UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D/Amendment No. 1
Under the Securities Exchange Act of 1934
NBG RADIO NETWORK, INC.
(Name of Issuer)
Common Stock, par value $.001 per share
(Title of Class of Securities)
62873Q 10 6
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(CUSIP Number)
Gregory W. Mallory, Esq.
Schwabe, Williamson & Wyatt
1211 SW Fifth Avenue, Suites 1600-1900
Portland, Oregon 97204-3795
503-222-9981
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(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
April 10, 2001
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(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition that is the subject of this Schedule 13D, and is filing this
schedule because of ss.ss.240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check the
following box. [ ]
NOTE: Schedules filed in paper format shall include a signed original and five
copies of the schedule, including all exhibits. Seess.240.13d-7 for other
parties to whom copies are to be sent.
* The remainder of this cover page shall be filled out for a reporting person's
initial filing on this form with respect to the subject class of securities, and
for any subsequent amendment containing information which would alter
disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be deemed
to be "filed" for the purpose of Section 18 of the Securities Exchange Act of
1934 ("Act") or otherwise subject to the liabilities of that section of the Act
but shall be subject to all other provisions of the Act (however, see the
Notes).
Potential persons who are to respond to the collection of information contained
in this form are not required to respond unless the form displays a currently
valid OMB control number.
CUSIP No. 62873Q 10 6
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1. Names of Reporting Persons.
I.R.S. Identification Nos. of above persons (entities only)
John A. Holmes III
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2. Check the Appropriate Box if a Member of a Group (See Instructions)
(a)
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(b)
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3. SEC Use Only
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4. Source of Funds (See Instructions) OO, PF
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5. Check if Disclosure of Legal Proceedings Is Required Pursuant to Items
2(d) or 2(e)
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6. Citizenship or Place of Organization Oregon, United States of America
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Number of 7. Sole Voting Power 1,458,564
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Shares Beneficially
Owned by 8. Shared Voting Power
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Each Reporting
Person With 9. Sole Dispositive Power 1,458,564
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10. Shared Dispositive Power
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11. Aggregate Amount Beneficially Owned by Each Reporting Person 1,458,564
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12. Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See
Instructions)
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13. Percent of Class Represented by Amount in Row (11) 9.4%
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14. Type of Reporting Person (See Instructions)
IN
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Preliminary Note:
This Schedule 13D Amendment No. 1 amends and restates in its entirety
the Schedule 13D for John A. Holmes, III filed on November 12, 1999.
Item 1. Security and Issuer
a) Name and Address of Principal Executive Offices of Issuer:
NBG Radio Network, Inc. ("Issuer")
520 SW Sixth Avenue, Suite 750
Portland, Oregon 97204
b) Title and Class of Equity Securities: Common Stock, par value $.001 per
share ("Common Stock")
Item 2. Identity and Background
a) - c), f)
Reporting Person
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This statement is filed by John A. Holmes, III, a U.S. citizen. Mr. Holmes is
the Chairman of the Board, President and Chief Executive Officer of the Issuer.
The principal business and office address of Mr. Holmes is 520 SW Sixth Avenue,
Suite 750, Portland, Oregon 97204.
d) During the last five years, Mr. Holmes has not been convicted in any
criminal proceeding (excluding traffic violations or similar misdemeanors).
e) During the last five years, Mr. Holmes has not been party to any civil
proceeding of a judicial or administrative body of competent jurisdiction as a
result of which he would have been subject to any judgment, decree or final
order enjoining future violations of or prohibiting or mandating activities
subject to Federal or State securities laws or finding any violation with
respect to such laws.
Item 3. Source and Amount of Funds or Other Consideration
On March 5, 2001, Mr. Holmes purchased 32,832 units consisting of one
share of Common Stock and a warrant to purchase one share of Common Stock. Mr.
Holmes paid a total of $32,832 for the units using his personal funds.
On April 10, 2001 Mr. Holmes was granted options to purchase 500,000
shares of Common Stock in accordance with the Issuer's 1998 Stock Incentive
Plan. Mr. Holmes did not pay any consideration for the options.
