of Kids and Family video content by the Company's internal sales team increased by \$3.7 million due to the additional titles added to the catalog from production. Revenue earned from third-party distributor sales for The Next Step (Seasons 1-5) increased by \$0.2 million in the three months ended September 30, 2020 compared to the same period of 2019.

In the nine months ended September 30, 2020, distribution revenue was \$8.5 million in comparison to distribution revenue in the same period of 2019 of \$6.1 million, an increase of \$2.4 million.

Service revenue mainly represents revenue earned from the performance of animation services for thirdparty buyers or IP owners by the Jam Filled Entertainment animation studio. When Jam Filled Entertainment is animating the Company's own video content, the service revenue is eliminated on consolidation and production revenue is recognized when the video content is delivered to the buyers or IP owners. While in the three months ended September 30, 2020, service revenue was consistent with the same period of 2019, in the nine months ended September 30, 2020, service revenue decreased to \$28.6 million from \$34.6 million in the same period of 2019. This decrease reflects more animation services of the Company's IP that have been rendered by Jam Filled Entertainment in the 2020 period, which will be recognized as production revenue when the programs are delivered.

Production, distribution and service expenses. For the three months ended September 30, 2020, production, distribution and service expenses were \$15.3 million in comparison to \$8.4 million in the same period of 2019, an increase of \$6.9 million. This increase is related to the increase in revenue in the same periods.

Production, distribution and service expenses in the nine months ended September 30, 2020 were \$25.1 million, compared to \$25.4 million in the same period of 2019.

General and administrative expenses. General and administrative expenses for the three months ended September 30, 2020 increased by \$1.5 million compared to the same period of 2019. The Company incurred expenses to support the franchise and brand management team and related marketing costs without any related revenue. During the three months ended September 30, 2020, general and administrative expenses related to the franchise and brand management team were \$0.4 million compared to \$0.2 million in the same period of 2019, creating a negative variance of \$0.2 million.

In the nine months ended September 30, 2020, general and administrative expenses were \$5.1 million compared to \$2.3 million in the same period of 2019, an increase of \$2.7 million. During the nine months ended September 30, 2020, general and administrative expenses related to the franchise and brand management team were \$1.1 million compared to \$0.4 million in the same period of 2019, creating a negative variance of \$0.7 million.

Segment profit. For the three months ended September 30, 2020, profit in the Kids and Family segment was \$5.7 million compared to \$2.8 million in the same period of 2019.

For the nine months ended September 30, 2020, the Kids and Family segment recognized profit of \$17.0 million compared to \$13.2 million in the same period of 2019.

A strong slate of production deliveries and full pipelines of animation services in 2020 have enabled the growth in segment profit in these periods.

Representation

The Representation segment includes brand and management services provided to talent and IP representation and representation services to third-party IP owners for which the Company earns a prenegotiated commission from its clients. The table below presents the Representation segment revenue and segment profit for the three and nine months ended September 30, 2020 and 2019:

	Three months ended				Nine months ended
	September 30,		Increase (Decrease)		September 30,		Increase (Decrease)
	2020	2019	Amount	Percent	2020	2019	Amount	Percent
Representation Segment:					(Amounts in thousands)
Representation revenue	\$ 5,042	\$ 10,190	\$ (5,148)	(51%)	\$ 18,984	\$ 24,390	\$ (5,406)	(22%)
Total revenue	\$ 5,042	\$ 10,190	\$ (5,148)	(51%)	\$ 18,984	\$ 24,390	\$ (5,406)	(22%)
Expenses:
Production, distribution and service	859	1,051	(192)	(18%)	1,051	1,400	(349)	(25%)
General and administrative	2,933	5,328	(2,395)	(45%)	12,231	12,468	(237)	(2%)
	\$ 3,792	\$ 6,379	\$ (2,587)	(41%)	\$ 13,282	\$ 13,868	\$ (586)	(4%)
Segment profit	\$ 1,250	\$ 3,811	\$ (2,561)	(67%)	\$ 5,702	\$ 10,522	\$ (4,820)	(46%)

Revenue. Revenue in the three months ended September 30, 2020 was \$5.0 million compared to \$10.2 million in the same period of 2019, a decrease of \$5.1 million. Revenue in the nine months ended September 30, 2020 was \$19.0 million compared to \$24.4 million in the same period of 2019, a decrease of \$5.4 million. In both the three months and the nine months, commissions earned from management services provided to talent decreased as the Company's clients were affected by delays and restrictions associated with the COVID-19 pandemic. Similarly, commissions earned from representation of third-party brands and IP also decreased in both periods.

General and administrative expenses. General and administrative expenses for the three months ended September 30, 2020 decreased by \$2.4 million compared to the same period of 2019. In the nine months ended September 30, 2020, general and administrative expenses were \$12.2 million compared to \$12.5 million in the same period of 2019, a decrease of \$0.2 million. Both decreases relate to wage cuts implemented in the talent management team during 2020.

Segment profit. Segment profit in the three months ended September 30, 2020 was \$1.3 million, compared to \$3.8 million in the same period of 2019, a decrease of \$2.6 million. Segment profit in the nine months ended September 30, 2020 was \$5.7 million compared to \$10.5 million in the same period of 2019, a decrease of \$4.8 million. These decreases relate to the decreases in revenue in each period.

Corporate and Shared Services

Corporate and shared services is a cost center that includes corporate functions such as human resources, finance, business development, information technology, business and legal affairs and senior management. The tables below sets forth corporate and shared services expenses for the three and nine months ended September 30, 2020 and 2019:

	Three months ended September 30,			Increase (Decrease)	Nine months ended September 30,	Increase (Decrease)
	2020		2019	Amount	Percent	2020	2019	Amount	Percent
Corporate and Shared Services: Expenses					(Amounts in thousands)
General and administrative	\$ 7,040	\$	6,334	\$ 706	11%	\$ 15,249	\$ 19,204	\$ (3,955)	(21%)
	\$ 7,040	\$	6,334	\$ 706	11%	\$ 15,249	\$ 19,204	\$ (3,955)	(21%)

General and administrative expenses. General and administrative expenses are concentrated in the corporate office in Toronto. These expenses include professional fees and consulting, travel and entertainment, information technology and equipment leases, bank fees, advertising and promotions, and office and related facilities expenses. The New York and Los Angeles locations and resources are included in the related segment results and not considered shared services.

General and administrative expenses for the three months ended September 30, 2020 increased by \$0.7 million compared to the same period of 2019.

In the nine months ended September 30, 2020, general and administrative expenses were \$15.2 million compared to \$19.2 million in the same period of 2019, a decrease of \$4.0 million. During the nine months ended September 30, 2020, the Company received government assistance in the form of a grant from the Ministry of Heritage administered by the Canada Media Fund of \$0.6 million and \$1.5 million of CEWS funds recognized in general and administrative expenses. Professional, consulting and promotion fees decreased by \$3.6 million in the nine months ended September 30, 2020, compared to 2019 where there were two acquisitions that required external support. In contrast, during the nine months ended September 30, 2020, share-based compensation expenses were \$3.0 million compared to \$0.5 million in the same period of 2019. The increase is due to the change in the estimate of the economic life of the outstanding stock options.

Year ended December 31, 2019 compared to 2018

Boat Rocker acquired several businesses during the two years covered by the following analysis and it is important to note the effect of the acquisitions on the results described below. The following chart summarizes the businesses acquired between 2018 and 2019 and the dates from which their results are included in the Company's results:

Acquired	Date of Acquisition	2019 Includes	2018 Includes
Certain assets of International Kids and Family Acquisition	January 24, 2018	12 months	11 months
Insight Productions	May 17, 2018	12 months	7 months
Matador Content	October 30, 2018	12 months	2 months
Untitled Entertainment	February 1, 2019	11 months	No results
Platform One Media	August 31, 2019	4 months	No results

The following table sets forth the consolidated results of operations for the years ended December 31, 2019 and 2018:

		Year Ended
	December 31,				Increase (Decrease)
	2019		2018		Amount	Percent
			(Amounts in thousands)
Revenue	\$ 244,165	\$	164,845	\$	79,320	48%
Expenses
Production, distribution and service	157,576		110,117		47,459	43%
General and administrative	69,820		35,741		34,079	95%
Amortization of property and equipment,
right-of-use assets and other intangible
assets	18,989		6,562		12,427	189%
Finance costs, net	8,415		2,580		5,835	226%
Foreign exchange gains	(307)		(2)		(305)	15250%
Other (gains)/losses	8,088		(3,983)		12,071	(303%)
(Loss)/Income before income taxes	\$ (18,416)		\$ 13,830	\$	(32,246)	(233%)
Income tax expenses	1,067		4,073		(3,006)	(74%)
Net (loss)/income	\$ (19,483)	\$	9,757	\$	(29,240)	(300%)
Net income attributable to non-controlling interests	\$ 4,224	\$	397	\$	3,827	964%
Net (loss)/income attributable to shareholders of the Company	\$ (23,707)	\$	9,360	\$	(33,067)	(353%)
Other Financial Information
Adjusted EBITDA*	\$ 32,469	\$	32,014	\$	455	1%

Revenue. Revenue was \$244.2 million in 2019 compared to \$164.8 million in 2018, an increase of \$79.3 million or 48%. The Company delivered 17 productions during 2019 and 14 during 2018. For further details on the variance refer to Segment Results.

*previously defined as a non-IFRS measure

Production, distribution and service expenses. Production, distribution and service costs were \$157.6 million in 2019, an increase of 43% from \$110.1 million in 2018. For further details on the variance refer to Segment Results.

General and administrative expenses. General and administrative expenses were \$69.8 million in 2019, compared to \$35.7 million in 2018, an increase of \$34.1 million or 95% related to the consolidation of acquired businesses as they were acquired during the two years.

	Year Ended December 31,		Increase (Decrease)
	2019	2018	Amount
		(Amounts in thousands)
Amortization of property and equipment	3,784	3,477	307
Amortization of right-of-use asset	6,938	2,308	4,630
Amortization of other intangible assets	8,177	777	7,400
Amortization expense	18,899	6,562	12,337

The increase in amortization of the right-of-use asset is related to new leases signed or acquired during 2018 and 2019. Other intangible assets are recognized at fair value on the date of acquisition of a business and include trademarks, non-compete agreements and talent relationships. These other intangible assets are amortized on a straight-line basis between five and ten years. Intangible assets were recognized in the Matador acquisition in October 2018 and the Untitled Entertainment acquisition in February 2019, leading to the increase in amortization in 2019 compared to 2018.

Foreign exchange gains and losses. Foreign exchange gains and losses arise when transactions are recognized in a currency other than the functional currency of a particular legal entity. Foreign exchange gains of \$0.3 million were recognized in 2019 compared to \$nil in 2018, related to increased exposure to foreign currency transactions.

Finance costs, net. The following table presents the breakdown of net finance costs for the years ended December 31, 2019 and 2018:

		Year Ended December 31,	Increase (Decrease)
		2019	2018	Amount
	(Amounts in thousands)
Interest income	\$	(483)	\$	(32)	\$	(451)
Interest expense		7,196		2,109		5,087
Accretion expense	1,702 503 1,199
Finance costs, net	\$ 8,415 2,580					5,835

Interest income is earned in certain circumstances when film and television tax credits are paid by the Canada Revenue Agency. Collections of tax credits increased in 2019 compared to 2018, leading to an increase in interest income of \$0.5 million.

Interest expense in 2019 and 2018 was incurred on the following liabilities: 1) interim production financing from various banks to finance the production of video content, 2) demand loans advanced to the Company by the Bank, 3) convertible debentures issued to the Company's majority shareholder, Fairfax, and 4) mortgages that were extinguished in June 2018 and November 2019. In 2019, interest expense was \$7.2 million compared to \$2.1 million in 2018. The increase reflects the increased borrowing in the form of the demand loan from the Bank to fund various acquisitions during 2018 and 2019 and the convertible debentures issued in September 2019 which incur non-cash interest. Refer to the section Liquidity and Capital Resources for a discussion on indebtedness.

Lease liabilities are initially recognized at the present value of future lease payments. The difference between the carrying values at initial recognition and the amounts to be paid at settlement dates is recognized in profit and loss over the term of the liability as accretion expense using the effective interest rate method. In 2019, accretion expense was \$1.7 million compared to \$0.5 million in the same period of 2018. The increase is related to the accretion the leases associated with the acquired businesses in 2018 and 2019.

Other gains and losses. The following table presents the breakdown of other gains and losses for the years ended December 31, 2019 and 2018:

	Year Ended December 31,				Increase (Decrease)
		2019		2018		Amount
				(Amounts in thousands)
Gain on sale of property	\$	(3,079)	\$	(2,792)	\$	(287)
Loss on loan modification		4,317		—		4,317
Share of equity investee income		(360)		(241)		(119)
Change in fair value of financial assets		(1,868)		(390)		(1,478)
Change in fair value of other financial liabilities		8,710		265		8,445
Change in fair value of contingent consideration		368		(824)		1,192
Other (gains) and losses	\$	8,088		\$ (3,982)		\$ 12,070

In 2019, the Company sold the land and building that was situated at 772 Dovercourt Road in Toronto, Canada. The gain recognized during 2019 was \$3.1 million. In 2018, the Company sold its 83% ownership in the land and building that was situated at 22 Sackville Street in Toronto, Canada. The gain recognized during 2018 was \$2.8 million.

The Company amended its existing demand loan facility with the Bank on December 31, 2019. The Company assessed the amendment in the context of IFRS 9, Financial Instruments ("IFRS 9") and concluded that it constituted a modification of debt, which resulted in a loss on modification of \$4.3 million recognized in 2019.

Share of income from equity-accounted investees is recognized when the Company owns a non-controlling interest in a third-party, exerts significant influence, and accounts for the investment using the equity method. Under the equity method, the investment in associates is carried on the consolidated statement of financial position at cost plus post-acquisition changes in the Company's share of income and other comprehensive income (OCI), less distributions of the investee. In the year ended December 31, 2019, income from equity-accounted investees was \$0.4 million compared to \$0.2 million in 2018.

Changes in the fair value of financial assets is comprised of mark-to-market adjustments on: 1) derivative conversion feature of convertible debentures (2019 - \$1.3 million, 2018 - \$nil) 2) foreign currency hedges (2019 - \$0.1 million, 2018 - \$nil) and 3) non-controlling investments in third-parties which do not meet significant influence thresholds (2019 - \$0.4 million, \$2018 - \$0.4 million

The fair value of financial liabilities is recalculated at each reporting date and gains and losses can result from changes in estimates, probabilities, foreign currency rates. In addition, where liabilities are recorded using the effective interest method, the fair value will change due to the time value of money. In 2019, changes in the fair value of financial liabilities were \$8.7 million compared to \$0.3 million in 2018. The loss in 2019 was mainly related to the fair value of the put option to acquire 49% of Untitled Entertainment which is denominated in U.S. dollars and is not puttable to the Company until 2024.

Frequently, a portion of the consideration for an acquired business is contingent on the acquired business achieving a predetermined milestone. Under IFRS, contingent consideration is measured at fair value at the date of acquisition and discounted to net present value to reflect the estimated amount and timing of future payments. Contingent consideration liabilities are remeasured at fair value at each reporting date and subsequent changes in the fair value are recognized on the statement of income. In 2019, changes in fair value due to the time value of money amount to an expense of \$1.1 million as compared to \$0.6 million in 2018. Additionally, in 2019, \$0.7 million of contingent consideration was reversed and in 2018, \$1.5 million was reversed. In these cases the sellers did not earn the consideration that had been estimated to be payable at the date of acquisition.

Income tax expense. Total income tax expense was \$1.1 million for 2019, an effective tax rate of 5.8% on the loss before taxes of \$18.4 million, as compared to \$4.1 million, or an effective tax rate of 29.5% on the income before taxes of \$13.8 million for 2018. The Company's statutory tax rate is 26.5% for each of these years. The significant difference in statutory rate in 2019 is due primarily to losses and other deductions in U.S. subsidiaries for which no tax benefit was recognized, amounting to \$4.5 million. Additionally, sharebased compensation and other non-deductible expenses amounted to \$2.2 million. These items were partially offset by the impact of lower tax rates in foreign jurisdictions.

Net income (loss) attributable to shareholders of the Company. Net loss attributable to shareholders of the Company for 2019 was \$23.7 million, compared to a net income attributable to shareholders of the Company of \$9.4 million in 2018, a decrease of \$33.1 million mainly driven by the in operating expenses due to the acquired businesses, as well as the increase in non-cash amortization expense of \$12.4 million, the increase in interest expense of \$5.8 million, and the recognition of the loss on modification of long-term debt of \$4.3 million.

Adjusted EBITDA.* Adjusted EBITDA for 2019 was \$32.5 million, an increase of \$0.5 million from \$32.0 million in 2018. Despite acquiring several businesses during these two years, Adjusted EBITDA remained relatively flat. Adjusted EBITDA for the period included \$4.4 million of costs incurred at Platform One Media and the franchise and brand management team with no comparative costs in 2018. The premium scripted dramas that are in production at Platform One Media are not expected to be delivered until 2021 and as a result, in 2019, the Company has recognized operating costs in Platform One Media with no offsetting revenue.

^*previously defined as a non-IFRS measure

Segment Results of Operations

The Company manages and reports operating results through three business segments that are described in detail below: Television, Kids and Family, and Representation.

Television

The following table presents the Television segment revenue and segment income for the years ended December 31, 2019 and 2018:

	December 31,	Year Ended			Increase (Decrease)
	2019		2018		Amount	Percent
Television Segment:				(Amounts in thousands)
Revenue
Production	\$ 69,697	\$	48,074	\$	21,623	45%
Distribution	26,959		28,656		(1,697)	-6%
Services	53,537		30,618		22,919	75%
Total revenue	\$ 150,193	\$	107,348	\$	42,845	40%
Expenses
Production, distribution and service	120,679		79,573		41,106	52%
General and administrative	21,220		9,717		11,503	118%
	\$ 141,899	\$	89,290	\$	52,609	59%
Segment profit	\$ 8,294	\$	18,058	\$	(9,764)	-54%

Revenue. Production revenue in 2019 increased 45% to \$69.7 million, an increase of \$21.6 million in comparison to production revenue in 2018 of \$48.1 million. During 2019, the Television segment delivered 14 video content titles. Productions included Killjoys (Season 5), Big Brother Canada (Season 6), The Amazing Race Canada (Season 7), MasterChef Canada (Season 6), Battle of the Blades (Season 5), and The Great Canadian Baking Show (Season 3). During the year ended December 31, 2018, the Company delivered 11 video content titles.

For 2019, the Company earned distribution revenue through its internal sales team as well as third-party distributors. The Company earns a significant amount of its distribution revenue twice per year in March and September from BBC Worldwide, the third-party distributor of the Company's very successful title, Orphan Black (Seasons 1 to 5).

Service revenue increased by 75%, an increase of \$22.9 million, from \$30.6 million in 2018 to \$53.5 million in 2019. During 2019, notable service productions included Disney Fam Jam (Season 1) for Disney, Dear ... (Season 1) for Apple TV +, and The Row, a documentary for Discovery.

Production, distribution and service expenses. During 2019, production, distribution and service expenses increased by \$41.1 million to \$120.7 million compared to \$79.6 million in 2018, driven by an increase in both productions delivered and services performed.

General and administrative expenses. General and administrative expenses increased by \$11.5 million due to the inclusion of full year expenses for Matador, Insight, and four months for Platform One Media. During 2019, the Company invested capital in distribution sales and incurred associated marketing expenses. While this increase in indirect expense had an impact on 2019, the Company expects future revenue and profit contributions to be generated from this upfront investment. Platform One Media general and administrative expenses were \$3.9 million in 2019.

Segment profit. Segment profit decreased by \$9.8 million in 2019 despite the increase in revenue. Platform One Media was consolidated into the Company's results from August 31, 2019 to December 31, 2019 but no revenue was recognized in that period as its premium scripted dramas were in production and preproduction. Therefore, the costs of Platform One Media had no corresponding revenue.

Kids and Family

The following table presents the Kids and Family segment revenue and segment profit for the years ended December 31, 2019 and 2018:

			Year Ended
	December 31,					Increase (Decrease)
		2019		2018		Amount	Percent
Kids and Family Segment:						(Amounts in thousands)
Revenue
Production	\$	2,915	\$	6,101	\$	(3,186)	(52%)
Distribution		12,510		10,373		2,137	21%
Services		42,630		36,202		6,428	18%
Total revenue	\$	58,055	\$	52,676	\$	5,379	10%
Expenses:
Production, distribution and service		34,712		29,753		4,959	17%
General and administrative		4,868		3,319		1,549	47%
	\$	39,580	\$	33,072	\$	6,508	20%
Segment profit	\$	18,475	\$	19,604	\$	(1,129)	-6%

Revenue. Kids and Family segment revenue is earned from production, distribution, and services. Production revenue in 2019 was recognized on delivery of two programs: Remy and Boo (Season 1) to Universal Kids, and Kingdom Force (Season 1) to CBC Kids. In 2018, Kids and Family also delivered two programs: Tee and Mo (Season 1) to TVOntario, and Ollie: The Boy Who Became What He Ate (Season 2) to CBC Kids.

Distribution revenue was recognized from The Next Step franchise (seasons 3 to 7) and Ollie: The Boy Who Became What He Ate (Seasons 1 and 2). Jam Filled Entertainment's animation studio continued service production on the following key projects: Loud House (Season 4) for Nickelodeon, Super Hero Girls (Season 1) for Warner Brothers, Thomas the Tank Engine (Seasons 23 and 24) for HIT Entertainment, Bubble Guppies (Season 5) for Nickelodeon, and Rusty Rivets (Season 3) for Spin Master.

Compared to 2018, the Kids and Family segment revenue increased by 10% or \$5.4 million in 2019, comprised of a \$6.4 million increase in service revenue and a decline of \$1.0 million production and distribution revenues.

Production, distribution and service expenses. Production, distribution and service expenses include amortization of the investment in video content, services expenses and distribution expenses. During the year ended December 31, 2019, total expenses increased by \$6.5 million to \$39.6 million compared to \$33.1 million for 2018.

Services expenses increased by \$4.0 million as the revenue and associated expenses are recognized on a percent of completion basis. The distribution expenses increased due to \$2.0 million of higher participation payments and partially offset by lower amortization from the investment in video content. In order to create, package and finance video content, third-parties may contribute IP, services, or financing, in exchange for which such individuals are entitled to, among other things, a contractual right to participate in future profits. The participation expense is recognized in the period that the distribution revenue is earned. Distribution costs are related to the preparation of video content for delivery to customers and include versioning, dubbing, and shipping expenses. While distribution revenue is recorded when the license period has started, the distribution costs are recognized as the services are rendered that can create variance year over year.

General and administrative expenses. General and administrative expenses increased by \$1.5 million. During 2019, the Company invested in distribution sales, a franchise and brand management team and associated marketing expenses. While this increased the indirect expense has a direct impact on the 2019 results, contributions to revenue and net income are expected in future periods. During 2019, the franchise and brand management team's general and administrative expenses were \$0.6 million.

Segment profit. Segment profit decreased by \$1.1 million despite the increase in revenue due to incremental participation payments and investments in sales resources and infrastructure.

Representation

On February 1, 2019, the Company acquired a controlling interest in Untitled Entertainment, a talent management business with operations in Los Angeles, CA and New York, NY. Results of the Representation segment include the post-acquisition period of 11 months. The table below presents the Representation segment revenue and segment profit for the years ended December 31, 2019 and 2018:

		Year Ended
	December 31,			Increase (Decrease)
	2019		2018	Amount	Percent
Representation Segment:			(Amounts in thousands)
Revenue
Representation	\$ 35,917	\$	4,821	\$ 31,096	645 %
Total revenue	35,917		4,821	31,096	645 %
Expenses:
Production, distribution and service	2,185		791	1,394	176 %
General and administrative	20,067		1,681	18,386	1094 %
	\$ 22,252	\$	2,472	\$ 19,780	800 %
Segment profit	\$ 13,665	\$	2,349	\$ 11,316	482 %

Revenue. The increase in Representation revenue was driven largely by the acquisition of Untitled Entertainment in February 2019, partially offset by a year over year decline in the commission earned from representation of third-party brands and IP. Total segment revenue increased by \$31.1 million from \$4.8 million in 2018 to \$35.9 million in 2019.

Expenses. Production, distribution and service costs in 2019 were \$2.2 million, an increase of \$1.4 million compared to 2018. The increase relates to higher costs associated with increased revenue from representing third-party brands and IP. General and administrative expenses in 2019 were \$20.1 million compared to \$1.7 million in 2018, an increase of \$18.4 million, mainly related to the acquisition of Untitled Entertainment in February 2019.

Segment profit. Segment profit increased to \$13.7 million in 2019, an increase of \$11.3 million from \$2.3 million in 2018, primarily driven by the acquisition of Untitled Entertainment and partially offset by a lower contribution from representation of third-party brands and IP.

Corporate and Shared Services

			Year Ended
		December 31,				Increase (Decrease)
		2019		2018		Amount	Percent
Corporate and Shared Services:	(Amounts in thousands)
Expenses:
General and administrative		23,665		21,024		2,641	13 %
	\$	23,665	\$	21,024	\$	2,641	36 %

The table below sets forth Corporate and Shared services for the years ended December 31, 2019 and 2018:

General and administrative expenses. General and administrative expenses comprise head-office charges including facilities, shared departments and corporate functions such as human resources, finance, business development, information technology, business and legal affairs and senior management. Expenses are concentrated in the Company's Toronto office, as our New York and Los Angeles locations and resources are included in the related segment results and not considered shared services. General and administrative expense categories also include travel and entertainment, professional fees and consulting, information technology and equipment leases, bank fees, advertising and promotions, and office and related facilities expenses.

The general and administrative expenses for 2019 increased as compared to 2018 due to an increase in headcount and related expenses, incentive compensation and professional fees.

Year ended December 31, 2018 compared to 2017

Boat Rocker acquired several businesses during the two years covered by the following analysis, and it is important to note the effect of the acquisitions on the results described below. The following chart summarizes the businesses acquired in 2017 and 2018 and the dates from which their results are included in the Company's results:

Acquired	Date of Acquisition	2018 Includes	2017 Includes
Certain assets comprising Proper Productions	September 21, 2017	12 months	3 months
Fremantle Kids and Family	January 24, 2018	11 months	No results
Insight Productions	May 17, 2018	7 months	No results
Matador Content	October 30, 2018	2 months	No results

The following table sets forth the consolidated results of operations for the years ended December 31, 2018 and 2017:

	Year Ended
	December 31,				Increase (Decrease)
	2018		2017			Amount	Percent
				(Amounts in thousands)
Revenue
Product revenue	\$	54,175	\$	67,597	\$	(13,422)	(20 %)
Distribution revenue		39,029		23,636		15,393	65 %
Service revenue		66,820		36,617		30,203	82 %
Representation revenue		4,821		1,200		3,621	302 %
Total revenue	\$	164,845	\$	129,050	\$	35,795	28 %
Expenses
Production, distribution and service		110,117		89,375		20,742	23 %
General and administrative		35,741		16,311		19,430	119 %
Amortization expense		6,562		2,713		3,849	142 %
Finance costs, net		2,580		1,225		1,355	111 %
Foreign exchange gains		(2)		(26)		24	(92 %)
Other gains and losses		(3,983)		(612)		(3,371)	551 %
Income before income taxes	\$	13,830	\$	20,064	\$	(6,234)	(31 %)
Income tax expenses		4,073		5,829		(1,756)	(30 %)
Net income	\$	9,757	\$	14,235	\$	(4,478)	(31 %)
Net income attributable to non-controlling interests	\$	397	\$	106	\$	291	275 %
Net income attributable to shareholders of the Company	\$	9,360	\$	14,129	\$	(4,769)	(34 %)
Other Financial Information
Adjusted EBITDA*	\$	32,014	\$	26,581	\$	5,433	20 %

*previously defined as a non-IFRS measure

Revenue. On January 1, 2018, the Company adopted IFRS 15, Revenue from Contracts with Customers ("IFRS 15"), which is based on the principle that revenue is recognized when control of a good or service is transferred to a customer. IFRS 15 supersedes IAS 18, Revenue and IAS 11, Construction Contracts. The Company adopted IFRS 15 using the modified retrospective approach applied to those contracts that were not completed as at January 1, 2018. There was no impact to opening retained earnings at January 1, 2018 from initially applying IFRS 15. Results for reporting periods beginning after January 1, 2018 are presented under IFRS 15, while prior period amounts have not been restated and continue to be reported under the accounting standards in effect for those periods.

Under IFRS 15, where the Company is acting as a principal in the distribution of content produced by a third-party, the revenue is recognized as the gross amount received. The adoption of IFRS 15 did not have a significant impact on the Company's consolidated financial statements. The impact to the Company's consolidated statement of income for the initial adoption period of 2018 was an increase in revenue of \$0.3 million and an increase in production, distribution and service expenses by \$0.3 million in 2018.

Revenue was \$164.8 million in 2018 compared to \$129.1 million in 2017, an increase of \$35.8 million or 28%. Production revenue was \$54.2 million in 2018 compared to \$67.6 million in 2017, a decrease of \$13.4 million resulting from the delivery of 1 scripted drama in 2018 in contrast to 3 delivered in 2017. In total, the Company delivered 14 productions during 2018 and 12 during 2017. In 2018, distribution revenue was \$39.0 million compared to \$23.6 million in 2017. Season 5 of Orphan Black was available to be distributed outside of Canada in late 2017 and during 2018 our third-party distributor of this title, BBC Worldwide began to report and remit the increased distribution revenue to the Company, resulting in this increase. Service revenue increased by \$30.2 million in 2018 compared to 2017 related to the inclusion of Matador from its acquisition on October 30, 2018.

Production, distribution and service expenses. Production, distribution and service costs were \$110.1 million in 2018, an increase of 23% from \$89.4 million in 2017. The increase relates to the increased revenues from the businesses acquired during 2018.

General and administrative expenses. General and administrative expenses were \$35.7 million in 2018 compared to \$16.3 million in 2017, an increase of \$19.4 million or 119%. The acquired business added headcount, facilities and related costs, causing the increase in general and administrative expenses between the two periods. Share-based compensation expense increased to \$3.3 million in 2018 from \$0.2 million in 2017 related to restricted share units that were granted in 2018. Transaction costs related to external legal and accounting support for the acquisitions increased by \$3.2 million, from \$5.6 million in 2018 to \$2.4 million in 2017.

