Tactical Air Defense Services, Inc.(fka TADF)

[Gaintrader]

Really? wow, against only 4.1M in current liabilities and an accumulated +41M deficit from a year and half ago...

Have you ever been successful with any attempts to contact TADF yet?

TADF is almost certainly in default with all lenders, because they ran out of common shares to issue as of the 9/'12 most current financial report issued. Then they started issuing boat loads of reverse split protected convertible preferred shares, just pay themselves and creditors, that would nearly double the last reported 6B common share count, if/when the preferred are converted (a near promise of a R/S).

Attempting to cherry pick a single line item off of an old balance sheet seems to not only have the strong smell of BS following it everywhere, just like any claims of a paying "contract" as made by others, but also ultimately will prove to be a FOOLS PURSUIT.

Have fun pumping this walking zombie, fraud laced, POBS, worthless, massively diluted, apparent stock SCAM, while the fun still lasts for ya.

Here, just try to figure out (count up) what the true TOTAL common shares would be if converted, as was over 18 months ago. Go ahead and grab some aspirin and start here, and don't forget to add in the +/-12% interest rates to date too;

http://ih.advfn.com/p.php?pid=nmona&article=56761003

NOTE 4 – SALE OF STOCK

Issuance of Convertible Debentures Q1/2012

On January 1, 2012, the Company issued a Convertible Debenture in a principle amount of $29,444.45 to Alexis Korybut as consideration for unpaid salary from Q4/2011. The Convertible Debenture has a term of three years, an interest rate of 12%, and has full-ratchet anti-dilution protection. The principle amount is convertible into 58,890,900 shares of Common Stock at a conversion price of $0.0005 per share.

On January 1, 2012, the Company issued a Convertible Debenture in a principle amount of $10,000 to Brad Hacker as consideration for accounting services for fiscal year 2011. The Convertible Debenture has a term of three years, an interest rate of 12%, and has full-ratchet anti-dilution protection. The principle amount is convertible into 20,000,000 shares of Common Stock at a conversion price of $0.0005 per share.

On January 1, 2012, the Company issued a Convertible Debenture in a principle amount of $41,528.22 to the Katherine M. O’Connor Trust as consideration for funding the purchase of aircraft to be sold to the Company. The Convertible Debenture has a term of three years, an interest rate of 12%, and has full-ratchet anti-dilution protection. The principle amount is convertible into 83,056,440 shares of Common Stock at a conversion price of $0.0005 per share.

On January 1, 2012, the Company issued a Convertible Debenture in a principle amount of $35,375.89 to Sopwith, LLC as consideration for funding the purchase of aircraft to be sold to the Company. The Convertible Debenture has a term of three years, an interest rate of 12%, and has full-ratchet anti-dilution protection. The principle amount is convertible into 70,751,780 shares of Common Stock at a conversion price of $0.0005 per share.

On February 29, 2012, the Company issued a Convertible Debenture in a principle amount of $57,804.38 to Jamie Goldstein as consideration for loans to the Company in Q1/2012. The Convertible Debenture has a term of three years, an interest rate of 12%, and has full-ratchet anti-dilution protection. The principle amount is convertible into 115,608,760 shares of Common Stock at a conversion price of $0.0005 per share.

On March 31, 2012, the Company issued a Convertible Debenture in a principle amount of $20,000.00 to The Bingham Law Group as consideration for unpaid legal services for Q1-2012. The Convertible Debenture has a term of three years, an interest rate of 12%, and has full-ratchet anti-dilution protection. The principle amount is convertible into 40,000,000 shares of Common Stock at a conversion price of $0.0005 per share.

On March 31, 2012, the Company issued a Convertible Debenture in a principle amount of $65,458.60 to Alexis Korybut as consideration for (i) unpaid salary from Q1/2012, (ii) out-of-pocket expenses, and (iii) a loan to the Company. The Convertible Debenture has a term of three years, an interest rate of 12%, and has full-ratchet anti-dilution protection. The principle amount is convertible into 130,917,200 shares of Common Stock at a conversion price of $0.0005 per share.


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Conversion of Notes and Exercise of Warrants

The Company issued 35,711,416 shares of restricted Common Stock to The Bingham Law Group in February, 2012 in consideration for the conversion of a principle amount of $25,000.00 and accrued interest of $1,783.56, for a total consideration of $26,783.56, of a Convertible Promissory Note initially issued to The Bingham Law Group on July 1, 2011 with a principle amount of $25,000.00. No registration rights were issued in connection with these shares.

The Company issued 82,136,063 shares of restricted Common Stock to The Bingham Law Group in February, 2012 in consideration for the conversion of a principle amount of $50,000.00 and accrued interest of $6,542.47, for a total consideration of $56,542.47, of a Convertible Promissory Note initially issued to The Bingham Law Group on January 1, 2011 with a principle amount of $50,000.00. No registration rights were issued in connection with these shares.

