SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of
1934
Date of Report (Date of earliest event reported): June 1,
Mustang Software, Inc.
(Exact name of registrant as specified in its charter)
California 0-25678 70-0204718
(State or other (Commission (IRS Employer
jurisdiction of File Number) Identification No.)
incorporation)
6200 Lake Ming Road, Bakersfield, CA 93306
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (805) 873-2500
- ------------------------------------------------------------------
(Former name or former address, if changed since last report.)
<PAGE> 2
Item 5. Other Events.
On October 14, 1998, Mustang Software, Inc. issued the press
release attached hereto as exhibit A and incorporated herein by
reference.
<PAGE> 3
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933,
the registrant has duly caused this report to be signed on its
behalf by the undersigned hereunto duly authorized.
Dated October 23, 1998
MUSTANG SOFTWARE, INC.
By: /s/ James A. Harrer
___________________________
James A. Harrer
President and Chief Executive
Officer
<PAGE> 4
Exhibit A
Press Release
Mustang Software, Inc. Completes $1.5 Million Private Financing
Transaction Also Establishes Additional $5 Million Equity Line of
Credit
Listing of Mustang's Common Stock to Move Conditionally to Nasdaq
SmallCap Market under the symbol "MSTGC" effective October 15,
1998
BAKERSFIELD, California, October 14, 1998. Mustang Software,
Inc. (Nasdaq:MSTG) today announced it has completed a private
placement of its securities to four institutional investors,
receiving proceeds, before offering expenses, of $1,500,000 (the
"Financing"). In the Financing, Mustang issued 617,000 shares of
its Common Stock, 5,456 shares of its Series A Convertible
Preferred Stock (the "Preferred Stock") and Warrants to purchase
up to 237,000 shares of its Common Stock (the "Warrants"). As
part of the Financing, Mustang and the investors also agreed to
establish an equity line of credit under which, subject to
certain conditions, Mustang may "put" additional shares of its
Common Stock to the investors, potentially raising additional
gross proceeds of up to $5,000,000 (the "Equity Line of Credit").
"The rapid adoption of our Internet Message Center solution has
prompted Mustang to expand its presence to meet growing market
requirements," said James A. Harrer, Mustang's President and
Chief Executive Officer. "This transaction strengthens Mustang
financially and is expected to provide us with working capital
sufficient to execute our business plan."
Each share of Preferred Stock will be convertible into that
number of shares of Common Stock determined by dividing $100
(plus 5% thereon from September 17, 1998 to the date of
conversion) by the Conversion Price. The "Conversion Price" is
the lower of $1.875 per share or the "market price" per share, as
defined in the transaction documents, at the time of conversion.
However, the investors may not convert their Preferred Stock or
exercise their Warrants, and Mustang may not put shares of Common
Stock to the investors under the Equity Line of Credit, until,
among other things, Mustang obtains shareholder approval therefor
or Mustang's Common Stock is no longer listed on The Nasdaq Stock
Market.
As previously announced, the Company has been appealing to a
Listing Qualification Panel (the "Panel"), Nasdaq's decision of
June 1, 1998 to delist Mustang's Common Stock from The Nasdaq
National Market because of Mustang's noncompliance with Nasdaq's
listing maintenance requirements.. On October 12, 1998, Mustang
received notice from Nasdaq that the Panel had made a
determination of Mustang's appeal. The Panel determined to move
Mustang's Common Stock listing to The Nasdaq Small Cap Market
effective on October 15, 1998 via an exception from the net
tangible assets requirement. The Panel informed Mustang that in
order to maintain its listing on The Nasdaq SmallCap Market,
Mustang must satisfy each of the following conditions: (1) On or
before November 16, 1998, Mustang must file with the SEC and
Nasdaq its Form 10-Q for the quarter ended September 30, 1998
evidencing a minimum of $2,000,000 in net tangible assets; (2) on
or before December 2, 1998, Mustang must provide Nasdaq with
written confirmation that its shareholders have approved the plan
to permit the investors in the Financing to convert the Preferred
Stock and exercise the Warrants and permit Mustang to utilize the
Equity Line of Credit, if necessary, prior to December 31, 1998;
and (3) Mustang must be able to demonstrate compliance with all
requirements for continued listing on The Nasdaq SmallCap Market.
