As filed with the Securities and Exchange Commission on June __, 1998
Registration No. 333-
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
____________________
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
____________________
RICH COAST INC.
(Exact name of Registrant as specified in its charter)
Delaware 91-1835978
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification Number)
10200 Ford Road
Dearborn, MI 48126
(Address of Principal Executive Offices) (Zip Code)
1997 STOCK OPTION AND STOCK BONUS PLAN
(Full title of the plan)
James P. Fagan
10200 Ford Road
Dearborn, MI 48126
(Name and Address of agent for service)
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
Proposed Proposed maximum
Title of securities Amount to maximum offering aggregate offering Amount of
to be registered be registered price per unit price registration fee
<C> <C> <C> <C> <C>
Common Stock $4,500,000 shares <F1> $.72 <F2> $3,240,000 $955.80
<FN>
<F1>
There are also registered hereunder such indeterminate number of additional
shares of Common Stock as may become subject to the Plan as a result of the
anti-dilution provisions thereof.
<F2>
Estimated solely for the purpose of calculating the registration fee, based
on the average of the high and low price ($.72) reported by NASDAQ on
May 29, 1998 (a day within five business days prior to the initial filing
hereof) pursuant to Rule 457(c).
</FN>
</TABLE>
<PAGE>
PART I
INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS
Item 1. Plan Information.
The required Plan Information is included in documents being
maintained and delivered by the Registrant as required by Rule 428 of the
Securities Act of 1933, as amended (the "Securities Act").
Item 2. Registrant Information and Employee Plan Annual Information.
The Registrant shall provide a written statement to participants
advising them of the availability, without charge, upon written or oral
request, of documents incorporated by reference in Item 3 of Part II of this
Registration Statement, which are incorporated by reference into the Section
10(a) Prospectus and of documents required to be delivered to employees
pursuant to Rule 428(b) under the Securities Act. The statement shall include
the address listing the title or department and telephone number to which the
request is to be directed.
<PAGE>
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference.
The following documents filed with the Commission by the Registrant
are incorporated into this Registration Statement by this reference:
(1) Registrant's Annual Report on Form 10-KSB for the fiscal
year ended April 30, 1997;
(2) Registrant's Quarterly Report on Form 10-QSB for the quarter
ended July 31, 1997;
(3) Registrant's Quarterly Report on Form 10-QSB for the quarter
ended October 31, 1997;
(4) Registrant's Current Report on Form 8-K dated
December 29, 1997;
(5) Registrant's Quarterly Report on Form 10-QSB for the quarter
ended January 31, 1998; and
(7) The description of the Common Stock contained in
Registrant's Current Report on Form 8-K dated February 25, 1997
and filed November 24, 1997 which amends the description of Common Stock
contained in the Registrant's Registration Statement on Form 20-F filed
under the Securities Exchange Act of 1934 (the "Exchange Act"), SEC File
No. 0-15859.
All documents filed by the Registrant pursuant to Sections 13(a),
13(c), 14 or 15(d) of the Exchange Act after the date hereof and prior to the
filing of a post-effective amendment which indicates that all shares offered
hereunder have been sold or which deregisters all securities then remaining
unsold shall be deemed to be incorporated by reference herein and to be a part
hereof from the date of filing such documents.
Item 4. Description of Securities.
No description of the class of securities to be offered is required under
this item because the class of securities to be offered is registered under
Section 12 of the Exchange Act.
<PAGE>
Item 5. Interests of Named Experts and Counsel.
None.
Item 6. Indemnification of Directors and Officers.
The Delaware General Corporation Law and the Certificate of
Incorporation of the Registrant generally provide that Registrant shall
indemnify a Director against all costs, charges and expenses, including an
amount paid to settle an action or satisfy a judgment, actually and reasonably
incurred by the Director, including an amount paid to settle an action or
satisfy a judgment in a civil, criminal or administrative action to which the
Director is a party by reason of his having been a Director, provided that the
Director was acting in good faith.
Item 7. Exemption from Registration Claimed.
Not applicable.
Item 8. Exhibits.
The following is a complete list of exhibits filed as a part of this
Registration Statement, which Exhibits are incorporated herein.
Exhibit
Number Description
4.1 Certificate of Incorporation. (A)
4.2 Bylaws. (B)
4.3 1997 Stock Option and Stock Bonus Plan. Filed herewith.
5.1 Opinion of Smith McCullough, P.C. as to the legality
of the securities registered hereby. Filed herewith.
23.1 Consent of Smith McCullough, P.C. See Exhibit 5.1.
23.2 Consent of Smythe Ratcliffe, Chartered Accountants.
Filed herewith.
(A) Incorporated by reference from Exhibit 3.1 to the Registrant's
Amendment No. 1 to Form S-4 Registration Statement, File
No. 333-6099, filed on August 6, 1996.
