<PAGE>
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON NOVEMBER 25, 1998
FILE NO. 333-51933
U.S. SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
----------------
FORM SB-2
POST-EFFECTIVE AMENDMENT NO. 2
to
REGISTRATION STATEMENT
UNDER THE SECURITIES ACT OF 1933
----------------
PTN MEDIA, INC.
(NAME OF SMALL BUSINESS ISSUER IN ITS CHARTER)
DELAWARE 7371
(STATE OR OTHER JURISDICTION (PRIMARY STANDARD
OF INCORPORATION OR ORGANIZATION) CLASSIFICATION CODE NUMBER)
38-3399098
INDUSTRIAL (I.R.S. EMPLOYER
IDENTIFICATION NO.)
313 NORTH FIRST ST., SUITE 8B, ANN ARBOR, MICHIGAN 48104 (734) 327-0579
(ADDRESS AND TELEPHONE NUMBER OF PRINCIPAL EXECUTIVE OFFICES)
313 NORTH FIRST ST., SUITE 8B, ANN ARBOR,
MICHIGAN 48104 (ADDRESS OF PRINCIPAL PLACE OF BUSINESS
OR INTENDED PRINCIPAL PLACE OF BUSINESS)
PETER KLAMKA, PRESIDENT
PTN MEDIA, INC.
313 NORTH FIRST ST., SUITE 8B, ANN ARBOR, MICHIGAN 48104 (734) 327-0579
(NAME, ADDRESS AND TELEPHONE NUMBER OF AGENT FOR SERVICE)
----------------
COPIES TO:
DAVID N. FELDMAN, ESQ.
LAW OFFICES OF DAVID N. FELDMAN
36 WEST 44TH STREET, SUITE 1201
NEW YORK, NEW YORK 10036
(212) 869-7000
FAX: (212) 997-4242
----------------
APPROXIMATE DATE OF PROPOSED SALE TO
THE PUBLIC: As soon as practicable after the effective
date of this registration statement.
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [ ]
If this Form is a post-effective amendment filed pursuant to Rule
462(c) under the Securities Act, check the following box and list the Securities
Act registration statement number of the earlier effective registration
statement for the same offering. [ ]
If this Form is a post-effective amendment filed pursuant to Rule
462(d) under the Securities Act, check the following box and list the Securities
Act registration statement number of the earlier effective registration
statement for the same offering. [ ]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [ ]
----------------
<PAGE>
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
<S> <C> <C> <C>
PROPOSED MAXIMUM PROPOSED MAXIMUM
TITLE OF EACH CLASS OF AMOUNT TO OFFERING PRICE PER AGGREGATE AMOUNT OF
SECURITIES TO BE REGISTERED BE REGISTERED SHARE OFFERING PRICE(1) REGISTRATION FEE
<S> <C> <C> <C> <C>
COMMON STOCK,
PAR VALUE $. 001 PER SHARE..... 400,000 SHARES $5.00 $2,000,000 $ 590
</TABLE>
- -------------------------------------------------------------------------------
(1) ESTIMATED SOLELY FOR THE PURPOSE OF COMPUTING THE AMOUNT OF THE REGISTRATION
FEE PURSUANT TO RULE 457.
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF
THE SECURITIES ACT OF 1933 OR UNTIL THIS REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE SECURITIES AND EXCHANGE COMMISSION, ACTING
PURSUANT TO SAID SECTION 8(A), MAY DETERMINE.
ii
<PAGE>
PTN MEDIA, INC.
400,000 SHARES OF COMMON STOCK
PROSPECTUS SUPPLEMENT
NOVEMBER 23, 1998
This Prospectus Supplement to Registration Statement on Form SB-2 of PTN
Media, Inc., a Delaware corporation (the "Company") includes certain amended
information contained in the Company's Registration Statement, as well as in the
Company's Prospectus dated September 18, 1998 ("Prospectus").
This Prospectus Supplement must be affixed to the Prospectus upon any
delivery to an offeree of the Shares.
Quarterly Report
On November 20, 1998, the Company filed a Quarterly Report on Form 10-QSB,
which reported that at September 30, 1998 current liabilities exceeded current
assets by $890,840. The Company also reported a net loss for the three months
ended September 30, 1998 of $255,096 and for the nine months ended September 30,
1998 of $807,627.
