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: January 29, 1998
COVENTRY INDUSTRIES CORP.
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(Exact name of registrant as specified in its charter)
FLORIDA 000-22653 65-0353816
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(State or other (Commission (IRS Employer
jurisdiction of File Number) Identification
incorporation) Number)
7777 Glades Road, Suite 211
Boca Raton, Fl 33434
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(Address of executive offices and Zip Code)
Registrant's telephone number, including area code: 561-488-4802
not applicable
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(Former name or former address, if changed since last report)
Item 5. Other Events.
On January 16, 1998 Coventry Industries Corp., a Florida corporation
(the "Company") sold 1,750 shares of its 5% Convertible Preferred Stock
("Preferred Stock"), at a purchase price of $1,000 per share, to an unaffiliated
third party in a private transaction exempt from registration under the
Securities Act of 1933, as amended (the "Act") in reliance on Section 4(2)
thereof and Regulation D promulgated thereunder. The designations, rights and
preferences of the Preferred Stock, which are included as Exhibit 3(i) to Item
7.(c) of this Report, generally provide that (i) the shares of Preferred Stock
have no voting rights, (ii) the holders receive cumulative dividends at the rate
of $50 per share per annum, payable in cash or stock at the Company's option,
(iii) in the event of a liquidation, dissolution or winding up of the Company,
the holders receive a liquidation preference of $1,000 per share of Preferred
Stock plus any accrued but unpaid dividends, and (iv) the shares of Preferred
Stock are convertible at the holder's option into shares of common stock at a
conversion price determined by dividing the liquidation value of $1,000 per
share by the conversion price, i.e., 80% of the average closing bid price of the
common stock as report on The Nasdaq SmallCap Market for the five (5) trading
days immediately preceding the date of conversion. The Company has agreed to
register the shares of Common Stock underlying the Preferred Stock (the
"Registerable Securities") under the Act in a registration statement on Form S-3
to be filed with the Securities and Exchange Commission (the "Commission") no
later than 30 days from the closing date of the transaction. In the event such
registration statement is not declared effective the Commission within 121 days
from the closing date, the Company is subject to a penalty of 2% of the purchase
price per month until the effectiveness thereof.
The ability of the purchaser to convert the shares of Preferred Stock
is presently limited to a conversion of up to 526,034 shares of common stock,
being a maximum of 19.95% of the Company's currently issued and outstanding
common stock, until such time as the Company's shareholders shall have approved
the issuance of the Registerable Securities. $500,000 of the purchase price and
a certificate for 500 shares of Preferred Stock have been deposited in escrow by
the purchaser with Atlas, Pearlman, Trop & Borkson, P.A., counsel for the
Company, pending such approval. Pursuant to the terms of the private placement,
should the Company obtain shareholder approval, the purchaser shall acquire an
additional 750 shares of Preferred Stock upon the same terms and conditions. In
connection therewith, the Company will hold a special meeting of its
shareholders on March 26, 1998 for the purposes of voting on the approval of the
issuance of the Registerable Securities in excess of 19.95% of the currently
issued and outstanding shares of common stock of the Company.
In connection with this placement, the Company paid the placement agent
a fee equal to 10% of the gross proceeds plus warrants to acquire 125,000 shares
of the Company's common stock at an exercise price of $4.36 per share.
Further, on January 16, 1998 the Company acquired 750,000 shares of the
common stock of Regenesis Holdings, Inc., a Florida corporation ("Regenesis"),
representing approximately 51% of Regenesis' issued and outstanding common
stock, from a shareholder of Regenesis in a private transaction exempt from
registration under the Act in reliance upon Section 4(2) thereof. The Company
issued 75,000 shares of its restricted common stock to the seller as full
consideration for the purchase. Regenesis, a publicly-traded company (OTC
Bulletin Board: RGNS), through its
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Latour International, Inc. subsidiary owns the rights to acquire a Canadian peat
moss harvesting and processing facility in the Quebec Province. Robert Hausman,
the Company's President and Chairman of the Board, is a member of the Board of
Directors of the Regenesis and C. Lawrence Rutstein, a member of the Board of
Directors and President of Regenesis, is a member of the Board of Directors of
the Company. The transaction was approved by the Company's disinterested
directors.
Item 7. Financial Statements and Exhibits.
(a) Financial Statements of Businesses Acquired.
Not applicable.
(b) Pro forma Financial Information.
Not applicable.
(c) Exhibits.
No. Description
3(i) Designations, rights and preferences of the 5% Convertible
Preferred Stock.
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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.
Date: January 29, 1998 By: /s/ Robert Hausman
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Robert Hausman,
President and Chief Executive Officer
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