Sands brothers & Co., LTD was to provide investment|
banking services to qgly. the agreement was oct 1,1996
I guess george longo was not around to veto that plan.
On October 1, 1996, the Company entered into an agreement with Sands Brothers
& Co., Ltd, ("Sands") to assist the Company raise additional capital and to
provide other investment banking services. For this service, Sands received
800,000 warrants at an exercise price of $1.75. Subsequently, this contract,
was modified in November 1996, and stipulated Sands had the conditional right
to purchase, at $10 per share, 200,000 shares of the Company's stock, for
every million dollars they identify for the Company in a private placement of
the Company's Stock pursuant to Regulation D. The Company desired that the
private placement was not to exceed $10 million. During the first quarter of
1997, the Company decided not to pursue a private placement offering.
Therefore, the aforementioned possible additional warrants for Sands will not
However, in order to terminate this arrangement with Sands, the Company issued
to Sands 350,000 additional warrants to purchase the Company's stock at $10
per share. Accordingly, a provision for loss of $700,000 ($417,000 net of
taxes) for a total of 1,150,000 warrants issued to Sands, and other expenses
expected to be incurred, was charged against earnings.