Loans from President
Amending and restating the Prospectus, in April 1998, Peter Klamka, the
Company's Chairman, President and Chief Executive Officer, provided the Company
with a revolving credit line with a maximum of $500,000 available (the "Klamka
Credit Line"). In September 1998, the Board of Directors of the Company
authorized an increase in this line to $550,000, and in November 1998, a further
increase to $800,000 was authorized. As of November 23, 1998, borrowings
outstanding under the Klamka Credit Line aggregated approximately $750,000.
Loans drawn on the Klamka Credit Line bear interest at a rate of 9% per annum
from the date they are made to the Company and are payable by May 2001,
provided, however, that if the Company raises gross proceeds in this Offering of
at least $1,500,000, the entire outstanding amount of the Klamka Credit Line and
accrued interest will be repaid from the proceeds of this Offering.
As a result of the foregoing, the Use of Proceeds section on page 18 of the
Prospectus is further adjusted by (i) increasing the "Repayment of Indebtedness"
by an aggregate of $345,000 in the columns under $2 million and $1.5 million,
and by (ii) reducing "Working Capital" by $345,000 in the columns under $ 2
Million and $1.5 Million.
Additional Placement Agent
On November 18, 1998, Hornblower & Weeks, Inc. signed a Placement Agent
Agreement with the Company. The cover page of the Prospectus has been changed to
include the Hornblower & Weeks, Inc.("Hornblower") name in replacement of CPA
Advisors Network, Inc.
The agreement with Hornblower is different from the form of Placement
Agency agreement entered into with other placement agents. In addition to a 10%
commission (similar to other placement agents), Hornblower will recieve (i)
certain accountable expenses incurred in connection with the transaction, (ii) a
five percent (5%) finders fee, for the term of the agreement and five years
thereafter, for transactions between the Company and Hornblower or its
affiliates, former affiliates and customers and (iii) a right of first refusal
to serve as underwriter or placement agent for future public offerings taking
place during the term of the agreement. The Company intends to terminate this
agreement with Hornblower upon completion of the Initial Public Offering, but
there can be no assurance that this termination will take place.
Calendar Agreement with Claudia Schiffer
In November 1998, the Company entered into a Licensed Calendar Agreement
with well-known model Claudia Schiffer ("Calendar Agreement"). The Calendar
Agreement grants the Company the right to use the name, likeness, and
endorsement of Ms. Schiffer in the advertisement, promotion and sale of a
16-month calendar for the year 1999, including photographs of Ms. Schiffer, in
downloadable electronic format, including CD-Rom ("Licensed
- 1 -
<PAGE>
Calendar"). Ms. Schiffer will provide photographic images and voice recording
for the Licensed Calendar. The Company agreed to pay Ms. Schiffer an advance
royalty in the aggregate amount of $75,000, of which $37,500 was paid upon
execution of the Calendar Agreement, and the remaining $37,500 is required to be
paid upon approval of the Licensed Calendar. The Company agreed to pay to Ms.
Schiffer royalties of a percentage of sales ranging from 20% of Net Sales for
0-20,000 units to 60% of Net Sales for 50,001 units and above. This advance
payment will be credited against any earned royalty payment. The Calendar
Agreement terminates December 31, 1999.
Proposed Web Site License Agreement with Claudia Schiffer
The Company intends to enter into a Web Site License Agreement with Claudia
Schiffer (the "Schiffer License Agreement") upon the earlier to occur of such
time as (i) the Company has received at least $150,000 in net proceeds from the
sale of shares in the Initial Public Offering or (ii) Peter Klamka, the
Company's President, loans sufficient funds to the Company to make the initial
required advance royalty to Ms. Schiffer (such date, the "Effective Date"). The
Schiffer License Agreement would grant the Company the exclusive license for an
on-line Internet service devoted to Ms. Schiffer. The Company would have the
right to use Ms. Schiffer's name and likeness for an Internet site including a
merchandise "boutique", monthly column and interviews or on-line chat sessions.
Ms. Schiffer also would make promotional appearances and voice recordings to
promote the site and provide content for it. The Schiffer License Agreement
would continue until the year 2001. The Company would pay Ms. Schiffer
guaranteed minimum royalties of $300,000 for the first year of the Schiffer
License Agreement, $400,000 for the second year, and $500,000 for the third
year, which would be credited against earned royalties ranging from 25% to 80%
of site revenues and profits from boutique merchandise sales.