Convertible Debenture Issuances Q2/2012

On April 15, 2012, the Company issued a Convertible Debenture in a principle amount of $11,000.00 to Jamie Goldstein as consideration for loans to the Company in Q2/2012. The Convertible Debenture has a term of three years, an interest rate of 12%, and has full-ratchet anti-dilution protection. The principle amount is convertible into 36,666,667 shares of Common Stock at a conversion price of $0.0003 per share.

On June 30, 2012, the Company issued a Convertible Debenture in a principle amount of $54,000.00 to Alexis Korybut as consideration for unpaid salary from Q2/2012. The Convertible Debenture has a term of three years, an interest rate of 12%, and has full-ratchet anti-dilution protection. The principle amount is convertible into 180,000,000 shares of Common Stock at a conversion price of $0.0003 per share.

On June 30, 2012, the Company issued a Convertible Debenture in a principle amount of $40,000.00 to The Bingham Law Group as consideration for unpaid legal services for Q2/2012. The Convertible Debenture has a term of three years, an interest rate of 12%, and has full-ratchet anti-dilution protection. The principle amount is convertible into 133,333,333 shares of Common Stock at a conversion price of $0.0003 per share.

On June 30, 2012, the Company issued a Convertible Debenture in a principle amount of $72,448.49 to Alexis Korybut as consideration for accrued and unpaid vacation from August 17, 2007 through June 30, 2012. The Convertible Debenture has a term of three years, an interest rate of 12%, and has full-ratchet anti-dilution protection. The principle amount is convertible into 241,494,967 shares of Common Stock at a conversion price of $0.0003 per share.

Conversion of Notes and Exercise of Warrants Q2/2012

On May 21, 2012, $25,000.00 of principle, together with accrued interest of $5,613.70, for a total amount of $30,613.70, of a Convertible Promissory Note issued to the Gary Fears Trust on July 1, 2010 in a principle amount of $218,570.50, was converted by Kristen Zankl at a conversion price of $0.0003 into 102,073,059 shares of restricted Common Stock of the Company.

On May 21, 2012, $86,000.00 of principle, together with accrued interest of $19,311.12, for a total amount of $105,311.12, of a Convertible Promissory Note issued to the Gary Fears Trust on July 1, 2010 in a principle amount of $218,570.50, was converted by Richard Applegate at a conversion price of $0.0003 into 351,131,324 shares of restricted Common Stock of the Company.

On May 21, 2012, $64,000.00 of principle, together with accrued interest of $12,235.56, for a total amount of $76,735.56, of a Convertible Promissory Note issued to the Gary Fears Trust on October 15, 2010 in a principle amount of $110,000.00, was converted by GFMB LLC at a conversion price of $0.0003 into 255,785,205 shares of restricted Common Stock of the Company.

On May 21, 2012, $65,000.00 of principle, together with accrued interest of $15,512.52, for a total amount of $80,514.42, of a Convertible Promissory Note issued to the Gary Fears Trust on May 19, 2010 in a principle amount of $150,000.00, was converted Lightening Equity Group LLC at a conversion price of $0.0003 into 268,381,735 shares of restricted Common Stock of the Company.

On May 21, 2012, $70,700.00 of principle, together with accrued interest of $13,737.11, for a total amount of $84,437.11, of a Convertible Promissory Note issued to the Gary Fears Trust on October 1, 2010 in a principle amount of $146,142.51, was converted by Lightening Equity Group LLC at a conversion price of $0.0003 into 281,457,023 shares of restricted Common Stock of the Company.


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On May 21, 2012, a Convertible Promissory Note issued to Joint Strategy Group LLC on September 3, 2009 in a principle amount of $19,762.32, together with accrued interest of $6,393.25, for a total amount of $26,155.57, was converted by the Dylan Scott Goldstein Irrevocable Trust at a conversion price of $0.0003 into 87,185,220 shares of restricted Common Stock of the Company.

On May 21, 2012, a Convertible Promissory Note issued to Jamie Goldstein on April 1, 2011 in a principle amount of $75,000.00, together with accrued interest of $10,084.93, for a total amount of $85,084.93, was converted by the Dylan Scott Goldstein Irrevocable Trust at a conversion price of $0.0003 into 283,616,438 shares of restricted Common Stock of the Company.

On June 20, 2012, $25,000.00 of principle, together with accrued interest of $6,090.41, for a total amount of $31,090.41, of a Convertible Promissory Note issued to the Gary Fears Trust on May 19, 2010 in a principle amount of $150,000.00, was converted by Northern Capital Group, LLC at a conversion price of $0.0003 into 103,634,703 shares of restricted Common Stock of the Company.

Conversion of Preferred Stock Q2/2012

On April 18, 2012, 874,913 out of 1,333,332 shares of Series B Preferred stock issued to Cornucopia, Ltd. in May, 2011, was converted by Cornucopia, Ltd. on behalf of Alan Nisselson, Responsible Officer & Authorized Person of MarketXT Holdings, Corp into 349,956,000 shares of restricted Common Stock of the Company.

