Entertainment Distribution Company (USA)

About Entertainment Distribution Company (USA)

Entertainment Distribution Company (USA), LLC is the Delaware company that bought the United States half of Universal Music Group's compact-disc manufacturing and distribution business and ran it until the end of 2008. It closed on 31 May 2005 under an asset purchase agreement of 9 May 2005 with UMG Manufacturing & Logistics, Inc. and Universal Music & Video Distribution, Corp., taking the disc plant at Grover, North Carolina, which it owned outright, and the leased distribution centres at Fishers, Indiana, Reno, Nevada and Wilkes-Barre, Pennsylvania; $28.4 million of the $79.4 million paid at closing was for the US operations.^[1][2][3] On the same day it signed the ten-year manufacturing and distribution agreements with UMG Recordings, Inc. that made it Universal's exclusive US supplier of CDs and of US distribution services, and it was from the closing a wholly owned subsidiary of Entertainment Distribution Company, LLC.^[2]

The corporation above it was Glenayre Technologies, Inc., which held the group through Glenayre Electronics, Inc. and owned about 98 per cent of the LLC's units at the closing.^[2] Glenayre renamed itself Entertainment Distribution Company, Inc. with effect from 10 May 2007, by merging a wholly owned subsidiary into itself under section 253 of the Delaware General Corporation Law for that sole purpose.^[4] It did not then rename itself a second time. EDCI Holdings, Inc. is a separate corporation, formed in 2008 with no operating history, which became the parent when the reorganisation adopted by stockholders on 22 August 2008 was consummated on 25 August 2008 and each ten shares of Entertainment Distribution Company, Inc. were exchanged for one share of EDCI Holdings; both corporations have their own page here.^[5] Exhibit 21.1 to the 2009 annual report lists this company among the group's subsidiaries at 31 December 2009, when EDCI held 97.99 per cent of the LLC's units indirectly.^[6][7]

EDCI announced on 31 October 2008, and closed on 31 December 2008, the sale of substantially all of EDC's United States business to Sony DADC U.S., Inc. for $26.0 million in cash: the Fishers distribution operations, the US supply agreements with Universal, all the equipment at Fishers, certain manufacturing equipment in the Kings Mountain plant and certain other US customer relationships.^[7][8] The leases of the Reno and Wilkes-Barre distribution centres were terminated effective on that closing.^[8] The plant itself was not sold. It stayed with this company: 356,000 square feet, the one facility of the group owned rather than leased, registered to ISO 9001:2000 and ISO 14001 while it ran.^[9] There were still 419 people at it on 31 December 2008 under the transition services agreement; production staff were phased out by the end of February 2009 and the rest by the end of April 2009.^[8] The building was listed for sale from the second quarter of 2009, was still unsold at 30 June 2010, and EDC then expected up to $7.3 million of liquidating proceeds from this company, most of it the plant's price.^[7][10] The 2007 annual report calls the plant Grover, North Carolina, and the later ones Kings Mountain: one facility under two names.^[9][7]

Two datings in the sources are wrong and are not followed here. The quarterly report for June 2010 twice puts the sale of EDC's US assets in December 2009, while the annual reports for 2008 and 2009 and that same report's own indemnity collateral, held until at least 1 January 2012 under a three-year obligation, all date the closing to 31 December 2008.^[10][8][7] The English Wikipedia article dates the sale to November 2008, which matches neither the announcement of 31 October 2008 nor the closing.^[11] No Delaware or North Carolina register entry for the company has been read, so its date of formation, its registered office and any date of dissolution are missing; the last filing that names it is the quarterly report of August 2010.^[10]