MGAM News!
TULSA, Okla.--(BUSINESS WIRE)--May 15, 1997--Multimedia Games, Inc. (NASDAQ:MGAM) announced it had entered into an agreement with Walsh Manning Securities, Inc. and its major shareholders to accelerate the payment of notes and the exercise of warrants which will yield $2.7 million of additional working capital for the company.
Walsh Manning, the Wall Street investment banking firm that led a $3.5 million private placement for the company in November 1996, will exercise 250,000 warrants at $8 per share in increments of 62,500 shares every two weeks subject to such shares being registered under the 1933 Act. The company plans to file a registration statement within the next two weeks.
In addition, major shareholders of Walsh Manning will pay $690,000 to MGAM on May 25,1997 for a note which was due in August 1997.
The warrants are part of 2.042 million warrants which were exercisable at $8 per share on or after August 12, 1997 when originally issued and could be called by the company for $.10 per share after August 12, 1997 if the common stock maintained a price of $12 per share for 20 consecutive trading days. In consideration for the accelerated payments, MGAM will extend the earliest date at which 523,000 of such warrants held by Walsh Manning can be called from August 12, 1997 until February 7, 1999.
MGAM has offered the holders of the other 1.519 million warrants an opportunity to modify their warrant agreements so that the earliest date at which their warrants can be called is delayed by 90 days. MGAM has made this offer in order to establish a more orderly market for the warrants and the underlying stock once the securities become registered under the 1933 Act.
The $2.7 million in additional capital will be used primarily to build MB-2000 player stations which are being installed by MGAM at a rate of approximately 500 per quarter in Indian bingo halls for playing MegaMania.
Multimedia Games, Inc., through its wholly owned subsidiary, MegaBingo, Inc. has exclusive contracts with over 50 Indian nations to provide linked games that are integrated among multiple halls. Multimedia Games, Inc. is the nation's leading provider of linked high-stakes bingo games, electronic based interactive bingo games and associated data processing services and products to the Indian gaming industry.
CONTACT: Multimedia Games, Inc. Gordon Graves or Fred Roll, 800/726-2464
REPEATS: New York 212-752-9600 or 800-221-2462; Boston 617-236-4266 or
800-225-2030; SF 415-986-4422 or 800-227-0845; LA 310-820-9473
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