	Year Ended		Increase
	December 31,		(Decrease)
	2018	2017	Amount
		(Amounts in thousands)
Amortization of property and equipment	3,477	2,713	764
Amortization of right-of-use assets	2,308	—	2,308
Amortization of other intangible assets	777	—	777
Amortization expense	6,562	2,713	3,849

On January 1, 2018, the Company adopted IFRS 16, Leases ("IFRS 16"), permitted as an early adoption option along with IFRS 15. IFRS 16 provides a comprehensive model for the measurement, presentation and disclosure of leases and supersedes IAS 17, Leases. The Company used the cumulative catch-up approach where it has recorded leases from the date of adoption forward and has not restated comparative information. The Company recorded right-of-use assets and lease liabilities of \$4,645 as at January 1, 2018. No adjustment was required to retained earnings on January 1, 2018 as a result of adoption. This adoption led to the recognition of amortization of right-of-use assets in 2018 with no comparable expense in 2017.

Other intangible assets are recognized at fair value on the date of acquisition of a business and include trademarks, non-compete agreements and talent relationships. These other intangible assets are amortized on a straight-line basis between five and ten years. Intangible assets were recognized in the Matador acquisition in October 2018, leading to the increase in amortization in 2018 compared to 2017.

Finance costs, net. The following table presents the breakdown of net finance costs for the years ended December 31, 2018 and 2017:

		Year Ended December 31,		Increase (Decrease)
	2018 2017				Amount
			(Amounts in thousands)
Interest income	\$	(32)		\$ (140)	\$	108
Interest expense		2,109		1,365		744
Accretion expense - leases		503		—		503
Finance costs, net	\$ 2,580 1,225

Interest expense in 2018 and 2017 was incurred on the following liabilities: 1) interim production financing from various banks to finance the production of content, 2) demand loans advanced to the Company by the Bank, and 3) mortgages for land and buildings, one of which was acquired in September 2017 and the second which was sold in June 2018, resulting in the extinguishment of the mortgage. In 2018, interest expense was \$2.1 million compared to \$1.4 million in 2017. Refer to the section Liquidity and Capital Resources for a discussion on indebtedness.

In 2018, accretion expense on lease liabilities was \$0.5 million compared to \$nil million in the same period of 2017. On January 1, 2018, the Company adopted IFRS 16, leading to an increase in accretion expense of \$0.5 million calculated on the lease liabilities.

Other gains and losses. The following table presents the breakdown of other gains and losses for the years ended December 31, 2018 and 2017:

		Year Ended December 31,			Increase (Decrease)
	2018 2017				Amount
	(Amounts in thousands)
Gain on sale of property		(2,792)		—		(2,792)
Share of equity investee income		(242)		(387)		145
Change in fair value of financial assets		(390)		—		(390)
Change in fair value of other financial liabilities		265		—		265
Change in fair value of contingent consideration	(824) (225)				(599)
Other gains and losses	\$	(3,983)	\$	(612)		\$ (3,371)

Share of income from equity-accounted investees is recognized when the Company owns a non-controlling interest in a third-party, exerts significant influence, and accounts for the investment using the equity method. Under the equity method, the investment in associates is carried on the consolidated statement of financial position at cost plus post-acquisition changes in the Company's share of income and other comprehensive income (OCI), less distributions of the investee. In the year ended December 31, 2018, income from equity-accounted investees was \$nil compared to \$0.4 million in 2017.

The Company recognized a gain of \$0.4 million from the movement in the fair value of financial assets which is comprised of mark-to-market adjustments on non-controlling investments in third- parties which do not meet significant influence thresholds. On January 1, 2018, the Company adopted IFRS 9, Financial Instruments ("IFRS 9"), which addresses the classification, measurement and derecognition of financial assets and financial liabilities, introduces new rules for hedge accounting and a new impairment model for financial assets. In accordance with the transitional provisions in IFRS 9, the Company adopted IFRS 9 on a modified retrospective basis and therefore comparative figures have not been restated. Financial assets classified as Loans and Receivables under IAS 39 that were measured at amortized cost continue to be measured at amortized cost under IFRS 9. Investment in equity instruments that were accounted for at cost have been classified as either fair value through other comprehensive income ("FVOCI") or fair value through profit and loss ("FVTPL"), pursuant to the irrevocable election available in IFRS 9. Under IFRS 9, if accounted for as FVOCI, all realized and unrealized gains and losses are recognized permanently in OCI with no reclassification to profit or loss. If accounted for as FVTPL, all realized and unrealized gains and losses are recognized in profit or loss.

Frequently, a portion of the consideration for an acquired business is contingent on the acquired business achieving a predetermined milestone. Under IFRS, contingent consideration is measured at fair value at the date of acquisition and discounted to net present value to reflect the estimated amount and timing of future payments. Contingent consideration liabilities are remeasured at fair value at each reporting date and subsequent changes in the fair value are recognized on the statement of income. In 2018, \$1.5 million of contingent consideration was reversed and, in 2017, \$0.2 million was reversed. In these cases the sellers did not earn the consideration that had been estimated to be payable at the date of acquisition. In addition, in 2018 an expense of \$0.6 million was recorded for the fair value movement representing the time value of money for the contingent consideration liabilities (2017- \$nil).

In 2018, the Company sold its 83% ownership in the land and building that was situated at 22 Sackville Street in Toronto, Canada. The gain recognized during 2018 was \$2.8 million.

Income tax expense. Total income tax expense was \$4.1 million for 2018, an effective tax rate of 29.5% on the income before taxes of \$13.8 million, as compared to \$5.8 million, or an effective tax rate of 29.1% on the income before taxes of \$20.1 million for 2017. The Company's statutory tax rate is 26.5% for each of these years. The difference in tax expense from the statutory rate in each year is due primarily to sharebased compensation and other non-deductible expenses creating difference in the effective tax rate of \$0.9 million in 2018 and \$0.3 million in 2017.

Net income attributable to shareholders of the Company. Net income attributable to shareholders of the Company for 2018 was \$9.4 million, compared to \$14.1 million in 2017, a decrease of \$4.8 million mainly driven by the higher general and administrative expenses as a result of the acquired businesses as described above, as well as due the increase in non-cash amortization expense of \$3.8 million, and the increase in interest expense of \$1.4 million, offset by the other gains of \$3.4 million.

Adjusted EBITDA.* Adjusted EBITDA for 2018 was \$32.0 million, an increase of \$5.4 million from \$26.6 million in 2017. Refer to Reconciliation Tables - Adjusted EBITDA for the calculation of Adjusted EBITDA.

*previously defined as a non-IFRS measure

Quarterly Information

The following table presents the revenue, net (loss) income, basic EPS, and diluted EPS by quarter for 2018, 2019 and three quarters of 2020:

	Revenue	Net (loss) income				Diluted EPS
2020
Q3	78,009	(22,990)	\$	(1.56)		\$ (1.56)
Q2	51,003	(6,622)	\$	(0.45)		\$ (0.45)
Q1	42,177	(13,932)	\$	(0.95)		\$ (0.95)
2019
Q4	59,434	(6,206)	\$	(0.48)		\$ (0.48)
Q31	51,001	(9,613)	\$	(0.70)		\$ (0.70)
Q2	54,212	(3,498)	\$	(0.33)		\$ (0.33)
Q12	79,517	(168)	\$	(0.10)		\$ (0.10)
2018
Q43	62,651	3,167	\$	0.16	\$	0.16
Q3	54,298	1,054	\$	0.08	\$	0.07
Q24	20,456	(32)	\$	0.01	\$	0.01
Q15	27,441	5,568	\$	0.37	\$	0.37

The acquisitions of the International Kids and Family Acquisition, Insight Productions, Matador Content, Untitled Entertainment, and Platform One Media, as previously described, have had a significant impact on the comparability of the quarterly financial information.
In the normal course, Boat Rocker's results vary on a quarterly basis due to 1) the number of shows delivered, 2) the timing of deliveries, 3) the size of budgets and related revenue of productions, and 4) licence period start dates contracted with buyers and distributors.
The Company is also reliant on the broadcasters/OTT's budget and financing cycles and at times the licence periods may be delayed and commence at a date later than originally anticipated.
In 2020, the impact of COVID-19 on production has affected revenue recognition and consequently net income (loss) in a manner that further prevents comparability of quarterly results to prior periods.
Readers of the MD&A, the interim financial statements, and annual financial statements are cautioned about extrapolating the results for the quarterly results above, into future quarterly or annual expectations.

¹ During Q3 2019, the Company acquired Platform One Media.

² During Q1 2019, the Company acquired Untitled Entertainment.

³ During Q4 2018, the Company acquired Matador Content.

⁴ During Q2 2018, the Company acquired Insight.

⁵ During Q1 2018, the Company acquired the International Kids and Family Acquisition.

LIQUIDITY AND CAPITAL RESOURCES

Cash

The majority of the Company's cash is held in three main currencies: Canadian dollars, U.S. dollars, and British pounds. The Company's treasury function is actively managed in order to seek to limit gains and losses that may arise on exchanging cash balances between currencies. The Company periodically enters into foreign exchange contracts to manage its foreign exchange risk, in particular for productions that are budgeted to incur costs in foreign currencies. These contracts are considered financial instruments under IFRS 9 and are recognized on the statement of financial position as financial assets or liabilities. Changes in the fair value of the foreign exchange contracts are recognized on the statement of loss or income in movement in fair value of financial assets.

The following table presents the breakdown of cash and cash equivalents as at September 30, 2020, December 31, 2019, and December 31, 2018:

		As at	Increase (Decrease)
				Sept 30, 2020 vs	Dec 31, 2019 vs
	Sept 30, 2020	Dec 31, 2019	Dec 31, 2018	Dec 31, 2019	Dec 31, 2018
	(Amounts in thousands)
Cash available for use *	27,132	29,186	17,283	(2,054)	11,903
Cash required for use in productions *	48,421	30,082	38,133	18,339	(8,051)
Total cash and cash equivalents	75,553	59,268	55,416	16,285	3,852

Certain cash is required for the funding of productions in progress and is not available for other uses. This cash has been provided by buyers and third-party IP owners that have engaged the Company to provide services, as well as banks with whom Boat Rocker has contracted to provide interim production financing. The increase in cash required for use in productions between December 31, 2019 and September 30, 2020 of \$18.3 million is primarily related to the cash balance maintained by a premium scripted drama which is currently in production. This production has a large budget and includes several global shoot locations. The decrease in cash required for use in production between December 31, 2018 and December 31, 2019 of \$8.1 million is related to the timing of certain service productions.

Cash available for use funds ongoing working capital requirements, principal and interest payments on the corporate demand loans as well as ongoing development and growth efforts. The Company did not declare or pay dividends to controlling shareholders during the nine months ended September 30, 2020, nor the year ended December 31, 2019. During the year ended December 31, 2018, the Company paid dividends of \$2.7 million to common shareholders which represented net cash proceeds from the sale of a building in June 2018.

^*previously defined as a non-IFRS measure

Indebtedness

The following table presents the Company's net debt as at September 30, 2020 and December 31, 2019 and 2018:

		As at		Increase (Decrease)
		Dec 31, 2019	Dec 31, 2018	Sept 30, 2020 vs	Dec 31, 2019 vs
	Sep 30, 2020 99,481 33,844 419 (2,821) (27,132) 103,791			Dec 31, 2019	Dec 31, 2018
		(Amounts in thousands)
Loans and borrowings, excluding interim
financing		87,869	47,432	11,612	40,437
Lease liabilities		29,626	27,583	4,218	2,043
Plus: Loan fees, net of amortization		1,305	—	(886)	1,305
Less: Loan modification		(4,317)	—	1,496	(4,317)
Less: Cash available for use*		(29,186)	(17,283)	2,054	(11,903)
Net debt*		85,297	57,732	18,494	27,565

*previously defined as a non-IFRS measure

The Company has a bi-lateral financing arrangement with the Bank for several facilities under a demand loan structure. The Company has drawn on the demand loan facilities to pay the cash consideration for various acquisitions during 2018 and 2019. Of the total, at September 30, 2020, \$32.7 million was drawn in Canadian dollars (as at December 31, 2019 - \$20.4 million, 2018 - \$29.7 million) and \$64.9 million was drawn in U.S. dollars (as at December 31, 2019 - \$63.1 million, 2018 - \$17.7 million).

The fair value of loans and borrowings differs from its carrying value due to the non-cash impacts of capitalized loan fees net of amortization and the impact of loan modification in 2019 and 2020. Boat Rocker identifies interim production financing to be short-term in nature as it typically has a maturity of less than two years and is repaid upon collection of the associated third-party funding. As such, management excludes interim production financing from its calculation of net debt. The Company does not include other liabilities in the net debt calculation such as: convertible debentures and other financial liabilities that are based on estimates and probabilities, rather than specific amounts owing.

The Company enters into leases in the normal course of business to secure office space and IT equipment in the various countries in which it operates. On January 1, 2018, the Company adopted IFRS 16 which resulted in the recognition of right of-use-assets and lease liabilities on the statement of financial position.

The following table presents the Company's interim production financing as at September 30, 2020, December 31, 2019 and 2018:

		As at		Increase (Decrease)
	Sep 30, 2020	Dec 31, 2019	Dec 31, 2018	Sept 30, 2020 vs Dec 31, 2019	Dec 31, 2019 vs Dec 31, 2018
		(Amounts in thousands)
Interim production financing	128,975	110,177	61,312	18,798	48,865

Boat Rocker's production funding model is unique to each show and consists of various sources of thirdparty funding. These third-party funding sources include contracted domestic license fees (i.e. pre-sale of initial Canadian broadcast rights to linear channels or OTT platforms), advances from international buyers (i.e. foreign OTT platforms, linear channels or third-party distributors who acquire certain geographic or global rights), and federal or provincial tax credits, grants and other domestic funding sources available to Boat Rocker. Due to timing differences between inflow of the third-party financing sources and required outflows to fund the production budget, interim production financing is required. When the third-party funding for the project is confirmed, these sources are pledged to a bank or other industry lender to secure an interim production financing loan. The pledges which generally include financing commitments from large OTT platforms, linear channels and governmental bodies are used to repay the interim production financing as each third-party financing source is collected by the Company. The timing of the collection of these funds can sometimes occur well after a production is completed, which is often the case for federal, provincial, and state tax credits, which may only be received 6 to 18 months after the end of the production company's fiscal year.

Boat Rocker incorporates a new single purpose entity for each of its productions, including for each new season of an existing series, in order to manage the budget and cash flow of its productions. For Canadian productions, the interim production financing is arranged on an individual production basis at the single purpose entity level which are excluded from the security of Boat Rocker's corporate credit facility. This structure enables the Company to limit liability, monitor production costs and to manage financing and future revenue streams associated with each production. The single purpose entity is amalgamated as the interim production financing is repaid. As at September 30, 2020, the aggregate amount outstanding for Canadian productions was \$62.5 million (December 31, 2019 - \$78.7 million, December 31, 2018 - \$61.3 million).

Subsidiaries of Platform One Media are party to a U.S.\$100.0 million senior secured five-year revolving credit facility with a major U.S. bank in connection with the interim financing of certain scripted programming produced by the Company in the U.S. ("U.S. Scripted Production Facility"). The borrower under the U.S. Scripted Production Facility is a direct subsidiary of Platform One Media and the subsidiaries of the borrower are guarantors of the facility. The U.S. Scripted Production Facility is not guaranteed by Platform One Media or the Company. As at September 30, 2020, the aggregate amount outstanding under the U.S. Scripted Production Facility was \$66.5 million (December 31, 2019 - \$31.5 million, December 31, 2018 - \$nil). The subsidiaries of the Company who are party to the U.S. Scripted Production Facility are in compliance with all covenants contained in the U.S. Scripted Production Facility.

The following table presents the Company's convertible debenture as at September 30, 2020, December 31, 2019 and 2018:

		As at		Increase (Decrease)
	Sep 30, 2020	Dec 31, 2019	Dec 31, 2018	Sept 30, 2020 vs Dec 31, 2019	Dec 31, 2019 vs Dec 31, 2018
		(Amounts in thousands)
Convertible debentures	22,429	18,618	—	3,811	18,618

In September 2019, the Company issued U.S.\$15.0 million of secured, subordinated convertible debentures to its controlling shareholder Fairfax. The debentures bear interest at 8% per annum from issuance date until December 31, 2019 and 12% per annum thereafter. The debentures are convertible into common shares at the discretion of Fairfax at a rate of \$10.33 for each U.S.\$1.00 of unpaid principal and interest outstanding at time of conversion. Under the current arrangement, the debentures are expected to convert to series A non-voting common shares on the earlier of an initial public offering and January 1, 2021.

The following table presents the Company's other financial liabilities as at September 30, 2020, December 31, 2019 and 2018:

		As at	Increase (Decrease)
	Sep 30, 2020	Dec 31, 2019	Dec 31, 2018	Sept 30, 2020 vs Dec 31, 2019	Dec 31, 2019 vs Dec 31, 2018
		(Amounts in thousands)
Other financial liabilities	61,528	68,380	45,919	(6,852)	22,461

Other financial liabilities at September 30, 2020 are comprised of \$38.9 million of put option liabilities stemming from the Untitled Entertainment and Insight acquisitions (December 31 2019 - \$33.5 million, December 31, 2018 - \$3.7 million), and \$22.6 million of non-contingent liabilities arising from the acquisitions of Matador and Platform One Media (December 31, 2019 - \$34.9 million, December 31, 2018 - \$42.3 million).

Cash Flows

The following table summarizes the cash flows in the nine months ended September 30, 2020 and 2019:

	Nine months ended September 30	Increase (Decrease)
	2020	2019		Amount

Cash provided by (used in) operating activities	(3,417)	13,409		(16,826)
Cash provided by (used in) financing activities	21,031	80,113		(59,082)
Cash provided by (used in) investing activities	(1,056)	(61,261)		60,205
Foreign exchange on cash held in foreign currency	(273)	612		(885)
Increase (decrease) in cash and cash equivalents	\$ 16,285	\$ 32,873	\$	(16,588)

The Company produces video content, the majority of which is fully funded from external cash sources prior to starting production. The license fees from the buyer plus the film and television tax credits from federal, provincial, and state government agencies comprise the cash inflows that equal the expenses of the production budget. The cash inflows from license fees and tax credits do not match the timing of cash outflows on production expenses and the Company enters into interim production financing arrangements with banks to borrow the necessary funds to bridge this timing difference. The cash movements of accounts receivables, tax credits receivable, deferred revenue, production expenses and accounts payable are classified as operations activities. Interim production financing cash movements, however, are classified as financing activities. In any given period, the difference in classification can lead to a use of cash from operations and a source of cash from financing that in aggregate more accurately reflect the cash flows of the production of video content.

Cash flow from operating activities for the nine months ended September 30, 2020 was a use of cash of \$3.4 million compared to a source of cash of \$13.4 million in the same period of 2019, a variance of \$16.8 million. The net loss in the nine months ended September 30, 2020 of \$43.5 million, after adjusting for the non-cash items, led to a cash source of \$49.8 million. The net loss of \$13.3 million in the same period of 2019 with non-cash items added back was a cash source of \$68.4 million, \$18.6 million higher than in 2020. For the nine months ended September 30, 2020, cash from operations used for the purchase of investment in content was \$123.3 million, or \$74.8 million higher than the comparative 2019 period of \$48.5 million. This higher cash outflow in 2020 was offset by \$77.2 million more cash inflow resulting from changes in other non-cash balances, primarily driven by an increase in deferred revenue in 2020.

Cash flow from financing activities for the nine months ended September 30, 2020 was a source of cash of \$21.0 million compared to \$80.1 million in the same period in 2019, a variance of \$59.1 million. The variance is comprised of a net \$36.0 million draw from the Company's demand loan facility in 2019, the issuance of preferred shares of \$20.1 million, the issuance of convertible debentures of \$20.0 million (U.S.\$15 million), partially offset by an increase of \$16.8 million in net proceeds from production financing.

Cash flow from investing activities for the nine months ended September 30, 2020 was a use of cash of \$1.1 million compared to \$61.3 million in the same period of 2019, a variance of \$60.2 million. Cash payments for acquisitions and contingent consideration used \$54.9 million in 2019 compared to \$1.6 million in 2020, a variance of \$53.3 million. In addition, expenditures on property and equipment were \$6.0 million in 2019 compared to \$1.0 million in 2020, a variance of \$5.0 million.

	Year ended December 31,		Increase (Decrease)
	2019	2018		Amount
		(Amounts in thousands)
Cash (used in) provided by operating activities	\$ (33,780)	\$ 7,393	\$	(41,173)
Cash provided by financing activities	112,352	36,914		75,438
Cash used in investing activities	(75,067)	(7,323)		(67,744)
Foreign exchange on cash held in foreign currency	347	(230)		577
Increase in cash	\$ 3,852	\$ 36,754	\$	(32,902)

The following table summarizes the cash flows in the years ended December 31, 2019 and 2018:

Cash flow from operating activities for the year ended December 31, 2019 was a use of cash of \$33.8 million compared to a source of cash of \$7.4 million in 2018, a variance of \$41.2 million. The variance can be explained by additions to investment in content that represent production costs net of film and television tax credits receivable. Investment in content additions increased by \$42.9 million from \$49.7 million in 2018 to \$92.6 million in 2019. This increase is mainly related to the production of two premium scripted dramas.

Cash flow from financing activities for the year ended December 31, 2019 was a source of cash of \$112.4 million compared to \$36.9 million in 2018, a variance of \$75.4 million. The variance is comprised of \$41.6 million of net draws from production financing that relate to the increase in investment in content additions described above. Additionally, the Company issued preferred shares for \$20.1 million during 2019 and convertible debentures of \$20.0 million (U.S.\$15 million).

Cash flow from investing activities for the year ended December 31, 2019 used \$75.1 million compared to \$7.3 million in 2018, a variance of \$67.7 million. Cash payments for acquisitions and contingent consideration used \$83.1 million in 2019 compared to \$10.3 million in 2018, a variance of \$72.8 million. In 2019, Boat Rocker sold its ownership in the land and building located at 772 Dovercourt Road, Toronto, Canada for proceeds of \$15.0 million while in 2018, Boat Rocker sold its ownership in the land and building located at 22 Sackville Road, Toronto, Canada for proceeds of \$6.2 million.

Free Cash Flow

Free cash flow is a non-IFRS measure. Several types of cash flows are excluded from cash provided by operating activities that management believes add value to evaluating the ability of the business to generate cash flows. In particular, interim production financing is crucial to the funding of productions and has been included in the calculation of free cash flow. Similarly, repayment of lease liabilities and distributions made to non-controlling shareholders have also been included.

The following table presents the reconciliation from cash provided by (used in) operating activities to free cash flow for the three and nine months ended September 30, 2020, the comparative periods of 2019, as well as the years ended December 31, 2019, 2018 and 2017:

	9 months
				9 months		12 months		12 months		12 months
		Sep 30, 2020	Sep 30, 2019		Dec 31, 2019		Dec 31, 2018		Dec 31, 2017
Cash provided by (used in) operating activities	\$	(3,417)	\$	13,409	\$	(33,780)	\$	7,393	\$	22,010
Proceeds from interim production financing		103,418		33,269		83,145		45,131	\$	43,122
Repayments from interim production financing		(85,086)		(31,790)		(34,280)		(37,906)		\$ (56,418)
Repayment of lease liabilities		(5,895)		(5,222)		(7,415)		(2,265)	\$	—
Distribution to non-controlling interest
shareholders		(1,989)		(3,529)		(5,330)		—	\$	—
Free Cash Flow*	\$	7,031	\$	6,137	\$	2,340	\$	12,353	\$	8,714

*previously defined as a non-IFRS measure

Recent Related Party Transactions

On November 16, 2020, the Company amended the convertible debentures issued to Fairfax such that the conversion ratio for the debenture is based on a price per share of \$10.33 and the maturity date is the earlier of the closing of an initial public offering and January 1, 2021.

On November 17, 2020, the Company issued \$7.1 million of notes receivable to certain shareholders. On November 18, 2020, the Company issued 686,091 series A non-voting common shares to the same shareholders in exchange for \$7.1 million of cash. The notes receivable are non-interest bearing and are due on the earlier of an initial public offering and January 1, 2021.

On November 17, 2020, the Company sold its investment in The Old Telegram Building Inc. to certain shareholders in exchange for notes receivable of \$1.4 million. The notes receivable are non-interest bearing and are due on the earlier of an initial public offering and January 1, 2021.

On December 1, 2020, the Company issued a secured, subordinated convertible debenture for \$25.0 million to Fairfax. The debenture bears interest at 8% per annum. The debenture matures on March 31, 2022. Fairfax may elect to convert the debenture into common shares at its discretion at any time, and must convert on the closing of an initial public offering of the Company. The applicable number of shares the amount outstanding would be converted into is based on a conversion ratio agreed to between the Company and Fairfax.

Liquidity and Capital Resources

The Company's objectives when managing capital are to continue as a going concern, provide an adequate return to shareholders, safeguard its assets, and maintain a competitive cost structure in order to pursue the development, production, distribution and licensing of its content. To facilitate the management of its capital structure, the Company prepares annual operating budgets that are updated as necessary depending on various factors including industry conditions and operating cash flows. The annual and updated budgets are reviewed by the Board of Directors.

The Company has undrawn revolvers of \$5.0 million as at September 30, 2020 that can be drawn to fund working capital as needed.

The Company manages liquidity by forecasting and monitoring operating cash flows and through the use of interim production financing. As at September 30, 2020, the Company had cash of \$75.6 million (December 31, 2019 – \$59.3 million). The Company maintains appropriate cash balances and has access to financial facilities to manage fluctuating cash flows. In addition, although the Company was in breach of its covenant on its loans and borrowings as at September 30, 2020, it has sufficient funds from operations as well as committed financing from its controlling shareholder, Fairfax, to fulfill its ongoing financial obligations.

The Company has a significant working capital deficiency of \$296.1 million at September 30, 2020 (December 31, 2019 - \$178.1 million). Certain liabilities that are classified as current, including amounts within interim production financing and loans and borrowings, are not expected to be settled within the next twelve months. Furthermore, management notes that the current portion of deferred revenue of \$120.5 million at September 30, 2020 (December 31, 2019 - \$41.4 million) relates mainly to production contracts in progress where the cash toward fulfilling the obligation has already been expended.

The Company has no significant commitments for capital expenditures as at September 30, 2020. Any expenditures not yet committed are in the normal course of business for items such as computer equipment and leasehold improvements, and are expected to be funded through cash generated from operations and credit facilities as required.

The following table discloses the Company's undiscounted financial obligations and commitments to be settled over the remainder of the current fiscal year and the following five years:

							2025 and
	Total	2020	2021	2022	2023	2024	after
	\$	\$	\$	\$	\$	\$	\$
Accounts payable and accrued liabilities (1)	54,325	38,503	15,822	—	—	—	—
Interim production financing (2)	128,975	34,781	28,543	65,651	—	—	—
Contingent consideration (3)	16,227	—	15,915	—	—	—	312
Loans and borrowings (4)	99,481	2,469	9,874	9,874	14,479	62,785	—
Convertible debentures (5)	22,429	—	22,429	—	—	—	—
Lease liabilities (6)	33,844	1,955	7,818	7,155	5,825	4,806	6,285
Other financial liabilities (7)	61,528	—	11,754	—	—	49,774	—
Production commitments (8)	10,024	3,706	3,579	2,739	—	—	—
	426,833	81,414	115,734	85,419	20,304	117,365	6,597

(1) Accounts payable and accrued liabilities are all current in nature. Accrued liabilities include interest on interim production financing as well as accrued participation costs.
(2) Interim production financing is classified as current due to being repayable on demand. Principal balance is settled at the time the license fees and film and television tax credits associated with the production are received which can be between 6 to 24 months from the date of the production's completion.
(3) Contingent consideration represents amounts arising from the acquisitions of Platform One, Untitled and Insight, the majority of which is expected to be settled through the issuance of equity.
(4) Loans and borrowings are comprised on the Company's demand loans, which are subject to scheduled principal repayments.
(5) Convertible debentures are expected to be settled through the issuance of equity.
(6) Lease liabilities represent the obligation to make payments on various property and facility rentals, as well as equipment rentals. Individual leases vary in term.
(7) Other financial liabilities consist of put options, a provision for the cash settlement of an acquisition liability related to Platform One, and a provision for the issuance of shares related to the acquisition of Matador.
(8) Production commitments arise from contracts with third-party producers whereby the Company commits to funding the production of content through a distribution advance that may be payable in installments over the production term, contingent on completion of certain milestones

The productions that will be greenlit and produced in a particular period;
The financing plan of each production;
The timing of the production period and the cash outflows of production spend;
The timing of collection of the associated accounts receivable and production tax credits receivable; and
The ability to draw on interim production financing to bridge the timing difference between production cash inflows and outflows.

Subsequent to September 30, 2020, the Company has formally approved the budget for 2021 and the forecast for 2022 which supports management's strategy to meet the Company's financial obligations as they come due, maintain liquidity, and improve the working capital position. In addition, on December 1, 2020, the Company issued a secured, subordinated convertible debenture for \$25.0 million to an entity owned and controlled by the controlling shareholder, Fairfax. On February 1, 2021, the Company issued a further secured, subordinated convertible debenture for \$15.0 million to the same Fairfax entity. These debentures allow for further advances of \$35.0 million to be made in 2021 (refer to Note 28). Management cannot make assurances that the assumptions used to estimate our liquidity requirements may not change because while it is management's intention to execute on its budget, the future impact of COVID-19 on the business is uncertain. Failure to execute the Company's business plan due to future shutdowns as a result of COVID-19 could have a material impact on these assumptions and judgements.

Based on the actions and assumptions described above, management has concluded that the 2021 budget and 2022 forecast can be effectively implemented. There are several investments, capex and growth initiatives in the business plan that can be altered or halted to increase cash inflows or reduce cash outflows in the event this is required, including but not limited to cost reductions, limiting external development expenditure, marketing spend and ownership of certain intellectual property. This, combined with the Company's ability to utilize the proceeds from the convertible debenture issuance described above, will in management's view allow the Company sufficient liquidity to satisfy its obligations for at least but not limited to, the next twelve months, while improving its working capital position moving forward. Accordingly, management has concluded that there are no material uncertainties that may cast significant doubt about the Company's ability to continue as a going concern.

Outstanding equity instruments

As of February 17, 2021, the following equity instruments are outstanding:

	Outstanding

Voting common shares	14,705,950
Series A non-voting common shares	2,816,400
Series B non-voting common shares	498,815
Series D non-voting common shares	418,739
Class C preferred shares	1,483,887
Stock options	1,281,355
Restricted share units	313,800

The weighted average exercise price of the stock options outstanding is \$12.23.

CRITICAL ACCOUNTING POLICIES, ESTIMATES AND JUDGEMENTS

For a summary of all of the Company's accounting policies, including the accounting policies discussed below, see Note 3 to Boat Rocker's annual financial statements.

