ArtistDirect the Internet music company that maintains Web sites or online stores for such musicians as Beck, 'N Sync, Beastie Boys, Metallica and Tori Amos issued more stock and options than legally allowed before its initial public offering Tuesday, according to papers the company filed Wednesday (March 29) with the Securities and Exchange Commission.
Nearly all the artists in the company's network which also includes "Other Side" (RealAudio excerpt) singers the Red Hot Chili Peppers, the Offspring, Filter, Eminem, Dr. Dre, Clint Black, B.B. King and dozens of others have been issued stock or options, according to an ArtistDirect representative who asked not to be named. Similar issuances also were made to employees.
The representative could not say immediately how the company came to overissue the securities.
In the next six months, the company said it intends to offer to buy back with interest stock and unexercised options. ArtistDirect's SEC filing states the buyback program could cost the company $19.8 million plus interest.
ArtistDirect (www.artistdirect.com) began selling stock to the public Tuesday, opening at $12 per share. On Wednesday it closed just below $8.