ETPI Augments Growth with $5.3M Financing; ETPI Signs Letter of Intent
HOUSTON--(BUSINESS WIRE)--Sept. 30, 1999--Entertainment Technologies & Programs Inc. (OTC BB:ETPI), a fully reporting, diversified entertainment-based company, today announced it has signed a letter of intent with Capital Growth Resources Inc., of El Cajon, Calif. The letter of intent provides for a private placement of a minimum $3.4 million to a maximum of $5.35 million. Each $1,000 unit to be sold consists of a two-year, 12% secured note, 200 shares of common stock, and warrants to purchase up to 1,000 shares of common stock at $1 per share. The notes will not accrue interest during the first year, and will be payable, interest-only during the second year. This will enable the company to consolidate its long-term debt, eliminate debt service on this financing package for the first 12 months and reduce monthly debt service by 38% thereafter.
"The timing of this agreement is important, considering ETPI's current momentum," commented ETPI CEO, James D. Butcher. "Over the next year, with combined acquisitions and growth, we expect revenues to increase by nearly 45% to over $10 million. During the same period, this financing will allow us to lower our corporate interest expense and furnish us with the funding necessary to expand our market share and make acquisitions. Given this expected rate of growth and minimum acceptable returns on potential acquisitions, it is important that we were able to structure this offering so that the notes could be repaid from the sales proceeds of common stock upon exercise of the warrants.
"This funding package is one in a series of measures planned to increase and potentially sustain returns for our shareholders," continued Mr. Butcher. "The first step was to institute and complete our "Focus and Finish Plan." Step two includes calendar year 2000 plans to focus on debt consolidation, with corresponding revenue increases of 45% and continued profitability. Step three involves achieving higher stock performance, thus enhancing market capitalization. If these plans succeed, we intend to change the company's trading from the OTC Bulletin Board to a national stock exchange. Additionally, if the company achieves its goals, we expect shareholder value to undergo a significant sustainable increase."
The brokerage firm Capital Growth Resources is raising the funds for the ETPI financing. Capital Growth Resources, and its parent company, Capital Growth Planning are headquartered in El Cajon, Calif. and have been in business for thirty-five years, specializing in asset based financing. Douglas Miller, President of the parent company, Capital Growth Planning has recently joined ETPI's Board of Directors. Mr. Miller brings to ETPI his years of professional investment experience to assist the company through its expansion period. Walter Miller, CEO of Capital Growth Planning commented that "we've worked closely with ETPI over the past 5 years and have been very impressed with the company's commitment to shareholders. This funding will enable ETPI to leverage its success and implement the next stage of its growth program. Our clients now have the opportunity to form a relationship with ETPI, participate in its growth and ultimately see the company perform."
Forward-looking statements in this press release are made pursuant to the "Safe Harbor" provisions of the Private Securities Litigation Reform Act of 1995. Investors are cautioned that such forward-looking statements involve risks and uncertainties, including without limitation, continued popularity of entertainment facilities, increased levels of entertainment competition, weather conditions affecting outdoor attractions, completion of a planned funding package, completion of planned acquisitions, and other risks.
CONTACT:
Entertainment Technologies & Programs Inc., Houston
Fritz Boudreaux, 281/486-6061 |