<PAGE>
(B) Incorporated by reference from Exhibit 3.2 to the Registrant's
Amendment No. 1 to Form S-4 Registration Statement, File No. 333-6099,
filed on August 6, 1996.
Item 9. Undertakings.
The undersigned Registrant hereby undertakes:
(a)(1) To file, during any period in which offers or sales are being made, a
post-effective amendment to this Registration Statement:
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act
(ii) To reflect in the prospectus any facts or events arising after the
effective date of this Registration Statement (or the most recent
post-effective amendment thereof) which, individually or in the aggregate,
represent a fundamental change in the information set forth in this
Registration Statement;
(iii) To include any material information with respect to the plan of
distribution not previously disclosed in the Registration Statement or any
material change to such information in the Registration Statement;
Provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) of this
section do not apply if the information required to be included in an
amendment by those paragraphs is included in periodic reports filed by the
Registrant pursuant to Section 13 or 15(d) of the Exchange Act that are
incorporated by reference in this Registration Statement.
(2) That, for the purpose of determining any liability under
the Securities Act, each such post-effective amendment shall be deemed to be
a new registration statement relating to the securities offered therein, and
the offering of such securities at that time shall be deemed to be the initial
bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the termination
of the offering.
(b) For purposes of determining any liability under the Securities
Act, each filing of the Registrant's annual report pursuant to Section 13(a)
or Section 15(d) of the Exchange Act that is incorporated by reference in the
registration statement shall be deemed to be a new Registration Statement
relating to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona fide offering
thereof.
(c) Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers and controlling persons
of the Registrant pursuant to the foregoing provisions, or otherwise, the
Registrant has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the
Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
Registrant of expenses incurred or paid by a director, officer or controlling
person of the Registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the Registrant will, unless in
the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the Act
and will be governed by the final adjudication of such issue.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
certifies that it has reasonable grounds to believe that it meets all of
the requirements for filing on Form S-8 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in Dearborn, Michigan, on June 3, 1998.
RICH COAST INC., Registrant
By:/s/ James P. Fagan
James P. Fagan, President
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
Signature Title Date
/s/ James P. Fagan President, Chief Executive Officer, June 3, 1998
James P. Fagan and Director
/s/ Robert W. Truxell Chairman, Director and Secretary June 3, 1998
Robert W. Truxell
Michael Grujicich Chief Financial Officer and June 3, 1998
Michael Grujicich Principal Accounting Officer
/s/ Thornton J. Donaldson Director June 3, 1998
Thornton J. Donaldson
/s/ George P. Nassos Director June 3, 1998
George P. Nassos
/s/ Geoffrey Hornby Director June 3, 1998
Geoffrey Hornby
<PAGE>
Exhibit 4.3
1997 Stock Option and Stock Bonus Plan
<PAGE>
RICH COAST INC.
1997 STOCK OPTION AND STOCK BONUS PLAN
(a) (1) Purposes of and Benefits Under the Plan. This 1997 Stock
Option and Stock Bonus Plan (the "Plan") is intended to encourage stock
ownership by employees, consultants and directors of Rich Coast Inc. and its
controlled, affiliated and subsidiary corporations (collectively, the
"Corporation"), so that they may acquire or increase their proprietary interest
in the Corporation, and is intended to facilitate the Corporation's efforts to
(i) induce qualified persons to become employees, officers and directors
(whether or not they are employees) and consultants to the Corporation; (ii)
compensate employees, officers, directors and consultants for services to the
Corporation; and (iii) encourage such persons to remain in the employ of or
associated with the Corporation and to put forth maximum efforts for the
success of the Corporation. It is further intended that options granted by the
Committee pursuant to Section 6 of this Plan shall constitute "incentive stock
options" ("Incentive Stock Options") within the meaning of Section 422 of the
Internal Revenue Code, and the regulations issued thereunder, and options
granted by the Committee pursuant to Sections 7 of this Plan shall constitute
"non-qualified stock options" ("Non-qualified Stock Options").
(b) Definitions. As used in this Plan, the following words and phrases
shall have the meanings indicated:
(1) "Board" shall mean the Board of Directors of the Corporation.
(c) "Committee" shall mean any Committee appointed by the Board to
administer this Plan, if one has been appointed. If no Committee has been
appointed, the term "Committee" shall mean the Board.
(d) "Common Stock" shall mean the Corporation's no par value common stock.
(e) "Disability" shall mean a Recipient's inability to engage in any
substantial gainful activity by reason of any medically determinable physical
or mental impairment that can be expected to result in death or that has
lasted or can be expected to last for a continuous period of not less than
12 months. If the Recipient has a disability insurance policy, the term
"Disability" shall be as defined therein.
