AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON JUNE 29, 1999
REGISTRATION NO. 333-75733
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
AMENDMENT No.1 TO
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
NEW FRONTIER MEDIA, INC.
(NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
<TABLE>
<S> <C>
COLORADO 84-1084061
- -------------------------------------------- ---------------------------------------------
(STATE OR JURISDICTION OF INCORPORATION OR (IRS EMPLOYER IDENTIFICATION NO.)
ORGANIZATION)
5435 Airport Blvd, Suite 100 Michael Weiner
Boulder, CO 80301 5435 Airport Blvd, Suite 100
(303) 444-0900 Boulder, CO 80301
Facsimile No.: (303) 444-0734 (303) 444-0900
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, (ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE
INCLUDING AREA CODE, OF REGISTRANT'S PRINCIPAL NUMBER, INCLUDING AREA CODE, OF AGENT FOR SERVICE)
EXECUTIVE OFFICES)
</TABLE>
---------------------------------------------
Copy to:
HANK GRACIN, ESQ.
LEHMAN & EILEN
SUITE 505
50 CHARLES LINDBERGH BOULEVARD
UNIONDALE, NEW YORK 11553
(516) 222-0888
FACSIMILE (516) 222-0948
----------------------------------------------
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE OF THE SECURITIES TO THE
PUBLIC: As soon as practicable after the effective date of this registration
statement.
If the securities being registered on this form are to be offered on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933 other than securities offered only in connection with dividend or interest
reinvestment plan, please check the following box: /x/
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 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>
PROPOSED PROPOSED
MAXIMUM MAXIMUM
TITLE OF EACH CLASS OF OFFERING AGGREGATE AMOUNT OF
SECURITIES TO BE AMOUNT TO PRICE PER OFFERING REGISTRATION
REGISTERED BE REGISTERED SHARE (1) PRICE (1) FEE
----------------------- ------------- ---------- ---------- -------------
<S> <C> <C> <C> <C>
Common Stock, par value $.0001 per share.... 2,610,000 $3.969 $10,359,090 $3,055.93 (2)
<FN>
- ----------------------------
(1) Estimated solely for purposes of calculating the registration fee. The
Proposed Maximum Aggregate Offering Price was calculated pursuant to Rule
457(c) under the Securities Act of 1933, as amended, on the basis of the
closing price reported in the NASDAQ SmallCap Market system on April 5,
1999.
(2) Previously Paid.
</FN>
</TABLE>
------------------------------------
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 the registration statement shall become
effective on such date as the commission, acting pursuant to said Section 8(a),
may determine.
- ------------------------------------------------------------------------------
- ------------------------------------------------------------------------------
Pursuant to Rule 429 of the Securities Act of 1933, the prospectus included
in this registration statement also relates to certain unsold securities of the
Registrant registered under registration statement No. 333-35337.
<PAGE>
SUBJECT TO COMPLETION DATED JUNE 29, 1999
The information in this prospectus is not complete and may be changed. We may
not sell these securities until the Registration Statement filed with the
Securities and Exchange Commission is effective. This prospectus is not an offer
to sell these securities and the selling stockholders are not soliciting an
offer to buy these securities in any state where the offer or sale is not
permitted.
PROSPECTUS
NEW FRONTIER MEDIA, INC.
2,610,000 SHARES OF COMMON STOCK
The 2,610,000 shares of common stock are being offered by the selling
stockholders. The common stock currently trades on the NASDAQ SmallCap Market
under the symbol "NOOF". On June 26, 1999, the last sale price of the common
stock as reported on NASDAQ was $7.781 per share.
All the common stock offered by this prospectus is being sold by the
selling stockholders. New Frontier will not receive any of the proceeds received
by the selling stockholders from the common stock sold.
The common stock may be sold by the selling stockholders directly or
through underwriters, dealers or agents in market transactions or privately
negotiated transactions.
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved these securities, or determined if this
prospectus is truthful or complete. Any representation to the contrary is a
criminal offense.
This investment involves a high degree of risk. Consider carefully the
risk factors beginning on page 5 in this prospectus.
The date of this prospectus is ______ __, 1999
1
<PAGE>
No person has been authorized in connection with this offering to give
any information or to make any representation other than as contained in this
Prospectus and, if given or made, such information or representation must not be
relied upon as having been authorized by the Company. This Prospectus does not
constitute an offer to sell or the solicitation of an offer to buy any
securities covered by this Prospectus in any state or other jurisdiction to any
person to whom it is unlawful to make such offer or solicitation in such state
or jurisdiction. Neither the delivery of this Prospectus nor any sales made
hereunder shall, under any circumstances, create an implication that there has
been no change in the affairs of the Company since the date hereof.
WHERE YOU CAN GET MORE INFORMATION
At your request, we will provide you, without charge, a copy of any
exhibits to our registration statement incorporated by reference in this
prospectus. If you want more information, write or call us at:
New Frontier Media, Inc.
5435 Airport Blvd, Suite 100
Boulder, Colorado 80301
Telephone number: (303) 444-0900
Toll Free number: 1-888-875-0632
Facsimile number: (303) 444-0734
Our fiscal year ends on March 31. We furnish our shareholders annual
reports containing audited financial statements and other appropriate reports.
In addition, we are a reporting company and file annual, quarterly and current
reports, proxy statements and other information with the SEC. You may read and
copy any reports, statements or other information we file at the SEC's public
reference room in Washington D.C. You can request copies of these documents,
upon payment of a duplicating fee, by writing to the SEC. Please call the SEC at
1-800-SEC-0330 for further information on the operation of the public reference
rooms. Our SEC filings are also available to the public on the SEC Internet site
at http:\\www.sec.gov.
The SEC allows us to "incorporate by reference" the information we file
with them, which means that we can disclose important information to you by
referring you to these documents. The information incorporated by reference is
an important part of this prospectus, and information that we file later with
the SEC will automatically update and supersede this information. We incorporate
by reference the documents listed below, which we have already filed with the
SEC, and any future filings we make with the SEC under Sections 13(a), 13(c), 14
or 15(d) of the Securities Exchange Act of 1934 until the selling shareholders
sell all of the securities offered by this prospectus.
<TABLE>
<CAPTION>
NEW FRONTIER SEC FILINGS (FILE NO. 33-27494-FW) PERIOD
- ---------------------------------------------------------------
<S> <C>
Annual Report on Form 10KSB Year ended
March 31, 1999
</TABLE>
This prospectus is part of a registration statement we filed with the
SEC.
You should rely on the information incorporated by reference or
provided in this prospectus. We have not authorized anyone to provide you with
different information. We are not making an offer of these securities in any
state where the offer is not permitted. You should not assume that the
information in this prospectus or the documents incorporated by reference is
accurate as of any date other than the date on the front of this prospectus or
those documents.
