UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
AMENDMENT TO
INFORMATION STATEMENT
Pursuant to Section 14(f) of the Securities Exchange Act of 1934
and Rule 14f-1 thereunder
GRACE DEVELOPMENT, INC.
(Exact name of registrant as specified in its charter)
Colorado
(State or other jurisdiction of incorporation or organization)
0-25582
(Commission File Number)
84-1110469
(I.R.S. Employer Identification No.)
2685South Dayton Way, Unit 42, Denver, CO 80231 (Address of
principal executive offices,
including zip code)
(303) 337-5700
(Registrant's telephone number,
including area code)
GRACE DEVELOPMENT, INC.
AMENDMENT TO
INFORMATION STATEMENT PURSUANT TO SECTION 14(f)
OF THE SECURITIES EXCHANGE ACT OF 1934 AND RULE 14f-1 THEREUNDER
NO VOTE OR OTHER ACTION OF THE COMPANY'S SHAREHOLDERS
IS REQURED IN CONNECTION WITH THIS INFORMATION STATEMENT
WE ARE NOT ASKING YOU FOR A PROXY
AND YOU ARE REQUESTED NOT TO SEND US A PROXY
Introduction
This Amendment (the "Amendment") to the Information Statement dated
September 7, 1999 (the "Information Statement") is being mailed on or about
September 24, 1999 to the holders of record at the close of business on August
27, 1999 of the common stock, no par value per share (the "Common Stock"), of
Grace Development, Inc., a Colorado corporation (the "Company"), in connection
with (i) the merger (the "Merger") of a wholly-owned subsidiary of the Company
with and into New Millennium Multimedia, Inc., a Georgia corporation ("NM"),
pursuant to which the shareholders of New Millennium will receive an aggregate
of 53,029,371 shares of the Company's Common Stock, representing approximately
87% of the Common Stock to be outstanding immediately following the consummation
of the Merger, and (ii) the election of certain persons to the Board of
Directors of the Company other than at a meeting of the Company's shareholders,
with such persons constituting a majority of the members thereof. No action is
required by the shareholders of the Company in connection with the election of
such persons. Nevertheless, you are urged to read this Information Statement
carefully.
The Board of Directors of the Company has approved the Merger. No action
is required by the shareholders of the Company in connection with the Merger.
This Amendment is being distributed pursuant to the requirements of
Section 14(f) of the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), and Rule 14f-1 thereunder. It amends certain information provided to
shareholders of the Company with respect to the ownership of the Company's
Common Stock following the Merger. A copy of the Information Statement
accompanies this Amendment, and the Amendment should be read and considered in
conjunction with the Information Statement.
Set forth below is information with respect to the beneficial ownership of
the Company's Common Stock following the Merger. The principal change in the
information provided herein from the information provided in the Information
Statement relates to (a) the ownership of certain warrants by certain NM
Designees (as defined in the Information Statement) and (b) the exercise of
certain other warrants to purchase shares of NM Common Stock (as defined in the
Information Statement). With respect to the warrants held by certain NM
Designees, the terms of the offering pursuant to which such warrants were
acquired provide that, as, if and when the Merger is consummated, NM will use
its best efforts to cause the Company to issue such
warrants, exercisable in shares of the Company's Common Stock. Inasmuch as NM
will be designating five members of a proposed six-person Company Board of
Directors following the Merger, it is expected that he Company will issue such
warrants. The Information Statement initially filed and disseminated pursuant to
Rule 14f-1 under the Exchange Act incorrectly assumed that such warrants would
be exercisable for share of NM common Stock, rather than the Company's Common
Stock. Accordingly, the number of shares and percentage ownership of Common
Stock following the Merger for the affected NM Designees was overstated in the
Information Statement. The table below sets forth the corrected information.
With respect to the exercise of other warrants to purchase shares of NM
Common Stock, the Information Statement stated that warrants to purchase 200,000
shares of NM Common Stock would be exercised prior to the closing of the Merger.