Expiration of Warrants Q2/2012

In April, 2012, both the Series A-100 and Series A-101 warrants issued to Cornucopia, Ltd. expired with no exercise of such warrants and no issuance of any shares of Common Stock. Such warrants were issued to Cornucopia, Ltd. in April, 2011, in connection with a securities purchase agreement with Cornucopia, Ltd. in which Cornucopia, Ltd. was issued (a) Series A-100 warrant to purchase up to 533,333,333 shares of Common Stock at an exercise price of $0.00075 for a one year period; and (b) Series A-101 warrant to purchase up to 800,000,000 shares of Common Stock at an exercise price of the lesser of: (A) $0.0025 or (B) a fifty percent (50%) discount to the average closing price of the Common Stock for the thirty (30) trading days prior to exercise of the A-101 warrant.

Issuance of Convertible Debentures

Third Quarter of 2012

On September 27, 2012, the Company issued a secured Non-Convertible Promissory Note in a principle amount of $500,000.00 to the Mark Daniels Irrevocable Trust III as partial consideration for the purchase of Northrop TF5-1 Corp. in the third quarter of 2012. The Convertible Debenture has a term of one year and an interest rate of 12%.

On September 27, 2012, the Company issued a secured Convertible Promissory Note in a principle amount of $1,350,000.00 to the Mark Daniels Irrevocable Trust III as partial consideration for the purchase of Northrop TF5-1 Corp. in third quarter of 2012. The Convertible Promissory Note has a term of one year, an interest rate of 12%, and is convertible into 2,500,000 shares of Series C Preferred Stock.

On September 30, 2012, the Company issued a Convertible Promissory Note in a principle amount of $36,377.92 to Jamie Goldstein as consideration for loans to the Company in the third quarter of 2012. The Convertible Promissory Note has a term of three years, an interest rate of 12%, and has full-ratchet anti-dilution protection. The principle amount is convertible into 121,259,733 shares of Common Stock at a conversion price of $0.0003 per share.

On September 30, 2012, the Company issued a Convertible Promissory Note in a principle amount of $21,700.00 to GFMB LLC as consideration for loans to the Company in the third quarter of 2012. The Convertible Promissory Note has a term of three years, an interest rate of 12%, and has full-ratchet anti-dilution protection. The principle amount is convertible into 72,333,333 shares of Common Stock at a conversion price of $0.0003 per share.

On September 30, 2012, the Company issued a Convertible Promissory Note in a principle amount of $11,376.53 to Alexis Korybut as consideration for loans to the Company in the third quarter of 2012. The Convertible Promissory Note has a term of three years, an interest rate of 12%, and has full-ratchet anti-dilution protection. The principle amount is convertible into 37,921,767 shares of Common Stock at a conversion price of $0.0003 per share.

On September 30, 2012, the Company issued a Convertible Promissory Note in a principle amount of $52,988.01 to Alexis Korybut as consideration for unpaid salary and benefits from the Company in the third quarter of 2012. The Convertible Promissory Note has a term of three years, an interest rate of 12%, and has full-ratchet anti-dilution protection. The principle amount is convertible into 176,626,700 shares of Common Stock at a conversion price of $0.0003 per share.


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On September 30, 2012, the Company issued a Convertible Promissory Note in a principle amount of $21,000.00 to the Mark Daniels Irrevocable Trust III as consideration for unpaid salary from the Company in the third quarter of 2012. The Convertible Promissory Note has a term of three years, an interest rate of 12%, and has full-ratchet anti-dilution protection. The principle amount is convertible into 70,000,000 shares of Common Stock at a conversion price of $0.0003 per share.

On September 30, 2012, the Company issued a Convertible Promissory Note in a principle amount of $17,310.00 to The Bingham Law Group as consideration for legal services to the Company in the third quarter of 2012. The Convertible Promissory Note has a term of three years, an interest rate of 12%, and has full-ratchet anti-dilution protection. The principle amount is convertible into 57,700,000 shares of Common Stock at a conversion price of $0.0003 per share.

On September 30, 2012, the Company issued a Convertible Promissory Note in a principle amount of $5,000.00 to Sopwith, LLC as consideration for consulting services to the Company in the third quarter of 2012. The Convertible Promissory Note has a term of three years, an interest rate of 12%, and has full-ratchet anti-dilution protection. The principle amount is convertible into 16,666,667 shares of Common Stock at a conversion price of $0.0003 per share.

Issuance of Common Stock

Conversion of Promissory Notes – Third Quarter of 2012

The Company issued 53,550,680 shares of restricted Common Stock to The Bingham Law Group in July, 2012 in consideration for the conversion of a principle amount of $25,000.00 and accrued interest of $1,775.34, for a total consideration of $26,775.34, of a Convertible Promissory Note initially issued to The Bingham Law Group on November 22, 2011 with a principle amount of $25,000.00. No registration rights were issued in connection with these shares.