2
<PAGE>
PROSPECTUS SUMMARY
This summary highlights selected information contained elsewhere in
this prospectus. It is not complete and may not contain all of the information
that is important to you. To understand this offering fully, you should read the
entire prospectus carefully, including the risk factors and financial
statements.
This prospectus and the documents incorporated in this prospectus by
reference may contain forward-looking statements within the meaning of Section
27A of the Securities Act and Section 21E of the Exchange Act. These
forward-looking statements are based on current expectations, estimates and
projections about the Company's industry, management's beliefs and assumptions
made by management. Words such as "anticipates," "expects," "intends," "plans,"
"believes," "seeks," "estimates," variations of such words and similar
expressions are intended to identify such forward-looking statements. These
statements are not guarantees of future performance and are subject to certain
risks, uncertainties and assumptions that are difficult to predict.
Accordingly, actual results may differ materially from those expressed
or forecasted in any such forward-looking statements. Such risks and
uncertainties include those risk factors and such other uncertainties noted
herein and in the documents incorporated herein by reference. New Frontier
assumes no obligation to update publicly any forward-looking statements, whether
as a result of new information, future events or otherwise.
NEW FRONTIER MEDIA, INC.
Offices: 5435 Airport Blvd, Suite 100,
Boulder, Colorado 80301
Telephone number (303) 444-0900
Facsimile number (303) 444-0734
THE OFFERING
<TABLE>
<S> <C>
Common Stock Offered by Selling
Stockholders............................. 2,610,000 shares.
Common Stock to be offered by the
Company.................................. 0 shares
Common Stock Outstanding Before
Offering (1)............................. 12,539,517 shares
Common Stock Outstanding After Offering.. 12,539,517 shares
Use of Proceeds.......................... All of the shares offered from time to time by this
prospectus are being offered by the selling stockholders.
New Frontier shall not receive any proceeds from these sales
of its stock.
Risk Factors............................. The securities offered by this prospectus involve a high
degree of risk. Investors should purchase the securities
offered by this prospectus only if they can afford the loss
of their entire investment.
NASDAQ symbol............................ NOOF
<FN>
- ---------------
(1) Based on shares outstanding as of June 26, 1999.
</FN>
</TABLE>
3
<PAGE>
RISK FACTORS
NEW FRONTIER MEDIA HAS INCURRED LOSSES FROM INCEPTION AND MAY NEVER GENERATE
SUBSTANTIAL PROFITS.
We were organized in July, 1995 and have incurred losses from
inception. We may never generate substantial profits. We incurred a net loss of
$7,581,124, or $1.04 per share, on revenues of $9,452,432 for the fiscal year
ended March 31, 1999 and a net loss of $3,258,343, or $.73 per share, on
revenues of $712,581 for the fiscal year ended March 31, 1998. As of March 31,
1999 we had an accumulated deficit of $10,278,197. Our ability to operate
profitably is dependent upon successful execution of our business plan.
LIMITS ON THE COMPANY'S ACCESS TO DISTRIBUTION CHANNELS COULD ADVERSELY AFFECT
ITS BUSINESS.
Our satellite uplink providers' services are critical to us. If our
satellite uplink providers fail to provide the services contracted for with
them, our satellite programming operations would in all likelihood be suspended,
resulting in a loss of substantial revenues to the Company. If our satellite
uplink providers improperly manage their uplink facilities, we could experience
signal disruptions and other quality problems that, if not immediately
addressed, could cause us to lose subscribers and subscriber revenues.
4
<PAGE>
Our continued access to satellite transponders is critical to us. Our
satellite programming operations require continued access to satellite
transponders to transmit programming to our subscribers. We also use satellite
transponders to transmit programming to cable operators. Material limitations to
satellite transponder capacity could materially adversely affect our operating
performance. Access to transponders may be restricted or denied if:
* we or the satellite owner is indicted or otherwise charged as a
defendant in a criminal proceeding;
* the FCC issues an order initiating a proceeding to revoke the
satellite owner's authorization to operate the satellite;
* the satellite owner is ordered by a court or governmental authority
to deny us access to the transponder;
* we are deemed by a governmental authority to have violated any
obscenity law; or
* our satellite transponder provider determines that the content of our
programming is harmful to its name or business.
In addition to the above, the access of our networks to transponders
may be restricted or denied if a governmental authority commences an
investigation concerning the content of the transmissions.
Our ability to convince cable operators to carry our programming is
critical to us. The primary way for us to expand our cable subscriber base is to
convince additional cable operators to carry our programming. We can give no
assurance, however, that our efforts to increase our base of cable subscribers
will be successful.
THE COMPANY'S PRIMARY COMPETITOR HAS SIGNIFICANTLY GREATER RESOURCES THAN THE
COMPANY.
Our principal competitor, Playboy, has significantly greater financial,
sales, marketing and other resources to devote to the development, promotion and
sale of its cable programming products, as well as a longer operating history
and broader name recognition, than we do. We compete with Playboy as to the
editing standards of its programming, network performance in terms of subscriber
buy rates and the license fees that we offer to cable and DBS system providers.
5
<PAGE>
THE COMPANY ALSO FACES GENERAL COMPETITION FROM OTHER FORMS OF ADULT AND
NON-ADULT ENTERTAINMENT.
The Company faces competition in the adult entertainment industry from
other providers of adult programming, adult video rentals and sales, newspapers
and magazines aimed at adult consumers, adult oriented telephone chat lines, and
adult oriented Internet services. To a lesser extent, we also face general
competition from other forms of non-adult entertainment, including sporting and
cultural events, other television networks, feature films and other programming.
NEW FRONTIER MEDIA MAY NOT BE ABLE TO RETAIN ITS KEY EXECUTIVES.
As a small company with approximately 45 employees, our success depends
upon the contributions of our executive officers and its other key technical
personnel. The loss of the services of any of our executive officers or other
key personnel could have a significant adverse effect on our business and
operating results. We cannot assure that New Frontier Media will be successful
in attracting and retaining such personnel.
RAPID TECHNOLOGICAL CHANGE WILL CONTINUE TO OCCUR IN OUR INDUSTRY.
We are engaged in a business that has experienced tremendous
technological change over the past two years. As a result, we face all the risks
inherent in businesses that are subject to rapid technological advancement, such
as the possibility that a technology that we have invested in may become
obsolete. In that event, we may be required to invest in new technology. Our
inability to identify, fund the investment in, and commercially exploit such new
technology could have an adverse impact on our financial condition. Our ability
to implement our business plan and to achieve the results projected by
management will be dependent upon management's ability to predict technological
advances and implement strategies to take advantage of such changes.
6
<PAGE>
GOVERNMENT REGULATIONS COULD ADVERSELY AFFECT THE COMPANY'S BUSINESS.
