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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 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) JUNE 20, 2000
TITAN MOTORCYCLE CO. OF AMERICA
(Exact Name of Registrant as Specified in Charter)
NEVADA 000-24477 86-0776876
(State or Other Jurisdiction (Commission (IRS Employer
of Incorporation) File Number) Identification No.)
2222 WEST PEORIA AVENUE, PHOENIX, ARIZONA 85029
(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code (602) 861-6977
(Former Name or Former Address, if Changed Since Last Report)
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ITEM 5. OTHER EVENTS.
On June 20, 2000, Titan Motorcycle Co. of America sold 650 shares of
Titan's Series C Convertible Preferred Stock and a warrant to purchase 821,053
shares of Titan's common stock to Esquire Trade & Finance Inc. and 650 shares of
Titan's Series C Convertible Preferred Stock and a warrant to purchase 821,053
shares of Titan's common stock to Celeste Trust Reg. in a private placement for
a total of $1,300,000 in gross proceeds to Titan.
Unless shareholder approval is obtained, the Series C Convertible
Preferred Stock and warrants are convertible at any time into a maximum of
1,750,000 shares of Titan's common stock for Esquire and 1,750,000 shares of
Titan's common stock for Celeste. For the first six months after issuance, the
Series C Convertible Preferred Stock is convertible at a fixed conversion price
of $.95. Thereafter, the conversion price is adjusted every three months to be
the lower of (a) 80% of the average market price for the lowest three trading
days during the last ten trading days prior to the adjustment date and (b)
either (i) the current conversion price if 80% of the average market price is
less than or equal to 200% of the current conversion price, or (ii) $.95 if 80%
of the average market price is more than 200% of the current conversion price.
The number of shares of common stock underlying the Series C Convertible
Preferred Stock is subject to adjustment for stock splits, stock dividends,
combinations, capital reorganizations and similar events relating to Titan's
common stock. Subject to certain restrictions in a subordination agreement with
Titan's bank, Wells Fargo Bank, N.A., Esquire and Celeste each have the right to
force Titan to redeem the Series C Convertible Preferred Stock at a premium upon
the occurrence of any of the following events:
1. The amount of common stock reserved for issuance upon
conversion of the Series C Convertible Preferred Stock is less
than 150% of the number of shares of common stock issuable
upon potential conversion of the Series C Convertible
Preferred Stock for 10 consecutive trading days and the
Company fails to increase the reserved amount above the 150%
threshold for 90 days thereafter;
2. The Company is unable to issue sufficient shares of common
stock upon conversion of the Series C Convertible Preferred
Stock as a result of Nasdaq Rule 4310(c)(25)(H)(i) or Rule
4460(i)(1); or
3. The Company is unable to timely deliver certificates
representing the common stock issuable on conversion of the
Series C Convertible Preferred Stock.
The net proceeds of the offering will be used for working capital and
general corporate purposes.
The terms of the private placement are set forth in full in the
Securities Purchase Agreement attached as Exhibit 10.1 to this report. The
rights and preferences of the Series C Convertible Preferred Stock are set forth
in full in the Certificate of Designations attached as Exhibit 4.1 to this
report. The warrants are subject to the terms and conditions of the warrants
attached as Exhibits 4.2 and 4.3 to this report. Under the Registration Rights
Agreement attached as Exhibit 4.5 to this report, Titan has agreed to prepare
and file with the Securities and
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Exchange Commission a registration statement covering the resale of the shares
underlying the Series C Convertible Preferred Stock and warrants.
In exchange for the waiver of certain terms and conditions related to
the placement of Titan's Series C Convertible Preferred Stock, Titan also issued
common stock purchase warrants to the Series A and Series B Convertible
Preferred Stock investors. Advantage Fund II Ltd. received a warrant to purchase
75,000 shares of Titan's common stock and Koch Investment Group Limited received
a warrant to purchase 25,000 shares of Titan's common stock. Titan will include
the 100,000 shares of Titan's common stock issuable upon exercise of these
warrants in the registration statement covering the resale of the shares
underlying the Series C Convertible Preferred Stock and warrants held by Esquire
and Celeste. If Titan is unable to include the common stock underlying the
Advantage and Koch warrants, it will file a separate registration statement
covering these shares.
Five-sixths of the warrants issued to Esquire and Celeste are
exercisable at a price of $1.69 per share; the remaining warrants issued to
Esquire and Celeste are exercisable at a price of $2.26 per share. All of the
warrants expire June 30, 2005.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS.
(c) Exhibits.
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<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
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<S> <C>
4.1 Certificate of Designations of the Series C Convertible Preferred
Stock, as filed on June 15, 2000
4.2 Warrant issued to Esquire Trade & Finance, Inc., dated June 20, 2000
4.3 Warrant issued to Celeste Trust Reg., dated June 20, 2000
4.4 Form of Warrant issued to Advantage Fund II Ltd. and Koch Investment
Group Limited, dated June 20, 2000
4.5 Registration Rights Agreement with Esquire Trade & Finance Inc. and
Celeste Trust Reg., dated as of June 20, 2000
10.1 Securities Purchase Agreement with Esquire Trade & Finance Inc. and
Celeste Trust Reg., dated as of June 20, 2000
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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.
Titan Motorcycle Co. of America
By: s:/Francis S. Keery/
Francis S. Keery
Chief Executive Officer
Dated: June 21, 2000
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<TABLE>
<CAPTION>
EXHIBIT INDEX
EXHIBIT
NUMBER DESCRIPTION OF EXHIBITS
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<S> <C>
4.1 Certificate of Designations of the Series C Convertible Preferred
Stock, as filed on June 15, 2000
4.2 Warrant issued to Esquire Trade & Finance, Inc., dated June 20, 2000
4.3 Warrant issued to Celeste Trust Reg., dated June 20, 2000
4.4 Form of Warrant issued to Advantage Fund II Ltd. and Koch Investment
Group Limited, dated June 20, 2000
4.5 Registration Rights Agreement with Esquire Trade & Finance Inc. and
Celeste Trust Reg., dated as of June 20, 2000
10.1 Securities Purchase Agreement with Esquire Trade & Finance Inc. and
Celeste Trust Reg., dated as of June 20, 2000
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