The most significant estimates and judgments made by management in the preparation of the Company's consolidated financial statements are included in the following accounting policies, as described in further detail along with the accompanying policies below:

Revenue recognition
Amortization of investment in content
Impairment of goodwill and long-lived assets
Business combinations
Production tax credits
Fair value measurement of financial assets

The significant assumptions that affect these estimates and judgments in the application of accounting policies are noted throughout the Company's consolidated financial statements.

Revenue recognition

The Company earns four types of revenue. The first type of revenue is production revenue which is earned when content is licensed by a buyer who greenlights a project. This is called a pre-sale as the contract is executed prior to the commencement of Boat Rocker producing the content. The IP is owned by the Company and the agreement with the buyer specifies the territory and time period in which the video content can be broadcast.

Once greenlit, whether the content is completed or not, the Company can generate the second type of revenue: distribution revenue. The rights to broadcast Boat Rocker's content is granted to other buyers around the world for a specified time period. Boat Rocker Rights, the Company's internal sales team, has relationships with global buyers which are targeted based on the buyers' demand for scripted, unscripted, and kids and family genre content. Prior to the formation of Boat Rocker Rights, the Company engaged a third-party distributor to sell certain content, who distribute several of the Company's productions including Orphan Black (Seasons 1 to 5) and The Next Step (Seasons 1 to 5).

In both the first and second types, revenue is recognized when the following five criteria have been met:

the production has been completed;
the customer has access to the content;
the amount of revenue can be measured reliably;
the collectability of proceeds is probable; and
the license period associated with the contract has started.

The third type of revenue is the performance of services, both live action and animation, to facilitate production of content owned by third-parties. Progress of the contract is measured based on the proportion of costs incurred in the current period as a percentage of total expected costs. This percentage is applied to the total revenue of the service agreement to calculate the amount of revenue recognized in the current period. While live action service production can take between a month and a year, animation service generally takes a year to two years to produce the content.

Representation is the fourth type of revenue. The performance obligations pertaining to the Company's talent management services included in representation revenue are to provide various services for clients, which generally include representing, supporting and advocating for clients in the sourcing and negotiating of, and performance under client engagements with third-parties. This representation revenue is earned based on a predetermined percentage of a client's earnings. The performance obligations pertaining to services provided to third-party IP owners included in representation revenue typically end in with the Company negotiating a licensing arrangement for the use of the IP, on which the Company earns a prenegotiated commission from its client.

Under IFRS 15, representation revenue from talent management services is recognized as services are performed for the Company's customers over time, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those services. Revenue from variable consideration is recognized only to the extent that it is highly probable that a significant reversal in the amount of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is subsequently resolved (variable consideration constraint). The variable consideration contained in the Company's contracts primarily relates to the client's earnings. Once the variable consideration is known and the related uncertainty is resolved, which is mainly when the client has earned their income, the Company will recognize revenue. The Company typically receives its commission within a short period of time subsequent to the client earning their income. When such services are performed prior to receiving supporting statements or other information from our clients or third-party customers, we estimate the amount of revenue to recognize prior to receipt of the statement with the consideration of the variable consideration constraint. If our estimates and judgments were to change, the timing and amount of revenue recognized may be different. For representation revenue derived from IP representation for third-party IP, revenue is typically recognized at the point of sale since it is at this point that the Company's performance obligations are complete.

Significant estimates and judgments related to revenue are as follows:

Distribution of certain of the Company's content is performed by third-parties and given the uncertainty related to these sales, the details of each arrangement and collectibility of amounts, revenue is generally only recorded on receipt of the distribution report.
Measuring progress toward satisfaction of the Company's performance obligation in talent management arrangements included in representation revenue requires significant judgment. The Company fulfills its performance obligation and recognizes revenue as the performer completes a project. Generally, this is aligned with the performer's receipt of proceeds from these projects, however, judgment is required to evaluate whether the receipt of proceeds is aligned with the satisfaction of the Company's performance obligation.

Amortization of investment in content

Amortization of investment in content is a direct operating expense which represents the production costs of content that the Company owns. As the content is produced, the costs are capitalized on the statement of financial position until the revenue recognition criteria is satisfied, at which time an assessment of the life of the content is made. The criteria to assess the life of the content includes the genre, the global demand for the content, and the potential for subsequent seasons and ancillary revenue such as merchandise and licensing. Based on these criteria, delivered content is amortized on at rates ranging from 36% to 100% at the time of delivery and at rates of 10% to 50% annually on a declining balance as the underlying rights are consumed. Content that has been acquired from third-parties is amortized on a straight-line basis over 4 to 10 years.

Significant estimates and judgments relating to the investment in content are as follows:

• The methods and estimates of useful life needed to determine the appropriate amortization of investment in content depend on judgments with respect to many variables including the ability to license content to buyers, the availability of secondary markets, the impact of new media platforms, and the demand for merchandise and licensing of the related brand. The usage of content may differ materially and impact future amortization and net income.

Impairment of goodwill and long-lived assets

Goodwill represents the excess of the cost of an acquisition over the fair value of the net identifiable assets acquired at the date of acquisition. Goodwill is carried at cost less any accumulated impairment losses and is not subject to amortization. Goodwill is tested for impairment annually or more frequently if events or circumstances indicate that the asset might be impaired. Goodwill is allocated to a cash-generating unit ("CGU"), or group of CGUs, which is the lowest level within an entity at which the goodwill is monitored for internal management purposes, which is not higher than an operating segment. Impairment is tested by comparing the recoverable amount of goodwill assigned to a CGU or group of CGUs to its carrying value. For the purposes of allocating goodwill, the Company has determined that it has six groups of CGUs: scripted, unscripted, Insight, Kids and Family, Representation and Animation services. The first four groups of CGUs earn production, distribution and service revenue in the indicated genre of content. The talent management CGU earns a percentage of the revenue the performers manage to earn, and animation services generate service revenue.

Significant estimates and judgments relating to impairment of goodwill are as follows:

• Goodwill is tested for impairment if there is an indicator of impairment and annually for the Company's CGUs. Calculating the value in use of CGUs for goodwill impairment tests requires management to make estimates and assumptions with respect to future revenue and costs, as well as discount rates. Changes in any of the assumptions or estimates used in determining the fair values could impact the impairment analysis.

Business combinations

Business combinations are accounted for using the acquisition method. The consideration transferred by the Company is measured as the fair value of assets transferred and equity instruments issued at the date of completion of the acquisition. Identifiable assets acquired and liabilities assumed in a business combination are measured initially at fair value at the acquisition date. The excess of the consideration transferred over the fair value of the net assets acquired is recorded as goodwill. If the consideration transferred is less than the net assets acquired, the difference is recognized directly in the consolidated statement of (loss) income and comprehensive (loss) income as a gain on acquisition. Results of operations of a business acquired are included in the Company's consolidated financial statements from the date of the business acquisition. Acquisition costs incurred are expensed and included in general and administrative expenses.

The consideration transferred does not include amounts related to the settlement of pre-existing relationships. Such amounts are generally recognized in profit or loss.

Significant estimates and judgments relating to business combinations are as follows:

• The purchase price allocation process requires management to make significant estimates and assumptions including but not limited to the estimated fair values of tangible and intangible assets; probability of required payment under contingent consideration provisions; estimated income tax assets and liabilities and estimated fair value of pre-acquisition contingencies. While management uses its best estimates and assumptions as part of the purchase price allocation process to accurately value the assets acquired and liabilities assumed at the business combination date, estimates and assumptions are inherently uncertain and subject to refinement. As a result, during the measurement period, which is the earlier of the date management receives the information it is looking for and one year from the business combination date, adjustments are recorded to the assets acquired and liabilities assumed, with the corresponding amounts offset to goodwill.

Production tax credits

Significant estimates and judgments relating to production tax credits are as follows:

• The amount of production tax credits the Company files for as costs are incurred, and the amounts ultimately recovered may differ. The expected timing of the receipt of production tax credits is subject to uncertainty and amounts have been classified as current or long-term based on the expected date of receipt.

Fair value measurement of financial assets

The fair value measurement of certain financial assets requires the Company to assess the classification of the assets based on the contract from which the asset arises. In the case that the asset represents investments in third-party entities that are not registered in the public markets, factors that are used to assess fair value include: the valuation indicated by the most recent equity offerings, management information presented at board meetings, and knowledge of the market in which the third-party transacts. Changes in any of the assumptions or estimates used in determining the fair values could impact the valuation of these financial assets.

RISKS

Please refer to Risk Factors in the Company's prospectus dated February 17, 2021.

RECONCILIATION TABLES

Segment Profit

The following tables present the reconciliation of segment profit for the three months ended September 30, 2020 and 2019:

			Three months ended September 30, 2020
	Television	Kids and Family	Representation	Corporate	Total
			(Amounts in thousands)
Revenue
Total revenue	\$ 49,429	\$ 23,538	\$ 5,042	\$ — \$	78,009
Expenses:
Production, distribution and service	42,074	15,322	859	—	58,255
General and administrative	6,029	2,533	2,933	7,040	18,535
	\$ 48,103	\$ 17,855	\$ 3,792	\$ 7,040	\$ 76,790
Segment Profit
Segment profit	\$ 1,326	\$ 5,683	\$ 1,250	\$ (7,040)	\$ 1,219

						Three months ended September 30, 2019
		Television		Kids and Family		Representation		Corporate		Total
	(Amounts in thousands)
Revenue
Total revenue	\$	28,545	\$	12,266	\$	10,190	\$	— \$		51,001
Expenses:
Production, distribution and service		22,716		8,428		1,051		—		32,195
General and administrative		4,477		1,029		5,328		6,334		17,168
	\$	27,193	\$	9,457	\$	6,379	\$	6,334	\$	49,363
Segment Profit
Segment profit	\$	1,352	\$	2,809	\$	3,811	\$	(6,334)	\$	1,638

The following tables present the reconciliation of segment profit for the nine months ended September 30, 2020 and 2019:

September 30, 2020
	Television						Corporate		Total


\$	105,047	\$	47,158	\$	18,984	\$			171,189

	93,622		25,061		1,051		—		119,734
	18,147		5,087		12,231		15,249		50,714
\$	111,769	\$	30,148	\$	13,282	\$	15,249	\$	170,448

\$	(6,722)		17,010	\$	5,702	\$	(15,249)	\$	741



	Television						Corporate		Total


\$	119,362	\$	40,978	\$	24,390	\$			184,730

	95,459		25,438		1,400		—		122,297
	13,342		2,347		12,468		19,204		47,361
\$	108,801	\$	27,785	\$	13,868	\$	19,204	\$	169,658
				Kids and Family \$ Kids and Family		Representation Representation	Nine months ended September 30, 2019	(Amounts in thousands) (Amounts in thousands)	— \$ — \$

Segment Profit
Segment profit	\$ 10,561	\$ 13,193	\$ 10,522	\$ (19,204)	\$ 15,072

The following tables present the reconciliation of segment profit for the years ended December 31, 2019, 2018 and 2017:

			Year Ended
			December 31, 2019
	Television	Kids and Family	Representation	Corporate	Total
			(Amounts in thousands)
Revenue
Total revenue	\$ 150,193	\$ 58,055	\$ 35,917	\$ —	\$ 244,165
Expenses:
Production, distribution and service	120,679	34,712	2,185	—	157,576
General and administrative	21,220	4,868	20,067	23,665	69,820
	\$ 141,899	\$ 39,580	\$ 22,252	\$ 23,665	\$ 227,396
Segment Profit
Segment profit	\$ 8,294	\$ 18,475	\$ 13,665	\$ (23,665)	\$ 16,769
			Year Ended
			December 31, 2018
	Television	Kids and Family	Representation	Corporate	Total
			(Amounts in thousands)
Revenue
Total revenue	\$ 107,348	\$ 52,676	\$ 4,821	\$ —	\$ 164,845
Expenses:
Production, distribution and service	79,573	29,753	791	—	110,117
General and administrative	9,717	3,319	1,681	21,024	35,741
	\$ 89,290	\$ 33,072	\$ 2,472	\$ 21,024	\$ 145,858
Segment Profit
Segment profit	\$ 18,058	\$ 19,604	\$ 2,349	\$ (21,024)	\$ 18,987

			Year Ended
			December 31, 2017
	Television	Kids and Family	Representation	Corporate	Total
			(Amounts in thousands)
Revenue
Total revenue	\$ 78,668	\$ 49,182	\$ 1,200	\$ —	\$ 129,050
Expenses:
Production, distribution and service	56,551	32,484	340	—	89,375
General and administrative	2,952	1,136	443	11,780	16,311
	\$ 59,503	\$ 33,620	\$ 783	\$ 11,780	\$ 105,686
Segment Profit
Segment profit	\$ 19,165	\$ 15,562	\$ 417	\$ (11,780)	\$ 23,364

RECONCILIATION TABLES

Reconciliation from Net Income to Adjusted EBITDA

The Company uses the non-IFRS measure Adjusted EBITDA to evaluate performance. The following table presents the reconciliation from net income to Adjusted EBITDA for the three and nine months ended September 30, 2020, the comparative periods of 2019, as well as the years ended December 31, 2019, 2018 and 2017:

	3 months	3 months	9 months	9 months	12 months	12 months	12 months
	Sep 30, 2020	Sep 30, 2019	Sep 30, 2020	Sep 30, 2019	Dec 31, 2019	Dec 31, 2018	Dec 31, 2017
Net (loss) income	\$ (22,990)	\$ (9,613)	\$ (43,544)	\$ (13,279)	\$ (19,483)	\$ 9,757	\$ 14,235
Add:
Finance costs, net	\$ 2,404	\$ 2,237	\$ 7,860	\$ 6,299	8,415	2,580	\$ 1,225
Amortization of property
and equipment, right-of-use
assets and other intangible assets	\$ 4,736	\$ 4,687	\$ 13,817	\$ 13,993	18,989	6,562	\$ 2,713
Income taxes	\$ 1,598	\$ 681	\$ 620	\$ 209	1,067	4,073	\$ 5,829
Amortization of program intangibles	\$ 719	\$ 758	\$ 2,208	\$ 6,357	7,196	2,137	206
Change in fair value of other financial liabilities	\$ 3,359	\$ 2,002	\$ 6,951	\$ 6,703	8,710	265	—
Change in fair value of contingent consideration	\$ — \$	(10)	\$ 880	\$ 384	368	(824)	(225)
Share-based compensation	\$ 2,478	\$ 191	\$ 3,020	\$ 479	721	3,321	239
Transaction items 1	\$ 429	\$ 1,499	\$ 714	\$ 3,452	4,292	5,613	2,359
Goodwill impairment	\$ 12,959	\$ — \$	12,959	\$ —	—	—	—
Loss on debt modification	\$ 342	\$ — \$	342	\$ —	4,317	—	—
Reorganization costs	\$ — \$	22	\$ 192	\$ 774	956	1,322	—
Gain on sale of assets	\$ — \$	— \$	—	\$ —	(3,079)	(2,792)	—
Adjusted EBITDA	\$ 6,034	\$ 2,454	\$ 6,019	\$ 25,371	\$ 32,469	\$ 32,014	\$ 26,581

¹ Transaction items include legal and other professional fees incurred in the acquisition process

Pro Forma Condensed Consolidated Statement of Loss For the year ended December 31, 2019 (UNAUDITED) (expressed in thousands of Canadian dollars)

Pro Forma Condensed Consolidated Statement of Loss

For the Year Ended December 31, 2019

(Unaudited)

(expressed in thousands of Canadian dollars, except share amounts)

	Boat Rocker Media For the year ended December 31, 2019 \$	Platform One For the period ended August 30, 2019 \$	Pro Forma Adjustments (Note 2) \$	Boat Rocker Pro Forma Consolidated \$
Revenue	244,165	-	-	244,165
Expenses
Production, distribution and service costs	157,576	-	1,170	158,746
General and administrative costs	69,820	1,406	4,140	75,366
Development costs	-	1,170	(1,170)	-
Salaries and benefits	-	4,140	(4,140)	-
Amortization of property and equipment, right-of-use assets and intangible assets	18,989	256	-	19,245
Gain on sale of property and equipment	(3,079)	-	-	(3,079)
Finance costs (income), net	8,415	(74)	-	8,341
Foreign exchange gain	(307)	-	-	(307)
Loss on loan modification	4,317	-	-	4,317
Share of income of equity accounted investees	(360)	-	-	(360)
Change in the fair value of financial assets	(1,868)	-	-	(1,868)
Change in the fair value of other financial liabilities	8,710	-	-	8,710
Change in the fair value of contingent consideration	368	-	-	368
Loss before income taxes	(18,416)	(6,898)	-	(25,314)
Current income taxes	8,984	-	-	8,984
Deferred income tax recoveries	(7,917)	-	-	(7,917)
Net loss for the year	(19,483)	(6,898)	-	(26,381)

Pro Forma Condensed Consolidated Statement of Loss

For the Year Ended December 31, 2019

(Unaudited)

(expressed in thousands of Canadian dollars, except share amounts)

	Boat Rocker	Pro Forma Boat Rocker
Net loss attributable to
Owners of Boat Rocker Media Inc.	(23,707)	(30,605)
Non-controlling interests	4,224	4,224
Loss per share attributable to common
owners of Boat Rocker Media Inc.
Numerator for basic and diluted loss per
share – net loss attributable to owners	(23,707)	(30,605)
Denominator for basic and diluted loss per	14,776,866	14,776,866
share – weighted average common shares
Basic and diluted net loss per share	(\$1.60)	(\$2.07)

Notes to the Pro Forma Condensed Consolidated Statement of Loss and Comprehensive Loss For the Year Ended December 31, 2019

(expressed in thousands of Canadian dollars, except as indicated) (unaudited)

1 Background and basis of presentation

Boat Rocker Media Inc. (Boat Rocker or the Company) is a global entertainment company that creates, produces and distributes media content for all platforms and develops brands and intellectual property for worldwide monetization.

On August 31, 2019, the Company acquired 100% of the outstanding membership interests of Platform One Media LLC (Platform One), a television production company based in Los Angeles, CA. The total purchase price of \$18,662 (\$14,037 USD) consisted of non-cash financial liabilities and contingent rights to issue common shares of the Company as disclosed in Note 4(b) of Boat Rocker's audited consolidated financial statements as at and for the year ended December 31, 2019.

On February 1, 2019, the Company acquired 51% of the outstanding membership interests of Untitled Entertainment LLC (Untitled), a talent management company based in Los Angeles, CA that provides talent management services to a roster of celebrities and performers. The total purchase price of \$55,957 included an upfront cash payment of \$51,010 and \$4,947 of contingent consideration.

The accompanying unaudited pro forma condensed consolidated statement of loss of Boat Rocker for the year ended December 31, 2019 has been prepared to reflect the acquisition of Platform One.

The unaudited pro forma condensed consolidated statement of loss of Boat Rocker for the year ended December 31, 2019 does not reflect the operations of Untitled for the period from January 1, 2019 to the date of acquisition, February 1, 2019, as that one-month period is considered insignificant.

The unaudited pro forma condensed consolidated statement of loss for the year ended December 31, 2019, gives effect to the acquisition of Platform One as if it had occurred on January 1, 2019.

The unaudited pro forma condensed consolidated statement of loss is derived from, and should be read in conjunction with, the following:

the audited consolidated statement of loss and comprehensive loss of Boat Rocker Media for the year ended December 31, 2019; and
the audited consolidated statement of loss and comprehensive loss of Platform One for the 8 month period ended August 30, 2019.

The unaudited pro forma condensed consolidated statement of loss has been prepared by management of Boat Rocker on a consistent basis with the accounting policies disclosed in Note 3 of Boat Rocker's audited consolidated financial statements as at and for the year ended December 31, 2019.

Furthermore, certain financial statement line items included in Platform One's historical presentation have been amended to conform to corresponding financial statement line items included in Boat Rocker's historical presentation. Refer to Note 2 for a description of these reclassifications.

The pro forma information is for illustrative purposes only and is not necessarily indicative of the results of operations that would have occurred had the acquisition of Platform One been effected on January 1, 2019, nor is it indicative of the results that may be obtained in the future.

Notes to the Pro Forma Condensed Consolidated Statement of Loss and Comprehensive Loss For the Year Ended December 31, 2019

(expressed in thousands of Canadian dollars, except as indicated) (unaudited)

As the historical financial information of Platform One was presented in US dollars, the historical financial information was translated from US dollars to Canadian dollars using the average rate during the period from January 1, 2019 t0 August 30, 2019 of 1.3297, expressed in Canadian dollars.

2 Pro forma adjustments

The unaudited pro forma condensed consolidated statement of loss and comprehensive loss for the year ended December 31, 2019 gives effect to the following assumptions and adjustments:

1) Current and deferred income taxes

Platform One is a limited liability company based in the United States of America (U.S.). It is considered a disregarded entity and was treated as an asset purchase for U.S. tax purposes. No deferred tax assets or liabilities were recognized upon acquisition. Therefore, a pro forma tax adjustment has not been reflected as Platform One's net operating loss from January 1, 2019 to August 30, 2019 cannot be carried back to any previous tax years and a deferred tax asset is not recognized as recoverability is not probable.

2) Reclassifications

Development costs totalling \$1,170 and salaries and benefits totalling \$4,140 presented in Platform One's audited consolidated statement of loss for the 8 month period ended August 30, 2019 were reclassified to production, distribution and services costs and general and administrative costs respectively to conform to corresponding financial statement line items included in Boat Rocker's historical presentation.

Consolidated Financial Statements For the period ended May 17, 2018 and the year ended December 31, 2017 (expressed in Canadian dollars)

Independent auditor's report

To the Directors of Insight Productions Company Ltd.

Our opinion

In our opinion, the accompanying consolidated financial statements present fairly, in all material respects, the financial position of Insight Production Company Ltd. and its subsidiaries (together, the Company) as at May 17, 2018, December 31, 2017 and January 1, 2017, and its financial performance and its cash flows for the period ended May 17, 2018 and the year ended December 31, 2017 in accordance with International Financial Reporting Standards as issued by the International Accounting Standards Board (IFRS).

What we have audited

The Company's consolidated financial statements comprise:

the consolidated statements of financial position as at May 17, 2018, December 31, 2017 and January 1, 2017;
the consolidated statement of changes in equity for the period from January 1, 2018 to May 17, 2018 and year ended December 31, 2017;
the consolidated statements of income and comprehensive income for the period from January 1, 2018 to May 17, 2018 and year ended December 31, 2017;
the consolidated statements of cash flows for the period from January 1, 2018 to May 17, 2018 and year ended December 31, 2017; and
the notes to the consolidated financial statements, which include significant accounting policies and other explanatory information.

Basis for opinion

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Independence

PricewaterhouseCoopers LLP PwC Centre, 354 Davis Road, Suite 600, Oakville, Ontario, Canada L6J 0C5 T: +1 905 815 6300, F: +1 905 815 6499

"PwC" refers to PricewaterhouseCoopers LLP, an Ontario limited liability partnership.

Responsibilities of management and those charged with governance for the consolidated financial statements

Those charged with governance are responsible for overseeing the Company's financial reporting process.

Auditor's responsibilities for the audit of the consolidated financial statements

As part of an audit in accordance with Canadian generally accepted auditing standards, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:

Identify and assess the risks of material misstatement of the consolidated financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control.
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.

Conclude on the appropriateness of management's use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor's report to the related disclosures in the consolidated financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor's report. However, future events or conditions may cause the Company to cease to continue as a going concern.
Evaluate the overall presentation, structure and content of the consolidated financial statements, including the disclosures, and whether the consolidated financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the Company to express an opinion on the consolidated financial statements. We are responsible for the direction, supervision and performance of the group audit. We remain solely responsible for our audit opinion.

Chartered Professional Accountants, Licensed Public Accountants

Oakville, Ontario February • , 2021

Consolidated Statements of Financial Position

(expressed in thousands of Canadian dollars)
	May 17, 2018 \$	December 31, 2017 \$	January 1, 2017 \$
Assets
Current assets
Cash	17,498,820	13,345,464	7,085,565
Short-term accounts receivable (note 7)	3,284,845	1,359,381	1,914,644
Production tax credits receivable	8,565,854	12,081,866	18,818,185
Advances to equity accounted investee (note 13)	90,683	-	-
Income taxes receivable	-	221,238	511,904
Prepaid expenses and deposits	1,516,266	289,659	437,761
Total current assets	30,956,468	27,297,608	28,768,059
Investment in content (note 5)	4,160,245	4,363,091	3,147,916
Property and equipment (note 4)	231,743	254,452	294,566
Investment in equity accounted investee (note 6)	351,534	244,134	-
Long-term accounts receivable (note 7)	617,503	357,660	-
Long-term production tax credits receivable	15,683,217	11,978,031	12,165,542
Deferred income tax assets (note 18)	5,369,083	665,601	879,336
Total assets	57,369,793	45,160,577	45,255,419
Liabilities
Current liabilities
Accounts payable and accrued liabilities	9,494,437	3,631,921	4,825,201
Current portion of long-term debt (note 11)	-	1,000,000	1,000,000
Interim production financing (note 10)	17,830,894	17,267,097	23,243,325
Due to related parties (note 13)	6,573,000	7,225,947	5,663,008
Advance on sale of business	5,855,756	-	-
Income taxes payable	2,144,516	-	-
Deferred revenue	10,350,738	13,490,835	8,931,954
Preference shares (note 9)	7,173,000	-	-
Total current liabilities	59,422,341	42,615,800	43,633,488
Long-term debt (note 11)	-	916,667	1,916,667
Pension liabilities (note 14)	-	202,584	557,013
Total liabilities	59,422,341	43,735,051	46,137,168
Shareholders' equity
Share capital (note 8)	160	160	160
Accumulated other comprehensive income (loss)	16,378	(13,046)	-
Retained earnings (deficit)	(2,069,086)	1,438,412	(881,909)
Total shareholders' equity (deficit)	(2,052,548)	1,425,526	(881,749)

Total shareholders' equity and liabilities	57,369,793	45,160,577	45,255,419
Commitments and contingencies (note 22) Subsequent events (note 23)

On Behalf of the Board of Directors

___________________________________ Director ________________________________ Director

Consolidated Statement of Changes in Equity

(expressed in thousands of Canadian dollars)

	Number of common shares	Share capital \$	Accumulated other comprehensive income (loss) \$	Retained earnings \$	Total equity \$
Balance – January 1, 2017	80	160	-	(881,909)	(881,749)
Net income for the period	-	-	-	3,941,935	3,941,935
Dividends	-	-	-	(1,621,614)	(1,621,614)
Remeasurement of net pension liabilities	-	-	(13,046)	-	(13,046)
Balance – December 31, 2017	80	160	(13,046)	1,438,412	1,425,526
Net income for the period	-	-	-	3,065,502	3,065,502
Dividends	-	-	-	(6,573,000)	(6,573,000)
Remeasurement of net pension liabilities	-	-	29,424	-	29,424
Balance – May 17, 2018	80	160	16,378	(2,069,086)	(2,052,548)

Consolidated Statements of Income and Comprehensive Income

(expressed in thousands of Canadian dollars)

	Five month period ended May 17, 2018 \$	Year ended December 31, 2017 \$
Revenue (notes 12 and 19)	27,363,327	45,383,919
Expenses (note 19)
Production, distribution, and service	22,565,112	32,587,861
General and administrative costs	3,809,689	7,615,990
Amortization of property and equipment (note 4)	22,709	85,220
Total expenses	26,397,510	40,289,071
Operating income	965,817	5,094,848
Finance costs – net (note 16)	123,075	148,168
Share of income in equity accounted investee (note 6)	(107,400)	(75,115)
Earnings before income taxes	950,142	5,021,795
Current income taxes (note 18)	2,598,731	861,421
Deferred income taxes (recoveries) (note 18)	(4,714,091)	218,439
Net income for the period	3,065,502	3,941,935
Gain (loss) on remeasurement of net pension liabilities (net of income taxes)	29,424	(13,046)
Comprehensive income for the period	3,094,926	3,928,889

Consolidated Statements of Cash Flows

(expressed in thousands of Canadian dollars)

	Five month period ended May 17, 2018 \$	Year ended December 31, 2017 \$
Cash provided by (used in)
Operating activities Net income for the period Adjustments for non-cash items:	3,065,502	3,941,935
Amortization of property and equipment (note 4) Amortization of investment in content (note 5) Write-offs on investment in content (note 5)	22,709 17,630,289 -	85,220 24,521,984 31,713
Pension income Finance cost (note 16) Income of equity accounted investees Current income taxes (note 18) Deferred income taxes (recoveries) (note 18) Additions to investment in content (note 5) Pension contributions Cash interest paid Cash interest received Cash income taxes paid Change in non-cash balances related to operations (note 20)	(113,607) 123,075 (107,400) 2,598,731 (4,714,091) (17,427,443) (48,944) (162,500) 71,887 (131,611) (1,012,496)	(291,579) 148,168 (75,115) 861,421 218,439 (25,768,872) (80,600) (1,313,356) 200,926 (305,215) 11,333,858
Cash provided by (used in) operating activities	(205,899)	13,508,927
Financing activities Borrowings from related parties Dividends paid Advance on sale of business Repayment of long-term debt Proceeds from production financing Repayment of production financing	6,520,053 (6,573,000) 5,855,756 (1,916,667) 9,436,419 (8,872,623)	- (58,675) - (1,000,000) 19,431,384 (25,407,612)
Cash used in financing activities	4,449,938	(7,034,903)
Investing activities Investment in equity accounted investee Advance to equity accounted investee Acquisition of property and equipment (note 4)	- (90,683) -	(169,019) - (45,106)
Cash provided by (used in) investing activities	(90,683)	(214,125)
Increase in cash	4,153,356	6,259,899
Cash – Beginning of period	13,345,464	7,085,565
Cash – End of period	17,498,820	13,345,464

Notes to Consolidated Financial Statements May 17, 2018

(expressed in thousands of Canadian dollars)

1 Corporate information

Insight Production Company Ltd. (the Company) is a Canadian production company specializing in the production of made for television content. The Company was incorporated in and is domiciled Canada and the address of the Company's registered office is 135 Liberty St, Toronto, Ontario, M6K 1A7.

On May 15, 2018, the Company undertook a reorganization by incorporating a new subsidiary named Insight Productions Ltd. ("IPL"). Certain assets, liabilities and production companies were transferred from Insight to IPL. On May 17, 2018, Boat Rocker Media Inc. (Boat Rocker) acquired 70% of the outstanding shares of IPL and the Company received advance consideration of \$5,855,756 from Boat Rocker. Boat Rocker was incorporated in and is domiciled in Canada and the address of its registered office is 310 King Street East, Toronto, Ontario M5A 1K6.

2 Basis of preparation and statement of compliance

These consolidated financial statements have been prepared in accordance with International Financial Reporting Standards (IFRS) as issued by the International Accounting Standards Board (IASB). These are the Company's first consolidated financial statements reported under IFRS. Accordingly, IFRS 1 First-time Adoption of IFRS (IFRS 1), has been applied. The Company has never presented financial statements as at January 1, 2017 or at any period thereafter under IFRS and therefore an opening balance sheet as at January 1, 2017 has been included. Since the Company did not previously prepare consolidated financial statements for external use, the Company is not required to present reconciliations as per IFRS 1.