Telecommunications Act of 1996. The Telecommunications Act of 1996
appears to have slowed growth in cable access for domestic pay television
businesses. For example, Federal Communications Commission regulation,
including the "going-forward rules," provides cable operators with incentives to
add basic services. Competition for channel space has increased as cable
operators have utilized available channel space to comply with "must-carry"
provisions, mandated retransmission consent agreements and "leased access"
provisions. In addition, we believe that growth will continue to be slow in the
next two to three years as the cable television industry responds to the FCC's
rules and subsequent modifications. We cannot assure you that the growth will
not slow further in the future.
Section 505 of the Telecommunications Act. Section 505 of the
Telecommunications Act effectively requires each cable system that offers adult
programming either to (1) install additional blocking technology in each
household to prevent any momentary fragments of our content from accidentally
becoming available to non-subscribing cable customers or (2) restrict the period
during which adult programming is transmitted to the hours between 10:00 p.m.
and 6:00 a.m. Although a United States District Court has unanimously declared
this law unconstitutional and blocked its implementation, the decision has been
appealed and accepted for review by the U.S. Supreme Court. The results of our
operations could be adversely affected if Section 505 is found constitutional in
a reversal of the court decision or if cable operators restrict the hours of
transmission of our programming until all appeals have been exhausted.
NEGATIVE PUBLICITY, LAWSUITS OR BOYCOTTS BY OPPONENTS OF ADULT CONTENT COULD
ADVERSELY AFFECT OUR BUSINESS.
We could become a target of negative publicity, lawsuits or boycotts by
one or more advocacy groups who oppose the distribution of "adult
entertainment." These groups have mounted negative publicity campaigns, filed
lawsuits and encouraged boycotts against companies whose businesses involve
adult entertainment. The costs of defending against any such negative publicity,
lawsuits or boycotts could be significant, could hurt our finances and could
discourage investors from investing in our publicly traded securities. To date,
we have not been a target of any of these advocacy groups. As a leading provider
of adult entertainment, we can not assure you that we may not become a target in
the future.
7
<PAGE>
NEW FRONTIER MEDIA WILL NEED ADDITIONAL FUNDS TO FINANCE ITS FUTURE GROWTH.
We anticipate that our capital resources will be sufficient to satisfy
our capital requirements for our current operations for the next 12 months. We
will need, however, additional funds to upgrade and expand our playout facility
to incorporate the Extasy Networks at our Boulder, Colorado facility and to
aggressively market TeN and our new Pleasure channel to increase carriage among
the MSO community. We expect to receive as much as $9.75 million through the
exercise of our 1,500,000 publicly traded warrants, which are currently
"in-the-money". In the event that we do not receive at least $5.0 million
through the exercise of our public warrants, we will need to raise additional
funds. If we are unable to obtain additional funds in a timely manner or on
acceptable terms, we may have to curtail or, as a last resort, suspend the
planned expansion of our playout facility and the planned marketing effort for
TeN and Pleasure, which could have a significant adverse effect on our business
relationships, financial results and prospects, which in turn could lead to
lower overall revenues.
BECAUSE THE COMPANY IS INVOLVED IN THE ADULT PROGRAMMING BUSINESS, IT MAY BE
MORE DIFFICULT FOR IT TO RAISE MONEY OR ATTRACT MARKET SUPPORT FOR OUR STOCK.
Some investors, investment banking entities, market makers, lenders and
others in the investment community may decide not to provide financing to us, or
to participate in our public market or other activities due to the nature of our
business, which, in turn, may hurt the value of our stock, and our ability to
attract market support.
IT MAY BE DIFFICULT TO EFFECT A CHANGE IN CONTROL OF NEW FRONTIER MEDIA.
Issuance of preferred stock could have the effect of delaying,
deferring or preventing a change in control of New Frontier Media. New Frontier
Media's board of directors has the authority to issue up to 5,000,000 shares of
preferred stock and to determine the price, rights, preferences, privileges and
restrictions, including voting rights, of such stock without further shareholder
approval. The rights of the holders of common stock will be subjected to, and
may also be adversely affected by, the rights of the holders of any preferred
stock that may be issued in the future.
8
<PAGE>
FUTURE SALES OF COMMON STOCK MAY CAUSE THE MARKET PRICE OF THE COMMON STOCK TO
DROP.
Future sales of shares of common stock by New Frontier Media and/or its
stockholders could cause the market price of the common stock to drop. There are
currently 5,377,433 restricted shares and 7,162,084 shares of common stock which
are freely tradable or eligible to have the restrictive legend removed pursuant
to Rule 144(k) promulgated under the Securities Act. Of the 5,377,433 restricted
shares, 1,988,800 of such shares are currently eligible for resale under Rule
144. Sales of substantial amounts of common stock in the public market, or the
perception that such sales may occur, could have a significant adverse effect on
the market price of the common stock.
THE COMPANY IS SUBJECT TO A COUNTER-CLAIM FOR UNSPECIFIED DAMAGES IN A SUIT WITH
A FORMER FINANCIAL ADVISOR.
On October 3, 1997, we filed a complaint in District Court in Boulder,
Colorado (Case No. 97 CV 1428) against Sands Brothers & Co. Ltd. alleging breach
by Sands Brothers of the terms of a financial consulting agreement with us. We
also alleged fraud in the inducement, and are seeking return of our initial
payment of $25,000 to Sands Brothers and rescission of the agreement. Sands
Brothers has filed an answer and counter-claim to our complaint seeking
unspecified damages, and we have filed an answer to Sands Brothers
counter-claim. We intend to vigorously pursue our claim against, and defend the
counter-claim from, Sands Brothers.
THE COMPANY HAS BEEN SUED BY A PROSPECTIVE INVESTOR SEEKING TO ENFORCE AN
ALLEGED AGREEMENT TO CONVEY A 70% EQUITY INTEREST IN NEW FRONTIER MEDIA.
In a January 25, 1999 amended complaint (Case No. 99CV30), J.P. Lipson
seeks to enforce an alleged agreement by New Frontier Media to convey to Lipson
a 70% equity interest in New Frontier Media. Lipson is also seeking large and/or
unspecified damages. We dispute that there exists a binding and enforceable
agreement to transfer any equity interest in New Frontier Media to Lipson and
filed on February 10, 1999 a motion for partial summary judgement directed to
this issue. To date the Court has neither ruled on nor set our motion for a
hearing. We will continue to vigorously defend against Lipson's claims.
THE YEAR 2000 PROBLEM COULD DISRUPT OUR BUSINESS.
We recognize that we, like all other businesses, are at risk if key
suppliers in utilities, communications, transportation, banking and government
are not ready for the year 2000. It is also possible that our computer software
applications, internal accounting, customer billing and other business systems,
working either alone or in conjunction with those of third parties who do
business with us, will not accept input of, store, manipulate and output dates
in the year 2000 or after without error. If any of this were to happen, we may
suffer business interruptions or shutdown, reputational harm or legal liability
and, as a result, material financial loss.
