<PAGE> 1
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): February 20, 1998
Tollycraft Yacht Corporation
(Exact name of registrant as specified in its charter)
Nevada
(State or other jurisdiction of incorporation)
0-21087 86-0849925
(Commission File Number) (I.R.S. Employer Identification No.)
2200 Clinton Avenue, Kelso, Washington 98626
(Address of principal executive offices, including Zip Code)
(360) 423-5160
(Registrant's telephone number, including Area Code)
(Former name or former address, if changed since last report)
Item 9. Sales of Equity Securities Pursuant to Regulation S.
On February 20, 1998, the Registrant issued 2,000,000 common shares
to Manual Gomez Ramos Attorney Client Trust Account, Tijuana, Baja California,
Mexico for a US$6,000,000 promissory note in a Regulation S transaction. The
transaction is to assist in the relocation of its manufacturing and production
facility from Kelso, Washington to Mexico. Tollycraft will continue to
maintain its executive and sales office in the United States which is
anticipated to move to Florida by mid July of 1998.
The move will save the company an estimated $1,800,000 per year in General
and Administrative costs and will reduce its labor costs on each vessel by an
estimated 75%.
Tp;;ucraft jad prders diromg 1997 that amounted to almost $40,000,000
and yet it still was not able to produce vessels at a profit. The company
was being forced like its competitors to build larger and larger vessels
because even though there was a demand for the smaller sized yachts it
could not produce them at a profit. This move will allow Tolly to reintroduce
its 30' and 40' vessels. It will also mean that the Champagne Series of
vessels in the 70' to 120' range will be produced at a profit.
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.
TOLLYCRAFT YACHT CORPORATION
By: /s/ Peter D. Hobbs
_____________________________
Peter D. Hobbs, Chairman
Dated: February 20, 1998
