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): May 4, 2005
HOUSTON AMERICAN ENERGY CORP.
-----------------------------
(Exact name of registrant as specified in Charter)
Delaware 0-33027 76-0675953
------------------------------------------------------------------------
(State or other jurisdiction (Commission (IRS Employer
of incorporation or organization) File No.) Identification No.)
801 Travis Street, Suite 2020
Houston, Texas 77002
--------------------------------------------------
(Address of Principal Executive Offices)(Zip Code)
713-222-6966
-------------------------
(Issuer Telephone number)
-------------------------------------------------------------
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligations of the registrant under any of the
following provisions (see General Instruction A.2. below):
[_] Written communications pursuant to Rule 425 under the Securities Act (17
CFR 230.425)
[_] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17
CFR 240.14a-12)
[_] Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
[_] Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
1
Item 1.01. Entry into a Material Definitive Agreement.
On May 4, 2005, Houston American Energy Corp. (the "Company") entered into
Purchase Agreements (the "Purchase Agreements") with multiple investors pursuant
to which the Company sold $2,125,000 of 8% Subordinated Convertible Notes Due
2010 (the "Notes").
The Notes bear interest at 8%, provide for semi-annual interest payments and
mature May 1, 2010. The Notes are convertible, at the option of the holders,
into common stock of the Company at a price of $1.00 per share (the "Conversion
Price"), subject to standard anti-dilution provisions relating to splits,
reverse splits and other transactions, including issuances of common stock at
prices below the Conversion Price. The Notes are subject to automatic
conversion in the event the Company conducts an underwritten public offering of
its common stock from which the Company receives at least $5 million and the
public offering price is at least 150% of the then applicable Conversion Price.
The Company has the right to cause the Notes to be converted into common stock
after May 1, 2006 if the price of the Company's common stock exceeds 200% of the
then applicable Conversion Price on the date of conversion and for at least 20
trading days over the preceding 30 trading days. The Company has the right to
repurchase the Notes after May 1, 2007 at 103% of the face amount during 2007,
102% of the face amount during 2008, 101% of the face amount during 2009 and
100% of the face amount thereafter. The Notes are unsecured general obligations
of the Company and are subordinated to all other indebtedness of the Company
unless the other indebtedness is expressly made subordinate to the Notes.
The Notes were offered and sold in private placement transaction pursuant to the
exemption from registration provided by Section 4(2) of the Securities Act of
1933 and Rule 506 promulgated thereunder. Each of the investors is either an
"accredited investor", as defined in Rule 501 promulgated under the Securities
Act, or a "qualified institutional buyer", as defined in Rule 144A promulgated
under the Securities Act.
Pursuant to the terms of the Purchase Agreements, the Company and the investors
entered into Registration Rights Agreements under which the Company agreed to
file with the Securities and Exchange Commission, within 90 days, a registration
statement covering the Notes and the common stock underlying the Notes and to
use its best efforts to cause the registration statement to become effective
within 180 days.
Northeast Securities, Inc. acted as placement agent in connection with the offer
and sale of the Notes. For its services as placement agent, Northeast
Securities, Inc. received commissions and a warrant (the "Placement Agent
Warrant") to purchase shares of common stock. The Registration Rights
Agreements provide that the shares of common stock underlying the Placement
Agent Warrant are to be included in the registration statement required to be
filed.
The foregoing is qualified in its entirety by reference to the documents filed
herewith as Exhibits 4.1, 4.2, 4.3 and 10.1.
2
Item 2.03 Creation of a Direct Financial Obligation
See Item 1.01 above.
Item 3.02. Unregistered Sales of Equity Securities
See Item 1.01 above.
Item 9.01. Financial Statements and Exhibits.
(c) Exhibits
4.1 Form of 8% Subordinated Convertible Note due 2010,
dated May 4, 2005
4.2 Form of Placement Agent Warrant, dated May 4, 2005
4.3 Form of Registration Rights Agreement, dated May 4,
2005
10.1 Form of Purchase Agreement, dated May 4, 2005 relating
to the sale of 8% Subordinated Convertible Notes due 2010
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.
HOUSTON AMERICAN ENERGY CORP.
Dated: May 9, 2005
By: /s/ John Terwilliger
John Terwilliger,
President and
Chief Executive Officer
3