Item 4. Purpose of the Transaction
Mr. Holmes acquired the options in connection with his employment by
the Issuer. Mr. Holmes holds the securities described in Item 5(a) for
investment purposes. Mr. Holmes may make additional purchases of Common Stock in
open market or privately negotiated transactions or may alternatively seek to
sell his Common Stock in open market or privately negotiated transactions. Mr.
Holmes may also
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receive additional options or grants of Common Stock under the Issuer's 1998
Stock Incentive Plan. Mr. Holmes reserves the right to increase or decrease his
holdings on such terms and at such times as he may decide.
Under the Credit Facility Agreement dated June 29, 2001 ("Credit
Agreement") among the Issuer, the Issuer's subsidiaries, and MCG Finance
Corporation, the Issuer must propose a reorganization to its shareholders to be
voted on at the Issuer's July 2002 annual shareholders' meeting. Under the
reorganization proposal, the Issuer would transfer all of its assets to a
wholly-owned subsidiary and pledge the stock in the subsidiary to MCG Finance
Corporation. The Issuer is required to represent to its shareholders that the
reorganization proposal is supported by the Issuer's management and Board of
Directors. Mr. Holmes is currently the President and Chief Executive Officer of
the Issuer and a member of the Board of Directors of the Issuer.
Other than as described above, Mr. Holmes does not currently have any
plans or proposals which relate to or would result in:
(a) the acquisition by any person of additional securities of the Issuer,
or the disposition of securities of the Issuer;
(b) an extraordinary corporate transaction, such as a merger,
reorganization or liquidation, involving the Issuer or any of its
subsidiaries;
(c) a sale or transfer of a material amount of assets of the Issuer or any
of its subsidiaries;
(d) any change in the present Board of Directors or management of the
Issuer;
(e) any material change in the present capitalization or dividend policy of
the Issuer;
(f) any other material change in the Issuer's business or corporate
structure;
(g) any change in the Issuer's charter, bylaws or instruments corresponding
thereto or other actions which may impede the acquisition of control of
the Issuer by any person;
(h) causing the Shares to be delisted from a national securities exchange
or to cease to be authorized to be quoted in an inter-dealer quotation
system of a registered national securities association;
(i) the Shares becoming eligible for termination of registration pursuant
to Section 12(g)(4) of the Exchange Act; or
(j) any action similar to any of those actions set forth in this paragraph.
Item 5. Interests in Securities of the Issuer
(a) Mr. Holmes is deemed to be the beneficial owner of 1,458,564 shares
of Common Stock which equals 9.4% of the outstanding Common Stock of the Issuer.
Mr. Holmes owns 248,732 shares of Common Stock, immediately exercisable options
to purchase 1,177,000 shares of Common Stock, and warrants to purchase 32,832
shares of Common Stock that become excerciseable on September 5, 2001.
(b) Mr. Holmes has sole voting and dispositive power with respect to
the securities described in Item 5(a).
(c) Not appplicable.
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(d) Not applicable.
(e) Not applicable.
Item 6. Contracts, Arrangements, Understandings or Relationships with Respect to
Securities of the Issuer
Mr. Holmes owns immediately exercisable options to purchase 1,177,000
shares of Common Stock at an exercise price ranging from $.5417 to $2.00 per
share. The options are subject to the terms and conditions of the Issuer's 1998
Stock Incentive Plan which is incorporated by reference to Item 7.
Mr. Holmes owns warrants to purchase 32,832 shares of Common Stock. The
warrants are subject to the terms and conditions of the Stock Purchase Warrant
attached as Exhibit B and incorporated by reference to Item 7. The Stock
Purchase Warrant provides that the warrants become exercisable on September 5,
2001 for $1.50 per share and expire on March 5, 2003.
Under the Credit Agreement, the Issuer must propose a reorganization to
its shareholders to be voted on at the Issuer's July 2002 annual shareholders'
meeting. Under the reorganization proposal, the Issuer would transfer all of its
assets to a wholly-owned subsidiary and pledge the stock in the subsidiary to
MCG Finance Corporation. The Issuer is required to represent to its shareholders
that the reorganization proposal is supported by the Issuer's management and
Board of Directors. Mr. Holmes is currently the President and Chief Executive
Officer of the Issuer and a member of the Board of Directors of the Issuer. The
Credit Agreement is incorporated by reference to Item 7.