9
<PAGE>
THE COMPANY RECEIVED A NOTICE FROM NASDAQ IN EARLY 1999 STATING THAT IT MAY BE
DELISTED FROM NASDAQ.
Delisting of New Frontier Media's common stock from The Nasdaq SmallCap Market
would cause the price of the common stock to drop and impair the ability of
holders to sell their shares. In addition, in order to be relisted on Nasdaq, we
would be required to comply with the initial listing requirements, which are
substantially more onerous than the maintenance standards. In the event the
Company's securities are delisted from Nasdaq, such delisting would also be
likely to have an adverse effect on our ability to raise additional financing.
In early 1999, we received a notice from The Nasdaq Stock Market that we failed
to meet Nasdaq's $2 million in net tangible assets standard for continued
listing on the Nasdaq Small Cap Market. We attended a hearing to review that
determination on April 9, 1999. We have not yet heard any decision from Nasdaq.
At and before the hearing, we presented financial information to establish that
we exceeded Nasdaq's net tangible assets standard. We also discussed Nasdaq's
concerns regarding the written consent process used by us, upon the advice of
our counsel, to obtain shareholder approval for the issuance of more than 20% of
our outstanding shares under their corporate governance rules.
THE LIABILITY OF OUR DIRECTORS IS LIMITED.
Our Bylaws substantially limit the liability of our directors to us and
our shareholders for breach of fiduciary or other duties.
THE PRICE OF THE COMMON STOCK MAY CONTINUE TO BE HIGHLY VOLATILE.
The trading price for the common stock has been highly volatile and
could continue to be subject to significant fluctuations in response to
variations in our quarterly operating results, general conditions in the adult
entertainment industry or the general economy, and other factors. In addition,
the stock market is subject to price and volume fluctuations affecting the
market price for public companies generally, or within broad industry groups,
which fluctuations may be unrelated to the operating results or other
circumstances of a particular company. Such fluctuations may adversely affect
the liquidity of the common stock, as well as the price that holders may achieve
for their shares upon any future sale.
10
<PAGE>
INDEMNIFICATION
The Company's Bylaws require the Company, to the fullest extent
permitted or required by Colorado law, to (i) indemnify its directors against
any and all liabilities and (ii) advance any and all reasonable expenses
incurred in any proceeding to which any such director is a party or in which
such director is deposed or called to testify as a witness because he or she is
or was a director of the Company. Generally, Colorado statutory law permits
indemnification of a director upon a determination that he or she acted in good
faith and in a manner he or she reasonably believed to be in, or not opposed to,
the best interests of the corporation and, with respect to any criminal action
or proceeding, had no reasonable cause to believe his or her conduct was
unlawful. The right to indemnification granted in the Company's Bylaws is not
exclusive of any other rights to indemnification against liabilities or the
advancement of expenses which a director may be entitled to under any written
agreement, Board resolution, vote of stockholders, Colorado law or otherwise.
Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons of
the registrant pursuant to the foregoing provisions, or otherwise, the
registrant has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the Act
and is, therefore, unenforceable.
11
<PAGE>
SELECTED FINANCIAL AND OPERATING DATA
The following selected financial and operating data should be read in
conjunction with New Frontier's consolidated financial statements and the notes
thereto and Management's Discussion and Analysis of Financial Condition and
Results of Operations" included in New Frontier's Annual Reports on Form 10-KSB
for the Twelve Months Ended March 31, 1999 and March 31, 1998. The balance sheet
data and statement of operations data as of and for the years ended March 31,
1999 and 1998 are derived from the consolidated financial statements of New
Frontier, incorporated by reference herein, that have been audited by Spicer,
Jeffries & Co., independent accountants.
<TABLE>
<CAPTION>
YEAR ENDED MARCH 31,
----------------------------
1999 1998
----------- -----------
<S> <C> <C>
STATEMENT OF OPERATIONS DATA:
Revenues, net...................................... $9,452,432 $ 712,581
Cost of Sales...................................... 8,800,203 1,041,925
----------- -----------
Gross profit (loss)................................ 652,229 (329,344)
Total operating expenses.................... 7,708,346 1,310,642
----------- -----------
Loss from operations............................... (7,056,117) (1,639,986)
Total other income (expenses)................ (208,061) (159,454)
----------- -----------
Discontinued operations............................ (316,946) (1,458,903)
----------- -----------
Net loss........................................... (7,581,124) $(3,258,343)
----------- -----------
----------- -----------
Basic net loss per share........................... (1.04) $ (0.73)
----------- -----------
----------- -----------
Diluted net loss per share......................... (1.04) $ (0.73)
----------- -----------
----------- -----------
Weighted-average shares outstanding 7,288,453 4,460,744
----------- -----------
----------- -----------
BALANCE SHEET DATA:
Working Capital (Deficit).......................... $ 266,301 $ 1,013,736
Total assets....................................... 16,402,571 10,747,949
Long-term debt, net of current portion............. 474,430 6,716
Stockholders' equity............................... 10,289,031 10,289,031
</TABLE>
12
<PAGE>
MARKET PRICE OF COMMON STOCK
Prior to February 11, 1998, a limited public market for New Frontier
common stock existed on the NASDAQ Bulletin Board under the symbol NOOF.
Commencing on February 11, 1998, our common stock and units were quoted on the
Nasdaq SmallCap Market under the symbols NOOF and NOOFU, respectively. As of the
close of business on May 18, 1998, we split the units into their component
parts, consisting of one share of common stock and one redeemable common stock
purchase warrant. Commencing on May 19, 1998, our warrants were quoted on the
Nasdaq SmallCap Market under the symbol NOOFW. On June 26, 1999, the last
sale price for our common stock as reported on NASDAQ was $7.781 per share.
The following table sets forth the high and low closing prices for the
Common Stock as reported on NASDAQ for each quarter since September 30, 1997 for
the periods indicated. Such information reflects inter dealer prices without
retail mark-up, mark down or commissions and may not represent actual
transactions.
QUARTER ENDED HIGH LOW
- ------------------------------------- --------- -----------
September 30, 1997.................. 5-1/2 5
December 31, 1997................... 5-3/4 4-3/4
March 31, 1998...................... 5-1/4 2-7/8
June 30, 1998....................... 4-1/4 2-3/4
September 30, 1998.................. 3-11/16 19/32
December 31, 1998................... 1-5/8 13/16
March 31, 1999...................... 5-3/8 14/16
We have not paid any dividends on our common stock. We currently
intend to retain any earnings for use in our business, and do not anticipate
paying cash dividends in the foreseeable future.
As of March 31, 1999, there were approximately 340 record holders of
our common stock.