Nasdaq has warned Mustang that the failure to meet any of these
conditions will result in the delisting of Mustang's securities
from The Nasdaq Stock Market. Mustang believes that it can meet
these conditions, but there can be no assurance that it will do
so. If Mustang's securities should cease to be listed on The
Nasdaq SmallCap market, they may continue to be listed in the OTC
Bulletin Board.
<PAGE> 5
Nasdaq has informed Mustang that because of the conditional
listing of its Common Stock on The Nasdaq SmallCap Market, Nasdaq
is appending a fifth character, "C," to its Nasdaq Symbol.
Accordingly, effective October 15, 1998, the trading symbol of
Mustang's Common Stock will be changed from MSTG to MSTGC. Nasdaq
has informed Mustang that the "C" will be removed from the symbol
when the Panel has confirmed compliance with the terms of the
conditional listing and all other criteria necessary for
continued listing on The Nasdaq SmallCap Market.
This announcement is neither an offer to sell nor a solicitation
to buy any of Mustang's securities. The securities mentioned in
this release have not been registered under the Securities Act of
1933, as amended (the "Securities Act"), or any state securities
laws, and unless so registered, may not be offered or sold in the
United States except pursuant to an exemption from, or in a
transaction not subject to, the registration requirements of the
Securities Act and applicable state securities laws.
About Mustang Software
Mustang Software, Inc. delivers creative e-mail management
solutions through a combination of the company's unique Web
Essentials tools, its unparalleled e-mail management experience
and expertise and world-class alliance partnerships. Mustang's
Web Essentials line of tools includes the award-winning Internet
Message Center, ListCaster and FileCenter.
The Internet Message Center was named "Best of Show" by Call
Center Magazine at CT Demo in November 1997, "Best of Show" by
Computer Telephony Magazine at CT Expo in March 1998 and recently
named "Product of the Year" by Computer Telephony, Call Center,
CTI and Internet Telephony magazines.
Mustang Software's corporate headquarters is located at 6200 Lake
Ming Road, Bakersfield, Calif., 93306. Inquiries can be addressed
via voice, 805-873-2500; fax, 805-873-2599; and e-mail,
[email protected], or by visiting Mustang Software on the Web at
http://www.mustang.com.
Statements in this news release that relate to future plans,
events, expected performance in future periods and Mustang's
ability to satisfy all conditions necessary permit the continued
listing of its Common Stock on The Nasdaq SmallCap Market are
forward-looking statements and fall within the safe harbor
provisions of the Private Securities Litigation Reform Act of
1995. Actual results and performance for such periods may differ
materially. Specifically, the Financing may not provide working
capital sufficient to execute the Company's business plan and
additional financing may be required. Moreover, the failure by
shareholders to approve, or a delay in obtaining clearance from
the Securities and Exchange Commission of the Company's proxy
materials in time to obtain shareholder approval by December 2,
1998 of, the plan to permit the investors in the Financing to
convert the Preferred Stock and exercise the Warrants and permit
Mustang to utilize the Equity Line of Credit, if necessary, prior
to December 31, 1998 would prevent Mustang from meeting all of
the conditions imposed by the Panel to continue the listing of
Mustang's Common Stock on The Nasdaq SmallCap Market. While
management wishes to provide readers with reasonable opinions and
viewpoints with respect to the Company's progress, marketplace
acceptance, business opportunities, fiscal performance and other
events material to the Company, such statements, opinions and
viewpoints are forward-looking and involve risks and
uncertainties, including risks of changing conditions in the
overall economy, the capital markets, the computer and
telecommunications industries, as well as risks of changing
consumer demand and the success of the Company's business
strategies and other factors detailed in the Company's annual and
other reports filed with the Securities and Exchange Commission.
Contact: Don Leonard, Chief Financial Officer
Ph: 805.873.2500 ext. 9003
Fax: 805.873.2474
Internet: [email protected]
WWW: http://www.mustang.com
