You're money went into arne's pocket,then into elsinore...that is after he sold tons of his and his wifes shares.Remember Gary block?
Item 2.01 Completion of Acquisition or Disposition of Assets.
On November 30, 2012, Elsinore Services, Inc., a Delaware corporation (the “Company,” “we,” “our,” “us”) closed on the acquisition (the “Acquisition”) of Government-Buys, Inc. a Maryland corporation (“Government-Buys”). The Acquisition was effected pursuant to the terms of a Stock Purchase Agreement, dated effective as of November 30, 2012 (the “Stock Purchase Agreement”), by and among the Company, Government-Buys and Gary Block, the sole stockholder of Government-Buys (the "Mr. Block"), under which we acquired all of the issued and outstanding shares of capital stock of Government-Buys (the “Government-Buys Stock”).
Government-Buys and its wholly-owned subsidiary, G4 Government-Solutions, Inc., specialize in facilitating transactions between government agencies, industry partners and contractors, employing a wide array of contract vehicles and strategies to ensure a timely and efficient procurement. Contractor partners include a number of small businesses, small disadvantaged, 8(a), Service-disabled, Native American and Alaskan Native owned firms. Government-Buys’ principal executive offices are located in Bethesda, Maryland, a suburb of Washington, D.C.
As consideration for the execution of the Stock Purchase Agreement, we issued to Mr. Block 525,000 shares of our common stock (“SPA Shares”). In addition, at closing and as consideration for our purchase of the outstanding shares of Government-Buys Stock, we paid or issued to Mr. Block the following: 525,000 shares of our common stock (the “Acquisition Shares”), (b) a promissory note in the aggregate principal amount of $542,500 (the “Acquisition Note”), and (c) a promissory note in the aggregate principal amount of $600,000 (the “Three Year Note”).
The Acquisition Note and Three Year Note bear interest at the rate of 6% per annum and may not be assigned or negotiated without our consent. The principal amount of the Acquisition Note shall be due on or before ninety (90) calendar days after the Closing Date and shall be paid contemporaneously with the Company’s closing of major acquisition financing. The principal amount and accrued interest under the Three Year Promissory Note are payable in twelve (12) equal quarterly installment in immediately available United States’ funds with first payment on March 31, 2013 together with interest at the annual rate of six percent (6%) on the unpaid principal balance.
An event of default under the either the Acquisition Note or Three Year Note is deemed to have occurred if (i) we fail for any reason or for no reason to make any payment of the interest or principal under the note within ten days of the date due; (ii) we fail to observe or perform any other covenant, agreement or warranty contained in, or otherwise commit any material breach or default of any material provision of the note which is not cured within ten days notice of the default; or (iii) if any of the following events occurs or is commenced by or with respect to us or any of our subsidiaries (excluding Government-Buys): there shall be commenced under any applicable bankruptcy or insolvency laws, or any other proceeding is commenced under any reorganization, arrangement, adjustment of debt, relief of debtors, dissolution, insolvency or liquidation or similar law relating to us or there is commenced against us any bankruptcy, insolvency or other proceeding which remains undismissed for a period of sixty-one (61) days; an adjudication of insolvency or bankruptcy; any order of relief or other order approving any such case or proceeding is entered; we suffer any appointment of any custodian, private or court appointed receiver for us or a substantial part of our property which continues undischarged or unstayed for a period of sixty-one days; we make a general assignment for the benefit of creditors; we fail to pay, or shall state that we are unable to pay, or we are unable to pay, our debts generally as they become due; we call a meeting of our creditors with a view to arranging a composition, adjustment or restructuring of our debts; we expressly indicate our consent to, approval of or acquiescence in any of the foregoing; or any corporate or other action is taken by us for the purpose of effecting any of the foregoing. Upon the occurrence of an event of default, the entire principal balance and accrued interest outstanding under the applicable note and all other obligations under the note, become immediately due and payable and interest starts accruing on the unpaid principal balance at a rate of 18% per annum or the highest rate permitted by applicable law, if lower, and the holder is entitled to seek and institute any and all remedies available to him.
