(BSNS WIRE) FutureLink Retains New York Investment Banker, Closes Initia
FutureLink Retains New York Investment Banker, Closes Initial Financing and
Signs Deal to Buy Out Convertible Debentures
Business/Technology Editors
CALGARY, Alberta--(BUSINESS WIRE)--April 30, 1999--FutureLink
Distribution Corp. (NASD OTC BB:FLNK) is pleased to announce that it
has closed on nearly US$3.8 million of new financing. Commonwealth
Associates LP of New York, acted as the company's placement agent for
this offering and has been retained as FutureLink's primary investment
banker.
"We have been looking at retaining a US-based investment bank for
some time," stated Raghu Kilambi, FutureLink's CFO. "Commonwealth has
impressed us with their track record of taking OTC-listed companies to
the next level."
"We see FutureLink as a leader in the emerging ASP (Application
Service Provider) sector," said Michael Falk, Commonwealth's Chairman
and CEO. "We focus on undervalued, well positioned companies in
high-growth sectors and feel FutureLink fits this profile."
The financing involved the placement of senior subordinated
convertible notes. The notes are convertible to FutureLink common
stock at $0.20 per share. Investors also received 50 percent warrant
coverage entitling the holder to purchase common shares at an exercise
price of $0.25 per share. Commonwealth received nine percent of the
gross proceeds of the offering in commissions, together with agent's
warrants (also exercisable at $0.25 per share). This stock is subject
to a six-month lockup.
When FutureLink's directors approved this financing, they agreed
that if any director or senior officer purchased treasury shares in
this offering, they would pay "market price" equal to a ten day
trading average set at the commencement of the offering, which
calculated to be $0.30 per share. Both Cameron Chell, FutureLink's
President and CEO, and Raghu Kilambi have participated in this
financing at the $0.30 "market price", which is subject to a one-year
lockup.
Effective April 26, 1999, FutureLink entered into an agreement
with Thomson Kernaghan & Co. Limited ("TK") to alter the terms and
amounts of outstanding securities held by TK on behalf of its clients.
One of the key terms of this agreement is to fix the conversion price
of the debentures at $0.20 per share rather than basing the conversion
price on a floating discount to market formula. In addition, the
issuance of new warrants and/or repricing of existing warrants to TK
and its clients will result in them holding a total of 6,000,000
warrants exercisable at $0.25 per share. The Company will prepay a
portion of these outstanding debentures on or before May 26, 1999 for
cash of $1,881,600 together with common stock issued "at market"
(based on a five day average of closing bid and ask prices) to cover
accrued interest, leaving $2,500,000 principal amount of such
convertible debentures outstanding with a fixed conversion price of
$.20 per share.
About Commonwealth Associates
Commonwealth Associates LP (http://www.comw.com), established in
1988, is a New York merchant and investment bank dedicated to creating
long-term value for investors. Commonwealth focuses on investments in
well-managed, emerging micro-cap or small-cap growth companies. With
over 70 professionals devoted to all areas of investment banking and
brokerage activities, Commonwealth offers a full range of value-added
services.
Since 1995, Commonwealth has managed over $400 million of
financings through over 60 transactions, most as sole or lead manager.
Examples of recent portfolio companies include iMall, Inc. (Nasdaq:
IMAL), PICK Communications, Inc. (Nasdaq: PICK), Preferred Employers
Holdings, Inc. (Nasdaq: PEGI) and ProxyMed, Inc. (Nasdaq: PILL).
About FutureLink Distribution Corp
FutureLink is "The Computer Utility Company(tm)" and a founder of
the Application Service Provider (ASP) industry. FutureLink provides
small and mid-sized businesses (10-1,000 employees) with off-site,
server-based computing, allowing them to escape the hardware/software
upgrade cycle and focus on their core business. FutureLink's expertise
in Application Hosting, IT Outsourcing, Business Practices Consulting,
and Software Development enables them to offer an all-inclusive,
trouble-free service at a predictable price. FutureLink offers
computer and information service as transparently and reliably as
today's utilities deliver electricity, water and telephone services.
For more information, contact FutureLink toll-free at (877) 216-6001,
E-mail sales@futurelink.net or visit the FutureLink Web site at
futurelink.net.
Forward-looking statements and comments in this news release are
made pursuant to safe harbor provisions of the Securities Exchange Act
of 1934. Such statements relating to, among other things, the
prospects for the Company to complete transactions and enhance
operating results, are necessary subject to risks and uncertainties,
some of which are significant in scope and nature. These risks may
further be discussed in periodic reports and registration statements
to be filed by the Company from time to time with the Securities and
Exchange Commission in the future.
FUTURELINK
"The Computer Utility Company"
--30--gk/bos*
CONTACT: FutureLink
Leone Bechard
(877) 216-6001
lbechard@futurelink.net
or
Investors
Troy Cleland
(877) 216-0001
invrel@futurelink.net
KEYWORD: NEW YORK
INDUSTRY KEYWORD: COMED COMPUTERS/ELECTRONICS
INTERACTIVE/MULTIMEDIA/INTERNET TELECOMMUNICATIONS
Today's News On The Net - Business Wire's full file on the Internet
with Hyperlinks to your home page.
URL: businesswire.com
*** end of story *** |
