| Gay Entertainment Television, Inc. | |||
| Proposed Ticker: | GETC | 7 East 17th Street | |
| Exchange: | NASDAQ-Small Cap Market | New York, NY 10003 | |
| Industry: | Service (SIC Code 7812) | (212) 255-8824 | |
| # of Employees: | 1 | ||
| Type of Shares: | Common Shares | Filing Date: | 10/1/97 | |
| U.S. Shares Filed: | 2,350,000 | Filing Price: | $4.25 | |
| Non-U.S. Shares Filed: | 0 | Offering Amount: | $9,987,500 | |
| Primary Shares: | 2,350,000 | Expenses: | $280,000 | |
| Secondary Shares: | 0 | Shares Out After: | 5,125,000 |
| Manager | Tier | Phone |
| Agean Group, Inc. The | Lead Manager |
| Issuer's Law Firm: | Atlas, Pearlman, Trop & Borkson |
| Bank's Law Firm: | Dreier & Baritz |
| Auditor: | Spear, Safer, Harmon & Co., P.A. |
| Registrar/Transfer Agent: | American Stock Transfer & Trust Co |
Dollar amounts in U.S. millions except for per share data | |||||
| 8 Month Ending Financials | |||||
| Full Year Audited Income | Latest Unaudited Income | Prior Unaudited Income | Balance Sheet | ||
| 10/31/96 | 6/30/97 | 6/30/96 | 6/30/97 | ||
| Revenue: | $0.07 | $0.01 | $0.05 | Assets: | $0.00 |
| Net Income: | -$0.04 | -$0.02 | -$0.02 | Curr Assets: | $0.00 |
| EPS: | -$0.02 | -$0.01 | -$0.01 | Liabilities: | $0.17 |
| Prior EPS: | -$0.01 | -$0.01 | Curr Liabilities: | $0.10 | |
| Cash Flow/Oper: | -$0.03 | $0.00 | $0.01 | Equity: | -$0.16 |
| Cash Flow/Fin: | $0.04 | Cash: | $0.00 | ||
| Cash Flow/Inv: | Working Cap: | -$0.10 | |||
| Business Description |
| The company was organized to create and develop a cable television network and television channel devoted to informing, educating, and entertaining the public concerning the gay and lesbian lifestyle. While the Company expects that much of its viewership will be comprised of members of the gay and lesbian population, management also believes that quality programming about the gay and lesbian lifestyle will be attractive to many other segments of the television audience. The company, a development stage company, had limited operations since its inception in November 1992 as a New York corporation and continuing through December 1996. The Company ceased its activities in December 1996 and since then, while not generating any revenues, has sought to develop and enhance its original programming concept. |
| Competition |
| The Company will face intense competition for a finite amount of viewership from numerous other businesses in the entertainment industry. In particular, the television programming market is intense and the Company's programming will compete for distribution on cable systems, for viewers and for advertising revenue with hundred of cable and broadcast television networks supplying a variety of entertainment programming. The Company will also compete with various forms of entertainment which provide similar types of programming,including movies, video and audio cassettes, broadcast television, cable programming, special pay-per-view events, sporting events and other forms of entertainment which may be less expensive or provide other advantages to the Company's viewers. The Network and Channel will compete directly with other networks and channels, many of which have a substantial number of viewers, and who are substantially larger, better capitalized, more established and have greater access to resources necessary to produce a competitive advantage. Additionally, the Company will also compete for advertising dollars with traditional media. While the Company believes that GET will be the only Network and Channel of its kind, there can be no assurances that other companies are not developing or will not seek to develop similar networks. If GET is successful, it is possible that other companies may seek to enter or capitalize on such market and compete directly with the Company. Many of these companies have substantially greater financing, personnel, technical and other resources than the Company and have well-established reputations for success in the development, promotion and marketing of entertainment events. There can be no assurance that the Company will be able to compete successfully. Moreover, initially, the Company will compete with other networks and infomercials who also seek to lease cable access in favorable time slots and on specific dates. Many of these networks are better capitalized and may have more leverage to negotiate for these limited numbers of time slots. To the extent that the Company is unable to purchase leased access on terms and conditions favorable to the Company, or to purchase leased access for critical time slots, this inability could have a material impact on the Company's profitability. The Company is prepared, however, to explore other means of distribution to build its viewership should the Company be unable to clear certain leased access markets. It is possible that the Company will buy time on UHF (local low frequency broadcast) or via local satellite distribution on a limited basis. Furthermore, because the Company is unable to protect its concept of a network targeted at the gay and lesbian lifestyle, there can be no assurances that other companies who may, among other things, have more experience and be better capitalized, may not also develop programming targeted at the same market. |
| Business Plan |
| The Company's strategy is (i) to commence broadcasting of six hours of programming per week focusing on issues relating to the gay and lesbian lifestyles on channels available to targeted markets within six (6) months of the closing of this Offering, (ii) to provide twenty-four hour programming on a dedicated channel through GET within three years from the closing of this Offering, and (iii) to establish a website to complement its programming. In particular, the Company expects that the website will (a) help to promote programming and viewership of the Network and Channel, (b) provide a forum for the advertisement, promotion, purchase of, and participation in, gay and lesbian themed events, vacations, products and services and local and regional periodicals, and (c) provide a forum for the expression of, and response to, current events and issues that impact the gay and lesbian community. |
| Use of Proceeds |
| The proceeds from the proposed offering will be used for production costs, leased access, salaries, acquired programming, repayment of loans, website development, facilities, and working capital and general corporate purposes. |
| Name of Shareholder | % Owned Before | % Owned After |
| Marvin A. Schwam | 74.80% | 40.50% |
| David Mayer | 6.70% | 3.60% |
| Richard Moorehead | 6.30% | 3.40% |
| Officer Name | Title | Age |
| Marvin A. Schwam | Chairman of the Board and Chief Executive Officer | 55 |
| Joseph F. Lovett | Executive Vice President, Programming and Production | 52 |
| Jim Arnoff | Senior Vice President, ProgramDevelopment and Acquisitions | 47 |
| Michael Ingersoll | Senior Vice President, Public Affairs | 47 |
| Additional Underwriter Compensation |
| Warrant to purchase 235,000 shares/units at a nominal price. |
| Exercise price of $5.10 for 3 year(s), 0 year(s) from . |
| $105,000.00 consulting agreement for 3 year(s). |
| # of Units: | 2,350,000 | |||
| Unit Ticker: | GETU | Unit Price: | $4.25 | |
| Warrant Ticker: | GETW | Warrant Price: | ||
| Warrant Exercise Date: | Warrant Exercise Price: | $5.25 | ||
| Warrant Expiration Date: | ||||
| Warrant Detachable: | No | |||
| Warrant Callable: | Yes | Warrant Call Date: |
| Unit Composition: 1 Common Share + 2 Warrants |
| Warrant Entitlement: 1/2 Common Share |
| Warrants are callable at $0.05 if the common stock trades at $6.50 for 20 of 20 consecutive trading days. |