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Posted on 12/31/2002 11:46:27 AM PST by Timesink
In a current report filed with the U.S. Securities and Exchange Commission, Salon said it issued a convertible promissory note and warrants to Shea Ventures LLC on Dec. 18 to raise $200,000 for working capital.
Salon said the warrants give Shea the right to buy about 300,000 Salon shares at a price of $0.0575 per share.
The company previously raised $200,000 in October through the sale of a promissory note to Salon director John Warnock.
In August Salon had said it had enough cash to last through September, but then raised additional capital through the note sale to Warnock.
Prior to that, the company had ended the June quarter with only enough cash to last through July but later raised more funds.
Shares in Salon were unchanged at 4 cents on the OTC Bulletin Board.
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They should have been entirely out of cash by now.
This might buy them another six weeks, tops.
I don't understand why the market values the company at $580,000 and these two jokers have already paid 70% of the value of a company that they don't even control.
Very, very fishy.
It may be that some very wealthy lefty investors have simply decided to run Salon as a charity so they can write off their promissory notes for tax purposes.
He purchased warrants. If the stock goes to $1.00, he can buy $300,000 worth of stock for $17,250. Not bloody likely, but it could happen.
Which is, of course, worthless - since you can buy the same number of shares in the open market for $12,300
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On December 18, 2002, Salon Media Group, Inc. (the "Registrant" or the "Company") sold and issued a convertible promissory note ("Note") and warrants ("Warrants") in a financing transaction in which it raised gross proceeds of approximately $200,000 (the "Financing"). The terms of the Financing are set forth in the Note and Warrant Purchase Agreement (the "Agreement") entered into between the Company and an investor (the "Investor") Shea Ventures LLC. The Note may be convertible at a future date into equity securities of the Company at a conversion price to be determined. The Warrants grant the holders thereof the right to purchase an aggregate of approximately 300,000 shares of the Company's common stock at an exercise price of $0.0575 per share. The Company will use the capital raised for working capital and other general corporate purposes.
The Note automatically converts upon the closing of the Company's first sale of its preferred or common stock following the date hereof with aggregate gross proceeds to the Company of at least $2,000,000 (including the conversion of the outstanding principal of all Notes and other converted indebtedness of the Company)(a "Subsequent Financing"), and, if no Subsequent Financing shall have occurred by the close of business on September 30, 2003, then the Note shall automatically convert into shares of the Company's common stock. In the event of an automatic conversion of the Note upon a Subsequent Financing, the number of shares of preferred or common stock to be issued upon conversion of this and other notes shall equal the aggregate amount of the Note obligation divided by the price per share of the securities issued and sold in the Subsequent Financing. In the event of an automatic Note conversion into common stock absent a Subsequent Financing, the number of shares of the Common Stock to be issued upon conversion of Notes shall equal the aggregate amount of the Note obligations divided by the average closing price of the Company's common stock over the sixty (60) trading days ending on September 30, 2003, as reported on such market(s) and/or exchange(s) where the common stock has traded during such sixty trading days.
In connection with the Financing, the Company granted the Investors a security interest in the Company's assets, subject to the rights of any Senior Indebtedness (as such term is defined in the Agreement).
Neither the Note, Warrants, nor the shares of common stock underlying the Warrants have been registered for sale under the Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration under such act or an applicable exemption from registration requirements.
The foregoing description is qualified in its entirety by reference to the Note and Warrant Purchase Agreement, Form of Convertible Promissory Note and Form of Common Stock Purchase Warrant, copies of which are filed herewith as Exhibits 4.2.14, 4.2.15, and 4.2.16 respectively, and each of which are incorporated herein by reference.
(c) Exhibits
![[new]](http://us.i1.yimg.com/us.yimg.com/i/new2.gif){kind=small}
of streaming real-time exchange quotes, charts, and screener from NYSE, AMEX, and Nasdaq. EXHIBIT NO. DESCRIPTION
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4.2.14 Note and Warrant Purchase Agreement,
dated as of December 18, 2002
4.2.15 Form of Convertible Promissory Note,
dated December 18, 2002 issued by Salon
Media Group, Inc.
4.2.16 Form of Common Stock Purchase Warrant
dated December 18, 2002 issued by Salon
Media Group, Inc.
On November 21, 2002, Salon Media Group, Inc. (Salon) common stock began trading over-the-counter (OTC). Prior to this date, Salon stock was traded on The Nasdaq SmallCap Market. Information on Salon stock OTC sales can be located at http://www.otcbb.com. A copy of the press release announcing the transfer is attached as Exhibit 99.8 and is incorporated herein by reference.
"Safe Harbor" Statement under the U.S. Private Securities Litigation Reform Act of 1995: This Exhibit contains certain "forward-looking" statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are based on management's current expectations and are naturally subject to uncertainty and changes in circumstances. Actual results may vary materially from the expectations contained herein. More detailed information about these factors is set forth in the reports filed by the Company with the Securities and Exchange Commission. The Company is under no obligation to (and expressly disclaims any such obligation to) update or alter its forward-looking statements, whether as a result of new information, future events or otherwise.
(a) Financial statements of businesses acquired.
(b) Pro forma financial information.
Not applicable
(c) Exhibits.
Exhibit No. Description - -
99.8 Company Press Release dated November 20, 2002.
Congressman Billybob
Click for latest column on UPI, "Incision Decision in the Senate" (Not yet on UPI wire, or FR.)
As the politician formerly known as Al Gore has said, my book, "to Restore Trust in America"
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