SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
AMENDMENT TO FORM 6-K ON
FORM 8-K/A
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): November 10, 1998
OFFICELAND INC.
(Exact name of registrant as specified in its charter)
Ontario, Canada
(State or other jurisdiction of incorporation)
86732971
(Canadian Federal Tax Account No.)
312 Dolomite Drive, Suite 212
Downsview, Ontario M3J 2N2
(Address of Principal Executive Offices)
Registrant's telephone number, including area code: (416) 736-4000
Item 5 Other Events
On June 4, 1998, the Company entered into a Senior Subordinated Unsecured
Convertible Note Purchase Agreement (the "Note Agreement") with (i) each of
seven purchasers (the "June Purchasers") of the Senior Subordinated Unsecured
Convertible Notes (the "June Convertible Notes") and (ii) International Capital
Partners, Inc. ("ICP") a Connecticut corporation, the "Representative" of the
June Purchasers. Pursuant to the Note Agreement, the Company sold $2,000,000
principal amount of June Convertible Notes to the June Purchasers. The June
Convertible Notes are payable on June 4, 2001 and bear interest at the rate of
12% per annum, with interest payable in arrears on June 4, 1999 and June 4,
2000, except that if the June Convertible Notes are converted, no interest shall
be accrued or payable.
On November 10,1998, the Company entered into a Restructured Purchase
Agreement (the Restructured Purchase Agreement") with Ardara Investment Inc.
(one of the June Purchasers) ("Ardara"), ICP, four of the Company's Directors,
(James F. Kay, Marvyn Budd, Ronald Faust, and Edwin Lax) and Jack McSorley
Vice-President of the Company (collectively the "November Purchasers".) Pursuant
to Restructured Purchase Agreement, the Company sold $1,550,000 in principal
amount of new Senior Subordinated Unsecured Convertible Notes (the "November
Convertible Notes".) The November Convertible Notes are payable on November 10,
2001 and bear interest at the rate of 12% per annum, with interest payable in
arrears on November 10, 1999, and in arrears on December 10, and June 10, in the
two years subsequent to November 10, 1999, with the last interest payment to be
made on November 10, 2001, except that if the November Convertible Notes are
converted, no interest shall be accrued or payable. As part of the Restructured
Purchase Agreement, Ardara exchanged its June Convertible Note in the amount of
$571,428 for a like amount of November Convertible Notes and Ardara was give the
option to purchase an additional $600,000 of November Convertible Notes for a 60
day period following Ardara's receipt of the Company's financial statements for
the six month period ending May 31,1999.
In addition, the Company agreed, prior to July 31, 1999, to sell up to an
additional $5,000,000 principal amount of November Convertible Notes to the
November Purchasers and the November Purchasers agreed to purchase the
additional November Convertible Notes subject to certain conditions as follows:
a) $1,200,000 of November Convertible Notes will be purchased by the
November Purchasers upon the occurrence of a definitive agreement of
purchase and sale of Eastern Equipment Brokers, Inc., the terms of which
are unanimously approved by the Acquisition Committee of the Board of
Directors of the Company. The $1,200,000 purchase of the November
Convertible Notes will be made provided that the Company's gross profit
for the period (the "Period") commencing on December 1, 1997 and ending on
the date of the Company's last completed fiscal quarter is a minimum of
90% of the projected gross profit (the "PGP") for the Period. Should the
gross profit for the Period be less than 90% of the PGP, but more than 70%
of the PGP, then International Capital Partners, Inc. shall have the
option, on behalf of the November Purchasers, within 14 days from the
determination of the percentage of the PGP that the gross profit for the
Period represents, of: (i) completing the purchase of $1,200,000 in
November Convertible Notes; or, (ii) deferring the purchase to the end of
the Company's next succeeding fiscal quarter, at which time a calculation
of the percentage of
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PGP that the then gross profit of the Company represents will be made and
at which time the parties will refer to the formulae set forth in this
Paragraph to determine the obligations of the Purchasers to purchase the
additional Convertible Notes. Should the gross profit for the Period be
less than 70% of the PGP, then Representative shall have the option, on
behalf of the November Purchasers, within 14 days from the determination
of the percentage of the PGP that the gross profit for the Period
represents, of: (i) completing the purchase of $1,200,000 in November
Convertible Notes; (ii) deferring the purchase to the end of the Company's
next succeeding fiscal quarter, at which time a calculation of the
percentage of PGP that the then gross profit of the Company represents
will be made and at which time the parties will refer to the formulae set
forth in this Paragraph to determine the obligations of the November
Purchasers to purchase the additional November Convertible Notes, or;
(iii) terminating all obligations of the November Purchasers to purchase
any additional November Convertible Notes.
b) The balance of $3,450,000 in November Convertible Notes may be sold
in all or parts thereof, on such dates as may be mutually agreed
upon by the November Note Purchasers and the Company, for the
period expiring July 31,1999.
Note Convertibility
The principal amount of the June Convertible Notes, in whole, is
convertible into Units (the " A Units"), each A Unit being comprised of one
Class "A" Special Share (the "Class "A" Shares") and one warrant (the "June Note
Warrant") to purchase one Common Share. Each Class "A" Share is convertible at
any time into one Common Share. Each June Note Warrant entitles the holder to
purchase one Common Share from the Company at a price of $3.75, subject to
adjustment, during the period expiring on June 4, 2003.
