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: February 21, 1997
SISKON GOLD CORPORATION
CALIFORNIA 0-19502 68-0254824
(State or other (Commission (I.R.S. Employer
Jurisdiction of File Number) Identification No.)
Incorporation)
350 CROWN POINT CIRCLE, SUITE 100, GRASS VALLEY, CA 95945
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (916) 273-4311
<PAGE>
Item 9. Sales of Equity Securities Pursuant to Regulation S.
On February 18, 1997, the Company issued an aggregate principal amount
of $450,000 in a new series of 8% convertible debentures (the "Debentures")
due February 1, 1999. The Debentures were issued in reliance upon an
exemption from the registration provisions of the Securities Act of 1933,
as amended, provided for in Regulation S promulgated thereunder. The
Debentures were offered and sold in an "offshore" transaction to qualified
persons who were not "U.S. Persons," as defined in Regulation S.
At the option of the holder, the principal and accrued interest of the
Debentures is convertible into shares of the Company's Class A Common Stock
on or after forty five (45) days from the date of issuance, February 18,
1997. The conversion price of the Debentures is equal to the lesser of
seventy five percent (75%) of the average closing bid price of the
Company's Class A Common Stock over a five (5) day trading period preceding
the date of issuance, February 18, 1997, or the date the holder elects to
convert. In addition, the Debentures will automatically convert into
shares of the Company's Class A Common Stock on the due date, February 1,
1999.
The sale of Debentures in this transaction is unrelated to the
Company's previous sale of debentures, as disclosed in the Company's
quarterly report on Form 10-QSB for the period ended September 30, 1996.
The Company closed that previous offering after receiving the aggregate
principal amount of $500,000.
Item 7. Financial Statements and Exhibits.
(a) Financial statements of businesses acquired. Not Applicable
(b) Pro forma financial information. Not Applicable
(c) Exhibits.
4.1 Form of 8% Convertible Debenture due February 1, 1999
<PAGE>
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.
Siskon Gold Corporation
TIMOTHY A. CALLAWAY
Dated: February 21, 1997 ____________________________
Timothy A. Callaway
President & CEO and
Chairman of the Board
EXHIBIT 4.1
FORM OF 8% CONVERTIBLE DEBENTURE
NEITHER THESE SECURITIES NOR THE SECURITIES ISSUABLE UPON CONVERSION
HEREOF HAVE BEEN REGISTERED WITH THE UNITED STATES SECURITIES AND
EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE OR UNDER
THE SECURITIES ACT OF 1933, AS AMENDED. THE SECURITIES ARE RESTRICTED
AND MAY NOT BE OFFERED, RESOLD, PLEDGED OR TRANSFERRED EXCEPT IN
ACCORDANCE WITH REGULATION S UNDER THE ACT, OR AS PERMITTED UNDER THE
ACT PURSUANT TO REGISTRATION OR EXEMPTION OR SAFE HARBOR THEREFROM.
No. US $
Date of Issue: February 18, 1997
SISKON GOLD CORPORATION
8% CONVERTIBLE DEBENTURE DUE FEBRUARY 1, 1999
THIS DEBENTURE is one of a duly authorized issue of up to a maximum
aggregate of $450,000 in Debentures of SISKON GOLD CORPORATION, a
corporation duly organized and existing under the laws of the State of
California (the "Company") designated as its 8% Convertible Debenture Due
February 1, 1999.
FOR VALUE RECEIVED, the Company promises to pay to ______________,
_______________, the registered holder hereof (the "Holder"), the
principal sum of ____________________ United States Dollars ($_______) on or
before February 1, 1999 (the "Maturity Date") and to pay interest on the
principal sum outstanding from time to time in arrears on or before February
1, 1999 at the rate of 8% per annum accruing from the date of issue inscribed
hereon. Accrual of interest shall commence on the first such business day to
occur after the date of issue inscribed hereon until payment in full of the
principal sum has been made or duly provided for. The Company may pre-pay
this Debenture, subject to the Holder's right of conversion upon terms and
conditions set forth herein, without a pre-payment penalty thereafter by
paying the principal amount of this Debenture plus accrued interest in United
States Dollars. Subject to the provisions of <para>4 below, the principal
of, and interest on, this Debenture are payable at the option of the Company,
in shares Class A Common Stock (the "Common Stock") of the Company or in
such coin or currency of the United States of America as at the time of
payment is legal tender for payment of public and private debts, at the
address last appearing on the Debenture Register of the Company as designated
in writing by the Holder from time to time. The Company will pay the
principal of and interest upon this Debenture on or before the Maturity Date,
less any amounts required by law to be deducted, to the registered holder of
this Debenture as of the tenth day prior to the Maturity Date and addressed to
such holder as the last address appearing on the Debenture Register. The
forwarding of such check shall constitute a payment of interest hereunder and
shall satisfy and discharge the liability for principal and interest on
this Debenture to the extent of the sum represented by such check plus any
amounts so deducted.