The Company issued 12,656,256 shares of restricted Common Stock to Maria Idiaquez Meneses in July, 2012 in consideration for the conversion of a principle amount of $3,500.00 and accrued interest of $296.88, for a total consideration of $3,796.88, of a Convertible Promissory Note initially issued to Alexis Korybut on October 1, 2011 with a principle amount of $15,500.00 and subsequently assigned to Maria Idiaquez Meneses. No registration rights were issued in connection with these shares.

The Company issued 10,848,219 shares of restricted Common Stock to Evelyn Saldana Rodriguez in July, 2012 in consideration for the conversion of a principle amount of $3,000.00 and accrued interest of $254.47, for a total consideration of $3,254.47 of a Convertible Promissory Note initially issued to Alexis Korybut on October 1, 2011 with a principle amount of $15,500.00 and subsequently assigned to Evelyn Saldana Rodriguez. No registration rights were issued in connection with these shares.

The Company issued 21,696,438 shares of restricted Common Stock to Greisy Tejada Lujan in July, 2012 in consideration for the conversion of a principle amount of $6,000.00 and accrued interest of $508.93, for a total consideration of $6,508.93, of a Convertible Promissory Note initially issued to Alexis Korybut on October 1, 2011 with a principle amount of $15,500.00 and subsequently assigned to Greisy Tejada Lujan. No registration rights were issued in connection with these shares.

The Company issued 10,848,219 shares of restricted Common Stock to Juliana Hoyas Castelar in July, 2012 in consideration for the conversion of a principle amount of $3,000.00 and accrued interest of $254.47, for a total consideration of $3,254.47 of a Convertible Promissory Note initially issued to Alexis Korybut on October 1, 2011 with a principle amount of $15,500.00 and subsequently assigned to Juliana Hoyas Castelar. No registration rights were issued in connection with these shares.

Conversion of Preferred Stock – Third Quarter of 2012

The Company issued 43,447,410 shares of restricted Common Stock to Cornucopia, Ltd. In July, 2012 in consideration for the conversion of 108,619 shares of Series B Preferred stock initially issued to Cornucopia, Ltd. in May, 2011. No registration rights were issued in connection with these shares.

NOTE 5 – COMMITMENTS AND CONTRACTUAL OBLIGATIONS:

Compensation Agreements

On May 15, 2012, the Company entered into an employment agreement with its Chief Executive Officer, Alexis C. Korybut. Pursuant to the terms of the agreement, Mr. Korybut will be employed in the positions of Chief Executive Officer, President and Chief Financial Officer of the Company and will receive an annual salary of $180,000, a one-time issuance of 3,000,000 shares of the Company’s Series A Preferred Stock and additional benefits as outlined in the agreement.


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On August 2, 2012, pursuant to the terms of the AeroTech Acquisition Agreement, Mr. Mark Daniels was appointed to the position of President and Secretary of AeroTech, a wholly owned subsidiary of the Company. Concurrent with his appointment, the Company and Mr. Daniels entered into an employment agreement effective as of August 2, 2012 (the “Daniels Employment Agreement”). Under the terms of the Daniels Employment Agreement, Mr. Daniels’ initial base annual salary is to be $120,000 with additional benefits as outlined in the Daniels Employment Agreement. A copy of the Daniels Employment Agreement was attached as an exhibit to our Form 8-K filed with the SEC on August 3, 2012, the terms of which are hereby incorporated by reference in their entirety.

On August 2, 2012, pursuant to the terms of the AeroTech Acquisition Agreement, Colonel Scott Patterson was appointed to the position of Chief Operating Officer of AeroTech, a wholly owned subsidiary of the Company. Concurrent with his appointment, the Company and Col. Patterson entered into an employment agreement effective as of August 2, 2012 (the “Patterson Employment Agreement”). Under the terms of the Patterson Employment Agreement, Col. Patterson’s initial base annual salary is to be $120,000 with additional benefits as outlined in the Patterson Employment Agreement. A copy of the Patterson Employment Agreement was attached as an exhibit to our Form 8-K filed with the SEC on August 3, 2012, the terms of which are hereby incorporated by reference in their entirety.

On January 21, 2013, the Company entered into a one-year employment agreement with its Chief Executive Officer, Alexis C. Korybut. Pursuant to the terms of the agreement, Mr. Korybut will be employed in the positions of Chief Executive Officer, President and Chief Financial Officer of the Company and will receive an annual salary of $180,000, a one-time issuance of 6,000,000 shares of the Company’s Series A Preferred Stock, and additional benefits as outlined in the employment agreement.

ACQUISTIONS AND LETTERS OF INTENTS

AeroTech Corporation Acquisition Agreement

On or about July 12, 2012, the Company and AeroTech Corporation, a Florida corporation (“AeroTech”) entered into an Acquisition Agreement (the “AeroTech Acquisition Agreement”). A copy of the AeroTech Acquisition Agreement has been attached as an exhibit to our Form 8-K filed on June 20, 2012, the terms of which are hereby incorporated by reference in their entirety. Although executed on or about July 12, 2012, the AeroTech Acquisition Agreement called for certain closing condition which were to be met on or before August 12, 2012.