As a part of adoption of IFRS 1, the Company initially applied IFRS 9 Financial Instruments (IFRS 9) and IFRS 15 Revenue from Contracts with Customers (IFRS 15) as of January 1, 2017 in accordance with the transitional provisions of IFRS 1.

These consolidated financial statements were authorized for issue by the Board of Directors on February XX, 2021.

3 Summary of significant accounting policies

The significant accounting policies used in the preparation of these consolidated financial statements are described below.

Notes to Consolidated Financial Statements May 17, 2018

(expressed in thousands of Canadian dollars)

Basis of presentation

The consolidated financial statements have been prepared on a historical cost basis, except for those assets and liabilities that are measured at fair value, including financial assets and financial liabilities. These consolidated financial statements are presented in Canadian dollars, which is the functional currency of the Company. These consolidated financial statements are presented in dollars.

Basis of consolidation

The consolidated financial statements include the accounts of the Company and all of its controlled subsidiaries. All intercompany balances and transactions have been eliminated on consolidation. Subsidiaries are those entities that the Company controls. Consistent with the film and television industry, the Company utilizes single-purpose entities to manage the costs and funding for its content production projects. For accounting purposes, control is established by the Company when it is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power over the entity. Subsidiaries are fully consolidated from the date on which control is obtained by the Company and are de-consolidated from the date that control ceases. Changes in the Company's interest in a subsidiary that do not result in a loss of control are accounted for as equity transactions.

Investments in equity accounted investees

Investments in associates are originally recognized at cost and are subsequently accounted for using the equity method. Under the equity method, the investment in associates is carried on the consolidated statement of financial position at cost plus post-acquisition changes in the Company's share of income and other comprehensive income (OCI), less distributions of the investee.

Notes to Consolidated Financial Statements May 17, 2018

(expressed in thousands of Canadian dollars)

associate and its carrying value and recognizes the amount in the consolidated statement of income and comprehensive income.

Revenue

The Company earns revenue from the following sources:

the initial licensing of content produced and owned by the Company;
the performance of live action production service, to facilitate production of content owned by a third party.

Licensing revenue for content

The Company grants licences to third parties for content owned either by the Company or a third party producer. Licensing revenue that supports the greenlight of the production, also called a pre-sale, is presented as production revenue. Licensing revenue earned after the pre-sale is presented as distribution revenue.

The Company follows the specific guidance on licensing included in IFRS 15. The Company determined that licences for its content transfer a right to use intellectual property. Under the standard, revenue from contracts associated with right to use intellectual property is recognized in full when all of the performance obligations are met. Performance obligations for licensing revenue are satisfied when the production has been completed, the customer has access to the content, and the licence period associated with the contract has started.

Service revenue

The Company performs production services to facilitate production of content owned by a third party.

Contract assets are recognized on unbilled receivables for projects that are in progress. Amounts received in advance are recorded as deferred revenue until the revenue recognition conditions have been met.

Investment in content

Investment in content is classified by the Company into the following categories: development, in production, and delivered. For content produced by the Company, all direct production and financing costs incurred during production that are expected to benefit future periods are capitalized. Financing costs are capitalized until substantially all of the activities necessary to prepare the content for delivery are complete. Federal and provincial program contributions and production tax credits are recorded as a reduction of the cost of the content, as is production financing provided by third parties that acquire participation rights.

Notes to Consolidated Financial Statements May 17, 2018

(expressed in thousands of Canadian dollars)

Development costs represent expenditures incurred on projects prior to the commencement of production and are expensed at the date when the costs are determined not to be recoverable.

Content in production represents the accumulated costs of content currently in production. On delivery of the content to the licensor, content is reclassified into the delivered category.

Delivered content is accounted for as an intangible asset and is amortized using a declining balance method at 100% at the time of delivery.

Property and equipment

Property and equipment are recorded at cost less accumulated depreciation and accumulated impairment losses. Depreciation is provided for at the following annual rates:

Furniture and fixtures	declining balance	20% declining balance
Computer	declining balance	30% declining balance
Editing equipment	declining balance	30% declining balance
Art collection and other	declining balance	nil
Leasehold improvements	declining balance	30% declining balance

Depreciation rates and the estimated useful lives of property and equipment are reviewed at each financial yearend and are adjusted if necessary.

Gains and losses on disposal of a property and equipment are determined by comparing the proceeds from disposal with the carrying amount of the property and equipment and are recognized net in the consolidated statement of income and comprehensive income.

Impairment of long-lived assets

The carrying amounts of the Company's long-lived assets with finite lives, including investment in content and property and equipment, are reviewed whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. If any such indication exists, then the asset's recoverable amount is estimated.

The recoverable amount of an asset or cash generating unit (CGU) is the greater of its value in use and its fair value less costs to sell. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. For the purpose of impairment testing, assets that cannot be tested individually are

Notes to Consolidated Financial Statements May 17, 2018

(expressed in thousands of Canadian dollars)

grouped together into the smallest group of assets that generates cash inflows from continuing use that are largely independent of the cash inflows of other assets or groups of assets (CGUs).

The Company's corporate assets do not generate separate cash inflows. If there is an indication that a corporate asset may be impaired, then the recoverable amount is determined for the CGU to which the corporate asset belongs. An impairment loss is recognized if the carrying amount of an asset or its CGU exceeds its estimated recoverable amount. Impairment losses are recognized in profit or loss. Impairment losses recognized in prior periods are assessed at each reporting date for any indications that the loss has decreased or no longer exists. An impairment loss is reversed if there has been a change in the estimates used to determine the recoverable amount. An impairment loss is reversed only to the extent that the asset's carrying amount does not exceed the carrying amount that would have been determined, net of depreciation or amortization, if no impairment loss had been recognized.

Foreign currency transactions

Financial instruments

The Company accounts for its financial assets and liabilities in accordance with IFRS 9.

Classification of financial assets and financial liabilities

Financial assets

A financial asset is measured at amortized cost if it meets both of the following conditions and is not designated as at FVTPL:

Notes to Consolidated Financial Statements May 17, 2018

(expressed in thousands of Canadian dollars)

it is held within a business model whose objective is to hold assets to collect contractual cash flows; and
its contractual terms give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

For an investment in equity instruments that is not held for trading, the Company may elect, on an investment by investment basis, to present the subsequent change in fair value in OCI.

All financial assets not classified as amortized cost or FVOCI as described above are measured at FVTPL.

Financial liabilities

Impairment

Leases

Leases that transfer substantially all of the risks and rewards of ownership to the Company are classified as finance leases. Assets held under other leases are classified as operating leases and are not recognized in the Company's statement of financial position.

Payments made under operating leases are recognized in profit or loss on a straight-line basis over the term of the lease. Lease incentives received are recorded as a liability and recognized as an integral part of the total lease expense, over the term of the lease.

Notes to Consolidated Financial Statements May 17, 2018

(expressed in thousands of Canadian dollars) Government financing and assistance

Finance income and costs

Net finance income comprises interest income on funds invested, gains and losses on foreign currency transactions, interest expense on long-term debt, interest expense on interim financing, impairment losses recognized on financial assets and accretion expense on all liabilities whose calculations include net present value calculations.

Interest income and expense are recognized using the effective interest rate method.

Foreign currency gains and losses are reported on a net basis.

Cash

Cash consists of cash on hand and balances with banks.

Employee benefits

Pension plan

The Company has pension plans for certain employees. The pension plans are non-contributory defined benefit plans calculated by estimating the amount of future benefit that employees have earned in the current and prior periods, discounting that amount and deducting the fair value of any plan assets.

The calculation of defined benefit obligations is performed by a qualified actuary. The significant actuarial assumptions used in the determining the accrued benefit obligation for the funding method are the discount rates, salary escalation, inflation, maximum pension and retirement ages of employees. Changes in theses assumptions would impact pension plan expense.

Notes to Consolidated Financial Statements May 17, 2018

(expressed in thousands of Canadian dollars)

Remeasurements of the net defined benefit liability are recognized in other comprehensive income (loss). The Company determines the net interest expense (income) on the net defined liability (asset) for the period by applying the discount rate used to measure the defined benefit obligation at the beginning of the annual period to the then-net defined benefit liability (asset), taking into account any changes in the net defined liability (asset) during the period as a result of contributions and benefit payments. Net interest expense and other expenses related to defined benefit plans are recognized in profit or loss. The Company recognizes gains and losses on the settlement of a defined benefit plan when the settlement occurs.

Provisions

Income tax

Income tax expense comprises current and deferred income tax. Current tax and deferred tax are recognized in profit or loss except to the extent that they relate to items recognized directly in equity or in OCI.

Deferred tax is recognized in respect of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes. Deferred tax is not recognized for the following temporary differences: the initial recognition of assets or liabilities in a transaction that is not a business combination and that affects neither accounting nor taxable profit or loss, and differences relating to investments in subsidiaries to the extent that it is probable that they will not reverse in the foreseeable future. Deferred tax is measured at the tax rates that are expected to be applied to temporary differences when they reverse, based on the laws that have been enacted or substantively enacted by the reporting date. Deferred tax assets and liabilities are offset if there is a legally enforceable right to offset current tax liabilities and assets, and they relate to income taxes levied by the same taxation authority on the same taxable entity, or on different tax entities, but they intend to settle current tax liabilities and assets on a net basis or their tax assets and liabilities will be realized simultaneously.

Notes to Consolidated Financial Statements May 17, 2018

(expressed in thousands of Canadian dollars)

Use of estimates and judgments

The most significant estimates and judgments made by management in the preparation of the Company's consolidated financial statements include the following:

The methods and estimates of useful life needed to determine the appropriate amortization of investment in content depend on judgments with respect to many variables including the ability to license content to broadcasters, the availability of secondary markets, the impact of new media platforms, and the demand for merchandise and licensing of the related brand. The usage of content may differ materially and impact future amortization and net income
The amount of production tax credits the Company files for as costs are incurred, and the amounts ultimately recovered may differ. The expected timing of the receipt of production tax credits is subject to uncertainty and amounts have been classified as current or long-term based on the expected date of receipt.

Although management believes the assumptions and estimates made in the past have been reasonable and appropriate, they are based in part on historical experience and are inherently uncertain.

Unanticipated events and circumstances may occur, which may affect the accuracy or validity of such assumptions estimates or actual results.

The significant assumptions that affect these estimates and judgments in the application of accounting policies are noted throughout these consolidated financial statements.

Notes to Consolidated Financial Statements May 17, 2018

(expressed in thousands of Canadian dollars) Accounting pronouncements issued but not yet effective

IFRS 16 Leases (IFRS 16)

In January 2016 the IASB issued IFRS 16 which largely eliminates the distinction between finance and operating leases for lessees. With limited exceptions, a lessee will be required to recognize a right-of-use asset and a liability for its obligation to make lease payments. The standard is effective for annual periods beginning on or after January 1, 2019, with a choice of modified retrospective or full retrospective application. The application of IFRS 16 is expected to result in the recognition of approximately \$1.936 million of right-of-use assets and lease liabilities.

IFRIC 23 Uncertainty over Income Tax Treatments (IFRIC 23)

In June 2017 the IASB issued IFRIC 23 to clarify how the requirements of IAS 12 Income Taxes should be applied when there is uncertainty over income tax treatments. The interpretation is effective for annual periods beginning on or after January 1, 2019, with modified retrospective or retrospective application. The Company is evaluating the impact on its financial statements.

Notes to Consolidated Financial Statements May 17, 2018

(expressed in thousands of Canadian dollars)

4 Property and equipment

	Furniture and fixtures \$	Computers \$	Editing equipment \$	Leasehold improvements \$	Other \$	Total \$
Cost January 1, 2017 Additions Disposal	285,840 1,900 -	732,859 36 -	789,840 8,070 -	211,383 - -	6,371 35,100 - -	2,026,293 45,106 -
December 31, 2017	287,740	732,895	797,910	211,383	41,471	2,071,399
Additions Disposal	- -	- -	- -	- -	- -	- -
May 17, 2018	287,740	732,895	797,910	211,383	41,471	2,071,399
Accumulated amortization
January 1, 2017 Amortization Disposals	245,326 8,483 -	672,465 18,129 -	611,663 55,875 -	202,273 2,733 -	- - -	1,731,727 85,220 -
December 31, 2017	253,809	690,594	667,538	205,006	-	1,816,947
Amortization Disposals	2,547 -	4,763 -	14,680 -	719 -	- -	22,709 -
May 17, 2018	256,356	695,357	682,218	205,725	-	1,839,656
Net book value January 1, 2017 December 31, 2017	40,514 33,931	60,394 42,301	178,177 130,372	9,110 6,377	6,371 41,471	294,566 254,452
May 17, 2018	31,384	37,538	115,692	5,658	41,471	231,743

Notes to Consolidated Financial Statements May 17, 2018

(expressed in thousands of Canadian dollars)

5 Investment in content

		In
	Development \$	production \$	Delivered \$	Total \$
Cost
January 1, 2017	207,587	2,940,329	-	3,147,916
Additions	158,442	25,610,430	-	25,768,872
Reclassification	-	(24,521,984)	24,521,984	-
Write-offs	(31,713)	-	-	(31,713)
	334,316	4,028,775	24,521,984	28,885,075
December 31, 2017 Additions
Reclassification	91,283 -	17,336,160 (17,630,289)	- 17,630,289	17,427,443 -
Write-offs	-	-	-	-

May 17, 2018	425,599	3,734,646	42,152,273	46,312,518

Accumulated depreciation
January 1, 2017 Amortization charge	- -	- -	- 24,521,984	- 24,521,984

December 31, 2017	-	-	24,521,984	24,521,984
Amortization charge	-	-	17,630,289	17,630,289

May 17, 2018	-	-	42,152,273	42,152,273

Net book value
January 1, 2017 December 31, 2017	207,587 334,316	2,940,329 4,028,775	- -	3,147,916 4,363,091
May 17, 2018	425,599	3,734,646	-	4,160,245

6 Investments in equity accounted investee

In 2016, the Company entered into an agreement with a third party to co-produce certain scripted content. This agreement constitutes a joint venture and as such, the Company accounts for the arrangement as an investment using the equity method and records its share of income in the consolidated statement of income and comprehensive income and as an increase in the value of the investment. Cash relating to this agreement was not received until 2017.

Notes to Consolidated Financial Statements May 17, 2018

(expressed in thousands of Canadian dollars)

The following summarizes the carrying value of the Company interest as well as the Company's share of income in HMD Christmas:

	\$
Opening balance at January 1, 2017 Investments in equity accounted investees:	-
Investment in HMD Christmas Share of net income for the year ended December 31, 2017	169,019 75,115
Closing balance as at December 31, 2017 Share of net income for the period ended May 17, 2018	244,134 107,400
Closing balance as of May 17, 2018	351,534

7 Accounts receivable

	May 17, 2018	December 31, 2017	January 1, 2017
	\$	\$	\$
Trade receivables	3,050,375	1,340,551	1,999,078
Contract assets	693,629	253,000	-
Goods and services tax recoverable – net	158,344	123,490	(84,434)
	3,902,348	1,717,041	1,914,644
Short-term accounts receivable	3,284,845	1,359,381	1,914,644
Long-term accounts receivable	617,503	357,660	-
	3,902,348	1,717,041	1,914,644

The aging of trade receivables is as follows:

	May 17, 2018	December 31, 2017	January 1, 2017
	\$	\$	\$
Unbilled accounts receivable	1,403,759	969,633	1,313,571
Less than 60 days	1,362,076	370,918	680,507
Between 60 and 90 days	3,000	-	5,000
Over 90 days	281,540	-	-
	3,050,375	1,340,551	1,999,078

Notes to Consolidated Financial Statements May 17, 2018

(expressed in thousands of Canadian dollars)

8 Share capital

Authorized

Unlimited common shares, voting, with nominal or no par value

As of May 17, 2018, 80 common shares are issued and outstanding (December 31, 2017 - 80; January 1, 2017 – 80).

9 Preference shares

Authorized

The Company is authorized to issue an unlimited number of the non-voting Class A preference shares with nominal or no par value. The preferred shareholders are entitled to receive non-cumulative dividends up to an aggregate rate of three percent per annum, if, as and when declared by the Board of Directors.

The preferred shares may be redeemed at the option of the Company or holder upon giving 30 days. The Company or holder can redeem the whole or any part of the Class A Preference shares then outstanding at a price per share equal to \$1,000 together with all declared and unpaid dividends.

Issued

On May 15, 2018, the Company issued 7,173 Class A preference shares to a related party to extinguish a demand promissory note. The Company determined that these preference shares should be treated as liability, which have been valued at the fair value of consideration received (\$7,173,000 or \$1,000 per share).

10 Interim production financing

	May 17, 2018	December 31, 2017	January 1, 2017
	\$	\$	\$
Interim production financing from demand loans with interest at prime plus 0.75% - 1.5%, secured by a general security agreement covering all assets other than real property of the company as well as film production security agreements covering specific productions	17,830,894	17,267,097	23,243,352

Notes to Consolidated Financial Statements May 17, 2018

(expressed in thousands of Canadian dollars)

of production costs. On collection of amounts owing, interim production financing is repaid by the Company. Amounts are classified as current as the interim financing is due on demand.

11 Long-term debt

	May 17, 2018 \$	December 31, 2017 \$	January 1, 2017 \$

Revolving line of credit payable to RBC	-	1,916,667	2,916,667
Total before loan fees Loan fees, net of amortization	- -	1,916,667 -	2,916,667 -
Less: Current portion	-	1,000,000	1,000,000
Long-term portion	-	916,667	1,916,667

Long-term debt consists of a revolving line of credit. Interest and principal are payable on a monthly basis until November 30, 2019. The revolving line of credit was fully repaid on March 22, 2018. The agreement with the lender required the Company to maintain certain financial covenants: tangible net worth and debt service ratio. The Company was in compliance with its covenants for the year ended December 31, 2017.

12 Revenue

Disaggregation of revenue from contracts with customers

	May 17, 2018	December 31, 2017
	\$	\$
Production revenue Distribution revenue Service revenue	21,637,426 123,024 5,602,878	34,296,132 195,074 10,892,713
	27,363,327	45,383,919
Timing of revenue recognition At a point in time Over time	21,760,450 5,602,877	34,491,206 10,892,713
	27,363,327	45,383,919

Notes to Consolidated Financial Statements May 17, 2018

(expressed in thousands of Canadian dollars)

13 Related party transactions

Significant subsidiaries

The Company's principal subsidiaries include the following:

Name of company	Jurisdiction	Function	Owned by Company
			%
Insight Big Brother Canada 5 Ltd.	Canada	Production company	100.00
Insight Big Brother Canada 6 Ltd.	Canada	Production company	100.00
Insight BICJ 2 Ltd.	Canada	Production company	100.00
Insight Canada Day 2017 Ltd.	Canada	Production company	100.00
Insight CSA 2018 Ltd.	Canada	Production company	100.00
Insight Digital Noir Ltd.	Canada	Production company	100.00
Insight HMD Christmas Ltd.	Canada	Production company	100.00
Insight Greenpeace Doc Ltd.	Canada	Production company	100.00
Insight Lightfoot Ltd.	Canada	Production company	100.00
Rubber Road Films Ltd.	Canada	Production company	100.00
Insight NYE 150 Ltd.	Canada	Production company	100.00
Chase Entertainment 6 Ltd.	Canada	Production company	100.00
Insight Kitchen 5A Ltd.	Canada	Production company	100.00
Insight Kitchen 6 Ltd.	Canada	Production company	100.00
Insight Hip Ltd.	Canada	Production company	100.00
Youngster Ltd.	Canada	Production company	100.00
Insight Junos 2017 Ltd.	Canada	Production company	100.00
Insight Junos 2018 Ltd.	Canada	Production company	100.00
Insight NYE 2017 Ltd.	Canada	Production company	100.00
Insight Productions Ltd.	Canada	Corporate	100.00
Insight SCTV 2018 Special Ltd.	Canada	Production company	100.00
White Picket Films Ltd.	Canada	Production company	100.00
Insight Launch Ltd.	Canada	Production company	100.00
Insight Launch 2 Ltd.	Canada	Production company	100.00
Courier Entertainment 4 Ltd.	Canada	Production company	100.00
Doc Productions Ltd.	Canada	Production company	100.00
Endurance Entertainment Ltd.	Canada	Production company	100.00
Film Street Productions Ltd.	Canada	Production company	100.00
Insight Big Brother Canada 2 Ltd.	Canada	Production company	100.00
Insight Big Brother Canada 4 Ltd.	Canada	Production company	100.00
Insight Destination Detour Holdings Ltd.	Canada	Production company	100.00
Insight Dream Vacation Ltd.	Canada	Production company	100.00
Insight Junos 2016 Ltd.	Canada	Production company	100.00
Liftoff Productions 3 Ltd.	Canada	Production company	100.00
Portage Productions 2 Ltd.	Canada	Production company	100.00
Whiteboard Productions Ltd.	Canada	Production company	100.00
Insight Productions (USA) Inc.	US	Corporate	100.00

Notes to Consolidated Financial Statements May 17, 2018

(expressed in thousands of Canadian dollars)

Key management personnel

	May 17, 2018 \$	December 31, 2017 \$
Salaries and employee benefits	718,279	2,220,000
	718,279	2,220,000

Other transactions

Related party transactions include transactions between the Company's shareholders, their dependents and entities under common control, which include Northern Pines Ltd.

As at May 17, 2018, advances to equity accounted investee includes \$90,683 (2017 – \$nil) in respect of amounts owed from the Company's significant influence investee HMD Christmas, which is non-interest bearing.

As at May 17, 2018, payable to related parties includes \$6,573,000 (2017 – \$7,225,947) in respect of a loan due to Northern Pines Ltd., which is non-interest bearing, of which \$6,520,053 was borrowed during the year. During the year, the Company extinguished a demand promissory note payable to Northern Pines Ltd. of \$7,173,630 by issuing 7,173 Class A preference shares at \$1,000 per share and by paying \$630 in cash.

As at December 31, 2017, payable to related parties included \$7,225,947 in respect of amounts owed to Northern Pines Ltd. and HMD Christmas. There was a loan due to Northern Pines Ltd. in the amount of \$7,173,630, which was non-interest bearing, and \$1,562,939 was borrowed during the year. The remaining amount of \$52,317 related to a loan from HMD Christmas, which was also non-interest bearing.

The Company declared and paid a dividend of \$6,530,000 (2017 - \$1,621,614) to Northern Pines Ltd. during the period ended May 17, 2018.

Notes to Consolidated Financial Statements May 17, 2018

(expressed in thousands of Canadian dollars)

14 Defined benefit pension plan

The Company has non-contributory defined benefit plans for certain employees of the Company.

The changes of the net defined benefit obligation is as follows:

	May 17, 2018 \$	December 31, 2017 \$
Net defined benefit liability – opening balance	(202,584)	(557,013)
Pension income	113,607	291,579
Actuarial gains (losses) in other comprehensive income	40,033	(17,750)
Employer contributions	48,944	80,600
Net defined benefit liability – closing balance	-	(202,584)

The status of the net defined benefit obligation is as follows:

	May 17,	December 31,	January 1,
	2018	2017	2017
	\$	\$	\$
Benefit obligation	(946,294)	(2,309,458)	(2,432,994)
Fair value of plan assets	946,294	2,106,874	1,875,981
Net benefit liability	-	(202,584)	(557,013)

A portion of the obligation totaling \$1,170,812 was fully settled by May 16, 2018.

The primary assumption used were a discount rate of 3.65% (December 31, 2017 – 3.35%, January 1, 2017 – 3.75%), salary escalation of 3.0% (December 31, 2017 – 3.0%, January 1, 2017 – 3.0%), inflation rate of 2.0% (December 31, 2017 – 2.0%, January 1, 2017 – 2.0%), mortality rate of 82.7% of the CPM 2014 Private Sector table and CPM-2014 improvement scale (December 31, 2017 – 82.7%, January 1, 2017 – 82.7%/88%), and retirement ages of 65 or current age if later.

15 Government assistance

Additions to investment in content during the period ended May 17, 2018 have been increased by \$66,998 (December 31, 2017 - \$7,046,199) in respect of production tax credits receivable.

Notes to Consolidated Financial Statements May 17, 2018

(expressed in thousands of Canadian dollars) 16 Finance costs – net

May 17, 2018 \$ December 31, 2017 \$ Interest expense 122,312 138,680 Foreign exchange loss 763 9,488 123,075 148,168

17 Financial instruments

Credit risk

Credit risk arises from cash as well as credit exposure to customers, including outstanding trade receivables. The Company manages credit risk on cash by ensuring the counterparties are banks, governments and government agencies with high credit ratings.

The maximum exposure to credit risk for cash and trade receivables approximates the amount recorded on the consolidated statement of financial position of \$20,783,665 as at May 17, 2018 (December 31, 2017 – \$14,704,845; January 1, 2017 – \$9,000,209).

Trade receivables are with Canadian broadcasters. Management manages credit risk by regularly reviewing aged accounts receivable and performing an appropriate credit analysis.

Interest rate risk

The Company is exposed to interest rate risk arising from fluctuations in interest rates as its interim production financing and certain long-term debt bear interest at floating rates. Any changes in interest rates would increase or decrease production costs as interest owing on interim production financing is capitalized to investment in content.

With respect to interest rate risk on long-term debt, a 1% increase in the variable interest rate would have resulted in a \$9,583 decrease to the net income during the period ended May 17, 2018 (December 31, 2017 – \$24,167) in the Company's income before tax and a decrease of 1% would have resulted in an increase of \$9,583 (December 31, 2017 – \$24,167) in the Company's income before tax.

Liquidity risk

The Company manages liquidity by forecasting and monitoring operating cash flows and through the use of interim production financing (note 10). As at May 17, 2018, the Company had cash of \$17,498,820 (December

Notes to Consolidated Financial Statements May 17, 2018

(expressed in thousands of Canadian dollars)

31, 2017 – \$13,345,464; January 1, 2017 – \$7,085,565). The Company maintains appropriate cash balances and has access to financial facilities to manage fluctuating cash flows.

Interim financing and long-term debt are classified by the Company as current in nature as they are due on demand; however, the Company does not expect that the full amounts will be repaid within 12 months and the expected repayment schedule is reflected in the financial maturity table below.

The Company's activities involve holding foreign currencies, incurring production costs and earning revenue denominated in foreign currencies. These activities result in exposure to fluctuations in foreign currency exchange rates. At the reporting date, the Company revalues its financial instruments denominated in a foreign currency at the prevailing exchange rates.

Categories of financial instruments

As at May 17, 2018, the Company's financial instruments consisted of the following:

	May 17, 2018 \$	December 31, 2017 \$	January 1, 2017 \$

Financial assets
Measured at amortized cost
Cash	17,498,820	13,345,464	7,085,565
Trade and other receivables	3,902,348	1,717,041	1,914,644
Advances to equity accounted investee	90,683	-	-
Financial liabilities
Measured at amortized cost
Trade and other payables	9,494,437	3,631,921	4,825,201
Interim production financing	17,830,894	17,267,097	23,243,325
Due to related parties	6,573,000	7,225,947	5,663,008
Advance on sale of business	5,855,756	-	-
Long-term debt	-	1,916,667	2,916,667
Preference shares	7,173,000	-	-

Notes to Consolidated Financial Statements May 17, 2018

(expressed in thousands of Canadian dollars)

Fair values

Financial instruments recorded at fair value on the consolidated statement of financial position are classified using a fair value hierarchy that reflects the significance of the inputs used in making the measurements. The fair value hierarchy has the following levels:

Level 1 valuation based on quoted prices observed in active markets for identical assets and liabilities;
Level 2 valuation techniques based on inputs that are quoted prices of similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; inputs other than quoted prices used in a valuation model that are observable for that instrument, and inputs that are derived principally from or corroborated by observable market data by correlation or other means; and
Level 3 valuation techniques with significant unobservable market inputs.

A financial instrument is classified to the lowest of the hierarchy for which a significant input has been considered in measuring fair value.

Cash is valued based on quoted prices observed in active markets (Level 1) and the carrying amount reflects fair value.

There were no transfers between Level 1, Level 2, or Level 3 during the period ended May 17, 2018.

		May 17, 2018
	Carrying amount \$	Fair value \$
Advances to equity accounted investee	90,683	90,683
Interim production financing	17,830,894	17,830,894
Due to related parties	6,573,000	6,573,000
Advance on sale of business	5,855,756	5,855,756
Long-term debt	-	-
Preference shares	7,173,000	7,173,000

Notes to Consolidated Financial Statements May 17, 2018

(expressed in thousands of Canadian dollars)

		December 31, 2017
	Carrying amount \$	Fair value \$
Interim production financing	17,267,097	17,267,097
Due to related parties	7,225,947	7,225,947
Long-term debt	1,916,667	1,916,667
		January 1, 2017
	Carrying amount \$	Fair value \$
Interim production financing Due to related parties	23,243,325 5,663,008	23,243,325 5,663,008
Long-term debt	2,916,667	2,916,667

Notes to Consolidated Financial Statements May 17, 2018

(expressed in thousands of Canadian dollars)

Maturity analysis for financial liabilities

					May 17, 2018
	Less than 1 year \$	1 to 3 years \$	4 to 5 years \$	After 5 years \$	Total \$
Accounts payable and accrued
liabilities	9,494,437	-	-	-	9,494,437
Interim production financing	11,629,384	6,201,510	-	-	17,830,894
Due to related parties	6,573,000	-	-	-	6,573,000
Advance on sale of business	5,855,756	-	-	-	5,855,756
Preference shares	7,173,000				7,173,000
Long-term debt	-	-	-	-	-
	40,725,577	6,201,510	-	-	46,927,087

					December 31, 2017
	Less than 1 year \$	1 to 3 years \$	4 to 5 years \$	After 5 years \$	Total \$
Accounts payable and accrued
liabilities	3,631,921	-	-	-	3,631,921
Interim production financing	12,074,278	5,192,819	-	-	17,267,097
Long-term debt	1,000,000	916,667	-	-	1,916,667
Due to related parties	7,225,947	-	-	-	7,225,947-
	23,932,146	6,109,486	-	-	30,041,632

				January 1, 2017
	Less than 1 year \$	1 to 3 years \$	4 to 5 years \$	After 5 years \$	Total \$
Accounts payable and accrued
liabilities	4,825,201	-	-	-	4,825,201
Interim production financing	15,903,587	7,102,171	237,567	-	23,243,325
Long-term debt	1,000,000	1,916,667	-	-	2,916,667
Due to related parties	5,663,008	-	-	-	5,663,008

	27,391,796	9,018,838	237,567	-	36,648,201

Notes to Consolidated Financial Statements May 17, 2018

(expressed in thousands of Canadian dollars)

18 Income taxes

	May 17, 2018 \$	December 31, 2017 \$
Current income tax expenses Deferred income tax recoveries	2,598,731 (4,714,091)	861,421 218,439
Income tax expenses	(2,115,360)	1,079,860

The provision for (recovery of) income tax differs from the amount that would have resulted by applying the combined federal and Ontario statutory income tax rate of 26.5% (26.5% - December 31, 2017).

