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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Schedule 13D**
Under the Securities Exchange Act of 1934
(Amendment No. 2)*
Coyote Sports, Inc.
(Name of Issuer)
Common Stock, Par Value $0.001 Per Share
(Title of Class of Securities)
224071100
(Cusip Number)
Mr. Mark A. Pappas
307 West Seventh Street
Suite 1210
Fort Worth, Texas 76102
(817) 810-0014
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
January 27, 1999
(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G
to report the acquisition which is the subject of this Schedule 13D, and is
filing this schedule because of Rule 13d-1(b)(3) or (4), check the following box
[ ].
*The remainder of this cover page shall be filled out for a reporting person's
initial filing on this form with respect to the subject class of securities, and
for any subsequent amendment containing information which would alter
disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be deemed
to be "filed" for the purpose of Section 18 of the Securities Exchange Act of
1934 ("Act") or otherwise subject to the liabilities of that section of the Act
but shall be subject to all other provisions of the Act (however, see the
Notes).
**The total number of shares of Stock reported herein is 1,207,692 shares, which
constitutes approximately 21.4% of the 5,630,692 shares of Stock outstanding.
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1. Name of Reporting Person:
Paragon Coyote Texas Ltd.
2. Check the Appropriate Box if a Member of a Group:
(a) / /
(b) / X /
3. SEC Use Only
4. Source of Funds: OO
5. Check box if Disclosure of Legal Proceedings is Required Pursuant to Items
2(d) or 2(e):
/ /
6. Citizenship or Place of Organization: Texas
7. Sole Voting Power: 1,207,692 (1)(2)
Number of
Shares
Beneficially 8. Shared Voting Power: -0-
Owned By
Each
Reporting 9. Sole Dispositive Power: 1,207,692 (1)(2)
Person
With
10. Shared Dispositive Power: -0-
11. Aggregate Amount Beneficially Owned by Each Reporting Person:
1,207,692 (2)
12. Check Box if the Aggregate Amount in Row (11) Excludes Certain Shares:
/ /
13. Percent of Class Represented by Amount in Row (11): 21.4%
14. Type of Reporting Person: PN
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(1) Power is exercised through its sole general partner, Paragon Management
Group, Inc.
(2) Assumes exercise in full of Paragon Coyote Texas Ltd.'s option to acquire
up to 521,739 shares of the Stock. See Item 6.
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1. Name of Reporting Person:
Paragon Management Group, Inc.
2. Check the Appropriate Box if a Member of a Group:
(a) / /
(b) / X /
3. SEC Use Only
4. Source of Funds: Not Applicable
5. Check box if Disclosure of Legal Proceedings is Required Pursuant to Items
2(d) or 2(e):
/ /
6. Citizenship or Place of Organization: Texas
7. Sole Voting Power: 1,207,692 (1)(2)(3)
Number of
Shares
Beneficially 8. Shared Voting Power: -0-
Owned By
Each
Reporting 9. Sole Dispositive Power: 1,207,692 (1)(2)(3)
Person
With
10. Shared Dispositive Power: -0-
11. Aggregate Amount Beneficially Owned by Each Reporting Person:
1,207,692 (2)(3)
12. Check Box if the Aggregate Amount in Row (11) Excludes Certain Shares:
/ /
13. Percent of Class Represented by Amount in Row (11): 21.4%
14. Type of Reporting Person: CO
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(1) Acting through its President, Mark A. Pappas.
(2) Solely in its capacity as the sole general partner of Paragon Coyote Texas
Ltd.
(3) Assumes exercise in full of Paragon Coyote Texas Ltd.'s option to acquire
up to 521,739 shares of the Stock. See Item 6.
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1. Name of Reporting Person:
Mark A. Pappas
2. Check the Appropriate Box if a Member of a Group:
(a) / /
(b) / X /
3. SEC Use Only
4. Source of Funds: Not Applicable
5. Check box if Disclosure of Legal Proceedings is Required Pursuant to Items
2(d) or 2(e):
/ /
6. Citizenship or Place of Organization: USA
7. Sole Voting Power: 1,207,692(1)(2)
Number of
Shares
Beneficially 8. Shared Voting Power: -0-
Owned By
Each
Reporting 9. Sole Dispositive Power: 1,207,692(1)(2)
Person
With
10. Shared Dispositive Power: -0-
11. Aggregate Amount Beneficially Owned by Each Reporting Person:
1,207,692 (1)(2)
12. Check Box if the Aggregate Amount in Row (11) Excludes Certain Shares:
/ /
13. Percent of Class Represented by Amount in Row (11): 21.4%
14. Type of Reporting Person: IN
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(1) Solely in his capacity as the President of Paragon Management Group, Inc.