Item 7. Material to Be Filed as Exhibits
Exhibit A - 1998 Stock Incentive Plan (incorporated by reference to Exhibit 10.1
of NBG Radio Network, Inc.'s Form 10-QSB/A for the quarter ended August 31,
1999).
Exhibit B - Stock Purchase Warrant dated March 5, 2001.
Exhibit C - Credit Facility Agreement dated June 29, 2001 (incorporated by
reference to Exhibit 3 of the Schedule 13D filed by MCG Capital Corporation on
July 11, 2001).
Signature
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.
/s/JOHN A. HOLMES, III
--------------------------------
John A. Holmes, III
Attention: Intentional misstatements or omissions of fact constitute
Federal criminal violations (See 18 U.S.C. 1001).
5
Exhibit B
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED ("ACT"), OR ANY STATE OR FOREIGN
SECURITIES LAWS. NO OFFER, SALE, TRANSFER, PLEDGE OR OTHER DISPOSITION OF THESE
SECURITIES MAY BE MADE EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT
FILED WITH THE SECURITIES AND EXCHANGE COMMISSION UNDER THE ACT AND APPLICABLE
STATE OR FOREIGN SECURITIES LAWS OR PURSUANT TO AN OPINION OF COUNSEL, IN FORM
AND FROM COUNSEL ACCEPTABLE TO THE CORPORATION, THAT SUCH OFFER, SALE, TRANSFER,
PLEDGE OR OTHER DISPOSITION IS PURSUANT TO EXEMPTION FROM REGISTRATION
REQUIREMENTS UNDER FEDERAL AND STATE SECURITIES LAWS.
STOCK PURCHASE WARRANT
TO PURCHASE SHARES OF
COMMON STOCK OF
NBG RADIO NETWORK, INC.
No. of Shares: 32,832 Issuance Date: March 5, 2001
(Subject to Adjustment)
For value received as described in the Stock and Warrant Purchase
Agreement (the "Purchase Agreement"), of even date herewith, by and between NBG
RADIO NETWORK, INC., a Nevada corporation (the "Company"), and John A. Holmes
III, a resident of Oregon (the "Holder"), the Company grants to the Holder,
subject to the terms of this Warrant and the Purchase Agreement, the right to
purchase 32,832 shares of the Company's Common Stock at $1.50 per share, as
adjusted (the "Exercise Price").
1. Additional Definitions. As used in this Warrant, unless the context
otherwise requires:
1.1 "Common Stock" means shares of the class designated as Common Stock
of the Company.
1.2 "Exercise Date" means any date when this Warrant is exercised in
the manner indicated in Sections 2(a) and 2(b).
1.3 "Expiration Date" means 5:00 p.m. Pacific Time, March 5, 2003.
1.4 "Fair Market Value" means, with respect to the Common Stock, the
closing price of the Common Stock as reported on the OTC Bulletin Board, or any
exchange or NASDAQ on the last trading day preceding the date this Warrant is
exercised.
1 - WARRANT
1.5 "Securities Act" means the Securities Act of 1933, as amended from
time to time, and all rules and regulations promulgated thereunder, or any act,
rules or regulations that replace the Securities Act or any such rules and
regulations.
1.6 "Warrant Shares" means any shares of Common Stock issued or
issuable upon exercise of this Warrant.
2. Duration and Exercise of Warrant.
2.1 Exercise Period. Subject to the terms and conditions of this
Warrant and the Purchase Agreement, this Warrant may be exercised, in whole or
in part, during the period commencing on September 5, 2001 and ending on the
Expiration Date. After the Expiration Date, this Warrant shall become void, and
all rights to purchase Warrant Shares under this Warrant shall immediately
cease.