This Debenture is subject to the following additional provisions:
1. The Debentures are issuable in denominations of Ten Thousand
Dollars ($10,000(USD)) and integral multiples thereof. The Debentures are
exchangeable for an equal aggregate principal amount of Debentures of
different authorized denominations, as requested by the Holders
surrendering the same.
No service charge will be made for such registration or transfer or
exchange.
2. The Company shall be entitled to withhold from all payments of
principal of, and interest on, this Debenture any amounts required to be
withheld under the applicable provisions of the United States income tax
laws or other applicable laws at the time of such payments and Holder shall
execute and deliver all required documentation in connection therewith.
3. This Debenture has been issued subject to investment
representations of the original purchaser hereof and may be transferred or
exchanged only in compliance with the Securities Act of 1933, as amended
(the "Securities Act"), and other applicable state and foreign securities
laws. In the event of any proposed transfer of this Debenture, the Company
may require, prior to issuance of a new Debenture in the name of such other
person, that it receive reasonable transfer documentation including
opinions that the issuance of the Debenture in such other name does not and
will not cause a violation of the Securities Act or any applicable state or
foreign securities laws. Prior to due presentment for transfer of this
Debenture, the Company and any agent of the Company may treat the person in
whose name this Debenture is duly registered on the Company's Debenture
Register as the owner hereof for the purpose of receiving payment as herein
provided and for all other purposes, whether or not this Debenture be
overdue, and neither the Company nor any such agent shall be affected by
notice to the contrary.
4. The Holder of this Debenture is entitled, at its option, to
convert at any time after forty five (45) days from the issuance of this
Debenture up to one hundred percent (100%) of the principal amount of the
Debenture(s) and accrued interest held by the Holder into Common Stock, at
a conversion price per share equal to the lesser of (i) seventy five
percent (75%) of the average closing high bid price of the Company's Common
Stock quoted on the NASDAQ Stock Market (or such other market as may quote
the Common Stock if the Common Stock is no longer quoted on the NASDAQ
Stock Market) for the five (5) consecutive trading days immediately prior
to the Initial Issue Date of this Debenture or (ii) seventy five percent
(75%) of the average closing high bid price of the Company's Common Stock
quoted on the NASDAQ Stock Market (or such other market as may quote the
Common Stock if the Common Stock is no longer quoted on the NASDAQ Stock
Market) for the five (5) consecutive trading days immediately prior to the
Conversion Date as defined herein (the "Conversion Price"). Upon maturity,
the Company may elect, by written notice given at least thirty (30) days
prior to the Maturity Date, to convert the principal and all unpaid
interest into Shares of Common Stock ("Mandatory Conversion") at the
Conversion Price. Conversion shall be effectuated by surrendering the
Debentures to be converted to the Company with the form of conversion
notice attached hereto as Exhibit A, executed by the Holder of the
Debenture evidencing such Holder's intention to convert this Debenture or a
specified portion (as above provided) hereof, and accompanied, if required
by the Company, by proper assignment hereof in blank. Interest accrued or
accruing from the date of issuance to the date of conversion shall, at the
option of the Company, be paid in cash or Common Stock upon conversion. No
fraction of Shares or scrip representing fractions of shares will be issued
on conversion, but the number of shares issuable shall be rounded up to the
nearest whole share. The date on which notice of conversion is given (the
"Conversion Date") shall be deemed to be the date on which the Holder has
delivered this Debenture, with the conversion notice duly executed, to the
Company or, if earlier, the date set forth in such notice of conversion if
the Debenture is received by the Company within three (3) business days
therefrom. Facsimile delivery of the conversion notice shall be accepted by
the Company at telephone number (916) 273-3933. Certificates representing
Common Stock upon conversion will be delivered promptly after Conversion
Date. Subject to the terms and conditions set forth in Section 3.2(a) of
the Subscription Agreement, the Company shall issue shares of Common Stock
to the Holder upon conversion of this Debenture free of restrictive
legends.