13
<PAGE>
REGISTRATION RIGHTS
In connection with our private placement of 2,610,000 shares of common
stock on March 5, 1999 and pursuant to the terms of sixteen (16) subscription
agreements dated as of March 5, 1999, by and between New Frontier and each of
the selling stockholders, we are obligated to use our best efforts to cause this
registration statement to become effective by August 5, 1999. We are further
obligated to register and qualify the registerable shares under such state
securities laws as the Selling Stockholders may reasonably request. We will bear
the reasonable expenses of the registration and qualification of the shares
under the Securities Act and state securities laws other than any underwriting
discounts and commissions and the expenses of counsel for the selling
stockholders.
If the registration statement is not effective by August 5, 1999, then
New Frontier must make payments to the selling stockholders in such amounts and
at such times as are determined pursuant to Section 5(b)(iii) of the
subscription agreements, which states that the amount to be paid by us to the
selling stockholders shall be equal to five (5%) percent per month of the
purchase price paid by the selling stockholders for the common stock. Thus, if
the registration statement is not effective by August 5, 1999, then for the
period from August 5, 1999 to September 5, 1999, we must pay to the selling
stockholders a penalty of $261,000. If the registration statement still is not
effective on September 5, 1999, then for the period from September 5, 1999 to
October 5, 1999, we must pay to the selling stockholders an additional penalty
of $261,000, and so on.
USE OF PROCEEDS FROM SALE OF COMMON STOCK
None of the proceeds from the sale of the common stock registered
hereunder will accrue to New Frontier.
Through private placement, New Frontier has obtained $5,220,000 of
financing from the sale of 2,610,000 shares of Common Stock at a price of $2.00
per share, exclusive of fees and other expenses related to this sale.
We have used $1,518,872 of the proceeds to repay $1,485,000 principal
amount of short-term indebtedness incurred to finance our business operations,
of which $700,000 did not bear interest, $700,000 bore interest at 20% per annum
and $85,000 bore interest at 8.5%. We intend to apply the balance of the
proceeds of the sale of the Common Stock for working capital purposes.
14
<PAGE>
SELLING STOCKHOLDERS AND PLAN OF DISTRIBUTION
The selling stockholders whose shares of common stock are being
registered hereunder are: Robertson Stephens Diversified Cash Fund, Anglo Irish
Bank Corp. plc, Alderwood Securities Limited, Cheltenham Securities Ltd., Boston
Securities Australia Limited, Hathaway Partners Investment L.P., Special
Situations Private Equity Fund L.P., Talisman Capital Opportunity Fund Ltd.,
Talisman Capital Inc., Zeke, L.P., August C. Schultes and Mark S. Alsentzer, as
tenants in common, Ben Hasten, Mark Hess, and Raymond Martine.
Robertson Stephens is a Massachusetts corporation with a principal
place of business at 555 California Street, Suite 2600, San Francisco,
California 94104.
Anglo Irish is an Irish corporation with a principal place of business
at 18/21 St. Stephens Grove, Dublin 2, Ireland.
Alderwood is a British Virgin Islands corporation with a principal
place of business at c/24 Bd. Princess Charlotte, Monaco.
Cheltenham is an English corporation with a principal place of business
at Westhead House, Wigan Road Lathom, Ormskire Lancashire L406JN England.
Boston is an Australian corporation with a principal place of business
at 400 Upper Toyan Drive, Kentfield, Australia 94924.
Hathaway is a Connecticut corporation with a principal place of
business at 119 Rowayton Avenue, Rowayton, Connecticut 06853.
Special Situations is a New York limited partnership with a principal
place of business at 153 East 53rd Street, New York, New York 10022.
Talisman is a British Virgin Islands corporation with a principal place
of business at 16101 La Grande Drive, Suite 100, Little Rock, Arkansas 72223.
TCI is a British Virgin Islands corporation with a principal place of
business at 16101 La Grande Drive, Suite 100, Little Rock, Arkansas 72223.
Zeke is a Delaware corporation with a principal place of business at
1235 Westgates Drive, Borogn, Pennsylvania 19312.
Schultes and Alsentzer are individuals with an address at 101 Jessup
Road, Thorofare, New Jersey 08086.
Hasten is an individual with an address at 366 Elm Street, Denver,
Colorado 80220.
Hess is an individual with an address at 4311 Down Point Lane,
Windermere, Florida 34786.
Martine is an individual with an address at 8 Kensington Court Place,
London W85BT England.
No Selling Stockholder has any affiliation with the Company or its
officers, directors, promoters or principal shareholders.
Neither Anglo Irish, Alderwood, Cheltenham, Boston nor Martine has a
domestic agent for service of process. It may be difficult for United States
investors to effect service within the United States upon Martine or Anglo
Irish, Alderwood, Cheltenham and/or Boston and their respective officers and
directors, or to realize in the United States upon judgments rendered against
Martine or Anglo Irish, Alderwood, Cheltenham and/or Boston and their respective
officers and directors by courts of the United States predicated upon civil
liabilities under the Securities Act of 1933 ("Securities Act") or state
securities law.
New Frontier has agreed to register the public offering of the selling
stockholders' shares of common stock under the Securities Act and to pay all
expenses in connection therewith other than brokerage commissions and discounts
in connection with the sale of the common stock and the expenses of counsel.
15
<PAGE>
The following table sets forth the names of the selling stockholders,
the number of shares of common stock owned beneficially by each of the selling
stockholders as of March 31, 1999, the number of shares which may be offered for
resale pursuant to this prospectus and the number of shares of common stock
owned beneficially by each of the selling stockholders after the offering.
The information included below is based upon information provided by
the selling stockholders. Because the selling stockholders may offer all, some
or none of their common stock, no definitive estimate as to the number of shares
thereof that will be held by the selling stockholders after such offering can be
provided and the following table has been prepared on the assumption that all
shares of common stock offered under this prospectus will be sold.
<TABLE>
<CAPTION>
SHARES OF SHARES OF
COMMON STOCK SHARES OF COMMON STOCK
BENEFICIALLY COMMON BENEFICIALLY
OWNED PRIOR TO STOCK BEING OWNED AFTER
NAME OF SELLING STOCKHOLDER (1) OFFERING (2) OFFERED OFFERING(3) PERCENT (4)
- ------------------------------------------------ --------------- ------------ ------------- -----------
<S> <C> <C>
Robertson Stephens Diversified Cash Fund........ 500,000 500,000 0 0%
Anglo Irish Bank Corp. plc...................... 20,000 20,000 0 0
Alderwood Securities Limited.................... 650,000 650,000 0 0
Cheltenham Securities Ltd....................... 25,000 25,000 0 0
Boston Securities Australia Limited............. 25,000 25,000 0 0
Hathaway Partners Investment L.P................ 50,000 50,000 0 0
Special Situations Private Equity Fund L.P...... 300,000 300,000 0 0
Talisman Capital Opportunity Fund Ltd........... 225,000 225,000 0 0
Talisman Capital Inc............................ 25,000 25,000 0 0
Zeke, L.P....................................... 200,000 200,000 0 0
August C. Schultes and Mark S. Alsentzer...... 500,000 500,000 0 0
Ben Hasten...................................... 25,000 25,000 0 0
Mark Hess....................................... 25,000 25,000 0 0
Raymond Martine................................. 40,000 40,000 0 0
------- ------- --- ---
Total 2,610,000 2,610,000 0 0
<FN>
- ------------------
(1) Each of the parties listed has sole voting and investment power with respect
to all shares of common stock indicated.