2.2 Method of Exercise. This Warrant may be exercised by the Holder, in
whole or in part, by:
2.2.1 (a) tendering to the Company payment in full by cash or
by check acceptable to the Company of the Exercise Price for the Warrant Shares
for which exercise is made, (b) electing to receive Warrant Shares equal to the
value of this Warrant (or the portion thereof being cancelled) computed using
the following formula:
X = Y(A-B)/A
Where X = The number of shares of Common Stock
to be issued to the Holder
Y = The number of shares of Common
Stock purchasable under this Warrant
(as the date of such calculation)
A = The Fair Market Value of one
share of the Common Stock (at the
date of such calculation)
B = The Exercise Price for one share
of the Common Stock (as adjusted to
the date of such calculation)
or (c) performing any combination of the foregoing methods of payment; and
2.2.2 surrendering this Warrant to the Secretary of the
Company; and
2.2.3 executing and delivering to the Secretary of the Company
an Exercise Form, in the form attached to this Warrant.
2 - WARRANT
2.3 Effect of Exercise.
2.3.1 Upon exercise, the Holder shall be deemed to be the
holder of record of the Warrant Shares for which exercise is made, even though
the transfer or registrar books of the Company may then be closed or
certificates representing such Warrant Shares may not then be actually delivered
to the Holder.
2.3.2 No fractional shares or scrip representing fractional
shares shall be issued upon the exercise of this Warrant. In lieu of any
fractional share to which the Holder would otherwise be entitled, the Company
shall round up or down the number of shares to the nearest whole share.
2.3.3 As soon as practicable after the exercise, at the
Company's expense, certificates for such Warrant Shares shall be delivered to
the Holder and, unless this Warrant has expired, a warrant representing the
number of Warrant Shares, if any, with respect to which this Warrant shall not
have been exercised shall be issued to the Holder.
2.4 Securities Act Compliance. Unless the transfer of the Warrant
Shares shall have been registered under the Securities Act, as a condition of
the delivery of certificates for the Warrant Shares, the Company may require the
Holder to deliver to the Company, in writing, representations regarding the
Holder's sophistication, investment intent, acquisition for Holder's own account
and such other matters as are reasonable and customary for purchasers of
securities in an unregistered private offering. The Company may place
conspicuously upon each Warrant and upon each certificate representing the
Warrant Shares a legend substantially in the following form, the terms of which
are agreed to by the Holder:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED ("ACT"), OR ANY STATE OR
FOREIGN SECURITIES LAWS. NO OFFER, SALE, TRANSFER, PLEDGE OR OTHER
DISPOSITION OF THESE SECURITIES MAY BE MADE EXCEPT PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT FILED WITH THE SECURITIES AND EXCHANGE
COMMISSION UNDER THE ACT AND APPLICABLE STATE OR FOREIGN SECURITIES
LAWS OR PURSUANT TO AN OPINION OF COUNSEL, IN FORM AND FROM COUNSEL
ACCEPTABLE TO THE CORPORATION, THAT SUCH OFFER, SALE, TRANSFER, PLEDGE
OR OTHER DISPOSITION IS PURSUANT TO EXEMPTION FROM REGISTRATION
REQUIREMENTS UNDER FEDERAL AND STATE SECURITIES LAWS.
2.5 Taxes. The Company shall not be required to pay any tax that may be
payable in respect of any transfer of this Warrant.
3. Validity and Reservation of Warrant Shares. The Company covenants that
all shares of Common Stock issued upon exercise of this Warrant, pursuant to the
terms and conditions
3 - WARRANT
herein, will be validly issued, fully paid, nonassessable and free of preemptive
rights. The Company agrees that, as long as this Warrant may be exercised, the
Company will reserve from its authorized and unissued Common Stock a sufficient
number of shares to provide for the issuance of the Common Stock upon exercise
of this Warrant.
4. Limited Rights of Warrant Holder. The Holder shall not, solely by
virtue of being the Holder of this Warrant, have any of the rights of a holder
of Common Stock of the Company, either at law or equity, until such Warrant
shall have been exercised and the Holder shall be deemed to be the holder of
record of Warrant Shares as provided in this Warrant and the Purchase Agreement,
at which time the person or entity in whose name the certificate for Warrant
Shares being purchased is to be issued shall be deemed the holder of record of
such shares for all purposes.
