In the two days following Devine Entertainment’s June 9 announcement that production on its new six-part, family comedy series, The Not-So Grimm Brothers, would be temporarily postponed for six weeks, close to 1.5 million shares of the Toronto-based, Emmy-Award-winning prodco were traded on the tse.

The unprecedented trading action, however, has no relation to the postponement of production, says president and ceo David Devine. ‘It’s the small private placement we’re putting into the company that’s motivating the trading.’

Devine and cfo Richard Mozer have agreed to make a private placement in the company for a combined total of about $300,000 or approximately 500,000 shares at $0.65 each.

The placement, which will provide Devine Entertainment with working capital while longer-term production financing is finalized, is subject to board and tse approval and is expected to close within 90 days.

Raising capital in the public markets is one of Devine Entertainment’s major stumbling blocks these days. ‘With new investors, as soon as I say children’s entertainment, the word Cinar comes up, which has generally soured some decisions,’ says Devine, who believes the Cinar fiasco has definitely affected the financing of The Not-So Grimm Brothers.

Meanwhile, Devine has postponed production on the $8.5-million series because money expected from distributor CIC Productions of Southern California hasn’t come through yet.

Also, because Devine recognizes value upon delivery, a delay in the completion of projects in 2000 could have an effect on the company’s earnings and revenues for the year.

Results from Devine’s first quarter, ending March 31, as reported in late May, indicated a $362,000 drop in revenue from the same period last year – to $173,000 from $535,000.

In the Q1 report, the company stated the decline was a result of no new films being delivered in the first quarter and said it was hopeful delivery of The Not-So Grimm Brothers would provide a significant boost in third and fourth quarter revenues.

The series is now slated to go to camera from Aug. 15 to the end of November, and Devine says he expects three shows to be ready for December and three by March 2001.

Created by Devine, Mozer and Heather Conkie, the six-part, one-hour series is based on the fantasies and folktales of the Brothers Grimm, described by Devine as ‘a Mayberry gone awry.’ Taking place in the 19th century, each story explores the universal struggle of light against darkness where, against all odds, the gentle and meek triumph over evil.

In other Devine news, the company is heading into a joint venture with Vancouver’s WSi-Interactive to expand its existing website (www.devinetime.com) into a children’s entertainment and education Web portal.

Devine will continue to supply creative content to the site, which among its many offerings provides an interactive journey through time. WSi will invest $1 million to drive traffic and increase sales. Ultimately, the two companies will enter into an equal partnership with the intention of spinning off the website – equipped with e-commerce facilities that will offer visitor access to Devine’s video library – into a separately traded entity.

Devine Entertainment has 11,450,000 outstanding shares, with an estimated market cap of $8 million.

www.devine-ent.com