f8k062507_redmile.htm
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
WASHINGTON,
D.C. 20549
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FORM
8-K
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PURSUANT
TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934
Date
of
Report (Date of earliest event reported): June 25, 2007
Commission
File # 000-51055
RED
MILE ENTERTAINMENT, INC.
(Exact
name of registrant as specified in its charter)
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Delaware
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20-4441647
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(State
or other jurisdiction of incorporation or organization)
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(IRS
Employer Identification Number)
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4000
Bridgeway, Suite 101
Sausalito,
CA 94965
(ADDRESS
OF PRINCIPAL EXECUTIVE OFFICES)
415-339-4240
(Registrant’s
telephone number, including area code)
NOT
APPLICABLE
(Former
name or former address, if changed since last report)
Check
the
appropriate box below if the Form 8-K filing is intended to
simultaneously
satisfy the filing obligation of the registrant under any of the following
provisions (see General Instruction A.2. below):
|_| Written
communications pursuant to Rule 425 under the Securities Act (17
CFR
230.425)
|_| Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17
CFR
240.14a-12)
|_| Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange
Act (17 CFR 240.14d-2(b))
|_| Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange
Act (17 CFR 240.13e-4(c))
ITEM
2.03 Creation of a Direct Financial Obligation or an Obligation
under an Off-Balance Sheet Arrangement of Registrant.
On
June
25 through June 27, 2007, Red Mile issued an aggregate of $2,050,000 of
Convertible Promissory Notes (the “Notes”) to a total of 19 note holders with
J.F. Mackie & Company, Ltd. acting as the placement agent (the “Agent”). All
the note holders are residents of Canada. The Notes mature on the earlier to
occur of a Sale Event, as defined below, or the one year anniversary of the
date
of issuance. A Sale Event constitutes a bona fide, negotiated
transaction or integrated series of transaction pursuant to which either: (i)
Red Mile merges or consolidates with any other non-affiliated entity or sells,
exchanges, or otherwise disposes of all or substantially all of its assets
to a
non-affiliated third party; or (ii) in which more than 50% of Red Mile’s voting
power is transferred in a private placement to one person.
In
addition, on June 25, 2007, the Company, without the assistance of the Agent,
issued a $350,000 Convertible Promissory Note to one note holder. This note
holder is also a resident of Canada. This note matures on the same terms as
the
Notes (the Notes and this additional note, the “Combined Notes”).
The
Combined Notes will automatically convert if Red Mile completes prior to
maturity an equity financing in an amount of approximately $10 million on
certain terms. In the case of such a conversion, the Combined Notes
will convert into the form of equity issued by Red Mile in that equity financing
at a price per share equal to the lowest price in that financing. Immediately
upon such conversion, the Note Holder will also receive one half of one warrant
for every share received upon conversion of the note held by such Note Holder,
exercisable at $2.75 per share for a period of 2 years from the closing date
of
such equity financing.
The
Combined Notes bear interest at the rate of 10% per annum, non-compounded,
and
the interest is payable in cash by Red Mile on the maturity date. The Agent
is to be paid a commission equal to 6% of the principal amount of the
Notes.
The
Combined Notes are subordinated obligations of Red Mile secured against all
present and after acquired assets of Red Mile.
The
Combined Notes were issued in private placement transactions to investors who
are not "U.S. persons" pursuant to the exemption from registration provided
by
Rules 901 and 903 of Regulation S under the Securities Act of 1933, as
amended.
Item 7. Financial
Statements, Pro
Forma Financial Information and Exhibits.
(a)
Financial Statements
of Businesses Acquired.
Not
applicable.
(b)
Pro Forma Financial
Statements.
Not
applicable.
(c)
Exhibits.
4.8 Form
of Convertible
Promissory Note
Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant
has
duly caused this report to be signed on its behalf by the undersigned hereunto
duly authorized.
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Red
Mile Entertainment, Inc.
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Date:
June 29, 2007
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By:
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/s/ Ben Zadik
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Name:
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Ben
Zadik
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Title:
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Chief
Financial Officer
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Description
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4.8
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Form
of Convertible Promissory Note
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