The reconciliation of income tax expense computed at the statutory rate to income tax expense recognized in the period is:

	May 17, 2018 \$	December 31, 2017 \$
Income before income taxes	950,142	5,021,795
Income tax expense based on combined federal and provincial tax rate of 26.5% Income taxes increased (decreased) by	251,788	1,330,776
Non-deductible expenses Tax impact of transfer of assets pending sale Tax rate differential CCPC tax rate adjustment	128,989 (2,496,137) - -	(124,838) - (68,578) (57,500)
	(2,115,360)	1,079,860

The following table summarizes the components of the deferred income tax assets:

	May 17, 2018 \$	December 31, 2017 \$
Non-capital loss Property and equipment Intangible assets Net defined benefit pension liability Investment in content Investment in subsidiary	97,387 23,442 2,943,653 - 204,439 2,100,161	347,692 17,425 - 53,685 246,799 -
	5,369,083	665,601

Notes to Consolidated Financial Statements May 17, 2018

(expressed in thousands of Canadian dollars)

In assessing the value of deferred tax assets, the Company's management considers if it is probable that taxable profit will be available against which the deductible temporary differences and unused tax losses can be utilized. Available evidence considered by the Company includes, but is not limited to, the Company's historic operating results, projected future operating results, and changing business and market circumstances. As at May 17, 2018, the Company has determined that based on its projected future operating results in the remainder of 2018 and beyond, it is probable that the Company will be able to utilize all its unused tax losses.

As at May 17, 2018, the Company had the following Canadian income tax attributes to carry forward:

			Amount \$	Expiry date
	Canadian non-capital losses		367,497	2035 to 2038
19	Revenue and expenses by nature	May 17, 2018		December 31, 2017
		\$		\$
	Production revenue Distribution revenue Service revenue	21,637,426 123,024 5,602,878		34,296,132 195,074 10,892,713
	Total revenue	27,363,327		45,383,919
	Production, distribution and service costs Tax credits	4,825,604 34,840		7,647,908 -
	Amortization of investment in content Participation costs Salaries and employee benefits	17,630,289 74,379 2,024,503		24,521,984 417,969 5,681,754
	Overhead costs Amortization of property and equipment	1,785,186 22,709		1,934,236 85,220
	Total expenses	26,397,511		40,289,071
	Operating income	965,817		5,094,848

Notes to Consolidated Financial Statements May 17, 2018

(expressed in thousands of Canadian dollars)

20 Supplementary cash flow information

	May 17, 2018 \$	December 31, 2017 \$
(Increase) decrease in accounts receivable (Increase) decrease in production tax credits receivable Decrease in income tax receivable (Increase) decrease in prepaid expenses and deposits Increase (decrease) in accounts payable and accrued liabilities Increase (decrease) in income tax payable Increase (decrease) in deferred revenue	(2,257,194) (189,174) 221,238 (1,226,607) 3,434,822 2,144,516 (3,140,097)	(3,323) 6,923,830 290,666 148,102 (584,298) - 4,558,881
	(1,012,496)	11,333,858

The following table summarizes the change in the Company's liabilities arising from financing activities for the period ended May 17, 2018 and the year ended December 31, 2017:

	Interim production financing \$	Due to related party \$	Advance on sale of business \$	Preference shares \$	Long term debt \$
December 31, 2017	17,267,097	7,225,947	-	-	1,916,667
Cash payments Non-cash payments Issuance of shares Proceeds	(8,872,623) - - 9,436,419	- (7,173,000) - 6,520,053	- - 5,855,756	- - 7,173,000 -	(1,916,667) - - -
May 17, 2018	17,830,894	6,573,000	5,855,756	7,173,000	-

Notes to Consolidated Financial Statements May 17, 2018

(expressed in thousands of Canadian dollars)

	Interim production financing \$	Due to related party \$	Advance on sale of business \$	Preference shares \$	Long term debt \$
December 31, 2016	23,243,325	5,663,008	-	-	2,926,667
Cash payments Proceeds	(25,407,612) 19,431,384	- 1,562,939	-	- -	(1,000,000) -
December 31, 2017	17,267,097	7,225,947	-	-	1,916,667

21 Capital disclosures

The Company's objectives when managing capital are to provide an adequate return to shareholders, safeguard its assets, maintain a competitive cost structure and continue as a going concern in order to pursue the development, production, distribution and licensing of its content. As at May 17, 2018, cash includes \$8,570,680 (December 31, 2017 – \$9,422,655; January 1, 2017 – \$6,663,854) of cash that is required for the funding of productions in progress and is not available for other uses. This cash is not formally restricted but is instead earmarked for use for specific productions. The Company does not consider interim production financing, if any, to be part of its capital management programs as these loans are specific to individual productions and are repaid by funds earmarked to the individual productions such as production tax credits and other forms of support. The Company declared dividends of \$6,573,000 for the period ended May 17, 2018. The balance of the Company's cash is being used to maximize ongoing development and growth effort.

	May 17, 2018	December 31, 2017	January 1, 2017
	\$	\$	\$
Cash	17,498,820	13,345,464	7,085,565
Total long-term debt	-	(1,916,667)	(2,916,667)
Net capital	17,498,820	11,428,797	4,168,898
Total capital and reserves attributable to owners	(2,052,548)	1,425,526	(881,909)

Notes to Consolidated Financial Statements May 17, 2018

(expressed in thousands of Canadian dollars) 22 Commitments and contingencies

Operating leases relate primarily to the Company's facilities with lease terms of between one and eleven years. Most building leases contain five-year renewal options. During the period ended May 17, 2018, the Company recognized \$264,034 of operating lease payments as expenses (December 31, 2017 – \$611,100).

Non-cancellable operating lease commitments are due as follows:

	May 17, 2018 \$	December 31, 2017 \$
No later than one year Later than one year and not later than five years Later than five years	353,663 1,555,872 330,552	251,602 1,538,775 495,828
	2,240,087	2,286,205

23 Subsequent events

In February 2020, the Company was served with a class action lawsuit regarding allegations of non-compliance with Ontario's Employment Standard Act. The suit is seeking \$35,000,000 in damages. The Company believes that the suit is without merit and it is not probable that the Company will have to make payments in regard to this action.

In March 2020, the World Health Organization characterized COVID-19 as a global pandemic. Since that time, several preventative measures have been implemented in Canada, including shelter-in-place orders and the closure of the border between Canada and the United States to non-essential travel.

As a result of the COVID-19-associated protocols, the Company has incurred increased production costs that were not included in the pre-COVID-19 production budgets, such as shorter work days for certain union crew, personal protective equipment, and other safety measures. These protocols and costs are crucial to protect cast and crew and ensure that production continues without further delay or risk of the spread of COVID-19 on sets.

Notes to Consolidated Financial Statements May 17, 2018

(expressed in thousands of Canadian dollars)

Due to the preventative measures implemented to curb the spread of the virus such as shelter-in-place orders and halting of non-essential business activities, certain productions were forced to wrap production prior to all episodes being completed, experienced a temporary hiatus, or had the start of principal photography pushed into 2021. The Company anticipates that revenue recognition may be pushed to 2021 that would have previously occurred in 2020, but the majority of productions will continue to earn the anticipated revenue that was contemplated by management prior to the pandemic. The Company does not expect COVID-19 to have a significant impact on the collection of its trade accounts receivable or an increase in expected credit losses because the Company's customers are typically large, established broadcasters who are not anticipated to withhold payment and are anticipated to continue to be solvent.

The Company has accessed funds from the Canada Emergency Wage Subsidy ("CEWS") and has collected \$259 relating to its productions in 2020 that has been reflected as a reduction of investment of content. \$78 of this funding represents the collection of accelerated tax credits that would have been collected independently of the CEWS but which have been collected sooner under this program in order to provide for additional cash inflow in 2020. The Company also received a Ministry of Heritage grant of \$390 which has been recognized as a reduction of its operating expenses.

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following Management's Discussion and Analysis ("MD&A") has been prepared by management and is a review of the consolidated operating results and financial position of Insight Production Company Ltd. ("Insight"), based upon International Financial Reporting Standards ("IFRS"). This discussion and analysis should be read in conjunction with the consolidated financial statements of Insight, as well as the notes thereto, for the respective periods. All amounts are expressed in thousands of Canadian dollars unless otherwise stated. This disclosure is effective as February 17, 2021.

Overview of the company

Insight is a Canadian production company specializing in the production of television content. Insight was incorporated in Canada and the address of its registered office is 135 Liberty St, Toronto, Ontario, M6K 1A7.

Subsequent to year end, effective end of day on May 17, 2018, Boat Rocker Media Inc. acquired 70% of the outstanding shares of Insight. The financial statements have been prepared as of May 17, 2018 and for the period then ended, which is prior to when Insight began to be consolidated by Boat Rocker Media Inc.

SELECTED FINANCIAL INFORMATION

The following table provides selected financial information of Insight for the period from January 1, 2018 to May 17, 2018 as well as the year ended December 31, 2017:

		Period ended	Year ended
		May 17, 2018		Dec 31, 2017

Revenue	\$	27,363	\$	45,384
Net income	\$	3,066		3,942

		May 17, 2018		Dec 31, 2017
Cash	\$	17,499	\$	13,345
Total assets	\$	57,370	\$	45,161
Total non-current financial liabilities	\$	— \$		1,119
Total liabilities	\$	59,422	\$	43,735

	Period ended			Year ended
		May 17, 2018	Dec 31, 2017
Cash provided by (used in) operating activities	\$	(206)	\$	13,509
Cash provided by (used in) financing activities	\$	4,450	\$	(7,035)
Cash used in investing activities	\$	(91)	\$	(214)
Cash dividends declared per common share (in dollars)	\$	86,162	\$	20,270

Results of Operations

The discussion of the fiscal periods that follows compares the results of operations for the period from January 1 to May 17, 2018 to the year ended December 31, 2017. As a result of the difference in length of fiscal periods, in certain instances the comparative amounts may not provide meaningful information.

The following table sets forth the consolidated results of operations for the period ended May 17, 2018 and the year ended December 31, 2017:

	Period Ended				Increase (Decrease)
		May 17, 2018		December 31, 2017	Amount	Percent
Revenue Total revenue	\$	27,363	\$	45,384	(18,021)	(40%)
Expenses
Production, distribution, and service		22,565		32,588	(10,023)	(31%)
General and administrative		3,810		7,616	(3,806)	(50%)
Amortization of property and equipment		22		86	(64)	(74%)
Finance costs, net		123		148	(25)	(17%)
Share of income in equity accounted investee		(107)		(75)	(32)	43%
Net income before income taxes	\$	950	\$	5,021	\$ (4,071)	(81%)
Income tax expense (recovery)	\$	(2,116)	\$	1,079	(3,195)	(296%)
Net income	\$	3,066	\$	3,942	(876)	(22%)

Revenue. Insight grants licenses to third parties for content owned either by Insight or a third party producer. Licensing revenue that supports the greenlight of the production, also called a pre-sale, is presented as production revenue and is recognized at a point in time. Licensing revenue earned after the pre-sale is presented as distribution revenue. Insight also recognizes service revenue when Insight performs services to facilitate production of content owned by a third party and this revenue is recognized over time.

During the period ended May 17, 2018, revenue decreased by \$18,021 from the year ended December 31, 2017, a decrease of 40%. This decrease is attributable to the fact that five productions were delivered and serviced in the year ended December 31, 2017 compared to only three in the period ended May 17, 2018, owing to the shorter period presented in 2018. Fluctuations in revenue for production revenue are typically attributable to the number of productions Insight is working on, the size and scope of those productions, and, for production revenue, the delivery dates of those productions.

Production revenue earned in the year ended December 31, 2017 was \$34,296. Approximately 94% of this revenue was derived from the delivery of five key shows. Production revenue earned in the period ended May 17, 2018 was \$21,637. Approximately 98% of this revenue was derived from the delivery of three key shows.

Service revenue earned in the year ended December 31, 2017 was \$10,893. This revenue was derived from work performed on three key shows. Service revenue earned in the period ended May 17, 2018 was \$5,603. This revenue was derived from work performed on five key shows.

Distribution revenue earned in the year ended December 31, 2017 was \$195 compared to distribution revenue of \$123 in the period ended May 17, 2018. Distribution revenue relates to licensing revenue earned after the pre-sale of Insight's intellectual property and fluctuates based on demand for this intellectual property in each period.

Production, distribution, and service expenses. These expenses relate to costs incurred to produce Insight's shows, and include amortization of investment in content, distribution costs, and service costs. Amortization of investment in content is a direct operating expense which represents the production costs of content that Insight owns. As the content is produced, the costs are capitalized on the statement of financial position until the revenue recognition criteria is satisfied, at which time an assessment of the life of the content is made. The criteria to assess the life of the content includes the type of content, the global demand for the content, and the potential for subsequent seasons and ancillary revenue such as merchandise and licensing. Insight's delivered content is generally amortized at 100% at the time of delivery.

The cost of generating service revenue is also a direct operating expense. This expense primarily includes salaries of cast and crew. Expenses are also recognized for participation earned by third parties associated with certain content, including producers, writers, directors or actors. The recognition of participation expenses occurs as revenues for the content are earned.

Production and distribution costs were \$22,565 in the period ended May 17, 2018, a decrease of 31% from \$32,588 for the year ended December 31, 2017. This decrease is attributable to the fact that the period of May 17, 2018 is less than five months compared to twelve months in the comparative period in 2017. The most significant component of this category is amortization of investment in content of \$17,630 in the period ended May 17, 2018 (78% of this line item) compared to \$24,522 for the year ended December 31, 2017 (75% of this line item). As Insight typically amortizes 100% of the capitalized investment in content on delivery, these costs are primarily driven by the number and size of productions delivered in the period. See the revenue section above for discussion of the major productions delivered in each fiscal period. The bulk of the residual expenses are attributable to service costs, which relate to the service shows generating revenue in those periods. See the revenue section above for a discussion of these productions.

The primary driver of this line item is salaries and benefits, which were \$2,025 for the period ended May 31, 2018 compared to \$5,682 for the year ended December 31, 2017. Salaries and benefits fluctuate based on number of employees and level of compensation, including pay raises. Due to raises, additional hires, and bonuses, it is typically expected that salaries and benefits will increase year over year.

Amortization expense. Amortization expense consists of the amortization of property and equipment. Amortization of property and equipment expense for the period ended May 17, 2018 was \$22 compared to \$86 for 2017, a decrease of \$64 or 74%. This decrease is primarily attributable to the fact that the period of May 17, 2018 is less than five months compared to twelve months in the comparative period in 2017. There were no additions to property and equipment in the period ended May 17, 2018 compared to \$45 of additions in the year ended December 31, 2017. Neither period had disposals.

Finance costs, net. The following table presents the breakdown of finance costs for the period ended May 17, 2018 and year ended December 31, 2017:

	Period ended			Increase (Decrease)
	May 17, 2018	Dec 31, 2017			Amount	Percent
Interest expense	122		139		(17)	(12%)
Foreign exchange loss	1		9		(8)	(92%)
Finance costs, net	\$ 123	\$	148	\$	(25)	(17%)

Finance costs for the period ended May 17, 2018 was \$123 compared to \$148 in the year ended December 31, 2017, a decrease of \$25. This decrease is attributable to the fact that the period of May 17, 2018 is less than five months compared to twelve months in the comparative period in 2017. The main driver of this line item is interest expense. Interest expense on interim financing of productions is included in investment in content until the point of delivery, after which the interest expense is presented on the statement of operations as interest expense until the interim financing has been extinguished. Interest was also paid on a line of credit that was paid off during the period ended May 31, 2018. As more productions continue to be delivered, post-delivery interest expense on interim financing will increase, as those costs were previously included in investment in content rather than in this line item.

Income tax expense (recovery):

The following table presents the breakdown of income tax expense (recovery) for the period ended May 17, 2018 and year ended December 31, 2017:

	Period ended			Increase (Decrease)
	2018		2017		Amount	Percent
	(Amounts in thousands)
Current income tax expense	2,598		861		1,737	202%
Deferred income tax expense (recovery)	(4,714)		218		(4,932)	(2262%)
Income tax expense (recovery)	\$ (2,116)	\$	1,079	\$	(3,195)	(296%)

Total income tax recovery was \$2,116 for the period ended May 17, 2018, an effective tax rate of (222.6%) on the income before taxes of \$950, as compared to an income tax expense \$1,079, or an effective tax rate of 21.5% on the income before taxes of \$5,022 for the year ended December 31, 2017. Insight's statutory tax rate is 26.5% for each of these periods. The current income tax in 2018 is due to taxable capital gains on an internal sale of goodwill from Insight Production Company Limited (IPCL) to a newly created company - Insight Production Limited (IPL) at higher tax rate on CCPC investment income. The decrease of the deferred income tax in 2018 is triggered by the future income tax benefit from both the tax basis of internal transferred goodwill and the tax basis of the shares of IPL that will be sold in the foreseeable future to Boat Rocker Media.

Cash Flows

The following table summarizes the cash flows for the period ended May 17, 2018 and year ended December 31, 2017:

	Period ended				Increase (Decrease)
	2018			2017		Amount
	(Amounts in thousands)
Cash (used in) provided by operating activities	\$	(206)	\$	13,509	\$	(13,715)
Cash (used in) provided by financing activities		4,450		(7,035)		11,485
Cash used in investing activities		(91)		(214)		123
Increase in cash and cash equivalents	\$	4,153	\$	6,260	\$	(2,107)

Cash flow from operating activities for the period ended May 17, 2018 was a cash outflow of \$206 as compared to a cash inflow of \$13,509 in the year ended December 31, 2017, a variance of \$13,715. The primary driver of the decrease in operating cash flows was the decrease in the collection of production tax credits of \$7,113 in the period ended May 17, 2018 compared to the year ended December 31, 2017, as well as a decrease in the collection of cash from deferred revenue of \$7,699 in the period ended May 17, 2018 compared to the year ended December 31, 2017.

Cash flow from financing activities for the period ended May 17, 2018 was a cash inflow of \$4,450 compared to cash outflow of \$7,035 for the year ended December 31, 2017, a variance of \$11,485. The variance is caused by Insight receiving an advance on the sale of the business of \$5,856 immediately prior to the May 17, 2018 sale of Insight to Boat Rocker Media. Additionally, the net cash inflows from interim production financing were \$564 during the period ended May 17, 2018 compared to net cash outflows of \$5,976 during the year ended December 31, 2017, a variance of \$6,540. These inflows were offset by an increase in repayments of long-term debt of \$917 during the period ended May 17, 2018 compared to the year ended December 31, 2017

Cash flow from investing activities for the period ended May 17, 2018 was a cash outflow of \$91 compared to \$214 for the year ended December 31, 2017, a variance of \$123. The variance can be explained by a \$78 decrease in cash outflows relating to an equity accounted investee between the year ended December 31, 2017 and the period ended May 17, 2018. The impact is also attributable to the acquisition of property and equipment for \$nil in the period ended May 17, 2018, compared to \$45 in 2017.

Contractual Obligations

Future minimum lease payments under non-cancellable operating leases as at May 17, 2018 are \$354 payable within one year, \$1,556 payable between one and five years, and \$331 payable later than five years.

Liquidity and Capital Resources

Insight manages liquidity by forecasting and monitoring operating cash flows and through the use of interim production financing. Insight maintains appropriate cash balances and has access to financial facilities to manage fluctuating cash flows.

Interim financing and long-term debt are classified by Insight as current in nature as they are due on demand.

Interim production financing is drawn by Insight in order to bridge the timing differences between the receipt of licence fees, distribution advances, government assistance and production tax credits and the funding of production costs. On collection of amounts owing, interim production financing is repaid by Insight. Amounts are classified as current as the interim financing is due on demand. Insight had an outstanding interim financing balance of \$17,831 at May 17, 2018 and \$17,267 at December 31, 2017.

Long-term debt consists of a revolving line of credit. Interest and principal are payable on a monthly basis until November 30, 2019. The revolving line of credit was fully repaid during the period ended May 17, 2018, but a similar arrangement could be implemented depending on future liquidity needs, however the main tool to manage liquidity gaps is interim production financing.

Related Parties

Related party transactions include transactions between Insight's shareholders, their dependents and entities under common control, which include Northern Pines Ltd. Northern Pines Ltd. owns 100% of the common shares of IPCL Holdings Ltd. Related party transactions also include transactions with key management personnel including directors and officers of Insight who are considered to be responsible for the operational, financial, and strategic direction of Insight. Insight expensed \$718 in compensation of key management personnel in the period ended May 17, 2018 and \$2,220 in the year ended December 31, 2017.

As at May 17, 2018, payable to related parties includes \$6,573 (2017 - \$7,226) in respect of a loan due to Northern Pines Ltd., which is non-interest bearing, of which \$6,520 was borrowed during the period ended May 17, 2018. During the same period, Insight extinguished a demand promissory note payable to Northern Pines Ltd. of \$7,174 by issuing 7,173 Class A preference shares at \$1,000 per share and by paying \$630 in cash.

As at December 31, 2017, amounts payable to related parties included \$7,226 in respect of amounts owed to Northern Pines Ltd. and HMD Christmas. There was a loan due to Northern Pines Ltd. in the amount of \$7,174, which was non-interest bearing, and \$1,563 was borrowed during the year. The remaining amount of \$53 related to a loan from HMD Christmas, which was also non-interest bearing, and Insight also recognized advances to equity accounted investees of \$91 at May 17, 2018 from the same investee.

Insight declared and paid a dividend of \$6,530 (2017 - \$1,621) to Northern Pines Ltd. during the period ended May 17, 2018.

Outstanding equity instruments

As of February 17, 2021, the following equity instruments are outstanding:

Common shares: 100,000 Preferred shares: 7,173

CRITICAL ACCOUNTING POLICIES, ESTIMATES AND JUDGEMENTS

For a summary of all of Insight's accounting policies, including the accounting policies discussed below, see Note 3 to Insight's annual financial statements.

The most significant estimates and judgments made by management in the preparation of Insight's consolidated financial statements include the following:

The methods and estimates of useful life needed to determine the appropriate amortization of investment in content depend on judgments with respect to many variables including the ability to license content to broadcasters, the availability of secondary markets, the impact of new media platforms, and the demand for merchandise and licensing of the related brand. The usage of content may differ materially and impact future amortization and net income.
The amount of production tax credits Insight files for as costs are incurred, and the amounts ultimately recovered may differ. The expected timing of the receipt of production tax credits is subject to uncertainty and amounts have been classified as current or long-term based on the expected date of receipt.

Although management believes the assumptions and estimates made in the past have been reasonable and appropriate, they are based in part on historical experience and information obtained from the management of the acquired companies and are inherently uncertain. Unanticipated events and circumstances may occur, which may affect the accuracy or validity of such assumptions estimates or actual results.

Consolidated Financial Statements For the period ended August 30, 2019 and the years ended December 31, 2018 and December 31, 2017 (expressed in thousands of US dollars)

Independent auditor's report

To the Directors of Platform One Media, LLC

Our opinion

In our opinion, the accompanying consolidated financial statements present fairly, in all material respects, the financial position of Platform One Media, LLC and its subsidiaries (together, the Company) as at August 30, 2019, December 31, 2018, December 31, 2017 and January 1, 2017, and its financial performance and its cash flows for the period from January 1, 2019 to August 30, 2019 and the years ended December 31, 2018 and December 31, 2017, in accordance with International Financial Reporting Standards as issued by the International Accounting Standards Board (IFRS).

What we have audited

The Company's consolidated financial statements comprise:

the consolidated statements of financial position as at August 30, 2019, December 31, 2018, December 31, 2017 and January 1, 2017;
the consolidated statements of changes in equity for the period from January 1, 2019 to August 30, 2019 and for the years ended December 31, 2018 and December 31, 2017;
the consolidated statements of loss and comprehensive loss for the period from January 1, 2019 to August 30, 2019 and for the years ended December 31, 2018 and December 31, 2017;
the consolidated statements of cash flows for the period from January 1, 2019 to August 30, 2019 and for the years ended December 31, 2018 and December 31, 2017; and
the notes to the consolidated financial statements, which include significant accounting policies and other explanatory information.

Basis for opinion

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Independence

PricewaterhouseCoopers LLP PwC Centre, 354 Davis Road, Suite 600, Oakville, Ontario, Canada L6J 0C5 T: +1 905 815 6300, F: +1 905 815 6499

Responsibilities of management and those charged with governance for the consolidated financial statements

Those charged with governance are responsible for overseeing the Company's financial reporting process.

Auditor's responsibilities for the audit of the consolidated financial statements

As part of an audit in accordance with Canadian generally accepted auditing standards, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:

Identify and assess the risks of material misstatement of the consolidated financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control.
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.

Conclude on the appropriateness of management's use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor's report to the related disclosures in the consolidated financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor's report. However, future events or conditions may cause the Company to cease to continue as a going concern.
Evaluate the overall presentation, structure and content of the consolidated financial statements, including the disclosures, and whether the consolidated financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the Company to express an opinion on the consolidated financial statements. We are responsible for the direction, supervision and performance of the group audit. We remain solely responsible for our audit opinion.

Chartered Professional Accountants, Licensed Public Accountants

Oakville, Ontario February • , 2021

Consolidated Statements of Financial Position

(expressed in thousands of US dollars, except share amounts)

	August 30, December 31, December 31, January 1, 2019 \$	2018 \$	2017 \$	2017 \$
Assets
Current assets Cash and cash equivalents Restricted cash (note 13) Accounts receivable Prepaid expenses and deposits	1,248 150 37 763	12,611 150 - 50	19,495 - - 22	1,950 - - 80
Total current assets	2,198	12,811	19,517	2,030
Investment in content (note 5) Property and equipment (note 4) Right-of-use assets (note 8)	12,663 16 673	1,535 11 865	314 18 99	1,247 23 287
Total assets	15,550	15,222	19,948	3,587
Liabilities
Current liabilities Accounts payable and accrued liabilities Current lease liabilities (note 8) Deferred revenue	711 326 5,305	328 318 -	- 118 -	- 185 -
Total current liabilities	6,342	646	118	185
Long-term lease liabilities (note 8)	390	570	-	102
Total liabilities	6,732	1,216	118	287
Members' equity
Members' capital (note 6) Deficit	35,000 (26,182)	35,000 (20,994)	35,000 (15,170)	12,500 (9,200)
Total members' equity	8,818	14,006	19,830	3,300
Total members' equity and liabilities	15,550	15,222	19,948	3,587

On Behalf of the Board of Directors

_____ Director ________ Director

Consolidated Statements of Changes in Equity

(expressed in thousands of US dollars, except share amounts)

	Number of units	Members' capital \$	Deficit \$	Total equity \$
Balance – January 1, 2017	10,000,000	12,500	(9,200)	3,300
Members' capital issued (note 6)	1,666,667	22,500	-	22,500
Net loss for the period	-	-	(5,970)	(5,970)
Balance – December 31, 2017	11,666,667	35,000	(15,170)	19,830
Net loss for the period (note 6)	-	-	(5,824)	(5,824)
Balance – December 31, 2018	11,666,667	35,000	(20,994)	14,006
Members' capital issued1	181,875	-	-	-
Net loss for the period	-	-	(5,188)	(5,188)
Balance – August 30, 2019	11,848,542	35,000	(26,182)	8,818

1 The additional members' interests were allocated as part of a reorganization for no cash consideration.

Consolidated Statements of Loss and Comprehensive Loss

(expressed in thousands of US dollars, except share amounts)

	Period ended August 30, 2019 \$	Year ended December 31, 2018 \$	Year ended December 31, 2017 \$
Expenses (note 11)
Development costs	880	1,195	1,814
Salaries and benefits	3,114	3,337	2,426
General and administrative costs (note 11)	1,058	1,168	1,525
Amortization of property and equipment and right-of-use assets	192	286	199
Total expenses	5,244	5,986	5,964
Operating loss	(5,244)	(5,986)	(5,964)
Finance income (expense) – net (note 9)	56	162	(6)
Net loss and comprehensive loss for the period	(5,188)	(5,824)	(5,970)

Consolidated Statements of Cash Flows

(expressed in thousands of US dollars, except share amounts)

	Period ended August 30, 2019 \$	Year ended December 31, 2018 \$	Year ended December 31, 2017 \$
Cash provided by (used in)
Operating activities
Net loss for the period	(5,188)	(5,824)	(5,970)
Adjustments for non-cash items:
Amortization of property and equipment (note 4)	-	54	11
Amortization of right-of-use assets (note 8)	192	232	188
Write-offs of investment in content (note 5)	-	-	1,247
Finance (income) expense (net) (note 9)	(56)	(162)	6
Additions to investment in content (note 5)	(11,127)	(1,221)	(314)
Change in restricted cash Change in non-cash balances related to operations (note 12)	- 4,938	(150) 300	- 58
Cash used in operating activities	(11,241)	(6,771)	(4,774)
Financing activities
Repayments of lease liabilities (note 8) Members' capital issued (note 6)	(210) -	(264) -	(185) 22,500
Cash (used in) provided by financing activities	(210)	(264)	22,315
Investing activities
Cash interest received	94	198	9
Acquisition of property and equipment (note 4)	(6)	(47)	(5)
Cash provided by investing activities	88	151	4
(Decrease) Increase in cash and cash equivalents	(11,363)	(6,884)	17,545
Cash and cash equivalents – Beginning of period	12,611	19,495	1,950
Cash and cash equivalents – End of period	1,248	12,611	19,495
Cash and cash equivalents comprise
Cash	1,124	131	38
Cash equivalents	124	12,480	19,457
	1,248	12,611	19,495

Notes to Consolidated Financial Statements

August 30, 2019

(expressed in thousands of US dollars, except share amounts)

1 Corporate information

Platform One Media, LLC (the Company) is an American entertainment company that produces television media content. The Company was incorporated in and is domiciled in the United States of America and the address of the Company's registered office is 10100 Santa Monica Boulevard, Los Angeles, California, 90067.

On August 31, 2019, Boat Rocker Media Inc. (Boat Rocker) acquired 100% of the outstanding capital units of the Company. Boat Rocker was incorporated in and is domiciled in Canada and the address of Boat Rocker's registered office is 310 King Street East, Toronto, Ontario M5A 1K6.