(2) Beneficial ownership is calculated in accordance with Rule 13d-3(d) under
the Exchange Act.
(3) Assumes the sale of all shares offered hereby.
(4) Based upon 12,539,517 shares outstanding.
</FN>
</TABLE>
16
<PAGE>
The selling stockholders' shares of common stock may be offered and
sold from time to time as market conditions permit, provided that a registration
statement covering such shares is effective at the time of such offer and/or
sale. Under Section 10(a)(3) of the Securities Act of 1933, as amended, when a
prospectus is used more than nine months after the effective date of the
registration statement, the information contained therein must be as of a date
not more than 16 months prior to such use.
The selling stockholders' shares of common stock may be offered and
sold in the over-the-counter market, or otherwise, at prices and terms then
prevailing or at prices related to the then-current market price, or in
privately negotiated transactions. The selling stockholders' shares of common
stock may be sold by one or more of the following methods, without limitation:
(1) a block trade in which a broker or dealer so engaged will attempt to sell
the shares as agent but may position and resell a portion of the block as
principal to facilitate the transaction; (2) purchases by a broker or dealer as
principal and resale by such broker or dealer for its accounts pursuant to this
Prospectus; (3) ordinary brokerage transactions and transactions in which the
broker solicits purchases; and (4) transactions between sellers and purchasers
without a broker or dealer. In effecting sales, brokers or dealers engaged by
selling stockholders may arrange for other brokers or dealers to participate.
Such brokers or dealers may receive commissions or discounts from selling
stockholders in amounts to be negotiated. Such brokers and dealers and any other
participating brokers and dealers may be deemed to be "underwriters" within the
meaning of the Securities Act, in connection with such sales.
17
<PAGE>
DESCRIPTION OF SECURITIES
As of the date of this Prospectus, there are approximately 340 holders
of record of New Frontier's common stock. We are currently authorized to issue
50,000,000 shares of our common stock, par value $.0001 per share, and 5,000,000
shares of its preferred stock, par value $.10 per share. As of the date of this
Prospectus, New Frontier has 12,539,517 shares of its common stock, and no
shares of its preferred stock, issued and outstanding. There are also options
and warrants to purchase an additional 5,702,166 shares of our common stock
issued and outstanding.
COMMON STOCK
Each holder of shares of common stock is entitled to one vote per share
on all matters to be voted on by shareholders. The holders of common stock are
entitled to receive dividends, if any, as may be declared from time to time by
the board of directors out of funds legally available therefor and, in the event
of liquidation, dissolution or winding-up of New Frontier, to share ratably in
all assets available for distribution, subject to the rights of the holders of
any preferred stock as described below.
Upon the liquidation, dissolution or winding up of New Frontier, the
holders of shares of common stock would be entitled to share pro rata in the
distribution of all of New Frontier's assets remaining available for
distribution after satisfaction of all its liabilities and the payment of the
liquidation preference of any outstanding preferred stock. The holders of common
stock have no preemptive or conversion rights. All shares of common stock
outstanding as of the date of this prospectus are fully paid and are not subject
to further calls or assessments by the company. There are no redemption or
sinking fund provisions applicable to the common stock.
PREFERRED STOCK
Our Articles of Incorporation, as amended, authorize the issuance of up
to 5,000,000 shares of preferred stock. The board of directors is authorized,
without further shareholder action, to issue such shares in one or more series,
and to fix the rights, preferences, privileges and restrictions thereof,
including dividend rates, conversion rights, voting rights, terms of redemption,
redemption prices, amounts payable upon liquidation and the number of shares
constituting any series or the designation of such series. If such preferred
stock is issued, it will rank senior to our common stock in respect of rights to
receive dividends and to participate in distributions or payments in the event
of an liquidation, dissolution or winding up of New Frontier. The issuance of
preferred stock may have the effect of delaying, deferring, discouraging or
preventing a third party from acquiring a majority of the outstanding voting
stock of New Frontier or other change in control of New Frontier without further
action by the shareholders, and may adversely affect the voting and other rights
of the holders of the common stock, including the loss of voting control to
others. The board of directors does not at present intend to seek shareholder
approval prior to issuing any such preferred stock, unless required to do so by
law.
18
<PAGE>
DIVIDEND POLICY
We have not paid any cash or other dividends on our common stock since
our inception and do not anticipate paying any such dividends in the foreseeable
future. We intend to retain any earnings for use in our operations and to
finance the expansion of its business. See "Risk Factors--No Dividends."
LEGAL MATTERS
The legality of the Shares offered hereby has been passed upon for the
Company by Thorburn, Sakol & Throne of Denver, Colorado.
EXPERTS
The financial statements of the Company as of March 31, 1999 and 1998
and for the years ended March 31, 1999 and 1998, incorporated by reference in
this Prospectus from the Annual Report, have been incorporated herein in
reliance on the report of Spicer, Jeffries & Co., independent certified public
accountants, given on the authority of said firm as experts in accounting and
auditing.
19
<PAGE>
- --------------------------------------------------------------------------------
TABLE OF CONTENTS
PAGE
----
Where You Can Get More Information....................................2
Prospectus Summary....................................................3
The Offering..........................................................3
Risk Factors..........................................................4
Indemnification......................................................11
Selected Financial and Operating Data................................12
Market Price of Common Stock.........................................13
Registration Rights..................................................14
Use of Proceeds from Sale of Common Stock............................14
Selling Stockholders and Plan of Distribution........................15
Description of Securities............................................18
Dividend Policy......................................................19
Legal Matters........................................................19
Experts..............................................................19
- -------------------------------------------------------------------------------
<PAGE>
NEW FRONTIER MEDIA, INC.
PART II
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
Filing fee under the Securities Act of 1933...........................$ 3,055.93
Blue Sky qualification fees and expenses (1).......................... 1,000
Printing and engraving (1)............................................ 1,000
Legal Fees (1)........................................................ 25,000
Accounting Fees (1)................................................... 3,000
Miscellaneous (1)..................................................... 1,944.07
--------
TOTAL........................................................$35,000
- -------------------
(1) Estimates
Part II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
(i) Article 3, Section 3.17 of the Company's First Amended and
Restated Bylaws provides as follows:
"SECTION 3.17
LIMITATIONS ON LIABILITY
To the fullest extent permitted by the Colorado Business Corporation
Act as the same exists or may hereafter be amended, a director of the
corporation shall not be liable to the corporation or its stockholders for
monetary damages for any action taken or any failure to take any action as a
director. Notwithstanding the foregoing, a director will have liability for
monetary damages for a breach or failure which involves: (i) a violation of
criminal law; (ii) a transaction from which the director derived an improper
personal benefit, either directly or indirectly; (iii) distributions in
violation of the Colorado Business Corporation Act or the Articles of the
corporation (but only to the extent provided by law); (iv) willful misconduct or
disregard for the best interests of the corporation concerning any acts or
omissions concerning any proceeding other than in the right of the corporation
or a shareholder; or (v) reckless, malicious or wanton acts or omissions
concerning any proceeding other than in the right of the corporation or of a
shareholder. No repeal, amendment or modification of this Article, whether
direct or indirect, shall eliminate or reduce its effect with
II-1
<PAGE>
respect to any act or omission of a director of the corporation occurring prior
to such repeal, amendment or modification."