5. Loss of Warrant. Upon receipt by the Company of reasonably satisfactory
evidence of the loss, theft, destruction or mutilation of this Warrant and
either (in the case of loss, theft or destruction) reasonable indemnification
and a bond satisfactory to the Company if requested by the Company or (in the
case of mutilation) the surrender of this Warrant for cancellation, the Company
will execute and deliver to the Holder, without charge, a new Warrant of like
tenor and amount.
6. Adjustments. The Exercise Price and the number of shares purchasable
under this Warrant are subject to adjustment from time to time as follows:
6.1 Reorganization, Merger, Sale of Assets. If at any time while this
Warrant, or any portion hereof, is outstanding and unexpired, there shall be a
reorganization (other than a combination, reclassification, exchange or
subdivision of shares provided for herein), merger or consolidation of the
Company with or into another corporation, or the sale or transfer of all or
substantially all of the Company's properties and assets to any other person,
then, as a part of such reorganization, merger, consolidation, transfer or sale,
provision shall be made so that the Holder of this Warrant shall thereafter be
entitled to immediately exercise this Warrant and to receive upon exercise of
this Warrant, and upon payment of the Exercise Price then in effect, the number
of shares of stock or other securities or property of the Company, or of the
successor corporation resulting from such reorganization, merger, consolidation,
transfer or sale, to which a holder of the shares deliverable upon exercise of
this Warrant would have been entitled to receive in such reorganization, merger,
consolidation or sale, all subject to further adjustments as provided in this
Section 6.
6.2 Reclassification. If the Company at any time while this Warrant, or
any portion hereof, remains outstanding and unexpired shall change any of the
securities, by reclassification or otherwise, as to which purchase rights under
this Warrant exist into the same or a different number of securities of any
other class or classes, this Warrant shall thereafter represent the right to
acquire such number and kind of securities as would have been issuable as the
result of such change with respect to the securities that were subject to the
purchase rights under this Warrant immediately prior to such reclassification or
other change and the Exercise Price thereof shall be appropriately adjusted, all
subject to further adjustments as provided in this Section 6.
4 - WARRANT
6.3 Split, Subdivision or Combination of Shares. If the Company at any
time while this Warrant, or any portion hereof, remains outstanding and
unexpired, shall split, subdivide or combine the securities as to which purchase
rights under this Warrant exist, into a different number of securities of the
same class, the Exercise Price for such securities shall be proportionately
decreased in the case of a split or subdivision or proportionately increased in
the case of a combination, all subject to further adjustments as provided in
this Section 6.
6.4 Adjustments for Dividends in Stock or Other Securities or Property.
If while this Warrant, or any portion hereof, remains outstanding and unexpired,
the holders of the securities as to which purchase rights under this Warrant
exist at the time shall have been received, or on or after the record date for
the determination of eligible shareholders, shall have become entitled to
receive, without payment therefor, other or additional stock or other securities
or property (other than cash) of the Company by way of dividend, then and in
each such case, this Warrant shall represent the right to acquire, in addition
to the number of shares of the security receivable upon exercise of this
Warrant, and without payment of any additional consideration therefor, the
amount of such other or additional stock or other securities or property (other
than cash) of the Company that such holder would hold on the date of such
exercise had it been the holder of record of the security receivable upon
exercise of this Warrant on the date hereof and had thereafter, during the
period from the date hereof to and including the date of such exercise, retained
such shares and/or all other additional stock available by it as described above
during such period, giving effect to all adjustment called for during such
period by the provisions of this Section 6.
6.5 Certificate of Adjustments. Upon the occurrence of each adjustment
or readjustment pursuant to this Section 6, the Company, at its expense, shall
promptly compute such adjustment or readjustment in accordance with the terms of
this Warrant and furnish to the Holder of this Warrant a certificate, signed by
the President, the Secretary or the Chief Financial Officer, setting forth such
adjustment or readjustment and showing in detail the facts upon which such
adjustment or readjustment is based. The Company shall, upon the written request
at any time of any such Holder, furnish or cause to be furnished to such Holder
a certificate setting forth: (i) such adjustments and readjustments, (ii) the
Exercise Price at the time in effect, and (iii) the number of shares and the
amount, if any, of other property that at the time would be received upon the
exercise of the Warrant.