5. No provision of this Debenture shall alter or impair the
obligation of the Company, which is absolute and unconditional, to pay the
principal of, and interest on, this Debenture at the time, place, and rate,
and in the coin or currency, herein proscribed. This Debenture and all
other Debentures now or hereafter issued of similar terms are direct
obligations of the Company.
6. No recourse shall be had for the payment of the principal of, or
the interest on, this Debenture, or for any claim based hereon, or
otherwise in respect hereof, against any incorporator, shareholder, officer
or director, as such, past, present or future, of the Company or any
successor corporation, whether by virtue of any constitution, statute or
rule of law, or by the enforcement of any assessment or penalty or
otherwise, all such liability being, by, the acceptance hereof and as part
of the consideration for the issue hereof, expressly waived and released.
7. If the Company merges or consolidates with another corporation or
sells or transfers all or substantially all of its assets to another person
and the holders of the Company's Common Stock are entitled to receive
stock, securities or property in respect of or in exchange for Common
Stock, then as a condition of such merger, consolidation, sale or transfer,
the Company and any such successor, purchaser or transferee shall amend
this Debenture to provide that it may thereafter be converted on the terms
and subject to the conditions set forth above into the kind and amount of
stock, securities or property receivable upon such merger, consolidation,
sale or transfer by a holder of the number of shares of Common Stock into
which this Debenture might have been converted immediately before such
merger, consolidation, sale or transfer, subject to adjustments which shall
be as nearly equivalent as may be practicable. ln the event of any proposed
merger, consolidation or sale or transfer of all or substantially all of
the assets of the Company (a "Sale"), the Holder hereof shall have the
right to convert by delivering a notice of conversion to the Company within
fifteen (15) days of receipt of notice of such Sale from the Company. In
the event the Holder hereof shall elect not to convert, the Company may
prepay all outstanding principal and accrued interest on this Debenture,
less all amounts required by law to be deducted, upon which tender of
payment following such notice, the right of conversion shall terminate.
8. The Holder of the Debenture, by acceptance hereof, agrees that
this Debenture is being acquired for investment and that such Holder will
not offer, sell or otherwise dispose of this Debenture or the shares of
Common Stock issuable upon conversion thereof except under circumstances
which will not result in a violation of the Securities Act or any other
applicable Blue Sky or foreign laws or similar laws relating to the sale of
securities.
9. This Debenture shall be governed by and construed in accordance
with the laws of the State of California. The parties agree that any
dispute or claim concerning this Debenture or arising therefrom or related
thereto, including whether the dispute or claim is arbitrable, will be
settled by arbitration. The arbitration proceedings shall be conducted in
San Francisco, California, USA, under the Commercial Arbitration Rules of
the American Arbitration Association in effect at the time a demand for
arbitration under the rules is made. The decision of the arbitrators,
including a determination of the amount of any damages suffered, shall be
exclusive, final, and binding on both parties, their heirs, executors,
administrators, successors, and assigns. The parties hereto consent to the
jurisdiction of the Federal and State Courts in the State of California for
purposes of confirming any arbitration award made pursuant hereunder.
