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| SPQS.PK > SEC Filings for SPQS.PK > Form 8-K/A on 27-Aug-2007 | All Recent SEC Filings |
27-Aug-2007
Entry into a Material Definitive Agreement, Creation of a Direct
SportsQuest, Inc. (formerly known as Air Brook Airport Express, Inc.) (the "Company") has entered into the material definitive agreements described below.
Loan Facility. On August 16, 2007, the Company entered into a Securities Purchase Agreement (the "Purchase Agreement"), dated as of August 16, 2007, by and among the Company and AJW Partners, LLC, AJW Master Fund, Ltd. and New Millennium Capital Partners II, LLC (collectively, the "Air Brook Investors"). The transactions contemplated by the Purchase Agreement will result in a funding of a total of $1,500,000 into the Company. The Company completed these transactions on August 16, 2007. A copy of the Purchase Agreement is being filed as Exhibit 10.1 to this report and is incorporated by reference into this Item 1.01.
The Purchase Agreement provided for the sale by the Company to the Air Brook Investors of callable secured convertible notes with an aggregate face amount of $1,500,000, plus interest (the "Facility Notes"). The Air Brook Investors purchased from the Company at closing Facility Notes with an aggregate face amount of $500,000 and are required to purchase additional Facility Notes with an aggregate face amount of $500,000 from the Company upon each of (i) the filing of the registration statement required by the Registration Rights Agreement and (iii) the declaration of effectiveness of such registration statement by the Securities and Exchange Commission. The Facility Notes accrue interest at a rate of 8% per year, require quarterly interest payments in certain circumstances related to the market price of the Company's common stock, and are due and payable on August 16, 2010 (the "Maturity Date"). The Company is not required to make any principal payments until the Maturity Date, but it has the option to prepay the amounts due under the Facility Notes in whole or in part at any time, subject to the payment of varying prepayment penalties depending on the time of such prepayment, as set forth in the Facility Notes. The Facility Notes are convertible into common stock of the Company at a discount to the then current fair market value of the Company's common stock, as set forth in the Facility Notes. A copy of the form of Facility Note is being filed as Exhibit 10.2 to this report and is incorporated by reference into this Item 1.01.
In addition, the Purchase Agreement provided for the issuance by the Company to the Air Brook Investors of warrants to purchase 10,000,000 shares of the Company's common stock (the "Warrants"). Each Warrant permits its holder to acquire shares of the Company's common stock at an exercise price of $0.25 per share at any time through August 16, 2014. A copy of the form of Warrant is being filed as Exhibit 10.3 to this report and is incorporated by reference into this Item 1.01.
As a condition to entering into the Purchase Agreement, the Company and the Air Brook Investors entered into a Registration Rights Agreement, dated as of August 16, 2007. As set forth in the Registration Rights Agreement, the Company has agreed to file a registration statement with the Securities and Exchange Commission, within 30 days, to cover the resale by the Air Brook Investors of the shares of the Company's common stock into which the Facility Notes are convertible. The Company has further agreed to use its best efforts to have such registration statement declared effective and to keep such registration statement effective until the earlier of (i) the date on which all of the securities covered by the registration statement have
Loan to Lextra Management Group, Inc. On August 16, 2007, the Company loaned $500,000 to Lextra Management Group, Inc. ("Lextra"), as set forth in a callable secured note (the "Lextra Note") containing terms substantially similar to the Facility Notes. The Lextra Note, however, does not contain any provision for the outstanding amount due under it to be converted into Lextra's stock. A copy of the Lextra Note is being filed as Exhibit 10.5 to this report and is incorporated by reference into this Item 1.01.
Assumption of Debt of Greens Worldwide Incorporated. On August 17, 2007, the Company entered into a Stock Issuance, Assumption and Release Agreement (the "Assumption Agreement"), by and among the Company and Greens Worldwide Incorporated ("Greens Worldwide") and AJW Partners, LLC, AJW Offshore, Ltd., AJW Qualified Partners, LLC and New Millennium Capital Partners II, LLC (collectively, the "Greens Worldwide Investors"). The transactions contemplated by the Assumption Agreement include the following:
• The issuance by Greens Worldwide of 390,000 shares of its Series A Convertible Preferred Stock, par value $10.00 per share (the "Series A Preferred Stock"), to the Company; and
• The assumption by the Company of 50% of Greens Worldwide's indebtedness to the Greens Worldwide Investors under a Securities Purchase Agreement, dated as of March 22, 2007, by and among Greens . . .
The terms of the Facility Notes and the Assumption Notes are set forth in Item 1.01 above and are incorporated by reference into this Item 2.03.
On August 16, 2007, the Company issued 6,800,000 shares of its common stock to Lextra in exchange for the forgiveness of a $340,000 outstanding accounts payable owed by the Company to Lextra. The Company relied upon Section 4(2) of the Securities Act of 1933, as amended, for the exemption from registration for the sale of such shares.
On August 21, 2007, the Company issued 2,000,000 shares of its common stock to
Lextra in exchange for all of Lextra's assets under the Asset Purchase
Agreement. The terms of this transaction are set forth in Item 1.01 above and
are incorporated by reference into this Item 3.02. The Company relied upon
Section 4(2) of the Securities Act of 1933, as amended, for the exemption from
registration for the sale of such shares.
On August 20, 2007, the Company amended its Certificate of Incorporation to change its name from "Air Brook Airport Express, Inc." to "SportsQuest, Inc."
A copy of the Certificate of Amendment to the Company's Certificate of Incorporation is being filed as an exhibit to this report and is incorporated by reference into this Item 5.03.
(d) Exhibits.
3.1 Certificate of Amendment of Air Brook Airport Express, Inc., dated August 20, 2007.*
10.1 Securities Purchase Agreement by and among Air Brook Airport Express, Inc., AJW Partners, LLC, AJW Master Fund, Ltd. and New Millennium Capital Partners II, LLC dated August 16, 2007.*
10.2 Form of Callable Secured Convertible Note by Air Brook Airport Express, Inc. and issued to each of AJW Partners, LLC, AJW Master Fund, Ltd. and New Millennium Capital Partners II, LLC.*
10.3 Form of Stock Purchase Warrant by Air Brook Airport Express, Inc. and issued to each of AJW Partners, LLC, AJW Master Fund, Ltd. and New Millennium Capital Partners II, LLC.*
10.4 Registration Rights Agreement by and among Air Brook Airport Express, Inc., AJW Partners, LLC, AJW Master Fund, Ltd. and New Millennium Capital Partners II, LLC dated August 16, 2007.*
10.5 Callable Secured Note by Lextra Management Group, Inc. and issued to Air Brook Airport Express, Inc.*
10.6 Stock Issuance, Assumption and Release Agreement by and among Greens Worldwide Incorporated, Air Brook Airport Express, Inc., AJW Partners, LLC, AJW Offshore, Ltd., AJW Qualified Partners, LLC and New Millennium Capital Partners II, LLC dated August 17, 2007.*
10.8 Asset Purchase Agreement by and between SportsQuest, Inc. and Lextra Management Group, Inc. dated August 21, 2007.*
* Previously filed with Current Report on Form 8-K filed on August 22, 2007
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