The Schiffer License Agreement would also grant to Ms. Schiffer, 219,682
shares of Common Stock (the "Shares"), with the right to maintain the ratio of
her Common Stock ownership to that of Peter Klamka, the Company's President. The
Company expects to value the Shares at $4.00 per share of common stock, if
issued anytime prior to the existence of an active trading market in the
Company's stock. If the Shares are issued any time after the existence of an
active trading market in the Company's stock, then the Company intends to value
the shares at 80% of the market value of the Company's stock on the date of
issuance. The Company agreed to indemnify Ms. Schiffer for any U.S. income tax
liability resulting from the issuance of these shares, however, the Company has
been assured that Ms. Schiffer is not a U.S. citizen or resident, and therefore
is not likely to be responsible for any such taxes.
A payment of $150,000 is required upon execution and delivery of the
Agreement ("Initial Payment"). The Company has delivered executed versions of
the Schiffer License Agreement to Ms. Schiffer's attorney, and has delivered a
stock certificate representing the shares to Ms. Schiffer's manager. The Company
has been informed by Ms. Schiffer's attorney that the Schiffer License Agreement
will be executed and delivered by Ms. Schiffer upon receipt of the Initial
Payment and the Shares. The Company anticipates, but cannot assure, that the
Effective Date will occur on or before December 4, 1998.
After the offering, as a result of the proposed issuance of shares to Ms.
Schiffer, she will own 6% of the outstanding shares of Common Stock of the
Company (assuming all shares offered hereby are sold). The ownership of all
other stockholders, including those listed in the Prospectus on page 39, will be
reduced proportionately. In addition, the dilution to investors set forth in the
Prospectus on page 21, will be greater after the offering because Ms. Schiffer's
shares are being valued at $4 per share, rather than the $5 in place at the time
of the offering.
- 2 -
<PAGE>
www.fragrancedirect.com.
The Company is nearing completion of the building of a web site with the
Internet address "www.fragrancedirect.com." On this web site the Company will
sell colognes, perfumes and other fragrances direct to Internet users, much in
the same way that books are sold on web sites such as Amazon.com. The site will
be promoted through hyper-links from the Company's affiliated web sites. The
Company also intends to create mutual linking arrangements with operators of
apparel sites and to make barter arrangements for advertising.
The Company anticipates that its prices will be lower than the
manufacturers suggested retail prices, however, not necessarily less than all
retail outlets. The web site, currently being tested, is expected to open to the
public in late November or early December, although there can be no assurance
thereof.
The web site was built and will be maintained by an outside contractor whom
the Company agreed to pay a $3000 one-time fee, $299 per month maintenance and
5% of gross sales from the site with a $50,000 per year cap. The outside
contractor will process credit card orders.
The Company intends to obtain product liability insurance in such amounts
as it may deem appropriate to insure against any possible product liability
exposure resulting from the sale of fragrances on www.fragrancedirect.com.
There can be no assurance that the Company will generate any revenues from
the web site. In addition, the Company is aware of at least two similar web
sites attempting to compete for the on-line fragrance business.
- 3 -
<PAGE>
SIGNATURES
In accordance with the requirements of the Securities Act of 1933, the
registrant certifies that it has reasonable grounds to believe that it meets all
the requirements of filing on Form SB-2 and authorized this registration
statement to be signed on its behalf by the undersigned, in the City of Ann
Arbor, Michigan on November 25, 1998.
PTN MEDIA, INC.
By: /s/ Peter Klamka
Peter Klamka, Chairman,
President and Chief Exec. Officer
In accordance with the requirements of the Securities Act of 1933, this
registration statement was signed by the following persons in the capacities and
on the dates stated.
<TABLE>
<S> <C> <C>
Name Title Date
<S> <C> <C>
/s/ Peter Klamka Chairman, President, Chief November 25, 1998
- -------------------------------- Executive Officer and Secretary
Peter Klamka (Principal Executive Officer and
Principal Financial and Accounting
Officer)
Director
/s/ Deborah M. Schneider* November 25, 1998
- --------------------------------
Deborah M. Schneider
/s/ Lila Lazarus* Director November 25, 1998
- --------------------------------
Lila Lazarus
</TABLE>
* By Peter Klamka, as attorney-in-fact
pursuant to power of attorney granted
May 1, 1998
- 4 -
<PAGE>
Exhibit
Number Description
1.1* Form of Placement Agent Agreement
1.2 Engagement Agreement with Hornblower & Weeks, Inc.
2.1* Plan of Merger between PTN Media, Inc. and Interactive Entertainment
Studio, Inc., dated as of
February 25, 1998.