2 Basis of preparation and statement of compliance

These consolidated financial statements have been prepared in accordance with International Financial Reporting Standards (IFRS) as issued by the International Accounting Standards Board (IASB). These are the Company's first consolidated financial statements reported under IFRS. Accordingly, IFRS 1 First-time Adoption of IFRS (IFRS 1), has been applied. The Company has never presented consolidated financial statements and therefore an opening balance sheet as at January 1, 2017 has been included. Since the Company did not previously prepare consolidated financial statements, and accordingly does not have any previous generally accepted accounting principles (GAAP) for purposes of the consolidated financial statements, the Company is not required to present reconciliations as per IFRS 1.

As a part of adoption of IFRS 1, the Company retrospectively applied IFRS 9 Financial Instruments (IFRS 9), IFRS 15 Revenue from Contracts with Customers (IFRS 15) and IFRS 16 Leases (IFRS 16) as of January 1, 2017, in accordance with the transitional provisions of IFRS 1.

On transition to IFRS 16, the Company elected to apply the following optional exemptions provided by IFRS 1:

The option to exclude initial direct costs from the measurement of the right-of-use assets on transition;
The option to use hindsight e.g. in determining the lease term if the contract contains options to extend or terminate the lease.

These consolidated financial statements were authorized for issue by the Board of Directors on February XX, 2021.

3 Significant accounting policies

The significant accounting policies used in the preparation of these consolidated financial statements are described below.

Notes to Consolidated Financial Statements

August 30, 2019

(expressed in thousands of US dollars, except share amounts)

Basis of presentation

The consolidated financial statements have been prepared on a historical cost basis, except for those assets and liabilities that are measured at fair value, including financial assets and financial liabilities. These consolidated financial statements are presented in US dollars, which is the functional currency of the Company. These consolidated financial statements are presented in thousands of dollars, with the exception of capital unit amounts.

Significant subsidiaries

The Company's principal subsidiaries include the following:

Name of company	Jurisdiction	Function	Owned by Company %
Platform One Media Productions, LLC 5 Pebbles, LLC	Delaware Delaware	Borrower entity Intellectual property	100.00
		development and exploitation	100.00
Salvos,LLC	Delaware	Holding company	100.00
Rubigo, LLC	Delaware	Holding company	100.00
Magister, LLC	Delaware	Holding company	100.00
Ceteri Productions, LLC	Delaware	Production company	100.00
Fidelis Productions, LLC	Delaware	Production company	100.00
Illuminare Productions, LLC	Delaware	Production company	100.00

For all of the above listed subsidiaries, the Company exercises its control through voting interests.

Basis of consolidation

The consolidated financial statements include the accounts of the Company and all of its controlled subsidiaries. All intercompany balances and transactions have been eliminated on consolidation. Subsidiaries are those entities that the Company controls. Consistent with the film and television industry, the Company utilizes single-purpose entities to manage the costs and funding for its content production projects. For accounting purposes, control is established by the Company when it is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power over the entity. Subsidiaries are fully consolidated from the date on which control is obtained by the Company and are de-consolidated from the date that control ceases. Changes in the Company's interest in a subsidiary that do not result in a loss of control are accounted for as equity transactions.

Notes to Consolidated Financial Statements

August 30, 2019

(expressed in thousands of US dollars, except share amounts)

Investment in content

Investment in content is classified by the Company into the following categories: development, in production and delivered content. For content produced by the Company, all direct production and financing costs incurred during production that are expected to benefit future periods are capitalized. Financing costs are capitalized until substantially all of the activities necessary to prepare the content for delivery are complete. Federal and provincial program contributions and production tax credits are recorded as a reduction of the cost of the content, as is production financing provided by third parties that acquire participation rights.

Development costs represent expenditures incurred on projects prior to the commencement of production and are expensed at the date when the costs are determined not to be recoverable. Content in production represents the accumulated costs of content currently in production. On delivery of the content to the licensor, content is reclassified into the delivered category.

Delivered content is accounted for as an intangible asset and will be amortized using a declining balance method at rates ranging from 95% to 100% at the time of delivery and at rates ranging from 25% to 50% annually on a declining balance as the underlying rights are consumed.

Property and equipment

Property and equipment are recorded at cost less accumulated depreciation and accumulated impairment losses. Furniture and fixtures are amortized straight-line over a three-year period.

Depreciation rates and the estimated useful lives of property and equipment are reviewed at each financial yearend and are adjusted if necessary.

Recognition of revenue and deferred revenue

The Company earns revenue from the initial licensing and distribution of content produced and owned by the Company. The Company follows the specific guidance on licensing included in IFRS 15. The Company has determined that licences for its content transfer a right to use intellectual property. Under the standard, revenue from contracts associated with the right to use intellectual property is recognized in full when all of the performance obligations are met.

Performance obligations for licensing revenue are satisfied when the production has been completed, the customer has access to the content, and the licence period associated with the contract has started.

Amounts received in advance are recorded as deferred revenue until the revenue recognition conditions have been met. As of August 30, 2019, \$5,305 was received from customers in advance. No revenue was recognized because no production has been completed to date.

Notes to Consolidated Financial Statements

August 30, 2019

(expressed in thousands of US dollars, except share amounts)

Impairment of long-lived assets

Foreign currency transactions and translation

Foreign currency transactions are translated into the Company's functional currency using the exchange rates prevailing at the dates of the transactions. Foreign currency denominated monetary assets and liabilities are translated into functional currency at the rate of exchange in effect on the reporting date. Gains and losses on the translation of monetary items are recognized in the consolidated statement of loss and comprehensive loss.

Financial instruments

The Company accounts for its financial assets and liabilities in accordance with IFRS 9.

Classification of financial assets and financial liabilities

Financial assets

On initial recognition, a financial asset is classified as measured at amortized cost, fair value through other comprehensive income (FVOCI) or fair value through profit or loss (FVTPL). The classification of financial assets is generally based on the business model in which a financial asset is managed and its contractual cash flow characteristics. Derivatives embedded in contracts where the host is a financial asset in the scope of the standard are never separated. Instead, the hybrid financial instrument as a whole is assessed for classification.

Notes to Consolidated Financial Statements

August 30, 2019

(expressed in thousands of US dollars, except share amounts)

A financial asset is measured at amortized cost if it meets both of the following conditions and is not designated as at FVTPL:

it is held within a business model whose objective is to hold assets to collect contractual cash flows; and
its contractual terms give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

All financial assets not classified as amortized cost or FVOCI as described above are measured at FVTPL.

Financial liabilities

Financial liabilities are classified as measured at amortized cost or FVTPL. A financial liability is classified as at FVTPL if it is classified as held for-trading or it is designated as such on initial recognition. Financial liabilities at FVTPL are measured at fair value and net gains and losses, including any interest expense, are recognized in profit or loss. Other financial liabilities are subsequently measured at amortized cost using the effective interest method. Interest expense and foreign exchange gains and losses are recognized in profit or loss. Any gain or loss on derecognition is also recognized in profit or loss.

Impairment

The Company applies the simplified approach in calculating lifetime expected credit losses on accounts receivable. Impairment losses on financial assets carried at amortized cost are reversed in subsequent periods if the financial asset is no longer credit-impaired and the improvement can be related objectively to an event occurring after the impairment was recognized (such as an improvement in the counterparty's credit rating).

Leases

At the inception of a contract, the Company assesses whether a contract is, or contains, a lease. A contract is, or contains, a lease if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration. The Company assesses whether the contract involves the use of an identified asset, whether it has the right to obtain substantially all of the economic benefits from use of the asset during the term of the arrangement and if it has the right to direct the use of the asset. At inception or on reassessment of a contract that contains a lease component, the Company allocates the consideration in the contract to each lease component on the basis of their relative standalone prices.

As a lessee, the Company recognizes a right-of-use asset and a lease liability at the commencement date of a lease. The right-of-use asset is initially measured at cost, which is comprised of the initial amount of the lease liability adjusted for any lease payments made at or before the commencement date, plus any decommissioning and restoration costs, less any lease incentives received.

Notes to Consolidated Financial Statements

August 30, 2019

(expressed in thousands of US dollars, except share amounts)

The right-of-use asset is subsequently depreciated from the commencement date to the earlier of the end of the lease term, or the end of the useful life of the asset. In addition, the right-of-use asset may be reduced due to impairment losses, if any, and adjusted for certain remeasurements of the lease liability.

fixed payments, including in-substance fixed payments, less any lease incentives receivable;
variable lease payments that depend on an index or a rate, initially measured using the index or rate as at the commencement date;
amounts expected to be payable under a residual value guarantee;
exercise prices of purchase options if the Company is reasonably certain to exercise that option; and
payments of penalties for terminating the lease, if the lease term reflects the lessee exercising an option to terminate the lease.

The lease liability is measured at amortized cost using the effective interest method. The effect of the passage of time is recorded in the Company's profit and loss as accretion expense. It is remeasured when there is a change in future lease payments arising from a change in an index or rate, or if there is a change in the Company's estimate or assessment of the expected amount payable under a residual value guarantee, purchase, extension or termination option.

Variable lease payments not included in the initial measurement of the lease liability are charged directly to profit or loss.

Extension and termination options are included in the majority of the Company's leases. These options are exercisable only by the Company and not by the lessor. In determining the lease term, management considers all facts and circumstances that create an economic incentive to exercise an extension option, or not exercise a termination option. Extension options (or periods after termination options) are only included in the lease term if the lease is reasonably certain to be extended (or not terminated). Potential undiscounted future cash outflows of \$1,327 have not been included in the lease liability because it is not reasonably certain that the leases will be extended (or not terminated).

Government financing and assistance

The Company has access to several government programs that are designed to assist content production in the US Government assistance with respect to federal and provincial production tax credits and other programs is

Notes to Consolidated Financial Statements

August 30, 2019

(expressed in thousands of US dollars, except share amounts)

recorded as a reduction of investments in content when eligible expenditures are made and there is a reasonable expectation of realization.

Cash and cash equivalents

Cash and cash equivalents comprise cash on hand and balances with banks. Cash equivalents can be readily converted into a known amount of cash and are subject to an insignificant risk of changes in value.

Restricted cash comprises cash held by banks as collateral over the Company's lease. This balance is reduced and released back into the control of the Company over the remainder of the lease term.

Employee benefits

Provisions

Income taxes

The Company is a wholly owned LLC and is considered a disregarded entity and pays no income taxes in the US as a result.

Use of estimates and judgments

The preparation of consolidated financial statements in conformity with IFRS requires management to make estimates, judgments and assumptions that affect the application of accounting policies and the reported amounts of assets and liabilities and the reported amounts of revenue and expenses during the reporting periods. Estimates and judgments are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. Accounting estimates will, by definition, seldom equal the actual results.

The most significant estimates and judgments made by management in the preparation of the Company's consolidated financial statements include the following:

The methods and estimates of useful life needed to determine the appropriate amortization of investment in content depend on judgments with respect to many variables including the ability to license content to

Notes to Consolidated Financial Statements

August 30, 2019

(expressed in thousands of US dollars, except share amounts)

broadcasters, the availability of secondary markets and the impact of new media platforms. The usage of content may differ materially and impact future amortization and net income.

The amount of production tax credits the Company files for as costs are incurred and the amounts ultimately recovered may differ. The expected timing of the receipt of production tax credits is subject to uncertainty and amounts have been classified as current or long-term based on the expected date of receipt.
The application of IFRS 16 requires judgment as to whether a lease may be renewed at the end of its term. Measurement of the lease liability requires a discount rate to be selected. Changes to the underlying assumptions may materially change the value of both the right-of-use asset and the lease liability.

Although management believes the assumptions and estimates made in the past have been reasonable and appropriate, they are based in part on historical experience and information obtained from the management of the acquired companies and are inherently uncertain. Examples of critical estimates in valuing certain of the assets and liabilities acquired include but are not limited to licensing and other customer contracts, expected costs to complete content-in-progress and the estimated cash flows from the productions when completed.

Unanticipated events and circumstances may occur, which may affect the accuracy or validity of such assumptions estimates or actual results.

The significant assumptions that affect these estimates and judgments in the application of accounting policies are noted throughout these consolidated financial statements.

Accounting pronouncements issued but not yet effective

Definition of Material

On October 31, 2018, the IASB issued amendments to IAS 1 Presentation of Financial Statements (IAS 1), and IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors that clarify the definition of "material". These amendments are effective on January 1, 2020 and are to be applied prospectively. The adoption of the amendments is not expected to have a material impact on the Company's financial statements.

Notes to Consolidated Financial Statements

August 30, 2019

(expressed in thousands of US dollars, except share amounts)

4 Property and equipment

	Furniture and fixtures \$	Total \$
Cost
January 1, 2017 Additions	110 6	110 6
December 31, 2017	116	116
January 1, 2018 Additions	116 47	116 47
December 31, 2018	163	163
January 1, 2019 Additions	163 5	163 5
August 30, 2019	168	168
Accumulated amortization
January 1, 2017	87	87
Amortization for the period	11	11
December 31, 2017	98	98
Amortization for the period	54	54
December 31, 2018	152	152
Amortization for the period	-	-
August 30, 2019	152	152
Net book value
January 1, 2017	23	23
December 31, 2017	18	18
December 31, 2018 August 30, 2019	11 16	11 16

Notes to Consolidated Financial Statements

August 30, 2019

(expressed in thousands of US dollars, except share amounts)

5 Investment in content

	Development \$	In production \$	Total \$
Cost and net book value
January 1, 2017	1,247	-	1,247
Additions	314	-	314
Impairment	(1,247)	-	(1,247)
December 31, 2017	314	-	314
Additions	1,221	-	1,221
December 31, 2018	1,535	-	1,535
Additions	11,128	-	11,128
Reclassified	(9,989)	9,989	-
August 30, 2019	2,674	9,989	12,663

No amortization was recorded during the period ended August 30, 2019 (December 31, 2018 - nil; December 31, 2017 - nil) because no content has been delivered to date. The Company expects \$9,790 of the net book value of its investments in content to be amortized during the year ended December 31, 2021, \$50 in 2022, \$37 in 2023 and \$28 in 2024.

6 Members' capital

Members' capital units	Authorized	Outstanding August 30, 2019	Outstanding December 31, 2018	Outstanding December 1, 2017	Outstanding January 1, 2017
Class A units1	Unlimited	9,100,000	9,100,000	9,100,000	9,100,000
Class B units2	Unlimited	831,875	650,000	650,000	900,000
Class C units3	Unlimited	1,916,667	1,916,667	1,916,667	-
Total	Unlimited	11,848,542	11,666,667	11,666,667	10,000,000

The above members' capital units have no nominal or par value. On August 31, 2019, Boat Rocker acquired 100% of the outstanding capital units of the Company.

¹Cash totalling \$12,500 was received in 2017 for Class A units issued in 2013 due to drip funding structure. ²In 2017, the movement in Class B units was due to reallocation of members' interests. In 2019, the additional members' interests were allocated for no cash consideration as part of a reorganization.

Notes to Consolidated Financial Statements

August 30, 2019

(expressed in thousands of US dollars, except share amounts)

7 Related party transactions

Key management personnel

	Period ended	Year ended	Year ended
	August 30,	December 31,	December 31,
	2019	2018	2017
	\$	\$	\$
Salaries and employee benefits	1,907	2,363	1,828

Other transactions

No distributions were paid to the members of the Company during the period ended August 30, 2019 (December 31, 2018 - nil; December 31, 2017 - nil).

8 Leases

Right-of-use assets

The Company's significant lease arrangements are for office premises and equipment used in content and service production. As at August 30, 2019, \$673 of right-of-use assets are recorded.

	\$
Balance as at January 1, 2017 Amortization	287 (188)
Net book value as at December 31, 2017	99
Additions Amortization	998 (232)
Net book value as at December 31, 2018	865
Amortization	(192)
Net book value as at August 30, 2019	673

Notes to Consolidated Financial Statements

August 30, 2019

(expressed in thousands of US dollars, except share amounts)

Lease liabilities

Lease payments in respect of lease liabilities and the effect of discounting are as follows at August 30, 2019:

	\$
Undiscounted minimum lease payments Less than 1 year 2 to 3 years	326 453
Total undiscounted lease labilities	779
Effect of discounting	(63)
Total present value of lease liabilities	716
Less: Current portion	(326)
Long-term lease liabilities	390
Lease liabilities continuity	\$
Lease liabilities as at January 1, 2017	287
Cash payments	(185)
Accretion	16
Lease liabilities as at December 31, 2017	118
Less: Current portion	(118)
Long-term lease liabilities as at December 31, 2017	-
Lease liabilities as at January 1, 2018	118
Additions	998
Cash payments	(264)
Accretion	36
Lease liabilities as at December 31, 2018	888
Less: Current portion	(318)
Long-term lease liabilities as at December 31, 2018	570
Lease liabilities as at January 1, 2019	888
Cash payments	(210)
Accretion	38
Lease liabilities as at August 30, 2019	716
Less: Current portion	(326)
Long-term lease liabilities as at August 30, 2019	390

Notes to Consolidated Financial Statements

August 30, 2019

(expressed in thousands of US dollars, except share amounts)

9 Finance income (expense) - net

	Period ended	Year ended	Year ended
	August 30,	December 31,	December 31,
	2019	2018	2017
	\$	\$	\$
Interest income	94	198	10
Accretion on lease liability	(38)	(36)	(16)
	56	162	(6)

10 Financial instruments

Credit risk

Credit risk arises from cash and cash equivalents, as well as outstanding receivables. The Company manages credit risk on cash and cash equivalents by ensuring the counterparties are banks, governments and government agencies with high credit ratings.

The maximum exposure to credit risk for cash and cash equivalents, restricted cash and accounts receivable approximates the amount recorded on the consolidated statement of financial position of \$1,435 as at August 30, 2019 (December 31, 2018 - \$12,761; December 31, 2017 - \$19,495 and January 1, 2017 - \$1,950).

Receivables are non-trade in nature and are sundry receivables that are primarily billbacks with vendors, customers and employees. Management manages credit risk by regularly reviewing aged accounts receivable.

Liquidity risk

The Company manages liquidity by forecasting and monitoring operating cash flows. As at August 30, 2019, the Company had cash and cash equivalents of \$1,248 (December 31, 2018 - \$12,611; December 31, 2017 - \$19,495; January 1, 2017 - \$1,950). The Company maintains appropriate cash balances and has access to financial facilities to manage fluctuating cash flows.

Results of operations for any period are dependent on the amount and timing of content delivered, which cannot be predicted with certainty. Consequently, the Company's results from operations may fluctuate materially from period to period and the results of any one period are not necessarily indicative of results for future periods. Cash flows may also fluctuate and are not necessarily closely correlated with revenue recognition. During the initial broadcast of the rights, the Company is somewhat reliant on the broadcaster's budget and financing cycles and at times the licence period gets delayed and commences at a later date than originally projected.

Notes to Consolidated Financial Statements

August 30, 2019

(expressed in thousands of US dollars, except share amounts)

Categories of financial instruments

As at August 30, 2019 the Company's financial instruments comprised the following:

	August 30, 2019 \$	December 31, 2018 \$	December 31, 2017 \$	January 1, 2017 \$
Financial assets
Measured at amortized cost
Accounts receivable	37	-	-	-
Measured at fair value through profit or loss
Cash	1,248	12,611	19,495	1,950
Restricted cash	150	150	-	-
Financial liabilities
Measured at amortized cost
Trade and other payables	711	328	-	-

Fair values

Level 1 valuation based on quoted prices observed in active markets for identical assets and liabilities;
Level 2 valuation techniques based on inputs that are quoted prices of similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, inputs other than quoted prices used in a valuation model that are observable for that instrument, and inputs that are derived principally from or corroborated by observable market data by correlation or other means; and
Level 3 valuation techniques with significant unobservable market inputs.

A financial instrument is classified to the lowest of the hierarchy for which a significant input has been considered in measuring fair value.

Cash and cash equivalents, and restricted cash are valued based on quoted prices observed in active markets (Level 1) and the carrying amount reflects fair value.

The Company's accounts receivables and accounts payable and accrued liabilities are carried at amortized cost, which approximates fair value.

Notes to Consolidated Financial Statements

August 30, 2019

(expressed in thousands of US dollars, except share amounts)

Maturity analysis for financial liabilities

					August 30, 2019
	Less than 1 year \$	1 to 3 years \$	4 to 5 years \$	After 5 years \$	Total \$
Accounts payable and accrued liabilities Lease liabilities	711 326	- 453	- -	- -	711 779
	1,037	453	-	-	1,490
					December 31, 2018
	Less than 1 year \$	1 to 3 years \$	4 to 5 years \$	After 5 years \$	Total \$
Accounts payable and accrued liabilities Lease liabilities	328 318	- 671	- -	- -	328 989
	646	671	-	-	1,317
					December 31, 2017
	Less than 1 year \$	1 to 3 years \$	4 to 5 years \$	After 5 years \$	Total \$
Lease liabilities	120	-	-	-	120
	120	-	-	-	120

Notes to Consolidated Financial Statements

August 30, 2019

(expressed in thousands of US dollars, except share amounts)

					January 1, 2017
	Less than 1 year \$	1 to 3 years \$	4 to 5 years \$	After 5 years \$	Total \$
Lease liabilities	185	120	-	-	305
	185	120	-	-	305

11 Expenses by nature

	Period ended August 30, 2019 \$	Year ended December 31, 2018 \$	Year ended December 31, 2017 \$
Development costs	880	1,195	1,814
Salaries and employee benefits	3,114	3,337	2,426
Overhead costs	1,058	1,168	1,525
Amortization of property and equipment	-	54	11
Amortization of right-of-use assets	192	232	188
Total expenses	5,244	5,986	5,964

12 Supplementary cash flow information

	Period ended August 30, 2019 \$	Year ended December 31, 2018 \$	Year ended December 31, 2017 \$
Increase in accounts receivable	(37)	-	-
Increase in prepaid expenses and deposits	(713)	(28)	58
Increase in accounts payable and accrued liabilities	383	328	-
Increase in deferred revenue	5,305	-	-
	4,938	300	58

Notes to Consolidated Financial Statements

August 30, 2019

(expressed in thousands of US dollars, except share amounts)

The following table summarizes the change in the Company's liabilities arising from financing activities for:

	Period ended August 30, 2019
	Lease liabilities \$
January 1, 2019 Cash flows Accretion August 30, 2019	(888) 210 (38) (716)

Year ended December 31, 2018

	Lease liabilities \$
January 1, 2018	(118)
Cash flows	264
Addition of lease liabilities	(998)
Accretion	(36)
December 31, 2018	(888)

Year ended December 31, 2017

January 1, 2017	Lease liabilities \$
	(287)
Cash flows	185
Accretion	(16)
December 31, 2017	(118)

Notes to Consolidated Financial Statements

August 30, 2019

(expressed in thousands of US dollars, except share amounts)

13 Capital disclosures

The Company's objectives when managing capital are to provide an adequate return to members, safeguard its assets, maintain a competitive cost structure and continue as a going concern in order to pursue the development, production, distribution and licensing of its content. As at August 30, 2019, cash and cash equivalents include \$546 (December 31, 2018 - nil; December 31, 2017 - nil; January 1, 2017 - nil) of cash that is required for the funding of productions in progress and is not available for other uses. This cash is not formally restricted but is instead earmarked for use for specific productions. In addition to this, formally restricted cash below represents cash held by the Company's bank as collateral over a building lease. The cash will be transferred to the Company's unrestricted checking account over the course of the lease term. The Company has not declared or paid dividends during the period ended August 30, 2019. The balance of the Company's cash is being used to maximize ongoing development and growth effort.

August 30, 2019 \$	December 31, 2018 \$	December 31, 2017 \$	January 1, 2017 \$
1,124	131	38	72
			1,878
150	150	-	-
1,398	12,761	19,495	1,950
			3,300
	124 8,818	12,480 14,006	19,457 19,830

The acquisition of the Company on August 31, 2019 by Boat Rocker allowed the Company to maintain its capital requirements as a going concern.

Notes to Consolidated Financial Statements

August 30, 2019

(expressed in thousands of US dollars, except share amounts)

14 Subsequent events

Subsequent to December 31, 2019, the World Health Organization characterized COVID-19 as a global pandemic. Since that time, several preventative measures have been implemented in the United States, including shelter-in-place orders and the closure of the border between Canada and the United States to nonessential travel.

The Company has been impacted by COVID-19 in a number of ways. Employees have transitioned to workfrom-home and IT security and software has been upgraded to ensure the Company's information is protected. For all of the Company's productions, safety protocols for cast and crew are paramount and must be in place before production can begin. An internal task force was set up to understand and implement Covid-19 health and safety requirements on our productions, following standards set by public health, applicable unions and guilds, local production associations and clients. Productions have been halted or delayed, impacting cash inflows from broadcasters and delaying the delivery of greenlit content, negatively impacting 2020 revenue. Productions have since resumed under stricter guidelines in accordance with government and industry standards.

As a result of the Covid-19-associated protocols, the Company has incurred increased production costs that were not included in the pre-Covid-19 production budgets, such as shorter work days for certain union crew, personal protective equipment, and other safety measures. These protocols and costs are crucial to protect cast and crew and ensure that production continues without further delay or risk of the spread of Covid-19 on sets. The Company anticipates that revenue recognition may be pushed to 2021 that would have previously occurred in 2020, but the majority of productions will continue to earn the anticipated revenue that was contemplated by management prior to the pandemic. The Company does not expect COVID-19 to have a significant impact on the collection of its trade accounts receivable or an increase in expected credit losses because the Company's customers are typically large, established broadcasters who are not anticipated to withhold payment and are anticipated to continue to be solvent.

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Platform One Media, LLC ("Platform One") is an American entertainment company that produces television and media content. Platform One was incorporated in and is domiciled in the United States of America and the address of its registered office is 10100 Santa Monica Boulevard, Los Angeles, California, 90067.

This Management's Discussion and Analysis ("MD&A") has been prepared by management and is a review of the consolidated operating results and financial position of Platform One, based upon International Financial Reporting Standards ("IFRS"). This discussion and analysis should be read in conjunction with the consolidated financial statements of Platform One, as well as the notes thereto, for the respective periods. All amounts are expressed in thousands of U.S. dollars unless otherwise stated. This disclosure is effective as of February 17, 2021

Overview of the company

Platform One is an American entertainment company that develops scripted television and media content. Platform One is in its initial stages of production and has not yet recognized revenue as of August 30, 2019. The financial statements have been prepared as of August 30, 2019 and for the period then ended, which is prior to when Platform One began to be consolidated by Boat Rocker Media Inc.

SELECTED FINANCIAL INFORMATION

The following table provides selected financial information of Platform One for eight months ended August 30, 2019 as well as the years ended December 31, 2018 and 2017:

	8 months			12 months	12 months
	Aug 30, 2019			Dec 31, 2018	Dec 31, 2017

Revenue	\$	— \$		— \$		—
Net loss	\$	(5,188)	\$	(5,824)	\$	(5,970)
	Aug 30, 2019		Dec 31, 2018		Dec 31, 2017
Cash and cash equivalents	\$	1,248	\$	12,611	\$	19,495
Total assets	\$	15,550	\$	15,222	\$	19,948
Total non-current financial liabilities	\$	390	\$	570	\$	—
Total liabilities	\$ 6,732		\$ 1,216		\$	118

	8 months			12 months		12 months
		Aug 30, 2019		Dec 31, 2018		Dec 31, 2017
Cash used in operating activities	\$	(11,241)	\$	(6,771)	\$	(4,774)
Cash provided by (used in) financing activities	\$	(210)	\$	(264)	\$	22,315
Cash provided by investing activities	\$	88 \$		151	\$	4

Period ended August 30, 2019 compared to year ended December 31, 2018

The following table sets forth the consolidated results of operations for the eight-month period ended August 30, 2019 and year ended December 31, 2018:

	Period ended				Increase (Decrease)
	August 30, 2019		December 31, 2018		Amount	Percent
		(Amounts in thousands)
Revenue
Total revenue	\$ — \$		—		—

Expenses
Development costs	880		1,195		(315)	(26%)
General and administrative	4,172		4,505		(333)	(7%)
Amortization of property and equipment, right-of-use assets	192		286		(94)	(33%)
Finance expense (income)	(56)		(162)		106	(65%)
Net loss	\$ (5,188)	\$	(5,824)	\$	636	(11%)

Revenue. During the period ended August 30, 2019 and the year ended December 31, 2018, Platform One actively sought to create content in order to obtain a greenlight from broadcasters. The process of creating content generally commences with the optioning of rights to books and scripts, engaging with writers, and entering into first look deals with other content creators. Platform One did not deliver any shows during these periods. Accordingly, no revenue was recognized.

Development costs. Development costs were \$880 in 2019 compared to \$1,195 in 2018, a decrease of 26%. The decline is attributable to the 2019 period only including eight months as compared to twelve months in 2019. Expenditures related to first look deals and other one-time development costs that had no future economic life were recognized on the statement of loss as incurred. In contrast, expenditures that were expected to result in future greenlights were capitalized on the balance sheet when incurred. During the period ended August 30, 2019, \$2,317 was paid in cash for development costs related to 23 separate projects. At August 30, 2019, Platform One had capitalized \$9,989 relating to two shows in production, and \$2,674 capitalized relating to projects in development. On an annual basis, a review is undertaken of the costs recognized in the investment in content asset and those that were deemed to no longer have future economic life were written off. During the period ended August 30, 2019, \$874 were written off as a result of this review, and a further \$500 was written off in 2020 as a result of the subsequent year's annual review.

General and administrative expenses. General and administrative expenses include compensation expenses (salaries, benefits, bonus) of employees, facilities, travel, professional fees, information technology, and other office costs. In the year ended December 31, 2018, general and administrative expenses were \$4,505 as compared to \$4,172 in the period ended August 30, 2019, a decrease of 7%. The decline is attributable to 2019 only including eight months as compared to twelve months in 2018. On a prorata basis, however, the expense increased. The President and Chief Operating Officer, Courtney Conte, left the business in June 2018 after spending two years at Platform One. Katie O'Connell Marsh was promoted to Chief Executive Officer in his place and received a higher salary. Other key hires notably in finance, production and creative roles, were in place by early 2018.