(2) Assumes exercise in full of Paragon Coyote Texas Ltd.'s option to acquire
up to 521,739 shares of the Stock. See Item 6.
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Pursuant to Rule 13d-2(a) of Regulation 13D-G of the Rules and
Regulations under the Securities Exchange Act of 1934, as amended, the
undersigned hereby amend their Schedule 13D Statement dated March 30, 1998, as
amended by Amendment No. 1 thereto dated October 13, 1998, relating to the
common stock, par value $0.001 per share (the "Stock"), of Coyote Sports, Inc.,
a Nevada corporation (the "Issuer").
Item 1. SECURITY AND ISSUER.
No material change.
Item 2. IDENTITY AND BACKGROUND.
No material change.
Item 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
Item 3 hereby is amended in its entirety to read as follows:
The source and amount of the funds used or to be used by the Reporting
Persons to purchase shares of Stock are as follows:
REPORTING PERSON SOURCE OF FUNDS AMOUNT OF FUNDS
The Partnership (1) $ 1,000,000(1)
(2) $ 3,600,000(3)
(4) See Item 6.
Paragon Not Applicable Not Applicable
MAP Not Applicable Not Applicable
(1) 307,692 of the shares of the Stock reported herein as directly
owned by the Partnership were issued in connection with the $6,000,000
loan that the Partnership made to the Issuer. See Item 6.
(2) The source of the funds to be used by the Partnership to
exercise part or all of the Unifiber Option, assuming such exercise, has
not yet been determined. See Item 6.
(3) The indicated amount assumes exercise in full of the Unifiber
Option at the price of $6.90 per share of Stock. See Item 6.
(4) 378,261 of the shares of the Stock reported herein as directly
owned by the Partnership were issued in connection with the Consulting
Agreement. See Item 6.
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Item 4. PURPOSE OF TRANSACTION.
No material change.
Item 5. INTEREST IN SECURITIES OF THE ISSUER.
Paragraphs (a) through (c) of Item 5 hereby are amended in their
entirety to read as follows:
(a)
The Partnership
The aggregate number of shares of the Stock that the Partnership owns
beneficially, pursuant to Rule 13d-3 of the Act, is 1,207,692, which constitutes
approximately 21.4% of the outstanding shares of the Stock.
Paragon
Because of its position as the sole general partner of the Partnership,
Paragon may, pursuant to Rule 13d-3 of the Act, be deemed to be the beneficial
owner of 1,207,692 shares of the Stock, which constitutes approximately 21.4% of
the outstanding shares of the Stock.
MAP
Because of his position as the President of Paragon, MAP may, pursuant
to Rule 13d-3 of the Act, be deemed to be the beneficial owner of 1,207,692
shares of the Stock, which constitutes approximately 21.4% of the outstanding
shares of the Stock.
To the best of the knowledge of each of the Reporting Persons, other
than as set forth above, none of the persons named in Item 2 herein is the
beneficial owner of any shares of the Stock.
(b)
The Partnership
Acting through its sole general partner and assuming exercise in full
of the Unifiber Option, the Partnership has the sole power to vote or to direct
the vote or to dispose or to direct the disposition of 1,207,692 shares of the
Stock.
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Paragon
Acting through its President and assuming exercise in full of the
Unifiber Option, and in its capacity as the sole general partner of the
Partnership, Paragon has the sole power to vote or to direct the vote or to
dispose or to direct the disposition of 1,207,692 shares of the Stock.
MAP
In his capacity as Paragon's President and assuming exercise in full of
the Unifiber Option, MAP has the sole power to vote or to direct the vote or to
dispose or to direct the disposition of 1,207,692 shares of the Stock.
(c) Except as set forth in Item 6 of this Schedule 13D, to the best of
the knowledge of each of the Reporting Persons, none of the persons named in
response to paragraph (a) has effected any transactions in the Stock during the
past 60 days.
(d)-(e) No material change.
Item 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT
TO SECURITIES OF THE ISSUER.
