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IDW Cuts Two-Fifths of Employees, Executives, Stock Exchange Listing

New IDW CEO Davidi Jonas, states "today we hit reset" as IDW drops off the stock exchange and fires two-fifths of staff.


An update to the news below can be found at this link. IDW Media Holdings, Inc., the company best known at Bleeding Cool for the IDW Publishing comic book line and IDW Entertainment , today announced a series of major cuts and changes which they cite "in response to operational challenges to position the Company for recovery and future growth." Amongst other actions, that means "cutting approximately 39% of its current workforce." Bleeding Cool understands that IDW has just finished holding an all-hands meeting to give the bad news. Unless you are one of the Jonas family who currently own much of the media publisher.

IDW Publishing Full Solicits and Solicitations For July 2021

Recently IDW Media Holdings Investors called for the sale of IDW in an open letter. IDW's Board of Directors has stated that they will;

  • deregister the Company's Class B common stock under the Securities Exchange Act of 1934
  • delist the Class B common stock from the NYSE American
  • make changes in senior management
  • implement cost cutting measures.

These actions are intended to "preserve capital, and put the Company in the strongest position possible to unlock value from its assets, including its intellectual property and ability to generate new intellectual property."

IDW states that they will be "retaining essential personnel who are most directly related to preserving current operations and launching the Company on its new trajectory." I notice that former Bleeding Cool editor Keith Davidsen who was working for IDW in media relations has his e-mail bouncing.

IDW states that "the reduction in force and other steps, after the effect of backfilling certain positions, is expected to deliver approximately $4.4 million in annual savings (and potentially greater savings in future periods) and is currently expected to result in approximately $0.9 million in severance and related costs to be recognized in the current period. Before giving effect to any payments of severance or related costs, the Company expects to hold approximately $5.7 million cash and cash equivalents as of April 28,2023."

As for delisting IDW from the stock market, "The Company has determined to voluntarily delist from the NYSE American exchange and to deregister its Class B common stock under Section 12(b) and Section 12(g) of the Securities Exchange Act of 1934, as amended, and suspend its reporting obligations under Section 15(d) of the Exchange Act. The Company has notified NYSE American of its intent to delist its securities from NYSE American, anticipates that it will shortly file with the Securities and Exchange Commission (the "SEC") a Form 25 relating to the delisting and deregistration of its securities, and anticipates that the delisting and deregistration under Section 12(b) of its Class B common stock will become effective on or about May 18, 2023. Following the delisting of its securities from NYSE American, the Company plans to file with the SEC a Form 15 to deregister its securities under Section 12(g) of the Exchange Act and suspend its reporting obligations under Section 15(d) of the Exchange Act. The Board determined that deregistration is in the overall best interests of the Company and its stockholders following review and careful consideration of a number of factors, including, but not limited to, the expected reduction in operating expenses associated with continued listing and reporting, which would allow the Company to focus more resources on its recovery and growth plans."

And yes, it's probably time to watch the Wolf Of Wall Street again to remind me how this all works. "The Company intends to file an application for its Class B common stock to be quoted on the OTCQB platform, operated by OTC Markets Group Inc. as soon as practicable. It is likely that there will be some period following delisting of the Class B common stock from NYSE American prior to commencement of quotation on the OTCQB and during such period, the Class B common stock may be quoted on the OTC Pink Market. The Company intends to continue to provide information to its stockholders and to take such actions to enable a trading market in its Class B common stock to exist. There is no guarantee, however, that one or more brokers will continue to make a market in the Class B common stock and that trading of the Class B common stock will be approved for quotation on, or continue to be quoted on, the OTCQB."

"The Board determined that going dark is the best path for the Company due to expected cost savings, reduction of pressure on limited resources and the Company's current inability to realize many of the benefits from continued listing and Exchange Act registration and reporting," said David Breau, Lead Independent Director on IDW's Board. "Low trading values and volume has limited our Class B common stock's liquidity and made it untenable to effectively use our securities as transaction consideration, attract interest from institutional investors or market analysts or provide meaningful incentive to our employees. At the same time, we continued to bear the direct and indirect expenses associated with the NYSE American listing and SEC reporting. We believe the reduction in time spent by our management and employees complying with the requirements applicable to SEC reporting companies will enable them to focus more on managing the Company's businesses, strengthening our strategic relationships, exploiting our assets and thus increasing stockholder value, with a focus on long-term growth without an undue distraction by short-term financial results and stock price movement."