		Period Ended	Increase (Decrease)
	August 30, 2019	December 31, 2018	Amount	Percent
	(Amounts in thousands)
Personnel expense: Salary, bonus and benefits	3,114	3,337	(223)	(7%)
Professional fees	259	171	88	51%
Facilities and rent expenses	3	280	(277)	(99%)
Travel and entertainment	182	188	(6)	(3%)
Other expenses: Bank fees, information technology and other office costs	614	529	85	16%
Total general and administrative expenses	\$ 4,172	\$ 4,505	\$ (333)	(7%)

The following table presents the breakdown of the general and administrative expense in the comparative periods:

Amortization expense. Amortization expense consists of the amortization of property and equipment and right-of-use assets. The following table presents the breakdown of amortization expense for the period ended August 30, 2019 and year ended December 31, 2018:

	Period Ended				Increase (Decrease)
		August 30, 2019 December 31, 2018			Amount		Percent
	(Amounts in thousands)
Amortization of property and equipment		—		54		(54)	(100%)
Amortization of right-of-use asset		192		232		(40)	(17%)
Amortization expense	\$	192	\$	286	\$	(94)	(33%)

Amortization expense for the year ended December 31, 2018 was \$54 compared to \$nil for the period ended August 30, 2019. Additions to property and equipment during the year ended 2018 totaled \$47 compared to additions of \$6 in the period ended August 30, 2019. Additions to right-of-use assets during the year ended 2018 totaled \$998 compared to additions of \$nil in the period ended August 30, 2019. Amortization of right-of-use asset expense for the year ended December 31, 2018 was \$232 compared to \$192 for the period ended August 30, 2019, a decrease of \$40. The decrease is due to the period in 2019 only containing eight months compared to twelve months in 2018.

Finance income, net. The following table presents the breakdown of finance income and expense for the period ended August 30, 2019 and year ended December 31, 2018:

	Period Ended				Increase (Decrease)
	August 30, 2019		December 31, 2018		Amount	Percent
	(Amounts in thousands)
Interest income	94		198		(104)	(53%)
Accretion expense	(38)		(36)		(2)	6%
Finance income (expense) , net	\$ 56	\$	162	\$	(106)	(65%)

Interest income for the year ended December 31, 2018 was \$198 compared to \$94 for the period ended August 30, 2019, a decrease of \$104. The decrease is due to the period in 2019 only containing eight months compared to twelve months in 2018. On a prorata basis, however, interest income decreased in the 2019 period due to more cash used in operations and less earning a return.

Accretion expense for the year ended December 31, 2018 was \$36 compared to \$38 for the period ended August 30, 2019.

Income tax expenses. Platform One is organized as a limited liability company. A limited liability company is not subject to tax in accordance with partnership tax rules. Taxable income or loss from Platform One is passed through to and included in the taxable income of its members.

Year ended December 31, 2018 compared to 2017

The following table sets forth the consolidated results of operations for the years ended December 31, 2018 and 2017:

	Year Ended December 31,				Increase (Decrease)
		2018		2017		Amount	Percent
				(Amounts in thousands)
Revenue
Total revenue	\$	—	\$	—		—

Expenses
Development costs		1,195		1,814		(619)	(34%)
General and administrative		4,505		3,951		554	14%
Amortization of property and equipment,
right-of-use assets		286		199		87	44%
Finance expense (income), net		(162)		6		(168)	(2800%)
Net loss	\$	(5,824)	\$	(5,970)	\$	146	(2%)

Revenue. During the years ended December 31, 2018 and 2017, Platform One actively sought to create content in order to obtain a greenlight from broadcasters. The process of creating content generally commences with the optioning of rights to books and scripts, engaging with writers, and entering into first look deals with other content creators. Platform One did not deliver any shows during these periods. Accordingly, no revenue was recognized.

Development costs. Development costs were \$1,195 in 2018, a decrease of 34% from \$1,814 in 2017. Expenditures related to first look deals and other one-time development costs that had no future economic life were recognized on the statement of loss as incurred. In contrast, expenditures that could result in future greenlights were capitalized on the balance sheet when incurred. On an annual basis, a review was undertaken of the costs recognized in the investment in content asset and those that were deemed to no longer have future economic life were written off. During the year ended December 31, 2018, \$2,383 was paid in cash for development costs related to 15 separate projects (2017 - \$1,728 related to 37 projects).

The following table presents the breakdown of the general and administrative expense in the comparative periods:

	Year Ended December 31,			Increase (Decrease)
	2018	2017	Amount	Percent
			(Amounts in thousands)
Personnel expense: Salary, bonus and benefits	3,337	2,426	911	38%
Professional fees	171	380	(209)	(55%)
Facilities and rent expenses	280	199	81	41%
Travel and entertainment	188	116	72	62%
Other expenses: Bank fees, information technology and other, office fees	529	830	(301)	(36%)
Total expenses	\$ 4,505	\$ 3,951	\$ 554	14%

		Year Ended December 31,			Increase (Decrease)
		2018		2017		Amount	Percent
	(Amounts in thousands)
Amortization of property and equipment		54		11		43	391%
Amortization of right-of-use asset		232		188		44	23%
Amortization expense	\$	286	\$	199	\$	87	44%

Amortization expense for the year ended December 31, 2018 was \$54 compared to \$11 for 2017, an increase of \$43. Additions to property and equipment during the year ended 2018 totaled \$47 compared to additions of \$5 in the same period 2017. Additions to right-of-use assets during the year ended 2018 totaled \$998 compared to additions of \$nil in the same period 2017. Amortization of right-of-use asset expense for the year ended December 31, 2018 were \$232 compared to \$188 for 2017, an increase of \$44. The increase relates to a new lease agreement Platform One entered into on July 2018.

Finance income, net. The following table presents the breakdown of finance income and expense for the years ended December 31, 2018 and 2017:

		Year Ended
	December 31,		Increase (Decrease)
	2018		2017		Amount	Percent
			(Amounts in thousands)
Interest income	198		10		188	1880%
Accretion expense	(36)		(16)		(20)	125%
Finance income (expense) , net	\$ 162	\$		(6) \$	168	(2800%)

Interest income for the year ended December 31, 2018 was \$198 compared to \$10 in 2017, an increase of \$188. During 2017, Platform One issued shares and collected \$22,500 in cash that was invested and earned interest income.

Accretion expense for the year ended December 31, 2018 was \$36 compared to \$16 for 2017, an increase of \$20. The increase relates to the new lease contract Platform One entered into in July 2018.

Cash Flows

The following table summarizes the cash flows in the period ended August 30, 2019 and the year ended December 31, 2018 :

	Period Ended				Increase (Decrease) Amount
	August 30, 2019 December 31, 2018
	(Amounts in thousands)
Cash used in operating activities	\$	(11,241)	\$	(6,771)	\$	(4,470)
Cash used in financing activities		(210)		(264)		54
Cash provided by investing activities		88		151		(63)
(Decrease) increase in cash and cash equivalents	\$	(11,363)	\$	(6,884)	\$	(4,479)

Cash flow from operating activities in the period ended August 30, 2019 was a use of cash of \$11,241 compared to \$6,771 in the year ended December 31, 2018, a variance of \$4,470. The variance can be explained primarily by additions to investment in content of \$11,127 in the period ended August 30, 2019 compared to additions of \$1,221 in 2018, a variance of \$9,906. The period ended August 30, 2019 was the period where expenditures on the productions Invasion and Rust increased significantly as progress on those productions developed. This was partly offset by \$5,305 in cash inflows received from collections of deferred revenue relating to these productions that was collected in the period ended August 30, 2019.

Cash flow from financing activities in the period ended August 30, 2019 was a use of cash of \$210 compared to use of cash of \$264 for the year ended December 31, 2018. There were lower lease repayments in the period ended August 30, 2019 due to only eight months of payments compared to twelve months in 2018.

Cash flow from investing activities in the period ended August 30, 2019 was a cash source of \$88 as compared to \$151 for the year ended December 31, 2018. The variance of \$63 is attributable mainly to interest income received in 2018 of \$198 as compared to \$94 in the reduced eight month period ended August 30, 2019. This impact is partially offset by the acquisition of property and equipment for \$47 in 2018 as compared to \$6 in the period ended August 30, 2019.

	Year ended December 31,				Increase (Decrease)
	2018 2017			Amount
	(Amounts in thousands)
Cash used in operating activities	\$	(6,771)	\$	(4,774)	\$	(1,997)
Cash (used in) provided by financing activities		(264)		22,315		(22,579)
Cash provided by investing activities		151		4		147
(Decrease) increase in cash and cash equivalents	\$	(6,884)	\$	17,545	\$	(24,429)

The following table summarizes the cash flows in the years ended December 31, 2018 and 2017:

Cash flow from operating activities for the year ended December 31, 2018 was a use of cash of \$6,771 compared to \$4,774 in 2017, a variance of \$1,997. The variance can be explained primarily by additions to investment in content and development costs. Investment in content additions increased by \$907 from \$314 in 2017 to \$1,221 in 2018, and development costs of \$1,247 were included in the net loss of 2017 that related to a write-off of amounts incurred in prior years thus did not result in an cash outflow in 2017.

Cash flow from financing activities for the year ended December 31, 2018 was a use of cash of \$264 compared to a source of cash of \$22,315 in 2017. The variance can be explained by the issuance of member's capital for \$22,500 in 2017.

Cash flow from investing activities for the year ended December 31, 2018 was a source of cash for \$151 compared to \$4 in 2017. The variance of \$147 is attributable mainly to interest income received in 2018 for \$198 as compared to \$9 in 2017. This impact is partially offset by the acquisition of property and equipment for \$47 in 2018 as compared to \$5 in 2017.

Contractual Obligations

Platform One does not have other contractual obligations that are not reflected on the balance sheet.

Liquidity and Capital Resources

Platform One's objectives when managing capital are to provide an adequate return to members, safeguard its assets, maintain a competitive cost structure and continue as a going concern in order to pursue the development, production, distribution and licensing of its content. As at August 30, 2019, cash and cash equivalents include \$546 (December 31, 2018 - nil; December 31, 2017 - nil; January 1, 2017 - nil) of cash that is required for the funding of productions in progress and is not available for other uses. This cash is not formally restricted but is instead earmarked for use for specific productions. In addition to this, formally restricted cash below represents cash held by Platform One's bank as collateral over a building lease. The cash will be transferred to Platform One's unrestricted checking account over the course of the lease term. Platform One has not declared or paid dividends during the period ended August 30, 2019.

Subsequent to August 30, 2019, Platform One obtained interim production financing from JP Morgan Chase Bank which carries interest at LIBOR plus 2.75%. As of December 31, 2020, Platform One has an outstanding principal balance of \$71,000 relating to this debt.

Outstanding equity instruments

The following table discloses the composition Platform One's equity in form of members' capital at August 30, 2019:

Members' capital units		Outstanding
	Authorized	August 31, 2019
Class A units	Unlimited	9,100,000
Class B units	Unlimited	831,875
Class C units	Unlimited	1,916,667
Total		11,848,542

The above members' capital units have no nominal or par value. On August 31, 2019, Boat Rocker Media Inc. acquired 100% of the outstanding capital units of Platform One. There was no change in the composition or holdings of members' capital from this date to February 17, 2021.

CRITICAL ACCOUNTING POLICIES, ESTIMATES AND JUDGEMENTS

For a summary of all of Platform One's accounting policies, including the accounting policies discussed below, see Note 3 to Platform One's annual financial statements.

The most significant estimates and judgments made by management in the preparation of Platform One's consolidated financial statements include the following:

The methods and estimates of useful life needed to determine the appropriate amortization of investment in content depend on judgments with respect to many variables including the ability to license content to broadcasters, the availability of secondary markets and the impact of new media platforms. The usage of content may differ materially and impact future amortization and net income.
The amount of production tax credits Platform One files for as costs are incurred and the amounts ultimately recovered may differ. The expected timing of the receipt of production tax credits is subject to uncertainty and amounts have been classified as current or long-term based on the expected date of receipt.
The application of IFRS 16 requires judgment as to whether a lease may be renewed at the end of its term. Measurement of the lease liability requires a discount rate to be selected. Changes to the underlying assumptions may materially change the value of both the right-of-use asset and the lease liability.

Although management believes the assumptions and estimates made in the past have been reasonable and appropriate, they are based in part on historical experience and information obtained from the management of the acquired companies and are inherently uncertain. Examples of critical estimates in valuing certain of the assets and liabilities acquired include but are not limited to licensing and other customer contracts, expected costs to complete content-in-progress and the estimated cash flows from the productions when completed.

Unanticipated events and circumstances may occur, which may affect the accuracy or validity of such assumptions estimates or actual results.

Consolidated Financial Statements

December 31, 2018

(expressed in thousands of US dollars)

Independent auditor's report

To the Directors of Untitled Entertainment LLC

Our opinion

In our opinion, the accompanying consolidated financial statements present fairly, in all material respects, the financial position of Untitled Entertainment LLC and its subsidiaries (together, the Company) as at December 31, 2018 and its financial performance and its cash flows for the year then ended in accordance with International Financial Reporting Standards as issued by the International Accounting Standards Board (IFRS).

What we have audited

The Company's consolidated financial statements comprise:

the consolidated statement of financial position as at December 31, 2018;
the consolidated statement of income and comprehensive income for the year then ended;
the consolidated statement of changes in equity for the year then ended;
the consolidated statement of cash flows for the year then ended; and
the notes to the consolidated financial statements, which include significant accounting policies and other explanatory information.

Basis for opinion

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Independence

Comparative information

The comparative information as at and for the year ended December 31, 2017 has not been audited.

PricewaterhouseCoopers LLP PwC Centre, 354 Davis Road, Suite 600, Oakville, Ontario, Canada L6J 0C5 T: +1 905 815 6300; F: +1 905 815 6499

Responsibilities of management and those charged with governance for the consolidated financial statements

Those charged with governance are responsible for overseeing the Company's financial reporting process.

Auditor's responsibilities for the audit of the consolidated financial statements

As part of an audit in accordance with Canadian generally accepted auditing standards, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:

Identify and assess the risks of material misstatement of the consolidated financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control.
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.
Conclude on the appropriateness of management's use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company's ability to continue as a going

concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor's report to the related disclosures in the consolidated financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor's report. However, future events or conditions may cause the Company to cease to continue as a going concern.

Evaluate the overall presentation, structure and content of the consolidated financial statements, including the disclosures, and whether the consolidated financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the Company to express an opinion on the consolidated financial statements. We are responsible for the direction, supervision and performance of the group audit. We remain solely responsible for our audit opinion.

Chartered Professional Accountants, Licensed Public Accountants

Oakville, Ontario February • , 2021

CONSOLIDATED STATEMENT OF FINANCIAL POSITION

As at December 31, 2018

(expressed in thousands of US dollars)

	December 31, 2018	December 31, 2017 (unaudited)	January 1, 2017 (unaudited)
	\$	\$	\$
ASSETS
CURRENT ASSETS
Cash	883	42	-
Accounts receivable (Note 5 & 9)	217	865	852
Prepaid expenses	55	63	59
Total current assets	1,155	970	911
Property and equipment, net (Note 4)	13	34	60
TOTAL ASSETS	1,168	1,004	971
LIABILITIES AND MEMBERS' EQUITY CURRENT LIABILITIES
Bank overdraft	-	-	351
Accounts payable (Note 9)	672	477	486
Accrued liabilities (Note 9)	918	569	217
Payables to related parties (Note 7)	56	56	56
Total current liabilities	1,646	1,102	1,110
Accrued rent payable (Note 8)	54	260	358
TOTAL LIABILITIES	1,700	1,362	1,468
MEMBERS' EQUITY
Members' equity	(532)	(358)	(497)
Total members' equity	(532)	(358)	(497)
TOTAL LIABILITIES AND MEMBERS' EQUITY	1,168	1,004	971

Commitments (note 10)

Subsequent events (note 12)

CONSOLIDATED STATEMENT OF INCOME AND COMPREHENSIVE INCOME

For the year ended December 31, 2018

(expressed in thousands of US dollars)

	Year ended
	December 31, 2018	December 31, 2017
		(unaudited)
	\$	\$
Revenue (Note 6)	22,851	18,482
Expenses
Employee salary and benefits	11,299	9,378
Professional fees	1,368	1,052
Rent (Note 8)	1,111	1,000
Office and administrative	1,860	1,740
Depreciation (Note 4)	21	26
Total expenses	15,659	13,196
Operating income	7,192	5,286
Other income (Note 8)	201	208
Net income and comprehensive income	7,393	5,494

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

For the year ended December 31, 2018

(expressed in thousands of US dollars)

	Members' equity
	\$
Balance at January 1, 2017 (unaudited)	(497)
Net income	5,494
Distributions	(5,355)
Balance at December 31, 2017	(358)
Net income	7,393
Distributions	(7,567)
Balance at December 31, 2018	(532)

CONSOLIDATED STATEMENT OF CASH FLOWS

For the year ended December 31, 2018

(expressed in thousands of US dollars)

	Year ended
	December 31, 2018	December 31, 2017
Cash provided by (used in)		(unaudited)
	\$	\$
Operating activities
Net income	7,393	5,494
Adjustments for non-cash items:
Depreciation	21	26
Movement in working capital:
Prepaid expenses	8	(4)
Accounts receivable	648	(13)
Accounts payable and accrued liabilities	337	239
Cash provided by (used in) operating activities	8,407	5,742
Financing activities
Distributions paid	(7,566)	(5,349)
Cash used in financing activities	(7,566)	(5,349)
Increase in cash	841	393
Cash, beginning of year	42	(351)
Cash, end of year	883	42

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2018

(expressed in thousands of US dollars)

1. Corporate information

Untitled Entertainment LLC ("Untitled") is a talent management company based in Los Angeles with an additional office in New York. The Company was founded in 1999 in order to offer talent management services to actors and other talent. The Company was organized in and is domiciled in the United States with its principal place of business in Los Angeles, California and registered office is 200 Park Avenue South, 8th Floor, New York, NY 10003.

On February 1, 2019, Boat Rocker Media, Inc. acquired 51% of the outstanding LLC interests of the Company. Boat Rocker Media, Inc. was incorporated in and is domiciled in Canada and its registered office is 310 King Street East, Toronto, Ontario M5A 1K6.

2. Basis of preparation and statement of compliance

These consolidated financial statements have been prepared in accordance with International Financial Reporting Standards (IFRS) as issued by the International Accounting Standards Board (IASB).

These consolidated financial statements were authorized for issue by the Board of Directors of Boat Rocker Media Inc. on February XX, 2021.

Adoption of IFRS

No general purpose financial statements for the Company have been previously prepared or presented, therefore the financial statements for the year ended December 31, 2018, are the first annual financial statements issued for the Company. These financial statements apply IFRS 1 with a transition date of January 1, 2017 (the "Transition Date"). These financial statements have been prepared in accordance with the accounting policies described in note 3 and in accordance with the existing IFRS with an effective date of December 31, 2018 or earlier.

In preparing these financial statements in accordance with IFRS 1, the Company applied the mandatory exception from full retrospective application of IFRS related to estimates. Hindsight was not used to create or revise estimates. Estimates reflect conditions that existed at the point in time the estimate applies to. Additionally, the Company applied the mandatory exceptions related to the derecognition of financial assets and liabilities, the classification and

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2018

(expressed in thousands of US dollars)

measurement of financial instruments, and the impairment of financial instruments. The Company did not apply any of the optional exemptions to full retrospective application of IFRS.

3. Summary of significant accounting policies

The significant accounting policies used in the preparation of these consolidated financial statements are described below.

Basis of presentation

The consolidated financial statements have been prepared on a historical cost basis. These consolidated financial statements are presented in US dollars, which is the functional currency of the Company. These consolidated financial statements are presented in thousands of dollars.

Basis of consolidation

The consolidated financial statements include the accounts of the Company and all its controlled subsidiaries. All significant intercompany balances and transactions have been eliminated on consolidation. Subsidiaries are those entities that the Company controls. For accounting purposes, control is established by the Company when it is exposed to, or has rights to, variable returns from its involvement with the entity and can affect those returns through its power over the entity. Subsidiaries are fully consolidated from the date on which control is obtained by the Company and are de-consolidated from the date that control ceases. Changes in the Company's interest in a subsidiary that do not result in a loss of control are accounted for as equity transactions.

Revenue

Talent revenue is earned based on a predetermined percentage of a client's earnings. As a talent management services company, the Company's performance obligations are to provide various services for clients, which generally include representing, supporting and advocating for clients in the sourcing and negotiating of, and performance under client engagements with third parties.

Under IFRS 15, revenue is recognized as services are performed for the Company's customers over time, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those services. Revenue from variable consideration is recognized only to the extent that it is highly probable that a significant reversal in the amount of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is subsequently resolved (variable consideration constraint). The variable consideration contained in the Company's contracts primarily relates to the client's earnings. Once the variable consideration is known and the related uncertainty is resolved, which is mainly when the client has earned their income, the Company recognizes revenue. The Company typically receives its commission within a short period of time subsequent to the client earning their income. When such services are performed prior to receiving supporting statements or other information from our clients or third-party customers, we estimate the amount of revenue to recognize prior to receipt of the statement with the consideration of the variable consideration constraint. If our estimates and judgments were to change, the timing and amount of revenue recognized may be different.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2018

(expressed in thousands of US dollars)

Property and equipment

Property and equipment are recorded at cost less accumulated depreciation and accumulated impairment losses. Depreciation is provided for at the following annual rates:

Equipment	straight-line	three years
Leasehold improvements	straight-line	over lease term

Depreciation rates and the estimated useful lives of property and equipment are reviewed at each financial year-end and are adjusted if necessary.

Financial instruments

The Company accounts for its financial assets and liabilities in accordance with IFRS 9, Financial Instruments (IFRS 9).

Classification of financial assets and financial liabilities

● Financial assets

A financial asset is measured at amortized cost if it meets both of the following conditions and is not designated as at FVTPL:

it is held within a business model whose objective is to hold assets to collect contractual cash flows, and
its contractual terms give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

For an investment in equity instruments that is not held for trading, the Company may elect, on an investment-byinvestment basis, to present the subsequent change in fair value in OCI.

All financial assets not classified as amortized cost or FVOCI as described above are measured at FVTPL.

● Financial liabilities

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2018

(expressed in thousands of US dollars)

Impairment

The Company recognizes a loss allowance for expected credit losses on financial assets that are measured at amortized cost. The Company applies the simplified approach in calculating lifetime expected credit losses for accounts receivable. Accounts receivable are provided for based on estimated recoverable amounts as determined by using a combination of historical default experience, any changes to credit quality and management estimates. The lifetime expected credit loss allowance for accounts receivable was nominal as at December 31, 2018, December 31, 2017, and January 1, 2017.

Leases

The determination of whether an arrangement is, or contains, a lease is based on the substance of the arrangement at the inception date: whether fulfillment of the arrangement is dependent on the use of a specific asset or assets or the arrangement conveys a right to use the asset. Where the Company is the lessee, asset values recorded under finance leases are amortized on a straight-line basis over the period of expected use. Obligations recorded under finance leases are reduced by lease payments net of imputed interest. Operating lease commitments, for which lease payments are recognized as an expense in the consolidated statements of operations, are recognized on a straight-line basis over the lease term.

Cash

Cash consists of cash on hand and balances with banks, net of cheques issued and outstanding at the reporting date.

Employee benefits

Provisions

Income taxes

The Company is organized as a limited liability company. A limited liability company is not subject to tax in accordance with partnership tax rules. Taxable income or loss from the Company is passed through to and included in the taxable income of its members. Accordingly, the consolidated financial statements do not include a provision for income taxes on the flow-through taxable income or loss from the Company.

Use of estimates and judgments

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2018

(expressed in thousands of US dollars)

evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. Accounting estimates will, by definition, seldom equal the actual results.

The most significant estimates and judgments made by management in the preparation of the Company's consolidated financial statements include measuring progress toward satisfaction of the Company's performance obligation in talent management arrangements. The Company fulfills its performance obligation and recognizes revenue as the performer completes a project. Generally, this is aligned with the performer's receipt of proceeds from these projects, however, judgment is required to evaluate whether the receipt of proceeds is aligned with the satisfaction of the Company's performance obligation.

Accounting pronouncements issued but not yet adopted

On January 13, 2016, the International Accounting Standards Board issued IFRS 16 Leases (IFRS 16). IFRS 16 replaces the existing guidance in IAS 17 Leases. IFRS 16 eliminates the classification of leases as either operating leases or finance leases. It introduces a single lessee accounting model, which requires a lessee to recognize assets and liabilities for all leases with a term of more than 12 months and to recognize depreciation of lease assets separately from interest on lease liabilities in the income statement. Lessees are permitted to make an accounting policy election, by class of underlying asset, not to recognize lease assets and lease liabilities for leases with a lease term of 12 months or less, and, on a lease-by-lease basis, not to recognize lease assets and lease liabilities for leases where there underlying asset is of low value. IFRS 16 will be effective for the Company on January 1, 2019.

The Company expects to adopt IFRS 16 using the modified retrospective approach and, accordingly, comparative figures will not be restated. Upon adoption, the Company will recognize a right-of-use assets and a lease liability. The lease liability will initially be measured at the present value of lease payments that remain to be paid after January 1, 2019 and is estimated to be approximately \$1,114. The right-of-use asset will initially be measured at the amount of the lease liability, less the balance of accrued rent at January 1, 2019 and is estimated to be approximately \$854.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2018

(expressed in thousands of US dollars)

4. Property and equipment

	Equipment	Leasehold Improvements	Total
	\$	\$	\$
Cost
January 1, 2017 (unaudited)	68	24	92
Additions	-	-	-
Disposals	-	-	-
December 31, 2017 (unaudited)	68	24	92
Additions	-	-	-
Disposals	-	-	-
December 31, 2018	68	24	92

Accumulated amortization
January 1, 2017 (unaudited)	(32)	-	(32)
Depreciation	(18)	(8)	(26)
December 31, 2017 (unaudited)	(50)	(8)	(58)
Depreciation	(13)	(8)	(21)
December 31, 2018	(63)	(16)	(79)
Net book value
January 1, 2017(unaudited)	36	24	60
December 31, 2017 (unaudited)	18	16	34
December 31, 2018	5	8	13

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2018

(expressed in thousands of US dollars)

5. Accounts receivable

	December 31, 2018	December 31, 2017	January 1, 2017
		(unaudited)	(unaudited)
	\$	\$	\$
Unbilled accounts receivable (note 6)	204	813	688
Other receivables	13	52	164
	217	865	852

The Company does not have security over these balances.

6. Revenue

Disaggregation of revenue

	Year ended
	December 31, 2018	December 31, 2017 (unaudited)
	\$	\$
Talent Revenue (recognized over time)	22,851	18,482

Unbilled accounts receivable:

	December 31, 2018
	\$
Opening balance	813
Additions	22,851
Amounts received	(23,460)
Closing balance	204

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2018

(expressed in thousands of US dollars)

	December 31, 2017
	(unaudited)
	\$
Opening balance	688
Additions	18,482
Amounts received	(18,357)
Closing balance	813

7. Related party transactions

Ownership

For all periods presented, the Company was owned on a 50/50 basis by Jason Weinberg Management, Inc. and Stephanie Simon Management, Inc.

Significant Subsidiaries

Name of Company	Domicile	Owned by Company (%)
Brandtitled, LLC.	United States	50%
Ecosystem Pictures, Inc.	United States	100%
Untitled Entertainment, Inc.	United States	100%
Untitled Newco Inc.	United States	100%
Waterfall Media, Inc.	United States	100%

For all the above listed subsidiaries, the Company exercises its control through voting interests.

Key management personnel

Key management includes the Company's co-managing partners Stephanie Simon and Jason Weinberg. The partners receive distributions in their capacity as owners of the Company, but otherwise did not receive any material compensation from the Company for the years ended December 31, 2018 and 2017.

The Company had unsecured amounts payable to the co-managing partners of \$56 at each of December 31, 2018, December 31, 2017, and January 1, 2017.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2018

(expressed in thousands of US dollars)

8. Leases

The Company's significant lease arrangements are for office premises. The Company recorded total rent expense of \$1,111 and \$1,000 for the years ended December 31, 2018 and 2017, respectively.

The Company subleases space in its Beverly Hills office to third parties on a month-to-month basis. The Company recognized sublease income of \$201 and \$208 for the years ended December 31, 2018 and December 31, 2017, respectively.

9. Financial instruments

Credit risk

Credit risk arises from cash, as well as credit exposure to customers, including outstanding receivables. The Company manages credit risk on cash by ensuring the counterparties are banks, governments and government agencies with high credit ratings. The maximum exposure to credit risk for cash and accounts receivables approximates the amount recorded on the consolidated statement of financial position. Management manages credit risk by regularly reviewing aged accounts receivable and performing an appropriate credit analysis. No single customer accounted for more than 10% of outstanding accounts receivable at December 31, 2018, December 31, 2017 or January 1, 2017.

Liquidity risk

The Company manages liquidity by forecasting and monitoring operating cash flows and using its bank overdraft facility. As at December 31, 2018 and 2017, the Company had cash of \$883 and \$42, respectively. The Company maintains appropriate cash balances and has access to financial facilities to manage fluctuating cash flows.

Results of operations for any period are dependent on the amount and timing of talent management services provided, which cannot be predicted with certainty. Consequently, the Company's results from operations may fluctuate materially from period to period and the results of any one period are not necessarily indicative of results for future periods. Cash flows may also fluctuate and are not necessarily closely correlated with revenue recognition.

Currency risk

Substantially all of the Company's cash flows are denominated in US dollars. Accordingly, the Company is not exposed to significant currency risk.

Interest rate risk

The Company does not have long-term debt and accordingly is not exposed to significant interest rate risk.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2018

(expressed in thousands of US dollars)

Categories of Financial Instruments

The Company's financial instruments consisted of the following:

		December 31, 2018	December 31, 2017	January 1, 2017
			(unaudited)	(unaudited)
		\$	\$	\$
Financial assets
Measured at amortized cost	Accounts receivable	217	865	852
Measured at FVTPL	Cash	883	42	-
Financial liabilities
Measured at amortized cost	Accounts payable and accrued liabilities	1,644	1,306	1,061
Measured at amortized cost	Payables to related parties	56	56	56
Measured at FVTPL	Bank overdraft	-	-	351

Fair value

Level 1 valuation based on quoted prices observed in active markets for identical assets and liabilities;
Level 2 valuation techniques based on inputs that are quoted prices of similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; inputs other than quoted prices used in a valuation model that are observable for that instrument, and inputs that are derived principally from or corroborated by observable market data by correlation or other means; and
Level 3 valuation techniques with significant unobservable market inputs.

A financial instrument is classified to the lowest level of the hierarchy for which a significant input has been considered in measuring fair value.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2018

(expressed in thousands of US dollars)

The Company measures cash and bank overdraft at fair value using level 1 inputs. The Company's accounts receivable, accounts payable and accrued liabilities, and payables to related parties are carried at amortized cost, which approximates fair value.