Since the date of the Information Statement, the holder of such warrants has
advised NM that it will exercise warrants to purchase only 49,000 share of NM
Common Stock, and it has surrendered its right to exercise the remainder of such
warrants. In light of the surrender of such warrants, NM has issued an
additional 150,000 shares of NM Common Stock to certain subscribers.
Accordingly, the total number of shares of Common Stock that will be outstanding
following the Merger will be less than the number assumed to be outstanding in
the Information Statement, as indicated in the table below.
Security Ownership of Certain Beneficial
Owners and Management Following the Merger
The following table sets forth information concerning ownership of Common
Stock following the Merger by (i) each person who the Company believes will be
the beneficial owner of more than 5% of Common Stock, (ii) the NM Designees and
the director of Company, (iii) the proposed executive officer of the Company and
(iv) all executive officers and directors of the Company as a group. Except as
indicated in the footnotes hereto, the listed shareholders hold sole voting and
investment power over their respective shares:
Number of Shares
Name and Address of Common Stock
of Beneficial Owner to be Owned after the Merger
Percent of Class*
Jacob Barrocas 0 0
2685 South Dayton Way
Unit #42
Denver, Colorado 80230
Sean T. Duffy(1) 1,326,026 2.00 %
Louis Friedman(1)(2) 670,678 1.00%
Richard L. Granville(1) 14,122,176 21.32%
Ronald L. McCallum(1) 1,326,026 2.00%
Lee Silverstein(1)(3) 2,285,897 3.45%
2
Peter Tierney(1)(4) 261,936 *
All proposed executive officers and
Directors as a Group (7 in number) 19,992,739 30.18%
M. Allen Weed(5) 11,138,618 16.82%
7395 Glenmora Way
Swanee, Georgia 30024
Signal Compression, Inc.(6) 4,995,000 7.54%
3507 North Central Avenue
Suite 406
Phoenix, Arizona 85012
* Calculated assuming that 66,223,329 shares of Common Stock will
be outstanding following the consummation of the Merger, which
assumes the conversion of all 799,824 shares of NM Common Stock
outstanding as of August 27, 1999, plus conversion of warrants for
49,000 shares of NM Common Stock that NM has been informed will be
exercised prior to consummation of the Merger and the issuance of
an aggregate of 150,000 shares of NM Common Stock to certain
private investors. For purposes hereof, a person is deemed to be
the beneficial owner of securities that can be acquired by such
person within 60 days from the date of determination, upon the
exercise of warrants or options or conversion of convertible
securities. Each beneficial owner's percentage ownership is
determined by assuming that any warrants, options or convertible
securities that are held by such person (but not those held by any
other person) and which are exercisable or convertible within 60
days from August 27, 1999, have been exercised or converted. An
asterisk(*) beside a shareholder's name in this column indicates
that such holdings constitute less than 1% of the outstanding
shares of Common Stock following the Merger.
(1) The address for these individuals is c/o New Millennium Multimedia,
Inc., 1690 Chantilly Drive, Atlanta, Georgia 30324
(2) Includes 1,000 shares of Common Stock held jointly with spouse and
assumes the issuance and exercise of warrants to purchase 6,665 shares
of Common Stock.
(3) Includes 8,992 shares of Common Stock beneficially owned by Dr.
Silverstein or his minor child and assumes the issuance and exercise
of warrants to purchase 22,661 shares of Common Stock.
(4) Includes 128,000 share of Common Stock beneficially owned by Mr.
Tierney and the issuance and exercise of warrants to purchase 1,333
shares of Common Stock.
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(5) Mr. Weed currently serves as a director of NM and is employed by NM as
a consultant. Following the Merger, Mr. Weed will resign as a director
of NM, but will remain as a consultant to NM and the Company.
(6) Pursuant to the terms of the Merger Agreement, shares of Common Stock
held by Signal Compression, Inc. ("Signal") will be pledged to secure
the indemnity obligations of the Company to NM and the shareholders of
NM under the Merger Agreement.
By Order of the Board of Directors.
/s/ Jacob Barrocas
President, Treasurer & Secretary
Denver, Colorado
September 24, 1999
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