BMTM Bright Mountain Media Inc (QB)

 

 

UNITED STATES

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): January 18, 2024

 

Bright Mountain Media, Inc.

(Exact name of registrant as specified in its charter)

 

Florida

(State or other jurisdiction of incorporation)

 

000-54887		27-2977890
(Commission File Number)		(IRS Employer Identification No.)

 

6400 Congress Avenue, Suite 2050

Boca Raton, Florida 33487

(Address of principal executive offices) (Zip Code)

 

Registrant’s telephone number, including area code (760) 707-5959

 

 

(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:

 

	☐	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))

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of Each Class		Trading Symbol(s)		Name of Each Exchange on Which Registered
None		N/A		N/A

 

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

 

Emerging growth company ☐

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

 

 

 

Item 5.02. Departure of Directors or Principal Officers; Election of Directors; Appointment of Principal Officers; Compensatory Arrangements of Certain Officers.

 

On January 18, 2024, Pamela J. Parizek, a director of Bright Mountain Media, Inc. (the “Company”), notified the Company that she was resigning from the board of directors, effective immediately. At the time of her resignation, Ms. Parizek was also the Chair of the Company’s audit committee. Ms. Parizek’s resignation was prompted by a disagreement as to how to handle a matter with the Company’s lender. Over the course of several conversations and meetings, Management of the Company and the Board discussed the matter with the Company’s internal counsel and outside counsel. Pursuant to its standard procedures, outside SEC counsel recommended to the Board that the Company pursue the course of action that ultimately prevailed, supported by a four to one vote by the Board of Directors.

 

A copy of Ms. Parizek’s resignation letter is attached as an exhibit to this Form 8-K.

 

Item 9.01. Financial Statements and Exhibits.

 

(d) Exhibits

 

Exhibit No.		Description
17.1		Letter of Resignation of Pamela J. Parizek dated January 18, 2024
104		Cover Page Interactive Data File (embedded within the Inline XBRL document)

 

 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the Company has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

	Bright Mountain Media, Inc.
Date: January 24, 2024	By:	/s/ Matt Drinkwater
		Matt Drinkwater
		Chief Executive Officer

 

 

Exhibit 17.1

 

PAMELA J. PARIZEK

1224 Aldebaran Drive

McLean, VA 22101

 

January 18, 2024

 

To:	Board of Directors
	Bright Mountain Media, Inc.

 

I hereby submit my resignation as a member of the Board of Directors of Bright Mountain Media, Inc. (“BMTM” or the “Company”).

 

This action was and is prompted by the Board’s decision to authorize the Company to execute a release of liability for all known and unknown claims, past or future, against Centre Lane Partners Master Credit Fund II, LP (the “Lender”), without legal advice on the implications of the release vis-à-vis our fiduciary responsibilities as Board members to preserve all assets of the Company for the benefit of all stakeholders – particularly in the event of a voluntary or involuntary corporate restructuring.

 

In the past, I have raised with the Board my concerns about the level of dominion and control exercised by the Lender in connection with material transactions and business decisions. The Board’s decision tonight to yield what the Company’s own counsel described as an “aggressive” and “obnoxious” demand by the Lender to execute a full release or receive a default letter, is a case in point.

 

My understanding of the facts and circumstances surrounding this release is that the Company’s CFO learned that the Company had not executed Deposit Account Control Agreements (“DACA”) on all of its bank accounts as required by certain amendments to its credit agreement(s) with the Lender, and proactively reported and cured the technical defaults to the Lender. In response, the Lender documented the cure and then demanded the Company to execute a full release of any and all claims, known or unknown, past and future against the Lender. At an emergency meeting held yesterday, I expressed the view that the Board required legal advice before authorizing management to execute the release. When management communicated that request to the Lender, the Lender declared its intention to issue the Company a default letter on its obligations. Under duress from the Lender, the majority of Board members – citing business judgment – determined to give in to the Lender’s unreasonable demand.

 

My concerns regarding the Lender, which have been communicated to the Board and management, are summarized as follows:

 

	1.	The Company requires a capital restructuring to provide the shareholders with an opportunity of a value recovery of the equity securities issued by the Company.
	2.	The Company has not been pursuing such a capital restructuring because it has been and is acting, as a practical matter, at the direction of the Lender, whose motives are not aligned with those of the Company and its other stakeholders.

 

 

	3.	The Lender, which is a credit fund with less than $250 million of capital under management based on public reports (and over 25% invested in BMTM), appears to be encouraging the Company to avoid a capital restructuring because such a restructuring would require a substantial write-down (or mark-to-market) of its investment in the Company, given that such a mark-to-market would substantially impair the overall value of the Lender, given the concentration of the Lender’s investment in the Company vis-à-vis the investor capital committed to the Lender itself.
	4.	There is no existing equity security interest value in the Company.
	5.	If the Lender’s senior secured collateral interest is not set aside by an equitable subordination claim (brought by unsecured creditors) in bankruptcy court or otherwise, whatever value that is remaining in the Company’s assets or enterprise belongs to the Lender. It appears that the only reason the Lender is not enforcing its rights to its collateral and taking ownership control thereof is its avoidance of an accurate mark-to-market of its investment in the Company.
	6.	Public shareholders that purchase shares of the Company’s stock are purchasing securities whose future value is dependent on a capital restructuring, which is not clearly disclosed in the Company’s public filings.

 

Simply put, the Company has disclosed the factors that show the necessity of the Company to restructure its debt to continue as a going concern. I have urged the Board to pursue such a restructuring. The Board has not agreed to engage restructuring professionals and to date, management has not engaged in restructuring negotiations with the Lender. Instead, the Board and management have relinquished any and all claims against the Lender based on the Lender’s threat to issue a default letter in response to good faith actions taken by the Company.

 

Given the current disagreement between management, the Board members, and me as to how best to preserve value and exercise our fiduciary duties as Board members, I have no choice but to resign from the Board of Directors, effective immediately.

 

I wish each of you and the Company the best in your future endeavors.

 

Respectfully,

 

Pam

 

v3.23.4

Cover	Jan. 18, 2024
Cover [Abstract]
Document Type	8-K
Amendment Flag	false
Document Period End Date	Jan. 18, 2024
Entity File Number	000-54887
Entity Registrant Name	Bright Mountain Media, Inc.
Entity Central Index Key	0001568385
Entity Tax Identification Number	27-2977890
Entity Incorporation, State or Country Code	FL
Entity Address, Address Line One	6400 Congress Avenue
Entity Address, Address Line Two	Suite 2050
Entity Address, City or Town	Boca Raton
Entity Address, State or Province	FL
Entity Address, Postal Zip Code	33487
City Area Code	760
Local Phone Number	707-5959
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Entity Emerging Growth Company	false

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