3.1* Certificate of Incorporation of PTN Media, Inc. dated as of January 13,
1998.
3.2* By-Laws of PTN Media, Inc.
4.1* Specimen Common Stock Certificate
4.2* Specimen 1997 Warrant Certificate
4.3* Specimen 1998 Warrant Certificate
5.1* Opinion of the Law Offices of David Feldman
10.1* Web Site License Agreement between Niki, Inc. and Interactive
Entertainment Studio, Inc. dated as of June 1, 1997
10.2* Website License Agreement between Ty Girl, Inc. and Interactive
Entertainment Studio, Inc.dated as of January 1, 1998
10.3* License Agreement between Ty Girl, Inc. and Interactive Entertainment
Studio, Inc. dated as of January 1, 1998
10.4* Lease Agreement dated as of February 27, 1998, between First Miller
Limited Partnership and PTN Media, Inc.
10.5* Website Design Services Agreement between zoecom, Inc. and Interactive
Entertainment Studio, Inc. dated as of December 20, 1996
10.6* Letter of Intent between Cdnow, Inc. and Interactive Entertainment
Studio, Inc. dated as of September 8, 1997
10.7* Agreement for Fashion House Flowers & Gifts Service between PC Flowers
and Gifts, Inc. and Interactive Entertainment Studio, Inc. dated as of
September 9, 1997
10.8* Standard Publicists Guild Agency - Client Agreement between the
Angellotti Company and PTN Media, Inc. dated as of April 15, 1998
10.9* PTN Media, Inc. 1998 Stock Option Plan
10.10* Form of Subscription Agreement for Shares in this Offering
10.11* Revolving Promissory Note issued by PTN Media, Inc. to Peter Klamka
dated April 1, 1998, in the maximum principal sum of $500,000
10.12* Escrow Agreement between University Bank and PTN Media
11.1* Computation of per share earnings
23.1* Consent of Lazar Levine & Felix LLP
23.2* Consent of the Law Offices of David Feldman (included in Exhibit 5.1)
24.1* Power of Attorney (included in Part II of the Registration Statement)
27.1* Financial Data Schedule
_____________________
*Previously filed.
HORNBLOWER & WEEKS, INC.
November 24, 1998
Mr. Peter Klamka
PTN Media, Inc.
313 North First Street
Ann Arbor, MI 48104
RE: Engagement to Represent PTN Media, Inc. (the
"Company") as the Placement Agent for Public
Offering of $2,000,000.
Dear Mr. Klamka:
This letter sets forth the terms upon which Hornblower & Weeks, Incorporated
(the "Placement Agent") will be engaged as the non-exclusive placement agent in
connection with the Public Offering of securities by PTN Media, Inc. (the
"Company").
1. The Company hereby engages the Placement Agent as its non-exclusive placement
agent in connection with the sale by the Company of its securities as set forth
in Exhibit B (the "Financing" or the "Offering").
2. We agree to use our best efforts to introduce the offering to investors who
may be interested in participating in the Financing. We further agree that the
Financing shall be made through the Placement Agent and any additional National
Association of Securities Dealers ("NASD") member firm or firms we may invite to
participate in the sale of the Financing including firms already engaged.
3. In connection with our activities on your behalf, you will furnish us with
all information which we may request and will provide us access to your
officers, directors, accountants and counsel. When the terms of the proposed
Offering have been structured and agreed upon, a Public Offering prospectus (the
"Prospectus") will be prepared with respect to the Company and the Offering by
your counsel and at your expense. You acknowledge that in rendering our services
hereunder, we will be using and relying on the information contained in the
Prospectus. You represent and warrant that the Prospectus will be true, accurate
and
- --------------------------------------------------------------------------------
HORNBLOWER & WEEKS, INC. INVESTMENT BANKING
110 WALL STREET, 21ST FLOOR, NEW YORK, NY 10005 *
TEL: 212-361-2266. FAX: 212-361-2273
MEMBER NASD/SIPC/MSRB
Page 1
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complete in all material respects and will not contain any untrue statement of a
material fact or omit to state any material fact required to be stated therein
or necessary to make the statements therein not misleading. You will sign
additional documentation including indemnification agreements, selling
agreements and other documents in forms acceptable to the Placement Agent when
required by the Placement Agent. All projections which have been or shall be
furnished to us in connection with this Agreement, will represent Company
managemen's best judgment of future performance, based upon historical
information and reasonable assumptions of management (it being understood that
actual results may vary from such projections). We will not make any offer
regarding the Offering on the basis of any communications relating to the
Company except the Prospectus, the exhibits thereto, and any other information
approved by you in writing for use in connection with offers regarding the
Offering.