(ii) Article 3, Section 3.18 of the Company's First Amended and
Restated Bylaws provides as follows:
"SECTION 3.18
INDEMNIFICATION
Subject to and in accordance with the Colorado Business Corporation
Act, and except as may be expressly limited by the Articles of Incorporation and
any amendments thereto, the corporation shall indemnify any person:
(i) made a party to any proceeding (other than an action by,
or in the right of, the corporation) by reason of the fact that he is
or was a director, officer, employee or agent of the corporation, or is
or was serving at the corporation's request, as a director, officer,
employee or agent or another corporation, or other enterprise; or
(ii) who was or is a party to any proceeding by or in the
right of the corporation, to procure a judgement in its favor by reason
of the fact that he is or was a director, officer, employee, or agent
of the corporation or is or was serving at the request of the
corporation as a director, officer, employee, or agent of another
corporation, partnership, joint venture, trust, or other enterprise.
This indemnification shall be mandatory in all circumstances in which
indemnification is permitted by law.
The corporation may maintain indemnification insurance regardless of
its power to indemnify under the Colorado Business Corporation Act.
The corporation may make any other or further indemnification or
advancement of expenses of any of the directors, officers, employees or agents
under any bylaw, agreement, vote of shareholders or disinterested directors or
otherwise, both as to action in his or her official capacity and to action in
another capacity while holding such office, except an indemnification against
material criminal or unlawful misconduct as set forth by statute, or as to any
transaction wherein the director derived an improper personal benefit.
Except to the extent reimbursement shall be mandatory in accordance
herewith, the corporation shall have the right to refuse indemnification, in
whole or in part, in any instance in which the person to whom indemnification
would otherwise have been applicable, if he or she unreasonably refused to
permit the corporation, at its own expense and through counsel of its own
choosing, to defend him or her in the action, or unreasonably refused to
cooperate in the defense of such action."
II-2
<PAGE>
ITEM 16. EXHIBITS
The exhibits attached hereto are as follows:
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
- ----------------- -----------------------------------------------------------------------------------------
<S> <C>
3.01 -- Articles of Incorporation of Company, with Amendment*
3.02 -- First Amended Bylaws of Company*
4.01 -- Form of Common Stock Certificate*
5.01 -- Opinion of Thorburn, Sakol & Throne, counsel to the Company, concerning the
legality of the securities being registered*****
10.01 -- Asset Purchase Agreement Among the Company, CSB, Fifth Dimension Communications
(Barbados) Inc., and Merlin Sierra, Inc.*
10.02 -- Asset Purchase Agreement Among the Company, CSB, and 1043133 Ontario Inc.*
10.03 -- Asset Purchase Agreement Among the Company, CSB, and 1248663 Ontario Inc.*
10.04 -- Revocable Line of Credit Agreement*
10.05 -- Promissory Note*
10.06 -- Call Center Interim Service Agreement between the Company and 1248663 Ontario Inc.*
10.07 -- Settlement and Stock and Warrant Transfer Agreement, dated June 16, 1998, by and
among the Company, BIG, Quarto Holdings, Inc., New Frontier Media, Inc., Mark
Kreloff, Michael Weiner, Andrew Brandt and Scott Wussow**
10.08 -- Form of Securities Purchase Agreement, dated March 5, 1999, by and between
the Company and each of the Selling Stockholders.****
10.09 -- Employment Agreement, dated December 22, 1998, by and between
the Company and Mark Kreloff.****
10.10 -- Employment Agreement, dated December 22, 1998, by and between
the Company and Michael Weiner.****
10.11 -- Office Lease Agreement, dated August 12, 1998, for premises at
5435 Airport Boulevard, Boulder CO.***
21.01 -- Subsidiaries of the Company***
23.01 -- Consent of Spicer, Jefferies & Co.*****
23.02 -- Consent of Thorburn, Sakol & Throne, counsel to the Company (included in their
opinion filed as Exhibit 5.01).*****
27.01 -- Financial Data Schedule.***
<FN>
- --------------------
* Incorporated by reference to the Company's Registration Statement on Form SB-2
(File No. 333-35337)
** Incorporated by reference to the Company's Annual Report on Form 10-KSB for
the year ended March 31, 1998.
*** Incorporated by reference to the Company's Annual Report on Form 10-KSB for
the year ended March 31, 1999.
**** Previously Filed.
***** Filed with this Registration Statement.
</FN>
</TABLE>
II-3
<PAGE>
ITEM 17. UNDERTAKINGS.
The Company hereby undertakes:
(a) That insofar as indemnification for liabilities arising under the
1933 Act may be permitted to directors, officers and controlling persons of the
Company, the Company has been advised that in the opinion of the Securities and
Exchange Commission, such indemnification is against public policy as expressed
in the 1933 Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the Company
of expenses incurred or paid by a director, officer or controlling person of the
Company in the successful defense of any action, suit or proceeding) is asserted
by such director, officer or controlling person in connection with the
securities being registered, the Registrant will, unless in the opinion of its
counsel the matter has been settled by controlling precedent, submit to a court
of appropriate jurisdiction the question of whether such indemnification by it
is against public policy as expressed in the 1933 Act, and will be governed by
the final adjudication of such issue.
(b) That, subject to the terms and conditions of Section 13 (a) of the
Securities Exchange Act of 1934, it will file with the Securities and Exchange
Commission such supplementary and periodic information, documents and reports as
may be prescribed by any rule or regulation of the Commission heretofore or
hereafter duly adopted pursuant to authority conferred in that section.
(c) That any post-effective amendment filed will comply with the
applicable form, rules and regulations of the Commission in effect at the time
such post-effective amendment is filed.
(d) To file, during any period in which offers or sales are being made,
a post-effective amendment to this registration statement:
(i) To include any prospectus required by section 10 (a) (3)
of the 1933 Act;
(ii) To reflect in the prospectus any facts or events arising
after the effective date of the registration statement (or the most recent
post-effective amendment thereof) which, individually or in the aggregate,
represent a fundamental change in the information set forth in the registration
statement; and
(iii) To include any material information with respect to the
plan of distribution not previously disclosed in the registration statement or
any material change to such information in the registration statement.