In addition, upon any conversion of the June Convertible Notes, the
Company agreed to make available for sale to any of the Company's non-management
directors or their designees, upon the same terms as the Convertible Notes then
being converted, in amounts they may collectively determine, up to $500,000 in
Class "A" Shares and Note Warrants (the "Additional A Units").
The June Convertible Notes are convertible into A Units upon the
completion of the Company's audited financial statements for the fiscal year
ended November 30, 1998 as follows: (i) automatically at $3.40 per A Unit if the
Company achieves certain audited results; (ii) automatically if the Company
achieves certain audited results; or, (iii) if the Company fails to achieve
certain audited results, the June Purchasers have the option of converting at a
price of $2.72 per A Unit or, retaining the June Convertible Notes, without the
convertibility feature, and receiving, for each $10.00 in principal amount of
the Convertible Notes then outstanding, one warrant to purchase one Common Share
exercisable at $2.72 per Common Share for five years from the date of their
issue.
The principal amount of the November Convertible Notes, in whole, is
convertible into Units (the "B Units"), each B Unit being comprised of one Class
"B" Special Share (the "Class "B" Shares"), one $1.50 Warrant and one $2.00
Warrant. Each Class "B" Share is convertible at any time into one Common Share.
Each $1.50 Warrant and each $2.00 Warrant entitles the holder to purchase one
Common Share from the Company at a price of $1.50 and $2.00 respectively,
subject to adjustment, during the period ending November 10, 2003.
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The November Convertible Notes are convertible into B Units upon the
completion of the Company's audited financial statements for the fiscal year
ended November 30, 1998 as follows: (i) automatically at $3.40 per B Unit if the
Company achieves certain audited results; (ii) automatically if the Company
achieves certain audited results or, (iii) if the Company fails to achieve
certain audited results, the November Purchasers have the option of converting
at a price of $2.72 per B Unit or, retaining the November Convertible Notes,
without the convertibility feature, and receiving, for each $10.00 in principal
amount of the Convertible Notes then outstanding, one warrant to purchase one
Common Share exercisable at $2.72 per Common Share for five years from the date
of their issue.
On June 4, 1998, upon obtaining shareholders' approval, the Company filed
an amendment to its Articles of Incorporation establishing the rights,
preferences, restrictions and conditions attaching to the Class "A" Special
Shares. On November 10, 1998, upon obtaining shareholders' approval, the Company
filed an amendment to its Articles of Incorporation establishing the rights,
preferences, restrictions and conditions attaching to the Class "B" Special
Shares.
On November 9, 1998, in connection with the Restructured Purchase
Agreement, the Company entered into a Loan Amending Agreement with each of
Marvyn A. Budd, Ronald J. Faust and Edwin S. Lax amending the loan agreements
dated June 4, 1998 between the Company and each of Messrs. Budd, Faust and Lax.
Item 7 Exhibits
1. Articles of Amendment to the Articles of Incorporation of the
Company, filed on May 12, 1998 *
2. Articles of Amendment to the Articles of Incorporation of the
Company, filed on June 4, 1998 *
3. Senior Subordinated Unsecured Convertible Notes Purchase Agreement,
dated as of June 4, 1998 *
4. Form of Senior Subordinated Unsecured Convertible Note *
5. Form of Note Warrant *
6. Voting Trust Agreement, dated as of June 4, 1998 *
7. Loan Agreements, dated as of June 4, 1998, between the Company and
each of Marvyn Budd, Ronald J. Faust, and Edwin (Ted) Lax *
8. Employment contracts with each of Marvyn Budd, Ronald J. Faust,
Edwin (Ted) Lax, Christopher Walker and Jack McSorley *
9. Opinion of Robbins Appleby & Taub, dated June 4, 1998 *
10. Consent of Robbins Appleby & Taub *
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11. Press release of Officeland Inc. dated June 15, 1998 announcing the
initial closing of the private placement of a maximum principal
amount of U.S. $7,000,000 Senior Subordinated Unsecured Convertible
Notes *
12. Senior Subordinated Unsecured Convertible Notes Purchase Agreement
of November 10, 1998 ("The Restructured Purchase Agreement").
13. Amending Agreement dated October 23, 1998 to Senior Subordinated
Unsecured Convertible Notes Purchase Agreement of June 4, 1998.
14. Form of Senior Subordinated Unsecured Convertible Note dated
November 10, 1998.
15. Articles of Amendment to the Articles of Incorporation of the
Company filed in November 1998.
16. Form of Common Share ($1.50) Warrant.
17. Form of Common Share ($2.00) Warrant.
18. Amending Agreement dated as of November 10, 1998 to Voting Trust
Agreement of June 4, 1998.
19. Loan Amending Agreements, dated as of November 9, 1998, between the
Company and each of Marvyn Budd, Ronald J. Faust, and Edwin (Ted)
Lax.
20. Press Release
o Previously filed on June 23, 1998 as exhibits to Report of Foreign Issuer
on Form 6-K.
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SIGNATURES
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.
OFFICELAND INC.
(Registrant)
Dated: February 9, 1999 By: /s/ Marvyn A. Budd
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Marvyn A. Budd,
Chief Executive Officer and President
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