Maturity analysis for financial liabilities

				December 31, 2018
	Less than 1 year	1 to 3 years	After 3 years	Total
	\$	\$	\$	\$
Accounts payable and accrued liabilities	1,590	54	-	1,644
Payables to related parties	56	-	-	56
				December 31, 2017
	Less than 1 year	1 to 3 years	After 3 years	Total
	\$	\$	\$	\$
Accounts payable and accrued liabilities	1,046	260	-	1,306
Payables to related parties	56	-	-	56
				January 1, 2017
	Less than 1 year	1 to 3 years	After 3 years	Total
	\$	\$	\$	\$
Accounts payable and accrued liabilities	703	304	54	1,061
Payables to related parties	56	-	-	56

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2018

(expressed in thousands of US dollars)

10. Commitments and contingencies

Future minimum lease payments under non-cancellable operating leases at December 31, 2018 are as follows:

	\$
Within one year	932
After one year but not more than five years	235
More than five years	-
	1,167

In the normal course of business, the Company may become subject to various legal proceedings, arbitrations and actions. The final outcome of such legal proceedings and actions cannot be predicted with certainty. However, there are no such proceedings and actions outstanding which, in the opinion of management, will have a material impact on the Company's consolidated financial position or results of operations.

The Company has provided a letter of credit in the amount of \$235 as security for one of its leased premises.

11. Capital disclosures

The Company's objectives when managing capital are to provide an adequate return to its members, safeguard its assets, maintain a competitive cost structure and continue as a going concern. The Company does not have any longterm debt and therefore its capital structure is managed based on members' equity, cash flows from operations, and, to the extent necessary, its bank overdraft facility.

	December 31, 2018	December 31, 2017	January 1, 2017
		(unaudited)	(unaudited)
	\$	\$	\$
Cash	883	42	-
Bank overdraft	-	-	351
Total capital and reserves attributable to
members	(532)	(358)	(497)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2018

(expressed in thousands of US dollars)

12. Subsequent events

On February 1, 2019, Boat Rocker Media, Inc. acquired 51% of the outstanding LLC interests of the Company.

Subsequent to December 31, 2019, the World Health Organization characterized COVID-19 as a global pandemic. Since that time, several preventative measures have been implemented in the United States, including shelter-in-place orders and the closure of the border between Canada and the United States to non-essential travel.

The Company has been impacted by COVID-19 in a number of ways. Employees have transitioned to work-fromhome and IT security and software has been upgraded to ensure the Company's information is protected. An internal task force was set up to understand and implement COVID-19 health and safety requirements. The Company does not expect COVID-19 to have a significant impact on the collection of its accounts receivable or an increase in expected credit losses because the Company's customers are not anticipated to withhold payment and are anticipated to continue to be solvent.

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following Management's Discussion and Analysis ("MD&A") has been prepared by management and is a review of the consolidated operating results and financial position of Untitled Entertainment LLC ("Untitled Entertainment"), based upon International Financial Reporting Standards ("IFRS"). This discussion and analysis should be read in conjunction with the consolidated financial statements of Untitled Entertainment, as well as the notes thereto, for the respective years. All amounts are expressed in thousands of U.S. dollars unless otherwise stated. This disclosure is effective as of February 17, 2021.

Overview of the company

Untitled Entertainment is an American talent management company based in Los Angeles with an additional office in New York. Untitled Entertainment was founded in 1999 in order to offer talent management services to actors and other talent. Untitled Entertainment was organized in and is domiciled in the United States and its registered office is 200 Park Avenue South, 8th Floor, New York, NY 10003.

Subsequent to year end, on February 1, 2019, Boat Rocker Media Inc. acquired 51% of the outstanding LLC interests of Untitled Entertainment. In accordance with our exemptive relief application to the Ontario Securities Commission, Untitled Entertainment has not presented financial information for the one month period ended January 31, 2019.

SELECTED FINANCIAL INFORMATION

The following table provides selected financial information of Untitled Entertainment for the years ended December 31, 2018 and 2017:

	Year ended
		Dec 31, 2018	Dec 31, 2017
				(Unaudited)
Revenue	\$	22,851	\$	18,482
Net income	\$	7,393	\$	5,494

		Dec 31, 2018		Dec 31, 2017
			(Unaudited)
Cash	\$	883	\$	42
Total assets	\$	1,168	\$	1,004
Total non-current financial liabilities	\$	54 \$		260
Total liabilities	\$ 1,700		\$	1,362

		Year ended
		Dec 31, 2018		Dec 31, 2017
				(Unaudited)
Cash provided by operating activities	\$	8,407	\$	5,742
Cash used in financing activities	\$	(7,566)	\$	(5,349)
Cash distributions to members	\$	(7,567)	\$	(5,355)

Results of Operations

Year ended December 31, 2018 compared to 2017

The following table sets forth the consolidated results of operations for the years ended December 31, 2018 and 2017:

	Year Ended December 31,		Increase (Decrease)
			2017
	2018		(Unaudited)		Amount	Percent
			(Amounts in thousands)
Revenue
Total revenue	\$ 22,851	\$	18,482		4,369	24%

Expenses
Salaries and benefits	11,299		9,378		1,921	20%
General and administrative	4,360		3,818		542	14%

Other income	(201)		(208)		7	(3%)
Net income	\$ 7,393	\$	5,494	\$	1,899	35%

Revenue. During the years ended December 31, 2018 and 2017, Untitled Entertainment earned revenue based on a predetermined percentage of the earnings of the talent that it managed. Fluctuations in revenue are therefore determined based on the total number of clients who are generating income in that year and the amount of income that these clients are earning from projects they partake in. Revenue was \$22,851 in 2018, an increase of 24% from \$18,482 in 2017. The 24% increase in 2018 is attributable to both an increase in the number of clients as well as an increase in the revenue per client.

Salaries and benefits. Salaries and benefits were \$11,299 in 2018, an increase of 20% from \$9,378 in 2017. Salaries and benefits include all compensation expenses including salaries, benefits, commissions, and bonuses of Untitled Entertainment's employees. A key driver of this expense is employee commissions, as Untitled Entertainment's managers receive a commission that is derived from the income of the talent that they manage. As such, the 20% increase in salaries and benefits is directly correlated to the 24% increase in revenue in 2018 over 2017.

General and administrative expenses. General and administrative expenses include rent, professional fees, information technology, depreciation, and other office costs. In the year ended December 31, 2018, general and administrative expenses were \$4,360 compared to \$3,818 in 2017, an increase of \$542 or 14%.

Year Ended December 31, Increase (Decrease) 2018 2017 (Unaudited) Amount Percent (Amounts in thousands) Professional fees 1,368 1,052 316 30% Facilities and rent expenses 1,111 1,000 111 11% Office and administrative: Bank fees, Misc., Information Technology, etc. 1,860 1,740 120 7% Depreciation 21 26 (5) (19%) Total expenses \$ 4,360 \$ 3,818 \$ 542 14%

The following table presents the breakdown of the general and administrative expense in the comparative periods:

The majority of the 14% increase in general and administrative expenses is attributable to a 30% increase in professional fees between 2017 and 2018 that is driven primarily by an increase in legal fees between the two years as Untitled Entertainment incurred legal costs relating to the ultimate sale of 51% of the membership interests to Boat Rocker Media Inc. in early 2019, and as such a number of due diligence and other costs were incurred in 2018 to prepare for this.

Other income. Other income for the year ended December 31, 2018 was \$201 compared to \$208 in the same period of 2017, a decrease of \$7 or 3%. Untitled Entertainment subleases its Beverly Hills office to third parties on a month-to-month basis and the income from this arrangement is recognized as other income. The fluctuation between the years is due to minor changes in this month-to-month arrangement.

Income tax expenses. Untitled Entertainment is organized as a limited liability company. A limited liability company is not subject to tax in accordance with partnership tax rules. Taxable income or loss from Untitled Entertainment is passed through to and included in the taxable income of its members.

Cash Flows

The following table summarizes the cash flows in the years ended December 31, 2018 and 2017:

	Year ended December 31,	Increase (Decrease)
	2018		2017 (Unaudited)	Amount
	(Amounts in thousands)
Cash provided by operating activities	\$ 8,407	\$	5,742	\$ 2,665
Cash used in financing activities	(7,566)		(5,349)	(2,217)
Increase in cash and cash equivalents	\$ 841	\$	393	\$ 448

Cash flow from operating activities for the year ended December 31, 2018 was \$8,407 compared to \$5,742 in 2017, an increase of \$2,665. The primary driver of this increase is the increase of net income of \$1,899 in 2018. Accounts receivable also decreased by \$648 over 2018 representing cash collections of accounts receivable.

Cash flow used in financing activities for the year ended December 31, 2018 was a cash outflow of \$7,566 compared to \$5,349 in 2017, a variance of \$2,217. These outflows relate to distributions to members as Untitled Entertainment is a limited liability company and the taxable income is passed through to the members. Given net income in 2018 of \$7,393 and in 2017 of \$5,494, these closely approximate the taxable income being distributed in both years.

Contractual Obligations

Future minimum lease payments under non-cancellable operating leases at December 31, 2018 are \$932 within one year and \$235 between one and five years. Untitled Entertainment has provided a letter of credit in the amount of \$235 as security for one of its leased premises.

Liquidity and Capital Resources

Untitled Entertainment's objectives when managing capital are to continue as a going concern, provide an adequate return to members and to safeguard its assets. Untitled Entertainment's strong cash flows from operations have historically been sufficient to meet its required expenses, as the business model is not capital intensive. Historically, the cash flows from Untitled Entertainment's core business activities been sufficient to meet its ongoing capital needs. If necessary, the members can reduce the amount of distributions that they take to provide additional liquidity.

Related Parties

Key management includes Untitled Entertainment's co-managing partners Stephanie Simon and Jason Weinberg. The partners receive distributions in their capacity as owners of Untitled Entertainment, but otherwise did not receive any material compensation from Untitled Entertainment for the years ended December 31, 2018 and 2017. Untitled Entertainment had unsecured amounts payable to the co-managing partners of \$56 at December 31, 2018 and 2017.

Outstanding equity instruments

For all periods presented, Untitled Entertainment was owned on a 50/50 basis by Jason Weinberg Management Inc. and Stephanie Simon Management, Inc. Untitled Entertainment is structured such that it does not have outstanding share instruments but rather assigned membership interests, which are 50% split between the two aforementioned entities. As of February 17, 2021, the membership interests are 51% owned by Boat Rocker Media Inc. and 49% equally split by Jason Weinberg Management Inc. and Stephanie Simon Management Inc.

CRITICAL ACCOUNTING POLICIES, ESTIMATES AND JUDGEMENTS

For a summary of all of Untitled Entertainment's accounting policies, including the accounting policies discussed below, see Note 3 to Untitled Entertainment's annual consolidated financial statements.

The most significant estimates and judgments made by management in the preparation of Untitled Entertainment's consolidated financial statements include measuring progress toward satisfaction of Untitled Entertainment's performance obligation in talent management arrangements. Untitled Entertainment fulfills its performance obligation and recognizes revenue as the performer completes a project. Generally, this is aligned with the performer's receipt of proceeds from these projects, however, judgment is required to evaluate whether the receipt of proceeds is aligned with the satisfaction of Untitled Entertainment's performance obligation.

APPENDIX A - AUDIT AND RISK COMMITTEE CHARTER

AUDIT AND RISK COMMITTEE CHARTER

This charter (the "Charter") sets forth the purpose, composition, responsibilities and authority of the Audit and Risk Committee (the "Committee") of the board of directors (the "Board") of Boat Rocker Media Inc. (the "Company").

Section 1 Statement of Purpose

The purpose of the Committee is to assist the Board in fulfilling its oversight responsibilities with respect to:

financial statements and financial reporting processes;
the systems of internal accounting and financial controls;
the annual independent audit of the financial statements;
legal and regulatory compliance;
reviewing the capital structure of the Company, reviewing and monitoring compliance with debt covenants and reviewing the process and reports with which the Company measures financial results or performance;
public disclosure items such as quarterly press releases, financial-oriented investor relations materials and other public reporting requirements; and
oversight of the Company's risk management activities generally.

Section 2 Committee Membership

The Committee shall consist of as many directors of the Board as the Board may determine (the "Members"), but in any event, not less than 3 (three) Members. Subject to any exceptions permitted thereunder, all of the Members should meet the criteria for independence and financial literacy established by applicable laws and the rules of any stock exchanges upon which the Company's securities are listed, including National Instrument 52-110 — Audit Committees ("NI 52-110"). NI 52-110 requires, subject to any exceptions therein, that, to be independent, a Member be free of any relationship which could, in the view of the Board, reasonably interfere with the exercise of a Member's independent judgment.

Members shall be appointed by the Board, taking into account any recommendation that may be made by the Compensation, Nominating and Corporate Governance Committee of the Board (the "CNCG Committee"). Any Member may be removed and replaced at any time by the Board and will automatically cease to be a Member if he or she ceases to meet the qualifications required of Members. The Board will fill vacancies on the Committee by appointment from among qualified directors of the Board, taking into account any recommendation that may be made by the CNCG Committee. If a vacancy exists on the Committee, the remaining Members may exercise all of their powers so long as there is a quorum.

Chair

Unless a Chair of the Committee (the "Chair") is designated by the Board, the Members may designate a Chair by majority vote of the full Committee membership.

Qualifications

All Members should be independent and financially literate as described above, subject to any exceptions permitted. Members should have suitable experience and must be familiar with auditing and financial matters.

Attendance of Ex Officio Members, Management and other Persons

The Committee may invite, at its discretion, senior executives of the Company or such persons as it sees fit to attend meetings of the Committee and to take part in the discussion and consideration of the affairs of the Committee. Senior executives and other employees of the Company shall attend a Committee meeting if invited by the Committee. The Committee may also require senior executives or other employees of the Company to produce such information and reports as the Committee may deem appropriate in the proper exercise of its duties. The Committee may meet without senior executives in attendance for a portion of any meeting of the Committee.

Delegation

Subject to applicable law, the Committee may delegate any or all of its functions to any of its independent Members or any independent sub-set thereof, from time to time as it sees fit.

Section 3 Committee Operations

Meetings

The Chair, in consultation with the other Members, should determine the schedule and frequency of meetings of the Committee. Meetings of the Committee should be held at such times and places as the Chair may determine. To the extent possible, advance notice of each meeting will be given to each Member unless all Members are present and waive notice, or if those absent waive notice before or after a meeting. Members may attend all meetings of the Committee either in person or by telephone, video or other electronic means. Powers of the Committee may also be exercised by written resolutions signed by all Members.

At the request of the external auditors of the Company, the Chief Executive Officer, the Co-Executive Chairmen or the Chief Financial Officer of the Company or any Member, the Chair should convene a meeting of the Committee. Any such request should set out in reasonable detail the business proposed to be conducted at the meeting so requested.

Agenda and Reporting

To the extent possible and desirable, in advance of every regular meeting of the Committee, the Chair should prepare and distribute, or cause to be prepared and distributed, to the Members and others as deemed appropriate by the Chair, an agenda of matters to be addressed at the meeting together with appropriate briefing materials. The Committee may request that senior executives and other employees of the Company produce such information and reports as the Committee may deem appropriate in order for it to fulfill its duties.

The Chair should report to the Board on the Committee's activities since the last Board meeting. However, the Chair may report orally to the Board on any matter in his or her view requiring the immediate attention of the Board. Minutes of each meeting of the Committee should be approved by the Members and then circulated to the Board.

Secretary and Minutes

The secretary of the Company may act as secretary of the Committee unless an alternative secretary is appointed by the Committee. The secretary of the Committee should keep regular minutes of Committee proceedings.

Quorum and Procedure

A quorum for any meeting of the Committee will be a simple majority. The procedure at meetings will be determined by the Committee. The powers of the Committee may be exercised at a meeting where a quorum is present or by resolution in writing signed by all Members. In the absence of the Chair, the Committee may appoint one of its other Members to act as Chair of any meeting.

Exercise of Power between Meetings

Between meetings, the Chair, or any Member designated for such purpose by the Committee, may, if required in the circumstance, exercise any power delegated by the Committee on an interim basis. The Chair or other designated Member should promptly report to the other Members in any case in which this interim power is exercised.

Section 4 The Committee's Role

As part of its function in assisting the Board in fulfilling its oversight role (and without limiting the generality of the Committee's role), the Committee should perform the actions set out below.

Financial Reporting and Disclosure

Review and recommend to the Board for approval, the audited annual financial statements, including the auditors' report thereon, the quarterly financial statements, press releases with financial results, management discussion and analysis, financial reports, financial-oriented investor relations materials, and other applicable financial disclosure, prior to the public disclosure of such information.

Discuss with the independent auditors the matters required to be discussed by the applicable auditing standards from time to time, including any critical audit matters.

Review and recommend to the Board for approval, where appropriate, financial information contained in any prospectuses, annual information forms, annual reports to shareholders, management information circulars, material change disclosures of a financial nature and similar disclosure documents prior to the public disclosure of such documents or information.

Review with senior executives of the Company, and with external auditors, all critical accounting policies and practices to be used by the Company and alternative treatments under International Financial Reporting Standards ("IFRS"), with a view to gaining reasonable assurance that financial statements are accurate, complete and present fairly the Company's financial position and the results of its operations in accordance with IFRS, as applicable.

Review periodically the effect of regulatory and accounting initiatives, as well as off-balance sheet structures (if any), on the financial statements of the Company.

Seek to ensure that adequate procedures are in place for the review of the Company's public disclosure of financial information extracted or derived from the Company's financial statements, the Company's disclosure controls and procedures and periodically assess the adequacy of those procedures and recommend any proposed changes to the Board for consideration.

Internal Controls and Internal Audit

Review the adequacy and effectiveness of the Company's internal control and information systems through discussions with senior executives of the Company and the external auditor relating to the maintenance of: (i) necessary books, records and accounts in sufficient detail to accurately and fairly reflect the Company's transactions; (ii) effective internal control over financial reporting; and (iii) adequate processes for assessing the risk of material misstatements in the financial statements and for detecting control weaknesses or fraud. From time to time the Committee should assess any requirements or changes with respect to the establishment or operations of the internal audit function having regard to the size and stage of development of the Company at such time.

Satisfy itself, through discussions with senior executives of the Company, that the adequacy of internal controls, systems and procedures has been periodically assessed in accordance with regulatory requirements and recommendations.

Periodically review the Company's policies and procedures for reviewing and approving or ratifying related-party transactions.

External Audit

Provide recommendations to the Board relating to the appointment, compensation, retention, oversight and, when necessary, termination of any auditor engaged for the purpose of preparing or issuing an audit report or performing other audit, review or attest services for the Company (including the resolution of disagreements between management and such firm regarding financial reporting).

Consult with the external auditors on a regular basis.

Review, at least annually, the qualifications, performance and the independence of the external auditors.

Review the audit plan of the external auditors prior to the commencement of any audit. Establish and maintain a direct line of communication with the Company's external auditors.

Pre-approve all auditing services and non-audit services to be provided to the Company by its independent external auditor. The Committee may delegate authority to one or more independent members to grant pre-approvals of audit and permitted non-audit services; provided that any such pre-approvals will be presented to the full Committee at its next scheduled meeting.

Meet in camera with only the external auditors, senior executives of the Company, or the Members, where and to the extent that, such parties are present, at any meeting of the Committee.

Review the results of the external audit and the external auditor's report thereon, including discussions with the external auditors as to the quality of accounting principles used and any alternative treatments of financial information that have been discussed with senior executives of the Company and any other matters.

Review any material written communications between senior executives of the Company and the external auditors and any significant disagreements between the senior executives and the external auditors.

Discuss with the external auditors their perception of the Company's financial and accounting personnel, records and systems, the cooperation which the external auditors received during their course of their review and availability of records, data and other requested information and any recommendations with respect thereto.

Discuss with the external auditors their perception of the Company's identification and management of risks, including the adequacy or effectiveness of policies and procedures implemented to mitigate such risks.

Review the reasons for any proposed change in the external auditors which is not initiated by the Committee or Board and any other significant issues related to the change, including the response of the incumbent auditors, and enquire as to the qualifications of the proposed auditors before making its recommendations to the Board.

Review annually a report from the external auditors in respect of their internal quality-control procedures, any material issues raised by the most recent internal quality-control review, or peer review of the external auditors, or by any inquiry or investigation by governmental or professional authorities, within the preceding five years, respecting one or more independent audits carried out by the external auditors, and any steps taken to address any such issues.

Financial Strategy and Financial Transactions

Review, assess and discuss, including, as and when appropriate, with management, the Company's current and future capital and operating plans and budgets, the Company's capital structure, including debt and equity components, current and expected financial leverage, interest rate and foreign currency exposures and make recommendations to the Board regarding the same.

Review material prepared by management regarding any proposed issues of equity and debt, including public and private debt, credit facilities with banks and others, hybrid securities and other credit arrangements such as capital and operating leases and, in connection therewith, make recommendations to the Board for consideration.

Review and monitor compliance with the debt covenants of the Company, as applicable.

Periodically review and assess the method by which the Company measures and reports financial results and performance, and, in connection therewith, make recommendations to the Board for consideration.

Risk Oversight

Oversee the development of, and review, assess and discuss, as and when appropriate, with management, the Company's policies and procedures related to legal compliance and enterprise risk assessment, management, reporting and response, including limits and tolerances, risk roles and responsibilities, risk appetite and profile and risk mitigation decisions.

Review associated risks that affect or could affect the Company, the Company's employees and the public and seek to ensure proper management of those risks. Such review should include a review of regulatory risks, including those relating to (i) changes to federal, provincial and state funding and incentive programs, including tax credits; (ii) potential loss of "Canadian" status under the Investment Canada Act (Canada); and (iii) changes to legislation and regulations affecting or potentially affecting the Company.

Review and oversee the Company's health, safety, sustainability and environmental policies, programs, issues and initiatives.

Review and discuss the Company's major financial risk exposures and the steps taken to monitor and control such exposures, including the use of any financial derivatives and hedging activities.

Assess and make recommendations to the Board relating to the adequacy of insurance coverage maintained by the Company.

Seek to ensure that the Company's business strategy and implementation is consistent with its risk policies, appetite and profile and that risk assessment is an integral aspect of the business strategic planning process.

Review and evaluate management's implementation of the Company's risk strategy.

Other

Establish, monitor and periodically review the Company's applicable procedures for:

• the receipt, retention and treatment of complaints received by the Company regarding accounting, internal accounting controls or auditing matters;

the confidential, anonymous submission by directors, officers and employees of the Company of concerns regarding questionable accounting or auditing matters; and
if applicable, any violations of applicable law, rules or regulations that relate to corporate reporting and disclosure.

Review and approve the Company's hiring policies regarding employees and partners, and former employees and partners, of the present and former external auditors of the Company.

Direct and supervise the investigation into any matter brought to its attention within the scope of the Committee's role. Address such other matters as may be assigned to it by the Board from time to time or as may be required by applicable law.

Section 5 The Committee Chair

In addition to the role of the Chair described above, the Chair should oversee and report on the evaluations to be conducted by the Committee, as well as monitor developments with respect to accounting and auditing matters in general and report to the Committee on any related significant developments.

Section 6 Committee Evaluation

The performance of the Committee should be evaluated by the Board as part of its regular evaluation of the Board committees.

Section 7 Access to Information and Authority to Retain Independent Advisors

The Committee shall be granted unrestricted access to all information regarding the Company that is necessary or desirable to fulfill its duties and all directors of the Company, officers and employees will be directed to cooperate as requested by Members. The Committee has the authority to retain, at the Company's expense, independent legal, financial, and other advisors, consultants and experts to assist the Committee in fulfilling its duties and responsibilities, including sole authority to retain and to approve their fees. The Committee shall select such advisors, consultants and experts after taking into consideration factors relevant to their independence from management and other relevant considerations.

The Company shall provide appropriate funding, as determined by the Committee, for payment of compensation to the independent registered public accounting firm engaged for the purpose of preparing or issuing an audit report or performing other audit, review or attest services for the Company and any advisors that the Committee chooses to engage, as well as funding for the payment of ordinary administrative expenses of the Committee that are necessary or appropriate in carrying out its duties.

The Committee shall act in accordance with its business judgment and shall assess the information provided by the Company's management and the external advisers in accordance with such judgment. Members are entitled to rely, absent knowledge to the contrary, on the integrity of the persons and organizations from whom they receive information, and on the accuracy and completeness of the information provided. Nothing in this Charter is intended or may be construed as imposing on any member of the Committee or the Board a standard of care or diligence that is in any way more onerous or extensive than the standard to which the directors are subject under applicable law.

The Committee also has the authority to communicate directly with internal and external auditors. While the Committee has the roles and powers set forth in this Charter, it is not the duty of the Committee to plan or conduct audits or to determine that the Company's financial statements are complete and accurate or comply with IFRS and other applicable requirements. These are the responsibilities of the senior executives of the Company responsible for such matters and the external auditors. The Committee, the Chair and any Members identified as having accounting or related financial expertise are members of the Board, appointed to the Committee to provide broad oversight of the financial, risk and control related activities of the Company, and are specifically not accountable or responsible for the day to day operation or performance of such activities. Although the designation of a Member as

having accounting or related financial expertise for disclosure purposes is based on that individual's education and experience, which that individual will bring to bear in carrying out his or her role on the Committee, such designation does not impose on such person any duties, obligations or liability that are greater than the duties, obligations and liability imposed on such person as a member of the Committee and Board in the absence of such designation. Rather, the role of a Member who is identified as having accounting or related financial expertise, like the role of all Members, is to oversee the process, not to certify or guarantee the internal or external audit of the Company's financial information or public disclosure. This Charter is not intended to change or interpret the constating documents of the Company or applicable law or stock exchange rule to which the Company is subject, and this Charter should be interpreted in a manner consistent with all such applicable laws and rules.

Section 8 No Liability

The Company (acting through its Board) may in its sole discretion from time to time permit departures from the terms hereof, either prospectively or retrospectively, and no provision of this Charter is intended to give rise to civil liability to securityholders, or any other liability whatsoever except as expressly provided herein.

Section 9 Review of Charter

The Committee should periodically review and assess the adequacy of this Charter and recommend any proposed changes to the Board for consideration.

CERTIFICATE OF THE COMPANY

Dated: February 17, 2021

This Prospectus, together with the documents and information incorporated by reference, will, as of the date of the supplemented prospectus providing the information permitted to be omitted from this Prospectus, constitute full, true and plain disclosure of all material facts relating to the securities offered by this Prospectus as required by the securities legislation of each of the provinces and territories of Canada.

John Young

(signed) "John Young" (signed) "Michelle Abbott" Michelle Abbott

Chief Executive Officer

Chief Financial Officer

On behalf of the Board of Directors

(signed) "David Fortier" (signed) "Ivan Schneeberg" David Fortier

Ivan Schneeberg

Director

CERTIFICATE OF THE UNDERWRITERS

Dated: February 17, 2021

To the best of our knowledge, information and belief, this Prospectus, together with the documents and information incorporated by reference, will, as of the date of the supplemented prospectus providing the information permitted to be omitted from this Prospectus, constitute full, true and plain disclosure of all material facts relating to the securities offered by this Prospectus as required by the securities legislation of each of the provinces and territories of Canada.

RBC DOMINION SECURITIES INC. TD SECURITIES INC.

(signed) "James McKenna" (signed) "Matt Boelen" James McKenna

Managing Director

Matt Boelen

Director

J.P. MORGAN SECURITIES CANADA INC.

(signed) "David Rawlings" David Rawlings

Managing Director

BMO NESBITT BURNS INC.

(signed) "Brad Fraser"

Brad Fraser

Managing Director

SCOTIA CAPITAL INC.

(signed) "Ken Lehner"

Ken Lehner

Managing Director

CORMARK SECURITIES INC. CANACCORD GENUITY CORP.

(signed) "James Austen" (signed) "Mike Lauzon"

James Austen

Managing Director

Mike Lauzon

Managing Director

AI assistant

Blue Ant Media — Capital/Financing Update 2021

48037_rns_2021-02-17_11bde058-afc8-45ac-9ee9-4e295303f886.pdf

AMENDED AND RESTATED PRELIMINARY BASE PREP PROSPECTUS

BOAT ROCKER MEDIA INC.

\$175,000,000

([●] Subordinate Voting Shares)

Price: \$[⚫] per Subordinate Voting Share

TABLE OF CONTENTS

ABOUT THIS PROSPECTUS

MEANING OF CERTAIN REFERENCES

NON-IFRS MEASURES

Non-IFRS Measures (see "Selected Annual and Interim Financial Information of Boat Rocker – Reconciliation of Non-IFRS Measures" for a reconciliation to IFRS measures)

EXCHANGE RATE DATA

CAUTION REGARDING FORWARD-LOOKING STATEMENTS

MARKET AND INDUSTRY DATA

TRADEMARKS AND TRADE NAMES

MARKETING MATERIALS

ELIGIBILITY FOR INVESTMENT

DISCLAIMER

LETTER FROM THE FOUNDERS

PROSPECTUS SUMMARY

THE HISTORY OF THE COMPANY

THE BUSINESS OF THE COMPANY

Overview

COVID-19

Creative and Commercial Capabilities

How Boat Rocker Shortens the Distance

Source the IP

Assess the IP

Monetize the IP

COMPETITIVE STRENGTHS

Differentiated Creative and Commercial Capabilities Already Assembled

Independent Company of Scale Unaffiliated with Any Major Studio or Buyer

Diversified Business Model

Well-Positioned to Benefit from Industry Tailwinds with No Legacy Businesses

Significant Acquisition and Investment Expertise

Experienced and Aligned Management Team

Strong Financial Profile Enhanced by Strategic Long-Term Shareholder

Notes:

GROWTH STRATEGIES AND GOALS

Expanding Creative and Commercial Capabilities

Capitalizing on Operating Leverage

Increasing Sources of IP

Building and Monetizing Global Entertainment Brands

Pursuing Strategic Acquisitions and Investments

OUTLOOK

SUMMARY OF SELECTED ANNUAL AND INTERIM FINANCIAL INFORMATION OF BOAT ROCKER

Selected Financial Information for Boat Rocker

Notes:

Summary of Pro Forma Consolidated Financial Information

Boat Rocker Consolidated Capitalization

THE OFFERING

CORPORATE STRUCTURE OF BOAT ROCKER

INDUSTRY AND MARKET OPPORTUNITY

Media Consumption

Average Time Spent with Media in the U.S. (hours: minutes) 9

Global Growth of OTT Platforms

Video Content Purchasing Trends

Annual Content Programming Spend, Excluding Sports (US\$ billions)16

Relevant Content Genre Trends

Scripted

Number of Scripted Original Series in the U.S.25

Unscripted

Kids and Family

Talent and Celebrities

LETTER FROM THE FOUNDERS

THE HISTORY OF THE COMPANY

THE BUSINESS OF THE COMPANY

Overview

Creative and Commercial Capabilities

Creation and Development

Production

Animation

Distribution

Franchise and Brand Management

Talent Management

How Boat Rocker Shortens the Distance

Source the IP

Assess the IP

Blue Ant Media Capital/Financing Update 2021

Annual Content Programming Spend, Excluding Sports (US\$ billions)¹⁶

Number of Scripted Original Series in the U.S.²⁵