4. For due diligence, placement and other services which will be provided to the
Company from time to time over the course of our engagement, we mutually agree
that the Placement Agent may invite to participate in a syndicate of selling
firms, are entitled to compensation, payable at the first break of escrow and,
where applicable each subsequent close or closing, and other consideration
mutually understood, as set forth below:
a. A sales commission (the "Commissio") equal to 10% of the gross
proceeds to the Company from the Offering.
b. It is also agreed that the Company will pay all expenses incurred in
connection with the preparation and printing of the Prospectus, and
all amendments thereto. The Company will pay all expenses and those of
the Placement Agent and its agents relating to travel, legal,
accounting and other costs involved with the Financing. The
accountable expenses for the Placement Agent shall be exclusive of the
legal expenses and Blue Sky counsel fees, which the Company agrees to
pay directly. The Company agrees to pay the Blue Sky counsel and
filing fees for those jurisdictions designated by the Placement Agent
plus states already filed. The Company agrees to pay all reasonable
expenses. The expenses described in this paragraph shall be reimbursed
by the Company independent of any fees described in paragraph 4B
above, and shall be payable upon each close of escrow of the Offering.
Such payments shall be invoiced to and may be deducted from the
Offering Escrow Account (the "Escrow Account") with an escrow agent
suitable to the Placement Agent (the"Escrow Agent"). (See Paragraph 4e
below.)
c. The Company hereby agrees to enter into an escrow agreement with an
escrow agent suitable to the Company and the Placement Agent and
Company (the "Escrow Agent"), and agrees to abide with the terms of an
escrow agreement to be entered into with the Escrow Agent and the
Placement Agent. The Company also agrees to enter into such additional
certifications and documentation as may be requested from time to time
by the Placement Agent or the Escrow Agent.
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d. If at any time during the term of this Agreement and for any period of
five years following the termination of this Agreement, the Company
merges with, acquires assets or any other property, or obtain any
other financing from any of the entities, affiliations or persons of
the Placement Agent, its employees or former employees, agents,
representatives, advisors or consultants introduces to the Company,
the Company will pay a finder's fee in cash equal to 5% of the total
gross proceedings of such transaction. If required by applicable law,
or at election of the Placement Agent, the finde's fee will be deemed
to have been earned by and be paid to a placement agent selected
exclusively by the Placement Agent.
e. The Company hereby irrevocably agrees not to circumvent, avoid, bypass
or obviate directly or indirectly, the intent of this Agreement, to
avoid payment of fees, in any transaction with any corporation,
partnership or individual, introduced by the Placement Agent to the
Company in connection with any project, and any loans or collateral or
fundings, or any other transaction involving any products, transfers
or services, or addition, renewal, extension, rollover, amendment,
renegotiation, new contracts, parallel contracts, or third party
assignments thereof.
5. The Placement Agent is hereby granted an exclusive right of first refusal to
act as, underwriter and/or placement agent in connection with any Public
Offering or public offering of the Company's securities during the Term of this
Agreement. The Company will provide the Placement Agent with notice of any
proposed Public Offering or public offering (such notice to include the proposed
material terms and conditions thereof, together with copies of any written
proposals relating thereto) and the Placement Agent shall have fifteen (15)
business days from its receipt of such notice to exercise such right by notice
to the Company. Any material change in any such proposal shall constitute a
separate and distinct proposal requiring a further notice to the Placement
Agent.
6. Neither the Placement Agent nor its affiliates, or their respective officers,
directors, employees, agents, attorneys, consultants or controlling persons
shall be liable, responsible or accountable in damages or otherwise to the
Company or its affiliates, or their respective officers, directors, employees,
agents or controlling persons for any act or omission performed or omitted by
the Placement Agent with respect to the services provided by it pursuant or
otherwise relating to or arising out of this Agreement.
