SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934
Filed by the Registrant |X|
Filed by a party other than the Registrant |_|
Check the appropriate box:
|_| Preliminary Proxy Statement
|_| Confidential, for Use of the Commission Only (as Permitted by Rule
14a-6(e)(2))
|_| Definitive Proxy Statement
|X| Definitive Additional Materials
|_| Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
New Frontier Media, Inc.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
|X| No fee required.
|_| Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
----------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
----------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on
which the filing fee is calculated and state how it was
determined):
----------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
----------------------------------------------------------------
(5) Total fee paid:
----------------------------------------------------------------
|_| Fee paid previously with preliminary materials.
|_| Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
----------------------------------------------------------------
(2) Form, Schedule or Registration Statement No.:
----------------------------------------------------------------
(3) Filing Party:
----------------------------------------------------------------
(4) Date Filed:
----------------------------------------------------------------
LOGO
NEW FRONTIER MEDIA
For Immediate Release
Contact: Karyn Miller
(303) 444-0900 x102
kmiller@noof.com
NEW FRONTIER MEDIA CORRECTS MISLEADING STATEMENTS
REGARDING ITS DEBT REFINANCING
BOULDER, COLORADO, July 11, 2002 -- New Frontier Media, Inc. (Nasdaq: NOOF), a
leader in the electronic distribution of adult entertainment, clarified today
misleading statements made by a former director, Edward Bonn, regarding the
Company's recent debt refinancing.
In May 2002, New Frontier Media's note holders demanded the immediate repayment
of an aggregate of approximately $3 million of principal amount of indebtedness
in direct response to Mr. Bonn's decision to wage a proxy contest for control of
the Company. In order to repay these obligations and to raise additional funds
for general corporate purposes, the Company sold in a private placement, as
reported in its Annual Report on Form 10-K, 1.9 million shares of
non-convertible preferred stock for an aggregate amount of $3.8 million.
Contrary to Mr. Bonn's statement in his press release that this transaction
"subordinated" the common shareholders, it should be noted that the preferred
stock is not convertible into the Company's common stock and is non-dilutive to
shareholders' equity. The preferred has a dividend rate of 15.5%, as compared to
a blended rate of approximately 13.75% on the debt obligations that were
accelerated, and carries one vote per share along with the common stock, except
as otherwise required by law. Furthermore, the preferred is redeemable at par by
the Company at any time prior to its January 2004 stated redemption date. The
preferred stock may or may not be called, at the holders' sole discretion, upon
a change of control.
The issuance of the preferred stock was pre-cleared through Nasdaq and approved
by a majority of the Company's Board of Directors, including each of its
independent directors. The issuance of the preferred stock and repayment of the
debt obligations improved the Company's balance sheet and liquidity position.
Mark Kreloff, Chairman and Chief Executive Officer of New Frontier Media, Inc.,
stated that, "In an adverse financial environment, on extremely short notice and
in light of the uncertainties caused by the proxy fight, management was able to
raise $3.8 million on favorable terms to the Company without any dilution to our
current shareholders. Mr. Bonn's press release and statements concerning this
transaction can only be viewed as self-interested in light of his proxy
contest."
This news release contains forward-looking statements within the meaning of
Section 27A of the Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended. The forward-looking statements are
based on current expectations, estimates and projections made by management. The
Company intends for the forward-looking statements to be covered by the safe
harbor provisions for forward-looking statements. All forward-looking statements
made in this press release are made as of the date hereof, and the Company
assumes no obligation to update the forward-looking statements included in this
news release whether as a result of new information, future events, or
otherwise. The forward-looking statements are subject to risks and uncertainties
that could cause actual results to differ materially from those set forth or
implied by any forward-looking statements. Please refer to the Company's Form
10-K and other filings with the SEC for additional information regarding risks
and uncertainties, including, but not limited to, the risk factors listed from
time to time in such SEC reports. Copies of these filings are available through
the SEC's electronic data gathering analysis and retrieval system (EDGAR) at
www.sec.gov.
ABOUT NEW FRONTIER MEDIA, INC.
New Frontier Media, Inc. is a leader in the distribution of adult entertainment
content via electronic platforms. The Company delivers the most extensive lineup
of quality programming over the broadest range of electronic means including
cable, satellite, Internet, Broadband and video-on-demand.
The Erotic Networks(TM), the umbrella brand for the Company's subscription and
pay television subsidiary, provides pay-per-view and subscription TV networks to
over 29 million cable, DBS (direct broadcast satellite) and C-band households
throughout North America. The Erotic Networks(TM) include Pleasure(TM), TeN(TM),
ETC (Erotic Television Clips)(TM), Extasy(TM), True Blue(TM) and X-Cubed(TM).
These networks represent the widest variety of editing standards available and
are programmed without duplication to offer the most extensive selection of
adult network programming under a single corporate umbrella.
For more information contact Karyn Miller at (303) 444-0900, extension 102, and
please visit our web site at www.noof.com.
NEW FRONTIER MEDIA HAS FILED A PRELIMINARY PROXY STATEMENT WITH THE SECURITIES
AND EXCHANGE COMMISSION RELATING TO THE SOLICITATION OF PROXIES FROM THE
SHAREHOLDERS OF NEW FRONTIER MEDIA FOR USE AT THE ANNUAL MEETING OF
SHAREHOLDERS. NEW FRONTIER MEDIA STRONGLY ADVISES ALL NEW FRONTIER MEDIA
SHAREHOLDERS TO READ THE DEFINITIVE PROXY STATEMENT WHEN IT IS AVAILABLE BECAUSE
IT WILL CONTAIN IMPORTANT INFORMATION. THE PRELIMINARY PROXY STATEMENT IS
AVAILABLE AT NO CHARGE ON THE SEC'S WEBSITE AT HTTP://WWW.SEC.GOV. INFORMATION
RELATING TO THE PARTICIPANTS IN NEW FRONTIER'S PROXY SOLICITATION IS CONTAINED
IN AMENDMENT NO. 1 TO THE PRELIMINARY PROXY STATEMENT FILED ON JUNE 27, 2002.