On or about August 2, 2012, the Company and AeroTech finalized the closing conditions and the AeroTech Acquisition Agreement was closed. Through the acquisition of AeroTech, the Company has acquired 100% of AeroTech’s existing business and assets including, but not limited to, five separate teaming agreements, a sole source justification and approval from the United States Army, and AeroTech’s pre-transaction management team.

Pursuant to the terms of the AeroTech Acquisition Agreement, the Company has acquired 100% of the equity interest in AeroTech in exchange for the issuance of Five Million shares of the Company’s Series C Preferred Stock. The rights, privileges and preferences of the Series C Preferred Stock are outlined in Exhibit B to the AeroTech Acquisition Agreement filed as an exhibit to our Form 8-K filed on June 20, 2012, the terms of which are hereby incorporated by reference in their entirety. Following the closing of the AeroTech Acquisition Agreement, AeroTech will continue its existing business operations as a wholly owned subsidiary of the Company.

As further discussed below in Item 5. “Other Information” “Employment Agreements,” pursuant to the terms of the AeroTech Acquisition Agreement, on August 2, 2012, Mr. Mark Daniels was appointed to the position of President and Secretary of AeroTech and Colonel Scott Patterson was appointed to the position of Chief Operating Officer of AeroTech. Concurrent with their appointments, the Company and Mssrs. Daniels and Peterson entered into employment agreements effective as of August 2, 2012. Copies of the Employment Agreements with Mssrs. Daniels and Patterson were attached to our Form 8-K filed with the SEC on August 3, 2012 and incorporated herein by reference in its entirety.

Globalease Corporation Acquisition Letter Of Intent

On August 8, 2012, the Company entered into a Letter of Intent (the “Globalease LOI”) with Globalease Corporation (“Globalease”). Pursuant to the terms of the Globalease LOI and subject to further negotiation, the Company will acquire 100% of the equity interest and assets of Globalease, including, but not limited to, two (2) lease-to-purchase agreements which maintain existing leases on, and a subsequent rights to purchase, two (2) Canadair CF-5D aircraft, such that following the transaction, Globalease will become a wholly-owned subsidiary of the Company. In exchange, the existing shareholders of Globalease will be issued One Million Two Hundred Fifty Thousand (1,250,000) shares of TADF’s Series C Preferred Stock. The parties have agreed to use their best efforts to close the transaction within 30 days of execution of the Globalease LOI. A copy of the Globalease LOI was attached as an exhibit to our Form 8-K filed with the SEC on August 9, 2012, the terms of which are hereby incorporated by reference in their entirety.


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Northrop TF5-1 Corp. Acquisition Agreement

On August 20, 2012, Tactical Air Defense Services, Inc. (the “Company”) entered into a Letter of Intent (the “TF5-1 LOI”) with Northrop TF5-1 Corp. (“TF5-1”) in connection with the Company’s acquisition of TF5-1. A copy of the TF5-1 LOI was attached as an exhibit to our Form 8-K filed on August 21, 2012, the terms of which are hereby incorporated by reference in their entirety

On September 27, 2012, the Company entered into an acquisition agreement and closed the acquisition (the “TF5-1 Acquisition Agreement”) with TF5-1. Through the TF5-1 Acquisition Agreement the Company acquired: (i) 100% of the equity interest in TF5-1 (the “TF5-1 Shares”) such that following the TF5-1 Acquisition Agreement, TF5-1 will continue its existing business operations as a wholly owned subsidiary of the Company; and (ii) 100% of TF5-1’s existing business and assets including, but not limited to, one (1) Canadair Ltd. CF-5 aircraft (the “CF-5 Aircraft”). A copy of the TF5-1 Acquisition Agreement has been attached as an exhibit to our Form 8-K filed with the SEC on October 5, 2012, the terms of which are hereby incorporated by reference in their entirety.

Pursuant to and in connection with the TF5-1 Acquisition Agreement the Company: (i) issued TF5-1’s shareholder a secured convertible promissory note in the principle amount of One Million Three Hundred and Fifty Thousand Dollars ($1,350,000) (the “Convertible Note,”); (ii) issued TF5-1’s shareholder a secured non-convertible promissory note in the principle amount of Five Hundred Thousand Dollars ($500,000) (the “Note”); (iii) entered into security agreement securing the Notes with the TF5-1 Shares (the “Company Shares Security Agreement”); and (iv) entered into a separate security agreement securing the Notes with the CF-5 Aircraft (the “Aircraft Security Agreement”). A copy of the Convertible Note, the Note, the Company Shares Security Agreement and the Aircraft Security Agreement have been attached as exhibits to our Form 8-K filed with the SEC on October 5, 2012, the terms of which are hereby incorporated by reference in their entirety.

Logos Aviation Services International, Inc. Letter of Intent

On August 24, 2012, Tactical Air Defense Services, Inc. (the “Company”) entered into a Letter of Intent (the “Logos LOI”) with Logos Aviation Services International, Inc. (“Logos”).