6.6 No Impairment. The Company will not, by any voluntary action, avoid
or seek to avoid the observance or performance of any of the terms to be
observed or performed hereunder by the Company, but will at all times in good
faith assist in the carrying out of all the provisions of this Section 6 and in
the taking of all such action as may be necessary or appropriate in order to
protect the rights of the Holder of this Warrant against impairment.
7. Miscellaneous.
7.1 The rights and benefits of this Warrant will inure to the benefit
of and be enforceable by the Company and its respective successors and assigns.
The rights and obligations of the Holders under this Warrant may not be assigned
without the prior written consent of the Company.
5 - WARRANT
7.2 All notices and other communications under this Warrant must be in
writing and shall be deemed to have been given if delivered personally, sent by
facsimile (with confirmation), mailed by certified mail, or delivered by an
overnight delivery service (with confirmation) to the parties to the addresses
or facsimile numbers set forth in the Purchase Agreement (or at such other
address or facsimile number as a party may designate by like notice to the other
parties). Any notice or other communication shall be deemed to be given (i) on
the date of personal delivery, (ii) at the expiration of the third day after the
date of deposit in the United States mail, or (iii) on the date of confirmed
delivery by facsimile or overnight delivery service.
7.3 This Agreement shall be governed by and construed in accordance
with the laws of the State of Oregon, without regard to conflict-of-laws
principles. Any action or proceeding arising out of this Agreement that is
litigated will be litigated in courts located in Multnomah County, Oregon. Each
party consents and submits to the jurisdiction and venue of any local, state, or
federal court located in Multnomah County, Oregon.
7.4 This Agreement (including the documents and instruments referred to
in this Agreement) constitutes the entire agreement and understanding of the
parties with respect to the subject matter of this Agreement and supersedes all
prior understandings and agreements, whether written or oral, among the parties
with respect to such subject matter and may be amended only by a writing
executed by all parties.
7.5 This Warrant and any term hereof may be changed, waived, discharged
or terminated only by an instrument in writing signed by the party against which
enforcement of such change, waiver, discharge or termination is sought. No
waivers of, or exceptions to any term, condition or provision of this Warrant,
in any one or more instances, shall be deemed to be, or construed as, a further
or continuing waiver of any such term, condition or provision.
Dated as of the date first written above.
THE COMPANY:
NBG RADIO NETWORK, INC.
By: /s/ John J. Brumfield
----------------------
Name: John J. Brumfield
Title: CFO
6 - WARRANT
EXERCISE FORM
(To Be Executed by the Holder
to Exercise the Warrant in Whole or in Part)
To: NBG RADIO NETWORK, INC.
The undersigned irrevocably elects to exercise the right of purchase
represented by the Warrant, a copy of which is attached hereto, and to purchase
under the Warrant, _____________ shares of Common Stock for a purchase price of
$2.00 per share, as provided for in the Warrant. All capitalized terms used in
this Exercise Form without definition shall have the respective meanings given
to them in the Warrant.
The undersigned:
( ) tenders payment to the order of NBG RADIO NETWORK, INC.
in the amount of $ ______________; and/or
( ) elects to effect the purchase of the Common Stock though
the net issue exercise provision set forth in Section 2.2.1(b) of the Warrant.
The undersigned requests that certificates for such shares of Common
Stock be issued and delivered as stated below, and, if said number of shares of
Common Stock shall not be all the shares of Common Stock purchasable under the
Warrant, that a new Warrant for the balance remaining of the shares of the
Common Stock purchasable under the Warrant be registered and delivered to the
undersigned, as stated below:
THE HOLDER:
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John A. Holmes III
Address:
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Note: Signature must correspond with the name as written upon the face
of the Warrant in every particular, without alteration or enlargement or any
change whatsoever.