(f) "Fair Market Value" per share as of a particular date shall mean the
last sale price of the Corporation's Common Stock as reported on a national
securities exchange or on the NASDAQ National Market System or by NASDAQ, if
the quotation for the last sale reported is not available for the
Corporation's Common Stock, the average of the closing bid and asked prices
of the Corporation's Common Stock as so reported or, if such quotations are
unavailable, the value determined by the Committee in accordance with its
discretion in making a bona fide, good faith determination of fair market
value. Fair Market Value shall be determined without regard to any
restriction other than a restriction which, by its terms, never will lapse.
In the case of Options and Bonuses granted at a time when the Corporation does
not have a registration statement in effect relating to the shares issuable
hereunder, the value at which the Bonus shares are issued may be determined
by the Committee at a reasonable discount from Fair Market Value to reflect
the restricted nature of the shares to be issued and the inability of the
Recipient to sell those shares promptly.
<PAGE>
(g) "Recipient" means any person granted an Option or awarded a Bonus
hereunder.
(g) "Internal Revenue Code" shall mean the United States
Internal Revenue Code of 1986, as amended from time to time (codified as
Title 26 of the United States Code) (the" Internal Revenue Code"), and any
successor legislation.
1. Administration.
(a) The Plan shall be administered by the Committee. The
Committee shall have the authority in its discretion, subject to and not
inconsistent with the express provisions of the Plan, to administer the Plan
and to exercise all the powers and authorities either specifically conferred
under the Plan or necessary or advisable in the administration of the Plan,
including the authority: to grant Options and Bonuses; to determine the
vesting schedule and other restrictions, if any, relating to Options and
Bonuses; to determine the purchase price of the shares of Common Stock
covered by each Option (the "Option Price"); to determine the persons to
whom, and the time or times at which, Options and Bonuses shall be granted;
to determine the number of shares to be covered by each Option or Bonus; to
determine Fair Market Value per share; to interpret the Plan; to prescribe,
amend and rescind rules and regulations relating to the Plan; to determine the
terms and provisions of the Option agreements (which need not be identical)
entered into in connection with Options granted under the Plan; and to make
all other determinations deemed necessary or advisable for the administration
of the Plan. The Committee may delegate to one or more of its members or to
one or more agents such administrative duties as it may deem advisable, and
the Committee or any person to whom it has delegated duties as aforesaid
may employ one or more persons to render advice with respect to any
responsibility the Committee or such person may have under the Plan.
(b) Options and Bonuses granted under the Plan shall be
evidenced by duly adopted resolutions of the Committee included in the
minutes of the meeting at which they are adopted or in a unanimous written
consent.
(c) The Committee shall endeavor to administer the Plan and
grant Options and Bonuses hereunder in a manner that is compatible with the
obligations of persons subject to Section 16 of the U.S. Securities Exchange
Act of 1934 (the "1934 Act"), although compliance with Section 16 is the
obligation of the Recipient, not the Corporation. Neither the Committee, the
Board nor the Corporation can assume any legal responsibility for a
Recipient's compliance with his obligations under Section 16 of the 1934 Act.
<PAGE>
(d) No member of the Committee or the Board shall be liable
for any action taken or determination made in good faith with respect to the
Plan or any Option or Bonus granted hereunder.
(e) It is intended that Options and Bonuses be granted pursuant to this
Plan in accordance with applicable provisions of the British Columbia
Companies Act and that all grants pursuant to this Plan be so construed.
2. Eligibility.
(a) Subject to certain limitations hereinafter set forth, Options
and Bonuses may be granted to employees (including officers) and
consultants to and directors (whether or not they are employees) of the
Corporation or its present or future divisions and Subsidiary Corporations.
In determining the persons to whom Options or Bonuses shall be granted and the
number of shares to be covered by each Option or Bonus, the Committee shall
take into account the duties of the respective persons, their present and
potential contributions to the success of the Corporation, and such other
factors as the Committee shall deem relevant to accomplish the purposes of
the Plan.
(b) A Recipient shall be eligible to receive more than one grant of
an Option or Bonus during the term of the Plan, on the terms and subject to
the restrictions herein set forth.
3. Stock Reserved.
(a) The stock subject to Options or Bonuses hereunder shall
be shares of Common Stock. Such shares, in whole or in part, may be
authorized but unissued shares or shares that shall have been or that may be
reacquired by the Corporation. The aggregate number of shares of Common
Stock as to which Options and Bonuses may be granted from time to time
under the Plan shall not exceed 4,500,000, subject to adjustment as provided
in Section 8(i) hereof.
(b) If any Option outstanding under the Plan for any reason
expires or is terminated without having been exercised in full, or if any Bonus
granted is forfeited because of vesting or other restrictions imposed at the
time of grant, the shares of Common Stock allocable to the unexercised portion
of such Option or the forfeited portion of the Bonus shall become available
for subsequent grants of Options and Bonuses under the Plan.