Pursuant to the terms of the Logos LOI and subject to further negotiation, the Company will acquire 100% of the equity interest and assets of Logos, including, but not limited to, a Federal Aviation Administration (“FAA”) license to conduct business as an approved FAA Part 145 Repair Station, such that following the transaction, Logos will become a wholly owned subsidiary of the Company. In exchange, the existing shareholders of Logos will be issued Eight Hundred and Thirty-Three Thousand Three Hundred and Thirty-Three (833,333) shares of TADF’s Series C Preferred Stock. The parties have agreed to use their best efforts to close the Transaction within 90 days of execution of the Logos LOI. A copy of the Logos LOI has been attached as an exhibit to our Form 8-K filed with the SEC on August 27, 2012, the terms of which are hereby incorporated by reference in their entirety.

F-5 Simulator Asset Purchase Agreement

On October 11, 2012, the Company entered into an asset purchase agreement (the “F5 Simulator Purchase Agreement”) with Mark Daniels. Through the F5 Simulator Purchase Agreement the Company acquired one F-5 training simulator for the total purchase price of $250,000.00. In consideration of the $250,000.00 purchase price, the Company cancelled the $250,000.00 cash payment due and owing to the Company pursuant to the Daniels Settlement Agreement (as described below in Part II – Item.1 – Legal Proceedings).

NOTE 6: LEGAL PROCEEDINGS

Mr. Charlie Searock (“Searock”), a former executive officer of our company, has brought a laws suit in the District Court of the 336 th Judicial District of Grayson County, Texas against us and seven other defendants on February 6, 2007, on claims of breach of an employment agreement between Searock and International Tactical Training Center, Inc. (“ITTC”). (Charles J. Searock, Jr., vs. Tactical Air Defense Services, Inc., International Tactical Training Center, Inc., Mark Daniels, Victor Miller, John Farley, Gary Fears, Jamie Goldstein, and Joel Ramsden, Cause No.07-0322-336). ITTC and the Company are the only two corporate defendants named in the Searock lawsuit. Of the six individuals named as defendants, three are former ITTC management. Searock asserts that the Company is liable for ITTC’s breach of employment agreement because he alleges that the Company acquired ITTC’s assets, and that ITTC was a former subsidiary of AeroGroup, Inc., an entity not named as a defendant in the Searock lawsuit. In addition to his claim for breach of the ITTC employment contract, Searock also asserts theories of tort liability against the defendants. The Company denies any liability to Searock on his claim for breach of the ITTC employment contract and denies Searock has any factual basis to impose liability on the Company under any of his theories of tort liability. Specifically, the Company denies that it acquired, owns or controls ITTC’s former assets. The Company believes that this claim is without merit and is working towards resolution of the same. On October 25, 2010, Searock was awarded a default judgment of $1,248,962 including accrued interest, jointly and severally against TADS and the other defendants, all of whom who failed to appear for trial, and an award of exemplary damages of $2,000,000 against TADS. Searock claims that TADS and the other defendants were given notice of the trial, however it is TADS assertion and the assertion of the other defendants that none one of the defendants, including TADS, ever received notice of the trial, were unaware of the trial, and that the judgment is without merit. TADS is currently in the process of appealing the judgment in the Texas Appellate Court based upon not having received notice, and although no assurances can be given, the Company believes that the judgment will be vacated by the Court.


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On or about July 3, 2012, Tactical Air Defense Services, Inc., a Nevada corporation (the “Company”) entered into a Settlement Agreement (the “Daniels Settlement Agreement”) with Mark Daniels (“Daniels”), the Company’s former Chief Executive Officer. A copy of the Daniels Settlement Agreement was attached to our Form 8-K filed with the SEC on July 3, 2012 and incorporated herein by reference in its entirety.

Pursuant to the terms of the Daniels Settlement Agreement, the Company agreed to settle its litigational claims against Daniels related to the litigation action entitled Tactical Air Defense Services, Inc., et. al v. Mark Daniels, et. al, in the Circuit Court of the 15 th Judicial Circuit in and for Palm Beach County, Florida through the removal of Daniels from the action. As consideration for the removal of Daniels from the action: (i) Daniels agreed to the rescission, cancellation, waiver and termination in full of all Company obligations relating to a promissory note issued by the Company to Daniels on or about April 15, 2009 with a current balance of approximately $221,000 including all principle and accrued interest; and (ii) Daniels is required to deliver a Two Hundred and Fifty Thousand Dollars ($250,000.00) cash payment to the Company within one hundred and twenty (120) days of the execution of the Daniels Settlement Agreement, which indebtedness has been satisfied through the purchase from Daniels of an F-5 aircraft simulator.

August 3, 2010 certain individuals including Alexander Baranov/Glovatsky filed an improper and frivolous Involuntary Chapter 7 Petition (the “New Petition”) against the Company in the United States Bankruptcy Court for the Southern District of Florida, in an effort to circumvent the legitimate court process, in direct violation of the Court Order issued by Judge Paul Hyman on May 14, 2010.