IDW Launches Kickstarter for Wynonna Earp Season 3 Blu-Ray

As to senior management, Davidi Jonas, who was recently elected to the Board by the IDW's stockholders and was named as Executive Chairman and Vice Chairman of the Board will be taking on the role of Chief Executive Officer replacing Allan Grafman who has served in that role since late August 2022. Jonas is a member of the family that already collectively owns a controlling interest in the CIDW's equity, and his father, Howard Jonas, serves as IDW's Chairman and Chairman of the Board.

With the anticipated deregistration and delisting, IDW has stated that they determined that "Brooke Feinstein's services as Chief Financial Officer were no longer essential and she will be departing the Company. The principal financial position will be filled by existing internal resources."

"We appreciate Allan's industry experience and efforts on IDW's behalf during the last eight months as CEO and for over three years prior to that as a member of the Board and Chairman of the Audit Committee," added Howard Jonas, IDW's Chairman. However, with the need to make pivotal changes to preserve value and transform the Company, the Board felt that a new CEO with new ideas, a tireless work ethic, willingness to roll up his sleeves and do whatever is needed to help the Company, with a successful record at creating a corporate culture of excellence and maximizing stockholder value, was what IDW needed. Brooke has been a key member of management for over 4.5 years, serving well in different capacities."

Amber Huerta, who serves as the Senior Vice President, People and Organizational Development of IDW, has been promoted to Chief Operating Officer, which IDW states is "reflecting the much broader role she plays across several operational disciplines." IDW states that they are finalizing separation arrangements with Grafman and Feinstein.

"I am humbled by the confidence being placed in me by the IDW Board in appointing me to this position at such a pivotal time in the Company's existence," said Davidi Jonas, Executive Chairman and incoming Chief Executive Officer. "I feel an overwhelming sense of excitement and more than a little trepidation as I face the challenges before us. Our Board is taking bold action to address the challenges facing the Company and I share their view that alacrity is called for. My trepidation comes from the magnitude of the task ahead and my determination to do everything possible to unlock and create the value for our stockholders that they deserve. Many of our stockholders, not least of them members of my family, have shown patience and loyalty and it is my singular goal to see that rewarded. Since re-joining the Company as Executive Chairman, I have taken a deep dive into the Company and have strong views on what is needed to put the Company's best foot forward on the path of success. The painful cuts we are making are unfortunately absolutely necessary. We need to ensure that the Company can survive and then grow. I want to thank Allan, Brooke, and the great employees and other contributors to IDW's past successes. Today we hit reset. Today I take on the responsibility to those for whom I work and those whom I work with, the stockholders and my colleagues at IDW. I will work tirelessly to unlock value." IDW is a great company with a storied history. IDW has a great team of people who are ready to give their all and again I am humbled to be at their head,"

IDW Publishing was founded in 1999 as the publishing division of Idea and Design Works, LLC , also formed in 1999, and is regularly recognized as the fifth-largest comic book publisher in the US. It was formed in 1999 by a group of comic book managers and artists, Ted Adams, Robbie Robbins, Alex Garner, and Kris Oprisko, who first met while working at Wildstorm, and when Jim Lee sold Wildstorm to DC, Lee turned that company's creative service department, previously run by Adams, over to the newly formed IDW.

Early prominent titles included Steve Niles and Ben Templesmith's 30 Days of Night which started a seven-figure bidding war between DreamWorks, MGM, and Senator International for a movie adaptation. They also created Wynonna Earp, Locke & Key and the Dirk Gently TV series and comics, and also licenced the likes of Transformers, Doctor Who, GI Joe, Star Wars though they lost a number of the licenses to other publishers. IDW bought Teenage Mutant Ninja Turtles however in its entirety. They currently publish the Dungeons & Dragons series, Star Trek, Magic The Gathering, Sonic The Hedgehog, My Little Pony, a line of creator-owned comics showrun by Scott Snyder, and acquire small press publisher Top Shelf Productions which brought them the graphic novels From Hell, Lost Girls, The League Of Extraordinary Gentlemen and March. The also publish the industry-leading archive projects, the Artists' Editions from senior editor Scott Dunbier, also a former Wildstorm executive.

The original founders of IDW have moved on, as venture capital took over, and during the pandemic, the company furloughed and then laid off many editorial employees, a number of whom set up their own publishers, such as Opus Comics, Clover Press and Syzygy Publishing.

 


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Rich JohnstonAbout Rich Johnston

Founder of Bleeding Cool. The longest-serving digital news reporter in the world, since 1992. Author of The Flying Friar, Holed Up, The Avengefuls, Doctor Who: Room With A Deja Vu, The Many Murders Of Miss Cranbourne, Chase Variant. Lives in South-West London, works from Blacks on Dean Street, shops at Piranha Comics. Father of two. Political cartoonist.
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