6. Incentive Stock Options.
(a) Options granted pursuant to this Section 6 are intended to
constitute Incentive Stock Options and shall be subject to the following
special terms and conditions, in addition to the general terms and conditions
specified in Section 8 hereof. Only employees of the Corporation shall be
entitled to receive Incentive Stock Options.
<PAGE>
(b) The aggregate Fair Market Value (determined as of the date the
Incentive Stock Option is granted) of the shares of Common Stock with respect
to which Incentive Stock Options granted under this and any other plan of the
Corporation or any Parent Corporation or Subsidiary Corporation are
exercisable for the first time by an Recipient during any calendar year may
not exceed the amount set forth in Section 422(d) of the Internal Revenue Code.
(c) Incentive Stock Options granted under this Plan are intended to
satisfy all requirements for incentive stock options under Section 422 of
the Internal Revenue Code and the Treasury Regulations thereunder and,
notwithstanding any other provision of this Plan, the Plan and all Incentive
Stock Options granted under it shall be so construed, and all contrary
provisions shall be so limited in scope and effect and, to the extent they
cannot be so limited, they shall be void.
7. Non-qualified Stock Options. Options granted pursuant to this
Section 7 are intended to constitute Non-qualified Stock Options and shall be
subject only to the general terms and conditions specified in Section 8 hereof.
8. Terms and Conditions of Options. Each Option granted pursuant to the
Plan shall be evidenced by a written Option agreement between the Corporation
and the Recipient, which agreement shall be substantially in the form of
Exhibit A hereto as modified from time to time by the Committee in its
discretion, and which shall comply with and be subject to the following terms
and conditions:
(a) Number of Shares. Each Option agreement shall state the number of
shares of Common Stock covered by the Option.
(b) Type of Option. Each Option Agreement shall specifically identify
the portion, if any, of the Option which constitutes an Incentive Stock Option
and the portion, if any, which constitutes a Non-qualified Stock Option.
(c) Option Price. Subject to adjustment as provided in Section 8 (i)
hereof, each Option agreement shall state the Option Price, which shall be
determined by the Committee subject only to the following restrictions:
(1) Each Option Agreement shall state the Option Price, which
(except as otherwise set forth in paragraphs 8(c)(2) and (3) hereof) shall
not be less than 100% of the Fair Market Value per share on the date of grant
of the Option.
(2) Any Incentive Stock Option granted under the Plan to a person
owning more than ten percent of the total combined voting power of the Common
Stock shall be at a price of no less than 110% of the Fair Market Value per
share on the date of grant of the Incentive Stock Option.
<PAGE>
(3) Any Non-qualified Stock Option granted under the Plan shall be
at a price no less than 80% of the Fair Market Value per share on the date of
grant of the Non-qualified Stock Option.
(4) The date on which the Committee adopts a resolution expressly
granting an Option shall be considered the day on which such option is
granted, unless a future date is specified in the resolution.
(d) Term of Option. Each Option agreement shall state the period during
and times at which the Option shall be exercisable, in accordance with the
following limitations:
(1) The date on which the Committee adopts a resolution expressly
granting an Option shall be considered the day on which such Option is
granted, although such grant shall not be effective until the Recipient has
executed an Option agreement with respect to such Option.
(2) The exercise period of any Option shall not exceed ten years
from the date of grant of the Option.
(3) Incentive Stock Options granted to a person owning more than
ten percent of the total combined voting power of the Common Stock of the
Corporation shall be for no more than five years.
(4) The Committee shall have the authority to accelerate or extend
the exercisability of any outstanding Option at such time and under such
circumstances as it, in its sole discretion, deems appropriate. No exercise
period may be so extended to increase the term of the Option beyond ten years
from the date of the grant.
(5) The exercise period shall be subject to earlier termination
as provided in Sections 8(f) and 8 (g) hereof, and, furthermore, shall be
terminated upon surrender of the Option by the holder thereof if such
surrender has been authorized in advance by the Committee.
(e) Method of Exercise and Medium and Time of Payment.
(1) An Option may be exercised as to any or all whole shares of
Common Stock as to which it then is exercisable, provided, however, that no
Option may be exercised as to less than 100 shares (or such number of shares
as to which the Option is then exercisable if such number of shares is less
than 100).
(2) Each exercise of an Option granted hereunder, whether in
whole or in part, shall be effected by written notice to the Secretary of
the Corporation designating the number of shares as to which the Option is
being exercised, and shall be accompanied by payment in full of the Option
Price for the number of shares so designated, together with any written
statements required by, or deemed by the Corporation's counsel to be
advisable pursuant to, any applicable securities laws.
<PAGE>
(3) The Option Price shall be paid in cash, or in shares of Common
Stock having a Fair Market Value equal to such Option Price, or in property
or in a combination of cash, shares and property and, subject to approval of
the Committee, may be effected in whole or in part with funds received from
the Corporation at the time of exercise as a compensatory cash payment.
