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 19, 2001
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Rich Coast Inc.
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(Exact name of registrant as specified in its charter)
Nevada 0-15859 91-1835978
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(State or other jurisdiction (Commission File No.) (I.R.S. Employer
of incorporation) Identification No.)
6011 Wyoming Avenue, Dearborn, MI 48126
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (313) 582-8866
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Item 1. Changes in Control of Registrant
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(a) On June 11, 1998, Rich Coast Inc., a Nevada corporation (the "Registrant")
issued an aggregate of $1,500,000 in 8% Convertible Debentures due June 11, 2003
(the "Debentures") to Sovereign Partners, L.P., Dominion Capital Fund Ltd. and
Canadian Advantage Limited Partnership in amounts of $500,000, $800,000 and
$200,000, respectively. Pursuant to the terms of the original Debentures, no
Debenture holder was entitled to convert that amount of Debenture in excess of
that amount upon conversion of which the sum of: (1) the number of shares of
Common Stock beneficially owned by the holder and its affiliates (other than
shares of Common Stock which may be deemed to be beneficially owned through the
ownership of the unconverted portion of the Debentures); and (2) the number of
shares of Common Stock issuable upon the conversion of the Debentures with
respect to which the determination of this provisio was being made, would result
in beneficial ownership by the holder and it's affiliates of more than 4.9% of
the outstanding shares of Common Stock of the Registrant.
Trans National Holding Limited, a corporation organized under the laws of
the Isle of Man ("TNHL") entered into a Sale and Assignment of Debentures
Agreement by and among Sovereign Partners, L.P., Dominion Capital Fund Ltd.,
Canadian Advantage Limited Partnership (collectively, the "Sellers"), and the
Registrant dated November 13, 2000 (the "Agreement"). Pursuant to the Agreement,
TNHL purchased from Sellers all of Sellers' right, title and interest in the
Debentures for a purchase price of $500,000 in cash as full consideration for
the Debentures, including any and all interest or penalties due and owing on the
Debentures, and in exchange therefor, Sellers assigned all of their right, title
and interest in and to the Debentures to TNHL. As of January 18, 2001,
$1,275,000 of principal remained outstanding under the Debentures. The
Debentures are convertible into shares of Common Stock of the Registrant at the
conversion price for each share of Common Stock equal to the lesser of (i)
$2.50, or (ii) 75% of the five day average closing bid price of the Common Stock
for the five trading days immediately preceding the conversion date of the
Debentures.
On January 19, 2001, TNHL elected to convert $1,000,000 in outstanding
principal of the Debentures into shares of Common Stock of the Registrant
according to the terms of the Debentures. The applicable conversion price was
$0.04688 (75% of the five day average closing bid price of the Common Stock for
the five trading days immediately preceding the conversion date of the
Debentures) which resulted in the conversion of the $1,000,000 in principal into
21,331,058 shares of Common Stock of the Registrant. If TNHL were to convert, on
January 19, 2001, the remaining $1,759,186 of the outstanding principal, accrued
interest and penalties under the Debentures on January 19, 2001, at the
conversion price applicable on January 19, 2001, TNHL would receive an
additional 37,525,297 shares of Common Stock of the Registrant. As a result, and
as of January 19, 2001, TNHL beneficially owned an aggregate of 58,856,355
shares of Common Stock of the Registrant consisting of 21,331,058 shares
currently outstanding and an additional 37,525,297 shares issuable upon
conversion of the remaining principal, accrued interest and penalties on the
Debentures. Immediately preceding the conversion by TNHL, 11,939,889 shares of
Common Stock of the Registrant were issued and outstanding. As a result of the
conversion and as of January 19, 2001, TNHL beneficially owns approximately
83.1% of the Registrant's issued and outstanding Common Stock.
TNHL is located in the Isle of Man and is a private shareholding company.
The directors and officers of TNHL are Samuel John Bingham, who serves as a
director and Secretary of TNHL, Jeremy Paul Bradlet Carter who serves as a
director of TNHL and Victoria Prentice who serves as a director of TNHL. Messrs.
Bingham and Carter and Ms. Prentice are British citizens, and each resides and
is employed in the Isle of Man. Desteco S.A. is the controlling entity of TNHL
and is a financial and fiduciary company organized under the laws of
Switzerland. Loretta Bianchi is the controlling shareholder of Desteco S.A., is
employed in Switzerland and is an Italian citizen.
Immediately prior to the conversion of the Debentures by TNHL on January
19, 2001, the controlling persons and entities of the Registrant (5% or greater
beneficial owners) were Finrex S.A. (f/k/a Frippoma S.A.), a corporation
organized under the laws of Switzerland ("Finrex"), which beneficially owned
approximately 23.1% of the Registrant's issued and outstanding Common Stock;
Robert W. Truxell, Secretary and Chairman of the Board of the Registrant and
Linda C. Truxell who together beneficially owned approximately 8.75% of the
Registrant's issued and outstanding Common Stock; James P. Fagan, Chief
Executive Officer, President and a director of the Registrant, who beneficially
owned approximately 5.46% of the Registrant's issued and outstanding Common
Stock; and Alan Moore, who beneficially owned approximately 12.72% of the
Registrant's issued and outstanding Common Stock.
As a result of the conversion of Debentures by TNHL, and as a result of
sales of shares by Finrex in January 2001, Finrex beneficially owns 2,525,500
shares, or approximately 7.6% of the Registrant's issued and outstanding Common
Stock. As a result of the conversion of Debentures by TNHL, as of January 19,
2001, neither Robert W. or Linda C. Truxell, James P. Fagan, nor Alan Moore
beneficially owns 5% or more of the outstanding common stock of the Registrant.
Currently, TNHL and Finrex are the only 5% or greater beneficial owners of the
Registrant.
On November 1, 1999, the Registrant granted to each of Robert W. Truxell
and James P. Fagan sufficient options to acquire up to 12.5% of the Registrant's
fully diluted ownership. These options vest after the Registrant achieves six
consecutive months with EBITDA in excess of a total of $600,000. The terms of
these options have remained unchanged, though these options are not currently
exercisable.
(b) N/A
Item 7. Financial Statements and Exhibits
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(c) Exhibits
4.1 Securities Purchase Agreement dated January 10, 1996. (P)
4.2.1 8% Convertible Debenture dated June 11, 1998. Filed herewith.
4.2.2 8% Convertible Debenture dated June 11, 1998. Filed herewith.
4.2.3 8% Convertible Debenture dated June 11, 1998. Filed herewith.
4.3 Standstill Agreement with Debenture Holders. (1)
4.4 Addendum to Standstill Agreement with Debenture Holders (1)
4.5 Loan Modification Agreement with 10% Note Holder (1)
4.6 Sale and Assignment of Debentures. Filed herewith.
4.7 Amendment to Debentures. (1)
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(1) Incorporated by reference from Registration Statement on Form S-3 on Form
SB-2, File No. 333-63289, Exhibits 10.8.1 - 10.10.
(P) Filed in paper format on August 13, 1996, under the cover of Form SE.
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 31, 2001
RICH COAST INC.
By: /s/ James P. Fagan
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James P. Fagan, President