(e) That, for the purpose of determining any liability under the 1933
Act, each such post-effective amendment shall be deemed to be a new registration
statement relating to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona fide offering
thereof.
(f) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the termination of
this offering.
II-4
<PAGE>
SIGNATURES
Pursuant to the requirements of the 1933 Act, as amended, the Company
certifies that it has reasonable grounds to believe that it meets the
requirements of filing on Form S-3 and has caused this Registration Statement on
Form S-3 to be signed on its behalf by the undersigned, thereunto duly
authorized, in Boulder, Colorado on June 28, 1999.
NEW FRONTIER MEDIA, INC.
By: /s/ Mark H. Kreloff
-----------------------------
Mark H. Kreloff
President
Pursuant to the requirements of the 1933 Act, as amended, this
Registration Statement has been signed below by the following persons on the
dates indicated.
<TABLE>
<CAPTION>
Signature Title Date
- ---------------------------------------- ------------------------------------ ---------------
<S> <C> <C>
/s/ Mark H. Kreloff Chairman, Chief Executive Officer June 28, 1999
- ----------------------------------------- and President
Mark H. Kreloff
/s/ Michael Weiner Executive Vice President, Secretary, June 28, 1999
- ----------------------------------------- Treasurer and Director
Michael Weiner
/s/ Karyn Miller Chief Financial Officer June 28, 1999
- ----------------------------------------- (Principal Accounting Officer)
Karyn Miller
/s/ Koung Y. Wong Director June 28, 1999
- -----------------------------------------
Koung Y. Wong
/s/ Edward J. Bonn Director June 28, 1999
- -----------------------------------------
Edward J. Bonn
</TABLE>
II-5
<PAGE>
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
- ----------------- ----------------------------------------------------------------------------------------
<S> <C>
3.01 -- Articles of Incorporation of Company, with Amendment*
3.02 -- First Amended Bylaws of Company*
4.01 -- Form of Common Stock Certificate*
5.01 -- Opinion of Thorburn, Sakol & Throne, counsel to the Company, concerning the
legality of the securities being registered*****
10.01 -- Asset Purchase Agreement Among the Company, CSB, Fifth Dimension Communications
(Barbados) Inc., and Merlin Sierra, Inc.*
10.02 -- Asset Purchase Agreement Among the Company, CSB, and 1043133 Ontario Inc.*
10.03 -- Asset Purchase Agreement Among the Company, CSB, and 1248663 Ontario Inc.*
10.04 -- Revocable Line of Credit Agreement*
10.05 -- Promissory Note*
10.06 -- Call Center Interim Service Agreement between the Company and 1248663 Ontario Inc.*
10.07 -- Settlement and Stock and Warrant Transfer Agreement, dated June 16, 1998, by and
among the Company, BIG, Quarto Holdings, Inc., New Frontier Media, Inc., Mark
Kreloff, Michael Weiner, Andrew Brandt and Scott Wussow**
10.08 -- Form of Securities Purchase Agreement, dated March 5, 1999, by and between
the Company and each of the Selling Stockholders.****
10.09 -- Employment Agreement, dated December 22, 1998, by and between
the Company and Mark Kreloff.****
10.10 -- Employment Agreement, dated December 22, 1998, by and between
the Company and Michael Weiner.****
10.11 -- Office Lease Agreement, dated August 12, 1998, for premises
at 5435 Airport Boulevard, Boulder, CO.***
21.01 -- Subsidiaries of the Company**
23.01 -- Consent of Spicer, Jefferies & Co.*****
23.02 -- Consent of Thorburn, Sakol & Throne, counsel to the Company (included in their
opinion filed as Exhibit 5.01).*****
27.01 -- Financial Data Schedule.***
<FN>
- --------------------
* Incorporated by reference to the Company's Registration Statement on Form SB-2
(File No. 333-35337)
** Incorporated by reference to the Company's Annual Report on Form 10-KSB for
the year ended March 31, 1998.
*** Incorporated by reference to the Company's Annual Report on Form 10-KSB for
the year ended March 31, 1999.
**** Previously filed.
***** Filed with this registration statement.
</FN>
</TABLE>
II-6
EXHIBIT 5.1
THORBURN, SAKOL & THRONE
AN ASSOCIATION OF PROFESSIONAL CORPORATIONS
ATTORNEYS AND COUNSELLORS AT LAW
255 CANYON BOULEVARD AT CLOUD CREEK
SUITE 100
BOULDER, COLORADO 80302-4920
TELEPHONE (303) 449-1873
TELEFAX (303) 447-9840
June 29, 1999
Board of Directors
New Frontier Media, Inc.
5435 Airport Blvd., Suite 100
Boulder, CO 80301
Re: Registration Statement on Form S-3
Ladies and Gentlemen:
At your request, this letter relates to the Registration Statement on
Form S-3 filed by New Frontier Media, Inc. (the "Company") with the Securities
and Exchange Commission on April 6, 1999, as amended (the "Registration
Statement"), in connection with the registration under the Securities Act of
1933, as amended, of 2,610,000 shares of common stock (herein, the "Shares").
In so acting, we have examined originals or copies, certified or
otherwise identified to our satisfaction, of the proceedings taken by the
Company in connection with the issuance of the Shares, the Registration
Statement and such corporate records, agreements, documents and other
instruments, and such certificates or comparable documents of public officials
and of officers and representatives of the Company, and have made such inquiries
of such officers and representatives, as we have deemed relevant or necessary as
a basis for the opinions hereinafter set forth.
In such examination, we have assumed without independent verification,
the genuineness of all signatures, the authenticity of all documents submitted
to us as originals, the conformity to original documents of documents submitted
to us as certified or photostatic copies and the authenticity of the originals
of such latter documents. As to all questions of fact material to this opinion
that have not been independently established, we have relied upon
representations of the Company in the Registration Statement, certificates or
comparable documents of officers of the Company and of public officials. Our
examination of matters of law has been limited to the Colorado General
Corporation Law.
Based on the foregoing, and subject to the qualifications stated
herein, as of the date hereof, it is our opinion that such Shares have been
validly issued and are fully paid and non-assessable.
We consent to the use of this opinion as an exhibit to the Registration
Statement.
Very truly yours,
/s/ Thorburn, Sakol & Throne
Thorburn, Sakol & Throne
Exhibit 23.01
CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
We hereby consent to the incorporation by reference in the Registration
Statement, Amendment No. 1, on Form S-3 of New Frontier Media, Inc. and
Subsidiaries of our report dated June 9, 1999, accompanying the consolidated
financial statements of New Frontier Media, Inc. and Subsidiaries for the years
ended March 31, 1999 and 1998 which is part of the Annual Report on Form 10-KSB,
and to the reference to us under the heading "Experts" in such registration
statement.
SPICER, JEFFRIES & CO.
Denver, Colorado
June 28, 1999