(4) The Committee shall have the sole and absolute discretion to
determine whether or not property other than cash or Common Stock may be used
to purchase the shares of Common Stock hereunder and, if so, to determine the
value of the property received.
(5) The Recipient shall make provision for the withholding of taxes
as required by Paragraph 7 hereof.
(f) Termination.
(1) Unless otherwise provided in the Option Agreement by and
between the Corporation and the Recipient, if the Recipient ceases to be an
employee or consultant or director of the Corporation (other than by reason
of death, Disability or retirement), all Options theretofore granted to such
Recipient but not theretofore exercised shall terminate three months following
the date the Recipient ceased to be an employee or consultant or director of
the Corporation, and shall terminate upon the date of termination of
employment if discharged for cause.
(2) Nothing in the Plan or in any Option or Bonus granted
hereunder shall confer upon an individual any right to continue in the
employ of or other relationship with the Corporation or interfere in any way
with the right of the Corporation to terminate such employment or other
relationship between the individual and the Corporation.
(g) Death, Disability or Retirement of Recipient. Unless
otherwise provided in the Option Agreement by and between the Corporation
and the Recipient, if a Recipient shall die while a director of, or employed
by, or a consultant to the Corporation, or within ninety days after the
termination of such Recipient's employment or directorship or consulting
relationship, other than termination for cause, or if the Recipient's
employment or directorship or consulting relationship, shall terminate by
reason of Disability or retirement, all Options theretofore granted to such
Recipient (whether or not otherwise exercisable) unless earlier terminated in
accordance with their terms, may be exercised by the Recipient or by the
Recipient's estate or by a person who acquired the right to exercise such
Options by bequest or inheritance or otherwise by reason of the death or
Disability of the Recipient, at any time within one year after the date of
death, Disability or retirement of the Recipient; provided, however, that in
the case of Incentive Stock Options such one-year period shall be limited to
three months in the case of retirement.
<PAGE>
(h) Transferability Restriction.
(1) Options granted under the Plan shall not be transferable other
than by will or by the laws of descent and distribution or pursuant to a
qualified domestic relations order as defined by the Internal Revenue Code or
Title I of the Employee Retirement Income Security Act of 1974, or the rules
thereunder. Options may be exercised, during the lifetime of the Recipient,
only by the Recipient and thereafter only by his legal representative.
(2) Any attempted sale, pledge, assignment, hypothecation or other
transfer of an Option contrary to the provisions hereof and/or the levy of any
execution, attachment or similar process upon an Option, shall be null and
void and without force or effect and shall result in a termination of the
Option.
(3)(A) As a condition to the transfer of any shares of
Common Stock issued upon exercise of an Option granted under this Plan, the
Corporation may require an opinion of counsel, satisfactory to the
Corporation, to the effect that such transfer will not be in violation of the
Securities Act of British Columbia ("B.C. Act") or the U.S. Securities Act of
1933, as amended (the "1933 Act") or any other applicable securities laws or
that such transfer has been registered under federal and all applicable state
securities laws. (B) Further, the Corporation shall be authorized to refrain
from delivering or transferring shares of Common Stock issued under this
Plan until the Committee determines that such delivery or transfer will not
violate applicable securities laws and the Recipient has tendered to the
Corporation any federal, state or local tax owed by the Recipient as a result
of exercising the Option or disposing of any Common Stock when the
Corporation has a legal liability to satisfy such tax. (C) The Corporation
shall not be liable for damages due to delay in the delivery or issuance of
any stock certificate for any reason whatsoever, including, but not limited
to, a delay caused by listing requirements of any securities exchange or any
registration requirements under the B.C. Act, the 1933 Act, the 1934 Act, or
under any other state, federal or provincial law, rule or regulation. (D) The
Corporation is under no obligation to take any action or incur any expense in
order to register or qualify the delivery or transfer of shares of Common Stock
under applicable securities laws or to perfect any exemption from such
registration or qualification. (E) Furthermore, the Corporation will not be
liable to any Recipient for failure to deliver or transfer shares of Common
Stock if such failure is based upon the provisions of this paragraph.
(4) A shareholder issued shares as a bonus under the Plan and/or upon
exercise of options granted under the Plan (the "Shares") and wishing to trade
such Shares in the Province of British Columbia will be subject to the
following resale restrictions in British Columbia: (A) the shareholder must
file with the British Columbia Securities Commission a report within 10 days
of the initial trade within British Columbia in any of the Shares by the
shareholder; and (B) where the shareholder has filed such report with respect
to any Shares, the shareholder is not required to file a further such report
in respect of additional trades of shares acquired on the same date and under
the same exemption as the Shares which are the subject of the initial trade
report referred to in Section 5(g)(4)(1) above.