The Company immediately requested an emergency Motion to Dismiss the New Petition based upon its contention that:

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the New Petition violated the Court Order;
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a majority of the new petitioners were currently involved in civil litigation with TADF; and
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all of the claims of the new petitioners were either without merit, being contested, or were frivolous and improper.

On August 10, 2010, at an Emergency Hearing to Dismiss the fraudulent and improper Petition, the Federal Bankruptcy judge dismissed the Petition, as had been anticipated and previously disclosed by the Company, and, moreover, due to the egregious actions of the petitioners, reserved the right of the US Federal Bankruptcy Court to:

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impose sanctions upon the petitioners, and
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impose punitive sanctions upon the petitioners if it is determined that the actions of the petitioners violated the Court Order previously issued by U.S. Federal Bankruptcy Court Judge Hyman.

Although no assurances can be given, the Company believes that at the request of the Company, sanctions will be imposed upon the petitioners, and that it will be determined that the petitioners violated the Court Order issued by Judge Hyman.

As disclosed in our past filings, Sichenzia & Ross LLP (“Sichenzia”) had been pursuing a claim against the Company for unpaid services dating back to early 2007. The Company recently learned that Sichenzia obtained a judgment against the Company in the amount of $21,471.87 in the Civil Court of the City of New York, County of New York on April 3, 2008. We believe that this claim is without merit and are working towards resolution of the same.

As of the date of this Quarterly Report, the Company is not a party to any pending litigation or legal proceeding that is not described herein or in the ordinary course of business. To our knowledge, no such proceedings exist or are threatened other than those described herein.

NOTE 7 – NOTES RECEIVABLE

On July 22, 2011, the Company entered into a Binding Letter of Intent (the “LOI”) with Tactical Air Support, Inc., a Nevada corporation (“Tac-Air”) in connection with certain government services contracts Tac-Air is currently seeking (the “Services Contracts”).

Subject to further definitive agreements and pursuant to the terms of the LOI, in the event Tac-Air is awarded the Services Contracts, the Company will receive the right to thirty percent (30%) of all future net profits derived from the Services Contracts.


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In connection with the LOI and Services Contracts, the Company has provided Tac-Air funding codified by a secured promissory note issued to the Company by Tac-Air in the amount of Three Hundred and Fifteen Thousand Dollars (US$315,000 and the “Note”). The Note maintains zero interest, a maturity date of October 22, 2011 and is secured by and convertible into 100,000 shares of Tac-Air’s pledged, issued and outstanding common stock at the Company’s option, which represents a ten percent (10%) ownership interest in Tac-Air. A copy of the Note has been attached as an exhibit to our Form 8-K filed on July 28, 2012, and is hereby incorporated by reference.

On February 2, 2012, the Company made an additional loan to Tac-Air in the amount of fifty thousand dollars (US$50,000), which additional loan was retired on July, 31, 2012, as described below in Note 8. – Subsequent Events

Settlement Agreement with Mark Daniels

On or about July 3, 2012, the Company entered into a Settlement Agreement (the “Daniels Settlement Agreement”) with Mark Daniels (“Daniels”), the Company’s former Chief Executive Officer. A copy of the Daniels Settlement Agreement was attached to our Form 8-K filed with the SEC on July 3, 2012 and incorporated herein by reference in its entirety. Pursuant to the terms of the Daniels Settlement Agreement, the Company agreed to settle its litigational claims against Daniels related to the litigation action entitled Tactical Air Defense Services, Inc., et. al v. Mark Daniels, et. al, in the Circuit Court of the 15 th Judicial Circuit in and for Palm Beach County, Florida through the removal of Daniels from the action. As consideration for the removal of Daniels from the action: (i) Daniels agreed to the rescission, cancellation, waiver and termination in full of all Company obligations relating to a promissory note issued by the Company to Daniels on or about April 15, 2009 with a current then balance of approximately $221,000 including all principle and accrued interest; and (ii) Daniels is required to deliver a Two Hundred and Fifty Thousand Dollars ($250,000.00) cash payment to the Company within one hundred and twenty (120) days of the execution of the Daniels Settlement Agreement, which indebtedness has been satisfied through the purchase from Daniels of an F-5 aircraft simulator.

NOTE 8 – SUBSEQUENT EVENTS

Issuance of Convertible Debentures

On December 31, 2012, the Company issued a Convertible Promissory Note in a principle amount of $29,500.00 to the Mark Daniels Irrevocable Trust III as consideration for unpaid salary from the Company in the fourth quarter of 2012. The Convertible Promissory Note has a term of three years, an interest rate of 12%, and has full-ratchet anti-dilution protection. The principle amount is convertible into 147,500,000 shares of Common Stock at a conversion price of $0.0002 per share.

