ALL YOU NEED TO KNOW ABOUT MGMA :
From their most recent 10Q :
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ITEM 9. SALE OF EQUITY SECURITIES PURSUANT TO REGULATION S
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On April 14, 1998, the Company entered into an Offshore Securities Subscription Agreement for Convertible Preferred Shares. The securities offered have not been and will not be registered under the U.S. Securities Act of 1933 and were not offered or sold within the United States nor to the account or benefit of U.S. persons, as defined in Regulation S of the 1933 Act.
PART II - OTHER INFORMATION (CONTINUED)
Under the terms of the agreement, the accredited investor will purchase 1,675 shares of 1988 Series A Convertible Preferred Stock ("Series A Shares") at a price of $1,000 per share. After 90 days, the accredited investor will purchase 500 shares of the Series A Shares at a price of $1,000 per share. Of the $2,175,000 proceeds, the Company will receive $1,100,000, less administrative expenses. The Company may buy back a portion of these shares.
The Series A Shares are convertible at a rate of 100 shares per week into the Company's common stock. The Shares carry a 5% cumulative dividend, payable at the time of conversion in either cash or common stock. These Shares are subject to a 24 month automatic conversion feature.
In addition to the Series A Shares the accredited investor will be
issued a warrant to purchase 400,000 of the Company's common stock at $1.50 per share and exercisable for up to 5 years after the date of issuance.
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That doesn't scare you ? How about this :
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3. SUBSEQUENT EVENTS
During December, 1997, the company discovered that its former director and Chief Financial Officer was a convicted felon and had been criminally suspended from appearing or practicing before the Securities and Exchange Commission. See Form 8-K as filed by the Company on December 29, 1997 for more detailed information.
In January,1998, the Company engaged an independent forensic consulting firm to investigate whether there were any irregularities with respect to the Company's accounting and financial reporting during the former Chief Financial Officer's tenure with the Company. On March 5, 1998, the consultants issued a report stating that their investigation did not reveal any accounting or financial
reporting irregularities. Further, the investigation did not detect any
transactions that appear to have been other than in the ordinary course of business.
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Reg S deals and convicted felons. No thanks.
Rob
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