<PAGE>
(i) Effect of Certain Changes.
(1) If there is any change in the number of shares of
outstanding Common Stock through the declaration of stock dividends, or
through a recapitalization resulting in stock splits or combinations or
exchanges of such shares, the number of shares of Common Stock available
for Options and the number of such shares covered by outstanding Options,
and the exercise price per share of the outstanding Options, shall be
proportionately adjusted by the Committee to reflect any increase or decrease
in the number of issued shares of Common Stock; provided, however, that
any fractional shares resulting from such adjustment shall be eliminated.
(2) In the event of the proposed dissolution or liquidation of the
Corporation, or any corporate separation or division, including, but not
limited to, split-up, split-off or spin-off, or a merger or consolidation of
the Corporation with another corporation, the Committee may provide that the
holder of each Option then exercisable shall have the right to exercise such
Option (at its then current Option Price) solely for the kind and amount of
shares of stock and other securities, property, cash or any combination
thereof receivable upon such dissolution, liquidation, corporate separation
or division, or merger or consolidation by a holder of the number of shares
of Common Stock for which such Option might have been exercised immediately
prior to such dissolution, liquidation, corporate separation or division, or
merger or consolidation; or, in the alternative the Committee may provide that
each Option granted under the Plan shall terminate as of a date fixed by the
Committee; provided, however, that not less than 30 days' written notice of
the date so fixed shall be given to each Recipient, who shall have the right,
during the period of 30 days preceding such termination, to exercise the
Option as to all or any part of the shares of Common Stock covered thereby,
including shares as to which such Option would not otherwise be exercisable.
(3) Paragraph 2 of this Section 8 (i) shall not apply to
a merger or consolidation in which the Corporation is the surviving
corporation and shares of Common Stock are not converted into or exchanged
for stock, securities of any other corporation, cash or any other thing of
value. Notwithstanding the preceding sentence, in case of any consolidation or
merger of another corporation into the Corporation in which the Corporation
is the surviving corporation and in which there is a reclassification or change
(including a change to the right to receive cash or other property) of the
shares of Common Stock (excluding a change in par value, or from no par value
to par value, or any change as a result of a subdivision or combination, but
including any change in such shares into two or more classes or series of
shares), the Committee may provide that the holder of each Option then
exercisable shall have the right to exercise such Option solely for the kind
and amount of shares of stock and other securities (including those of any new
direct or indirect Parent of the Corporation), property, cash or any
combination thereof receivable upon such reclassification, change, consolida-
tion or merger by the holder of the number of shares of Common Stock for
which such Option might have been exercised.
(4) In the event of a change in the Common Stock of the Corporation
as presently constituted into the same number of shares with a par value, the
shares resulting from any such change shall be deemed to be the Common Stock
of the Corporation within the meaning of the Plan.
(5) To the extent that the foregoing adjustments relate
to stock or securities of the Corporation, such adjustments shall be made by
the Committee, whose determination in that respect shall be final, binding and
conclusive, provided that each Incentive Stock Option granted pursuant to this
Plan shall not be adjusted in a manner that causes such option to fail to
continue to qualify as an Incentive Stock Option within the meaning of
Section 422 of the Internal Revenue Code.
(6) Except as expressly provided in this Section 8(i), the
Recipient shall have no rights by reason of any subdivision or consolidation
of shares of stock of any class, or the payment of any stock
dividend or any other increase or decrease in the number of shares of stock of
any class, or by reason of any dissolution, liquidation, merger, or
consolidation or spin-off of assets or stock of another corporation; and any
issue by the Corporation of shares of stock of any class, or securities
convertible into shares of stock of any class, shall not affect, and no
adjustment by reason thereof shall be made with respect to, the number or
price of shares of Common Stock subject to an Option. The grant of an
Option pursuant to the Plan shall not affect in any way the right or power of
the Corporation to make adjustments, reclassifications, reorganizations or
changes of its capital or business structures, or to merge or consolidate, or
to dissolve, liquidate, or sell or transfer all or any part of its business or
assets.
(j) No Rights as Shareholder - Non-Distributive Intent.
(1) Neither a Recipient of an Option nor such Recipient's legal
representative, heir, legatee or distributee, shall be deemed to be the
holder of, or to have any rights of a holder with respect to, any shares
subject to such Option until after the Option is exercised and the shares are
issued.
(2) No adjustment shall be made for dividends (ordinary or
extraordinary, whether in cash, securities or other property) or distributions
or other rights for which the record date is prior to the date such stock
certificate is issued, except as provided in Section 8(i) hereof.
(3) Upon exercise of an Option at a time when there is no
registration statement in effect under the B.C. Act and/or the 1933 Act
relating to the shares issuable upon exercise, shares may be issued to the
Recipient only if the Recipient represents and warrants in writing to the
Corporation that the shares purchased are being acquired for investment and
not with a view to the distribution thereof and provides the Corporation with
sufficient information to establish an exemption from the registration
requirements of the B.C. Act and/or the 1933 Act. A form of subscription
agreement containing representations and warranties deemed sufficient as of
the date of adoption of this Plan is attached hereto as Exhibit B.