Item 6 hereby partially is amended by adding at the end thereof the
following:
On January 27, 1999, but effective as of December 30, 1998, the Issuer
and the Partnership, among others, entered into the First Amendment to Loan
Agreement, which is filed herewith as Exhibit 10.10 (the "First Amendment"). The
description that follows of the First Amendment is not, and does not purport to
be, complete, and is qualified in its entirety by reference to such Exhibit
10.10.
Pursuant to the First Amendment, Section 4.13 of the Loan Agreement has
been amended to change the first reset date (as described therein) from the
first anniversary of the closing under the Loan Agreement to December 30, 1998
and, pursuant to the formula set forth in such Section 4.13, the Issuer has
issued to the Partnership an additional 144,427 shares of the Stock effective as
of such date.
Except as set forth herein or in the Exhibits filed or to be filed
herewith, there are no other contracts, arrangements, understandings or
relationships with respect to the Stock owned by the Reporting Persons.
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Item 7. MATERIAL TO BE FILED AS EXHIBITS.
Item 7 hereby partially is amended by adding at the end thereof the
following:
Exhibit 10.10 -- First Amendment to Loan Agreement effective as of December
30, 1998, by and among Coyote Sports, Inc., Mel S.
Stonebraker, James M. Probst and Paragon Coyote Texas Ltd.
Exhibit 99.1 -- Agreement pursuant to Rule 13d-1(f)(1)(iii).
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After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.
Dated: February 5, 1999
PARAGON COYOTE TEXAS LTD.,
a Texas limited partnership
By: Paragon Management Group, Inc.,
a Texas corporation, General Partner
By: /s/ Mark A. Pappas
Mark A. Pappas, President
PARAGON MANAGEMENT GROUP, INC.,
a Texas corporation
By: /s/ Mark A. Pappas
Mark A. Pappas, President
/s/ Mark A. Pappas
MARK A. PAPPAS
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EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT DESCRIPTION
<S> <C>
10.1 Loan Agreement dated as of March 19, 1998 by and among Coyote
Sports, Inc., Mel S. Stonebraker, James M. Probst and Paragon
Coyote Texas Ltd., previously filed with the Schedule 13D
Statement dated March 30, 1998.
10.2 $6,000,000 Promissory Note dated as of March 19, 1998 made by
Coyote Sports, Inc. in favor of Paragon Coyote Texas Ltd.,
previously filed with the Schedule 13D Statement dated March
30, 1998.
10.3 Registration Rights Agreement dated as of March 19, 1998 by
and between Coyote Sports, Inc. and Paragon Coyote Texas Ltd.,
previously filed with the Schedule 13D Statement dated March
30, 1998.
10.4 Security Agreement dated as of March 19, 1998 by and between
Mel S. Stonebraker, as Pledgor, and Paragon Coyote Texas Ltd.,
as Secured Party, previously filed with the Schedule 13D
Statement dated March 30, 1998.
10.5 Security Agreement dated as of March 19, 1998 by and between
James M. Probst, as Pledgor, and Paragon Coyote Texas Ltd., as
Secured Party, previously filed with the Schedule 13D
Statement dated March 30, 1998.
10.6 Section 3 Agreement dated as of March 19, 1998 by and among
Robert W. Tennent, Special Trustee of the Tennent Family Trust
dated as of November 20, 1989, Coyote Sports, Inc. and Paragon
Coyote Texas Ltd., previously filed with the Schedule 13D
Statement dated March 30, 1998.
10.7 $6,000,000 Promissory Note dated as of March 19, 1998 made by
Paragon Coyote Texas Ltd. in favor of Don & Marty Management
Group, Inc., previously filed with the Schedule 13D Statement
dated March 30, 1998.
10.8 Pledge Agreement dated as of March 19, 1998 by and between
Paragon Coyote Texas Ltd., as Pledgor, and Don & Marty
Management Group, Inc., as Secured Party, previously filed
with the Schedule 13D Statement dated March 30, 1998.
10.9 Consulting Agreement dated as of October 7, 1998 by and
between Coyote Sports, Inc. and Paragon Coyote Texas Ltd.,
previously filed with Amendment No. 1 to the Schedule 13D
Statement dated October 13, 1998.
10.10 First Amendment to Loan Agreement effective as of December 30,
1998, by and among Coyote Sports, Inc., Mel S. Stonebraker,
James M. Probst and Paragon Coyote Texas Ltd., filed herewith.
