Apple cracker jack buys debt from A21. Press release of the
week Month Year :
a21, Inc. Signs Non-binding Letter of Intent with Applejack Art Partners, Inc.
Translation: A company with the dubious name of A21 (probably taken from a heavy drinking casino party) signed a non binding ( meaning its worthless) letter of intent ( meaning they might or might not do it) with Applejack ( a fruit juice company? it’s actually the name of the owner spelled backwards. Genius !!) to pay for its out of control debt.
The press release continues:
Transaction Would ( note the word “would” here. It can be replaced by IF, Maybe, Sort Of or Would Not) Result in Applejack Owning a Majority Stake in a21 ( making the company formally known as a21 now called 21applesjack)
Jacksonville, FL,( Who in their right mind has headquarters in Jacksonsville, Florida? Why not Middleof Nowhere, Arkansas ? ) July 22, 2008 . a21, Inc. (“a21”) (ATWO.OB), a leading ( in what universe?) online digital content marketplace ( new buzz word alert. No one is an agency anymore, everyone is a marketplace. The stock photo world is a giant Mall), today announced that it has entered into a non-binding Letter of Intent (LOI) with Applejack Art Partners, Inc. (Applejack). Pursuant to the LOI, Applejack would purchase all of a21s outstanding notes ( that’s another word for debt) (an aggregate principal amount of $18,000,000) from the holders of such notes and also purchase all of the shares of a21 common stock owned by a21s note holders (an aggregate of approximately 41 million shares). a21 would then exchange approximately 110 million newly issued shares of its common stock with Applejack in satisfaction of approximately $13,000,000 of such notes.( woopsie, another $13 million dollars borrowed against worthless shares)
The closing of the transactions contemplated by the LOI is subject to various conditions, including execution of definitive agreements by a21 ( ya, like they would say no. They just issued a press release even before the deal was signed), the note holders ( they want their money back, no objections here), and Applejack ( intention unknown). It is the intent of all parties to complete this transaction as described in the LOI as soon as possible.( You betya, specially those a21 guys)
In addition, on July 16, 2008, Applejack made a credit facility available to a21 pursuant to which a21 could borrow up to $500,000 with the consent of Applejack. One hundred thousand dollars has already been advanced to a21. The amounts outstanding under the credit facility bear interest at 12% per year.( they couldn’t wait for the deal so they already borrowed a hundred grand to pay the bills, or the gas for the car)
So, here is the deal in plain English:
Dude, I owe a big “aggregate principal amount” ? can you help ?
not much, about $18 million.
what do I get in exchange ?
Bro, give me a break. I ‘ll give you some of my worthless common stock if you want. How’s 151 million of them?
Dude, you rock. Can we agree to maybe agree in the future ?
Can I tell everyone that we are thinking about maybe agreeing ?
By the way, while you think about agreeing , can I borrow 100 grand ?
John Ferguson, Chief Executive Officer of a21, said, We are excited to be working with Applejack and believe the transaction should be beneficial to a21s stockholders, employees, and other stakeholders. This transaction will result in a significant reduction in a21s outstanding indebtedness and position the company to execute its growth strategy.( growth strategy that has been up to now : borrowing money to pay for a failing company)
Jack Appelman, Chief Executive Officer of Applejack, said, We are pleased to make an investment in a21 and believe that our complementary product offerings should result in greater sales opportunities and efficiency for both companies.(Good luck on this one, Appleman).
end of press release.
Please note that nowhere in this release is there any mention of photography or photographers. A21 could be selling candies, it would sound the same.
Furthermore, I am sure that all the photographers currently submitting images to SuperStock are overjoyed at the prospect of continuing not to see any sales and pleased to realize that the management is focused on confabulated financial deals rather than photo licensing.
NOW IT MAKES MUCH MORE SENSE : ( send by one of my readers)
UPDATE : On July 10, 2008, a21, Inc. (the Company”) entered into an amended and restated employment agreement with John Ferguson, the Company’s Chief Executive Officer, pursuant to which Mr. Ferguson will be entitled to receive (in addition to the compensation specified in his original employment agreement): (i) a special bonus of up to $125,000, in the event that the Company undergoes a change of control and a greater than $9,000,000 reduction in the amount of the Company’s outstanding promissory notes occurs; and (ii) an increase in the severance payments to be received in the event that Mr. Ferguson is terminated by the Company without Cause (as defined in the agreement) after a change in control of the Company from an amount equal to six (6) months salary, or $125,000, to an amount equal to twelve (12) months’ salary, or $250,000, payable over a period of one year.
as per yahoo business news