Film company pays debt but still faces High Court drama
Octagon Films, the Wicklowbased production company behind dramas like Love/ Hate and The Borgias, has repaid all of the start-up money advanced to it by a German investor 15 years ago.
Octagon has been involved in a shareholders’ row in the High Court over the past 12 months with the investor, Berlin-based W2 Filmproduktion und Vertriebs.
The €317,499 advanced by W2, gave it a 49% share of Octagon and a note attached to newly-filed accounts for the Wicklow company said that the money was fully paid as of the end of September last year.
The loan from W2 was unsecured and was due to be repaid in 2004, 2005 and 2006 out of anticipated recoupable development costs from successful movie productions.
In the High Court, W2 is suing the two directors of Octagon, James Flynn and Morgan O’Sullivan, claiming that it has lost estimated revenues of €25m in relation to activities of Octagon Films.
Mr Flynn and Mr O’Sullivan — who own the remaining 51% of the company — deny what they describe as “unfounded allegations” and are fully contesting the action.
The new accounts make reference to the dispute and state that three separate legal proceedings have arisen involving Octagon which all relate to a dispute between the shareholders.
“All three cases are due to be considered by the High Court during 2017.
“The future of the company is likely to be decided by the outcome of these cases,” the accounts, which were signed off on earlier this month, said.
W2 Filmproduktion und Vertriebs has also demanded payment of interest on the original €317,499 loan.
The interest bill is €186,872 and Octagon said it “is disputing and has denied” the bill.
A further note said that Mr O’Sullivan and Mr Flynn “are of the opinion that the interest penalty demanded is not payable and as such does not represent an obligation on the company and accordingly no provision has been made in these accounts”.
Accumulated profits at Octagon Films last year rose by €122,576 to €298,494.
The firm’s cash pile declined during the year from €272,439 to €94,148.
The company has also been involved in the production of the international drama Penny Dreadful and the hit movie, Calvary, which stars Brendan Gleeson and Chris O’Dowd.
The performance of Octagon Films Ltd is not representative of Octagon’s overall business, as the company sets up a number of special purpose companies for its various projects.
Holliday Grainger as Lucrezia Borgia from The Borgias, one of the shows produced by Octagon Films.