99.1 Agreement pursuant to Rule 13d-1(f)(1)(iii), filed herewith.
</TABLE>
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EXHIBIT 10.10
FIRST AMENDMENT TO LOAN AGREEMENT
THIS FIRST AMENDMENT TO LOAN AGREEMENT (this "Amendment") is made and
entered into as of December 30, 1998, by and among Coyote Sports, Inc., a Nevada
corporation (the "Borrower"), Mel S. Stonebraker, the Chairman of the Borrower's
board of directors ("Stonebraker"), James M. Probst, the Chief Executive Officer
and President and a director of the Borrower (jointly with Stonebraker, the
"Shareholders"), and Paragon Coyote Texas Ltd., a Texas limited partnership
whose principal executive offices are located at 307 West Seventh Street, Suite
1210, Fort Worth, Texas 76102 (the "Lender").
RECITALS
WHEREAS, the parties entered into that certain Loan Agreement dated as
of March 19, 1998 (the "Loan Agreement"); and
WHEREAS, the parties wish to amend the Loan Agreement as set forth
below.
NOW, THEREFORE, in consideration of the premises and of other good and
valuable consideration, the receipt and sufficiency of which the parties hereby
acknowledge, the parties hereby agree as follows:
1. Section 4.13 of the Loan Agreement hereby is amended in its
entirety to read as follows:
"Section 4.13. First Reset Date. In the event that, on December
30, 1998, any principal of the Loan remains unpaid and the aggregate
value of the Initial Consideration Shares (the "Aggregate First Reset
Value"), based on the per-share closing price of the Common Stock on
December 29, 1998 as quoted on the NASDAQ Small Cap market system (the
"Per-Share First Reset Value"), is less than $1,000,000, then the
Borrower promptly shall deliver to the Lender, at the Borrower's
option, either (a) an amount in cash equal to (i) $1,000,000 less (ii)
the Aggregate First Reset Value (the "Aggregate First Reset Value
Difference") or (b), free of any and all encumbrances (other than
restrictions on transfer imposed by applicable securities laws), such
number of shares validly-issued, fully-paid and nonassessable shares of
Common Stock as are equal to (i) the Aggregate First Reset Value
Difference divided by (ii) the Per-Share First Reset Value."
2. As amended hereby, the Loan Agreement shall remain in full force
and effect.
3. This Amendment may be executed in one or more counterparts, each
of which shall be an original and all of which taken together shall constitute
one and the same instrument.
First Amendment to Loan Agreement
(Paragon Coyote Texas Ltd./Coyote Sports, Inc.)
As of December 30, 1998 - Page 1 of 2
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Signatures exchanged by facsimile shall be deemed to constitute original,
manually-executed signatures and shall be fully binding.
IN WITNESS WHEREOF, the parties have entered into this First Amendment
to Loan Agreement as of the date set forth above.
BORROWER: COYOTE SPORTS, INC.,
a Nevada corporation
By: /s/ James M. Probst
James M. Probst, Chief Executive Officer
LENDER: PARAGON COYOTE TEXAS LTD.,
a Texas limited partnership
By: Paragon Management Group, Inc.,
a Texas corporation, General Partner
By: /s/ Mark A. Pappas
Mark A. Pappas, President
SHAREHOLDERS: /s/ Mel S. Stonebraker
MEL S. STONEBRAKER
/s/ James M. Probst
JAMES M. PROBST
First Amendment to Loan Agreement
(Paragon Coyote Texas Ltd./Coyote Sports, Inc.)
As of December 30, 1998 - Page 2 of 2
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Exhibit 99.1
Pursuant to Rule 13d-1(f)(1)(iii) of Regulation 13D-G of the General
Rules and Regulations of the Securities and Exchange Commission under the
Securities Exchange Act of 1934, as amended, the undersigned agrees that the
statement to which this Exhibit is attached is filed on behalf of each of them
in the capacities set forth below.
PARAGON COYOTE TEXAS LTD.,
a Texas limited partnership
By: Paragon Management Group, Inc.,
a Texas corporation, General Partner
By: /s/ Mark A. Pappas
Mark A. Pappas, President
PARAGON MANAGEMENT GROUP, INC.,
a Texas corporation
By: /s/ Mark A. Pappas
Mark A. Pappas, President
/s/ Mark A. Pappas
MARK A. PAPPAS
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