(4) No shares shall be issued upon the exercise of an
Option unless and until there shall have been compliance with any then
applicable requirements of the U.S. Securities and Exchange Commission and
the British Columbia Securities Commission or any other regulatory agencies
having jurisdiction over the Corporation.
<PAGE>
(k) Other Provisions. Option Agreements authorized under the Plan
may contain such other provisions, including, without limitation, (i) the
imposition of restrictions upon the exercise and (ii) in the case of an
Incentive Stock Option, the inclusion of any condition not inconsistent with
such Option qualifying as an Incentive Stock Option, as the Committee shall
deem advisable.
9. Grant of Stock Bonuses. In addition to, or in lieu of, the grant
of an Option, the Committee may grant Bonuses.
(a) At the time of grant of a Bonus, the Committee may
impose a vesting period of up to ten years, and such other restrictions which
it deems appropriate. Unless otherwise directed by the Committee at the time
of grant of a Bonus, the Recipient shall be considered a shareholder of the
Corporation as to the Bonus shares which have vested in the grantee at any
time regardless of any forfeiture provisions which have not yet arisen.
(b) The grant of a Bonus and the issuance and delivery of
shares of Common Stock pursuant thereto shall be subject to approval by the
Corporation's counsel of all legal matters in connection therewith, including
compliance with the requirements of the B.C. Act, the 1933 Act, the 1934
Act, other applicable securities laws, rules and regulations, and the
requirements of any stock exchanges upon which the Common Stock then
may be listed. Any certificates prepared to evidence Common Stock issued
pursuant to a Bonus grant shall bear legends as the Corporation's counsel may
seem necessary or advisable. Included among the foregoing requirements, but
without limitation, any Recipient of a Bonus at a time when a registration
statement relating thereto is not effective under the B.C. Act and/or the 1933
Act shall execute a Subscription Agreement substantially in the form of
Exhibit B.
10. Agreement by Recipient Regarding Withholding Taxes. Each Recipient
agrees that the Corporation, to the extent permitted or required by law,
shall deduct a sufficient number of shares due to the Recipient upon
exercise of the Option or the grant of a Bonus to allow the Corporation to pay
federal, provincial, state and local taxes of any kind required by law to be
withheld upon the exercise of such Option or payment of such Bonus from
any payment of any kind otherwise due to the Recipient. The Corporation
shall not be obligated to advise any Recipient of the existence of any tax or
the amount which the Corporation will be so required to withhold.
11. Term of Plan. Options and Bonuses may be granted under this Plan
from time to time within a period of ten years from the date the Plan is
adopted by the Board.
<PAGE>
12. Amendment and Termination of the Plan.
(a) (1) Subject to the policies, rules and regulations of
any lawful authority having jurisdiction (including any exchange with which
the shares of the Corporation are listed for trading), the Board of Directors
may at any time, without further action by the shareholders, amend the Plan or
any option granted hereunder in such respects as it may consider advisable
and, without limiting the generality of the foregoing, it may do so to ensure
that options granted hereunder will comply with any provisions respecting
stock options in the income tax and other laws in force in any country or
jurisdiction of which from time to time be resident or citizen or it may at any
time, without action by shareholders, terminate the Plan.
(2) provided, however, that any amendment that would: (A)
materially increase the number of securities issuable under the Plan to
persons who are subject to Section 16(a) of the 1934 Act; or (B) grant
eligibility to a class of persons who are subject to Section 16(a) of the 1934
Act and are not included within the terms of the Plan prior to the amendment;
(C) materially increase the benefits accruing to persons who are subject to
Section 16(a) of the 1934 Act under the Plan; or (D) require shareholder
approval under applicable state law, the rules and regulations of any national
securities exchange on which the Corporation's securities then may be listed,
the Internal Revenue Code or any other applicable law, shall be subject to the
approval of the shareholders of the Corporation as provided in Section 13
hereof;
(3) provided further that any such increase or modification
that may result from adjustments authorized by Section 8(i) hereof or which
are required for compliance with the 1934 Act, the Internal Revenue Code, the
Employee Retirement Income Security Act of 1974, their rules or other laws
or judicial order, shall not require such approval of the shareholders;
(b) Except as provided in Section 8 hereof, no suspension,
termination, modification or amendment of the Plan may adversely affect any
Option previously granted, unless the written consent of the Recipient is
obtained.