On December 31, 2012, the Company issued a Convertible Promissory Note in a principle amount of $29,500.00 to Victor Miller as consideration for unpaid consulting fees pursuant to the Air 1 Flight Support, Inc consulting agreement (described below in Item 5. Other Information – Consulting Agreements) in the fourth quarter of 2012. The Convertible Promissory Note has a term of three years, an interest rate of 12%, and has full-ratchet anti-dilution protection. The principle amount is convertible into 147,500,000 shares of Common Stock at a conversion price of $0.0002 per share.

On December 31, 2012, the Company issued a Convertible Promissory Note to Alexis Korybut in a principle amount of $10,000.00 as consideration for loans to the Company in the fourth quarter of 2012. The Convertible Promissory Note has a term of three years, an interest rate of 12%, and has full-ratchet anti-dilution protection. The principle amount is convertible into 50,000,000 shares of Common Stock at a conversion price of $0.0002 per share.

On December 31, 2012, the Company issued a Convertible Promissory Note to Alexis Korybut in a principle amount of $54,000.00 as consideration for unpaid salary and benefits from the Company in fourth quarter of 2012. The Convertible Promissory Note has a term of three years, an interest rate of 12%, and has full-ratchet anti-dilution protection. The principle amount is convertible into 270,000,000 shares of Common Stock at a conversion price of $0.0002 per share.

Conversion of Promissory Notes

On December 14, 2012, a Convertible Promissory Note issued to The Mark Daniels Irrevocable Trust III on September 27, 2012 in a principle amount of $1,350,000.00, was converted into 2,500,000 restricted shares of Series C Preferred Stock of the Company.

Issuance of Preferred Stock

On December 14, 2012, the Company issued 125,000 restricted shares of Series C Preferred Stock to Peter C. Maffitt as consideration for serving as a Director of the Company for 2012. No registration rights were issued in connection with these shares.


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On December 14, 2012, the Company issued 62,500 restricted shares of Series C Preferred Stock to Tactical Air Consulting for consulting services during Q3/2012. No registration rights were issued in connection with these shares.

On December 14, 2012, the Company issued 5,000,000 restricted shares of Series C Preferred Stock to the Mark Daniels Irrevocable Trust III as consideration for the acquisition of AeroTech Acquisition Agreement. No registration rights were issued in connection with these shares.

On January 21, 2013, the Company issued 3,000,000 restricted shares of Series A Preferred Stock to Alexis Korybut pursuant to his employment agreement for 2012. No registration rights were issued in connection with these shares.

On January 21, 2013, the Company issued 6,000,000 restricted shares of Series A Preferred Stock to Alexis Korybut pursuant to his employment agreement for 2013. No registration rights were issued in connection with these shares.

The Company reasonably believes that all of the issuances of securities described above were deemed to be exempt from registration in reliance on Section 4(2) of the Securities Act as transactions by an issuer not involving a public offering. Each investor had a pre-existing relationship with the Company and/or represented that it had the financial wherewithal, knowledge and sophistication to invest in the securities of the Company. In addition, each recipient represented that they are acquiring the securities as an investment only and not with a view towards distribution of the same to the public. We made available to each investor with disclosure of all aspects of our business, including providing the investor with press releases, access to our auditors, and other financial, business, and corporate information. Finally, all securities issued were either restricted with an appropriate restrictive legend on certificates for shares, notes and warrants issued stating that the securities (and underlying shares) have not been registered under the Securities Act and cannot be sold or otherwise transferred without an effective registration or an exemption therefrom, or were issued pursuant to an exemption provided under Rule 144.

Designation of Preferred Stock

On or about October 2, 2012, the Company filed a Certificate of Amendment to their Certificate of Designation amending the designation of the Series A Preferred Stock (the “Series A Preferred Stock”) and Series C Preferred Stock (the “Series C Preferred Stock”). The Series A Preferred Stock was amended to increase the number of authorized shares of Series A Preferred Stock to ten million shares; all other rights, preferences and privileges of the Series A Preferred Stock will remain the same as previously designated. The Series C Preferred Stock was re-designated to authorize up to twenty five million shares of Series C Preferred Stock, with each share of Series C Preferred Stock convertible into four hundred shares of Common Stock and maintaining a number of votes equal to the number of shares of Common Stock each share of Series C Preferred Stock is convertible into. A copy of the Certificate of Amendment to the Certificate of Designation has been attached as an exhibit to our Form 8-K filed with the SEC on October 5, 2012, the terms of which are hereby incorporated by reference in their entirety.

Consulting Agreements

On October 1, 2012, the Company entered into a one-year consulting agreement with Air 1 Flight Support, Inc. Pursuant to the terms of the agreement, Air 1 Flight Support shall review and advise upon the business and operations of the Company in connection with aircraft acquisition, aircraft maintenance, and other aircraft support services, and shall to review and advise upon logistical components of actual and potential aerial support contracts, in consideration for a monthly fee of $10,000. A copy of the consulting agreement has been attached as an exhibit to this Form 10-Q for the quarter ended September 30, 2012.



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