SINGAPORE - Media OutReach - 18 August 2020 - The Board ofDirectors ("Board") of Spackman Entertainment Group Limited ("Company" and together with itssubsidiaries, the "Group") wishes to inform shareholders that theCompany has today entered into a non-binding memorandum of understanding ("MOU")with Spackman Equities Group Inc ("SQG" or the "Purchaser"), acompany listed on the TSX Venture Exchange in Canada, pursuant to which theCompany intends to sell the its entire interest in Spackman Media Group Limited("Spackman Media Group") (the "Proposed Divestment") to thePurchaser.

The Purchaser is an investment companythat selectively invests into growth companies that possess proprietaryknow-how or technologies.  The commonshares of SQG are traded on the TSX Venture Exchange under the symbol 'SQG'. Asof the date of this announcement, SQG is a substantial shareholder of the Company,holding 7.55% of the total issued shares of the Company. Richard Lee, the Non-ExecutiveDirector of the Company, and Na Kyoungwon, the Executive Director, Presidentand Chief Operating Officer of the Company, are also directors of SQG.

Under the MOU,the Company intends to sell all its 13,968,038 common voting shares of SpackmanMedia Group ("Sale Shares"), representing 43.88% of the Company's interest in Spackman Media Group. The purchaseconsideration will be fully satisfied by newly issued common shares of thePurchaser ("Consideration"). Accordingly, following the completion ofthe Proposed Divestment, SQG will be a subsidiary of the Company.

The Company envisage the ProposedDivestment to be classified as a major transaction under Chapter 10 of theCatalist Rules and may also constitute an interested person transaction underChapter 9 of the Catalist Rules. The Company will, through its Sponsor, consultthe SGX-ST on the applicability of Chapter 9 of the Catalist Rules, and ifnecessary, on the applicability of Chapter 10 of the Catalist Rules.

The Parties further acknowledge andunderstand that the Proposed Divestmentmay constitute a reverse-takeover for SQG pursuant to the relevant regulationsof the TSX Venture Exchange.

The MOU does not constitute any legallybinding obligations on the Company and the Purchaser (collectively, the "Parties").It is intended to be a basis for further negotiations between the Parties.

Rationale

Upon thecompletion of the Proposed Divestment, the Parties plans to develop, produceand finance motion pictures and entertainment content targeted for the NorthAmerican market, as well as develop other entertainment-related businesses inNorth America.

The rationale mentioned above is in linewith the Group's strategy to diversify into the production and financing of US Hollywoodmovies, a major initiative that the Group plans to unveil in the near future.

Consideration

The Considerationfor the Proposed Divestment is as follows:

(1) The priceper share of the Sale Shares shall be no less than KRW 2,000 (equivalent to S$2.30)which is equivalent to the most recent significant transaction of the shares ofSpackman Media Group that has been documented in public records. Accordingly, theConsideration shall be no less than KRW 27,936,076,000 (equivalent to S$32,126,487).

(2) The issueprice of the shares of the Purchaser to satisfy the Consideration will be discussedand agreed upon by the Parties, in accordance with TSX Venture Exchange regulations.

The Considerationshall be further negotiated and agreed upon between the Purchaser and the Company.

Conditions Precedent

The keyconditions precedent to the Proposed Divestment include, but not limited to,the following:

(a) Completionof the respective Parties' due diligence exercise;

(b) ThePurchaser shall not own any shares in the Company prior to or at the time ofthe execution of the Proposed Divestment;

(c) The Purchasershall consolidate its common shares on a 10:1 basis;

(d) Completionof independent valuation on Spackman Media Group commissioned by each of the Companyand Purchaser, if required;

(e) Receipt ofapproval from the shareholders of the Company in relation to the Proposed Divestment,if needed;

(f) Receipt ofapproval from the shareholders of the Purchaser in relation to the acquisitionof the Sale Shares and the issuance of its common shares, if needed; 


(g) All othernecessary approvals and consents from all relevant government, regulatory andother authorities and third parties in Singapore, Canada, and other relevantjurisdictions to effect and complete the Proposed Divestment being obtained,and where such approvals or consents are subject to conditions pertaining toand are to be complied with by the Purchaser, such conditions being reasonablyacceptable to the Purchaser.

Further Information

Negotiations betweenthe Parties are ongoing, and no binding agreement has been entered into betweenthe Parties in respect of the Proposed Divestment. Pursuantto the MOU, the Parties agree that the MOU shall terminate if definitiveagreement(s) are not executed by 30 September 2020, unless extended mutually.

The Company shallmake the necessary announcements as and when there are further materialdevelopments on the Proposed Divestment.

Caution in Trading

Shareholders andpotential investors should exercise caution when trading in the shares of the Company.The Proposed Divestment is subject tothe execution of definitive agreement(s) by the Parties and conditionsprecedent to be fulfilled, and there is no certainty or assurance that the definitiveagreement will be entered into, or that the Proposed Divestment willbe completed.

BY ORDER OF THE BOARD

NaKyoungwon

ChiefOperating Officer, President and Executive Director

18August 2020