13. Approval of Shareholders. The Plan shall take effect upon its
adoption by the Board but shall be subject to approval at a duly called and
held meeting of stockholders in conformance with the vote required by the
Corporation's Charter documents, resolution of the Board, any other
applicable law and the rules and regulations thereunder, or the rules and
regulations of any national securities exchange upon which the Corporation's
Common Stock is listed and traded, each to the extent applicable.
14. Termination of Right of Action. Every right of action arising
out of or in connection with the Plan by or on behalf of the Corporation or of
any Subsidiary, or by any shareholder of the Corporation or of any Subsidiary
against any past, present or future member of the Board, or against any
employee, or by an employee (past, present or future) against the Corporation
or any Subsidiary, will, irrespective of the place where an action may be
brought and irrespective of the place of residence of any such shareholder,
director or employee, cease and be barred by the expiration of three years
from the date of the act or omission in respect of which such right of action
is alleged to have risen.
<PAGE>
15. Tax Litigation. The Corporation shall have the right, but not
the obligation, to contest, at its expense, any tax ruling or decision,
administrative or judicial, on any issue which is related to the Plan and which
the Board believes to be important to holders of Options issued under the Plan
and to conduct any such contest or any litigation arising therefrom to a final
decision.
16. Adoption.
(a) This Plan was approved by resolution of the Board of
Directors of the Corporation on June 23, 1997.
(b) This Plan was approved by the shareholders of the
Corporation on March 31, 1998.
<PAGE>
Exhibit 5.1
Opinion of Counsel Smith McCullough, P.C.
<PAGE>
EXHIBIT 5.1
OPINION OF COUNSEL
June 3, 1998
The Board of Directors
Rich Coast Inc
10200 Ford Road
Dearborn, MI 48116
Re: Form S-8 Registration Statement
Opinion of Counsel
Dear Sirs:
As securities counsel for Rich Coast Inc. (the "Company") a
Delaware corporation, we have examined the originals or copies certified or
otherwise identified, of the Articles of Incorporation, as restated and
amended, and Bylaws, as amended, of the Company, corporate records of the
Company, including minute books of the Company as furnished to us by the
Company, certificates of public officials and of representatives of the
Company, statutes and other records, instruments and documents pertaining to
the Company as a basis for the opinions hereinafter expressed. In giving such
opinions, we have relied upon certificates of officers of the Company with
respect to the accuracy of the factual matters contained in such certificates.
We have also, as such counsel, examined the Registration Statement
on Form S-8. File No. 333-________ (the "Registration Statement") to be
filed with the Commission on or about June 3, 1998 covering up to 4,500,000
shares of common stock. $ 001 par value (the "Common Stock"), which may
be issued under the Company's 1997 Stock Option and Stock Bonus Plan (the
"Plan"), as more particularly described in the Registration Statement.
Based upon the foregoing and subject to the other qualifications and
limitations stated in this letter, we are of the opinion that:
(1) The shares of Common Stock reserved for issuance as Bonus
Shares under the Plan have been duly authorized, and upon
issuance will constitute validly issued, fully paid and
non-assessable shares of Common Stock; and
(2) The shares of Common Stock reserved for issuance upon the
exercise of options granted under the Plan have been duly
authorized and, upon exercise of options and payment of the
exercise price stated in the options, will constitute validly
issued, fully paid and non-assessable shares of Common Stock.
<PAGE>
This opinion is a legal opinion and not an opinion as to matters of
fact. This opinion is limited to the laws of the State of Delaware and the
federal law of the United States of America, and to the matters stated herein.
This opinion is made as of the date hereof, and after the date hereof, we
undertake no, and disclaim any, obligation to advise you of any change in any
matters set forth herein. This opinion is furnished to you solely in
connection with the transactions referred to herein, and may not be relied on
by any other person, firm or entity without our prior written consent.
We hereby consent to such use of our name in the Registration Statement
and to the filing of this opinion as an Exhibit thereto. In giving this
consent, we do not thereby admit that we come within the category of persons
whose consent is required under Section 7 of the United States Securities Act
of 1933 or the Rules and Regulations of the Securities and Exchange
Commission promulgated thereunder.
Very truly yours,
/s/ SMITH MCCULLOUGH, P.C.
<PAGE>
Exhibit 23.2
Consent of Smythe Ratcliffe, Chartered Accountants
<PAGE>
June 2, 1998
Board of Directors
Rich Coast, Inc.
10200 Ford Road
Dearborn, Michigan 48126
We consent to the incorporation by reference in the Registration
Statement on Form S-8 related to the 1997 Employee Stock Option and
Bonus Stock Plan of our report dated July 11, 1997 relating to the
consolidated balance sheets of Rich Coast Inc. as of April 30, 1997 and 1996
and the related consolidated statements of operations, stockholders' equity and
cash flows for the years then ended, which report appears in the
April 30, 1997 annual report on Form 10-KSB of Rich Coast Inc.
/s/Smythe Ratcliffe
Chartered Accountants
Vancouver, Canada