10. The following shall constitute an "Event of Default":
a. The Company shall default in the payment of principal or
interest on this Debenture; or
b. Any of the representations or warranties made by the Company
herein, in the Subscription Agreement, or in any certificate
or financial or other written statements heretofore or
hereafter furnished by the Company in connection with the
execution and delivery of this Debenture or the Subscription
Agreement shall be false or misleading in any material
respect at the time made; or
c. The Company shall fail to perform or observe, in any
material respect, any other covenant, term, provision,
condition, agreement or obligation of the Company under this
Debenture, including, but not limited to, breach of the
covenant to issue shares of the Company's Common Stock to
the Holders upon conversion of this Debenture provided for
in paragraph 4 above, and such failure shall continue
uncured for a period of thirty (30) days after written
notice from the Holder of such failure; or
d. The Company shall (1) admit in writing its inability to pay
its debts generally as they mature; (2) make an assignment
for the benefit of creditors or commence proceedings for its
dissolution; or (3) apply for or Consent to the appointment
of a trustee, liquidator or receiver for its or for a
substantial part of its property or business; or
e. A trustee, liquidator or receiver shall be appointed for the
Company or for a substantial part of its property or
business without its consent and shall not be discharged
within sixty (60) days after such appointment; or
f. Any governmental agency or any court of competent
jurisdiction at the instance of any governmental agency
shall assume custody or control of the whole or any
substantial portion of the properties or assets of the
Company and shall not be dismissed within sixty (60) days
thereafter; or
g. Any money judgment, writ or warrant of attachment, or
similar process in excess of Two Hundred Thousand ($200,000)
in the aggregate shall be entered or filed against the
Company or any of its properties or other assets and shall
remain unpaid, unvacated, unbonded or unstayed for a period
of sixty (60) days or in any event later than five (5) days
prior to the date of any proposed sale thereunder; or
h. Bankruptcy, reorganization, insolvency or liquidation
proceedings or other proceedings for relief under any
bankruptcy law or any law for the relief of debtors shall be
instituted by or against the Company and, if instituted
against the Company, shall not be dismissed within sixty
(60) days after such institution or the Company shall by any
action or answer approve of, consent to, or acquiesce in any
such proceedings or admit the material allegations of, or
default in answering a petition filed in any such
proceeding; or
i. The Company shall have the trading in its Common Stock
delisted from all exchanges or over-the-counter markets.
Then, or at any time thereafter, and in each and every such case, unless
such Event of Default shall have been waived in writing by the Holder
(which waiver shall not be deemed to be a waiver of any subsequent default)
at the option of the Holder and in the Holder's sole discretion, the Holder
may consider this Debenture immediately due and payable, without
presentment, demand, protest or notice of any kind, all of which are hereby
expressly waived, anything herein or in any note or other instruments
contained to the contrary notwithstanding, and the Holder may immediately
enforce any and all of the Holder's rights and remedies provided herein or
any other rights or remedies afforded by law.
11. As set forth herein and in the Subscription Agreement, the
Company shall use its reasonable efforts to issue an deliver, within five
(5) business days after Holder has fulfilled all conditions and submitted
all necessary documents duly executed and in proper form required for
conversion, and all other terms and conditions set forth in the
Subscription Agreement have been met or satisfied (the "Deadline"), to the
Holder or any party receiving a Debenture by transfer from the Holder
(together, a "Holder"), at the address of the Holder on the books of the
Company, a certificate or certificates for the number of shares of the
Company's Common Stock to which the Holder shall be entitled upon
conversion pursuant to the provisions of paragraph 4 above.
12. Nothing contained in this Debenture shall be construed as
conferring upon the Holder the right to vote or to receive dividends or to
consent or receive notice as a shareholder in respect of any meeting of
shareholders or any rights whatsoever as a shareholder of the Company,
unless and to the extent converted in accordance with the terms hereof.
IN WITNESS WHEREOF, the Company has cause this instrument to be duly
executed by an officer thereunto duly authorized.
Dated: February 18, 1997
SISKON GOLD CORPORATION
By: __________________________________
Timothy A. Callaway, President
ATTEST:
______________________________
Michael K. Epstein, Secretary
<PAGE>
EXHIBIT A
NOTICE OF CONVERSION
(To Be Executed by the Registered Holder in order to Convert the Debenture)
The undersigned hereby irrevocably elects to convert $___________ of
the principal amount of the above Debenture No. ____ into Shares of Common
Stock of SISKON GOLD CORPORATION (the "Company") according to the
conditions hereof, as of the date written below.
The undersigned represents that it is not a U.S. Person as defined in
Regulation S promulgated under the Securities Act of 1933 and is not
converting the Debenture on behalf of any U.S. Person.
Date of Conversion* _________________________________________________
Applicable Conversion Price ___________________________________________
Signature ________________________________________________________
(Name)
Address: _________________________________________________________
_________________________________________________________
*This original Debenture and Notice of Conversion must be received by the
Company by the third business date following the Date of Conversion.