7. The Company agrees to indemnify and hold harmless the Placement Agent, each
other firm participating in this offering, their affiliates, and their
respective officers, directors, employees, agents and controlling persons (The
Placement Agent and each such other person and entity being an "Indemnified
Party" for purposes of this section) from and against any and all losses,
claims, damages and liabilities, jointly or severally, to which such Indemnified
Party may
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<PAGE>
become subject under any applicable federal or state law, or otherwise related
to or arising out any transaction contemplated by this Agreement, and the
performance by the Placement Agent of the services contemplated by this
Agreement, and shall reimburse each Indemnified Party for all reasonable
expenses (including reasonable counsel fees and expenses) as they are incurred
in connection with the investigation of, preparation for or defense of any
pending or threatened claim or any action or proceeding arising therefrom,
whether or not such Indemnified Party is a party thereto provided that the
Company shall not be liable for any of the foregoing to the extent they arise
from the gross negligence or willful misconduct of the Indemnified Party and
further provide that such Indemnified Party agrees to refund such reimbursed
expenses if and to the extent it is finally judicially determined that such
Indemnified Party is not entitled to indemnification. In the event that the
foregoing indemnity is unavailable or insufficient to hold any Indemnified Party
harmless, than the Company shall contribute to amounts paid or payable by such
Indemnified Party in respect of such losses, claims, damages and liabilities in
such proportions as approximately reflects the relative benefits received by, in
fault of, the Company and such Indemnified Party in connection with the matters
as to which such losses, claims, damages and liabilities relate and other
equitable considerations, provided however that nothing in this sentence shall
be construed as altering or limiting in any way the effect of the provision
contained in the immediately preceding sentence.
8. Neither termination nor completion of this financing shall affect the
provisions of this Agreement, and the Indemnification provisions which are
incorporated herein, which shall remain operative and in full force and effect.
9. The validity and interpretation of this Agreement shall be governed by the
laws of the State of New York without regard to the conflicts of laws principles
thereof or the actual domiciles of the parties hereto. Any dispute between the
Company and the Placement Agent or otherwise related to this Agreement shall be
resolved in the courts of New York State in New York City and the Company and
its executive officers hereby irrevocably consent to the jurisdiction of the
courts of New York City, New York.
10. The Company agrees that, upon each closing of the placement, it will provide
the Placement Agent & all investors with appropriate representations and
warranties and legal opinions relating to, among other things, its corporate
existence, its business, and the accuracy and adequacy of the information
provided by the Company to the Placement Agent and the investors in connection
with this Offering.
11. The Company agrees to issue all stock certificates, promissory notes and
warrants within 10 days of each closing of this offering.
12. The benefits of this Agreement shall inure to the respective successors and
assigns of the parties hereto and of the indemnified parties hereunder and their
successors and assigns and representatives, and the obligations and liabilities
assumed in this Agreement by the parties
Page 4
Initial________
<PAGE>
hereto shall be binding upon their respective successors and assigns.
13. This Agreement may be executed in any number of counterparts, each of which
will be deemed to be an original, but all of which together will constitute one
and the same instrument.
14. This Agreement contains the entire and complete understanding among the
parties concerning its subject matter and all representations, agreements,
arrangements and understandings between the parties, whether oral or written,
have been fully merged herein and are superseded hereby.
If you are in agreement with the foregoing, please execute and return one copy
of this letter to the undersigned. Thank you.
We look forward to working with you.
Very Truly Yours, APPROVED AND AGREED
Hornblower & Weeks Incorporated PTN Media, Inc.
/s/ Eric Ellenhorn /s/ Peter Klamka
- -------------------- --------------------
Eric Ellenhorn Peter Klamka
CEO Chairman
Attachments: Exhibit A: Capital Structure
Exhibit B: Proposed Terms
Page 5
Initial________
<PAGE>
EXHIBIT A
CAPITAL STRUCTURE FOR
PTN Media, Inc.
November 24, 1998
<TABLE>
<S> <C> <C>
Shares outstanding 3,041,680
CURRENT STRUCTURE
Principle Stockholders:
Peter Klamka 2,113,674 69.49%
Chris H. Giordano 540,340 17.76%
Michael Giordano 300,000 2.89%
Miscellaneous/Less than 5% 87,666 2.89%
Total -------------------------
3,041,680 100%
AFTER PROPOSED OFFERING
Principle Stockholders 2,954,014 85.8%
Miscellaneous/Less than 5% 87,666 2.50%
Float 400,000 11.7%
Total -------------------------
3,441,680 100%
</TABLE>
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Initial________
<PAGE>
EXHIBIT B
PTN MEDIA, INC.
PROPOSED PUBLIC OFFERING
November 24, 1998
Amount: $2,000,000 (400,000 shares)
Price Per Share: $5.00
To Be Paid Form All
Escrows: Attorney's and Financial ConsultanT's fees
as well as the other Accountable Expenses.
Page 7
Initial________
