Item 1.01 Entry into a Material Definitive Agreement.
On November 23, 2022 the registrant, United States Basketball League, Inc.
("USBL"), entered into an Agreement and Plan of Merger (the "Merger Agreement")
with Shurepower, LLC d/b/a Shorepower Technologies, Inc. ("Shorepower") under
which Shorepower will be merged with and into USBL subject to several closing
conditions, including satisfactory completion of due diligence reviews by each
party to the Merger Agreement, Shorepower providing USBL with the most recent
two years of audited financial statements by a PCAOB auditor, USBL authorizing a
new class of Series B preferred stock with each Series B preferred share having
the voting power of 40 shares of USBL common stock, USBL completing a stock and
warrant financing to have a minimum of $480,000 in cash at closing (the "USBL
Pre-Merger Financing") and USBL not having any debt or contingent liabilities of
any kind at the time of the closing. Either party to the Merger Agreement may
terminate it if the closing conditions are not met or waived by December 15,
2022.
Under the terms of the Merger Agreement, following the closing, Shorepower shall
own 55% of the issued and outstanding shares of USBL common stock that includes
any dilution from the USBL Pre-Merger Financing, Shorepower shall receive
2,000,000 shares of a Series B Preferred stock and the right to receive the
following additional shares of USBL common stock upon achieving the following
milestones: (i) an additional 2.5% of the issued and outstanding USBL Common
Stock upon the completion of either (a) the conversion of 75 existing connection
points to Level 2 or greater or the (b) installation of 75 new connection points
to revenue producing stations in the first 12 months or some combination of the
two yielding 75 units, (ii) an additional 2.5% of the of the issued and
outstanding USBL Common Stock upon (a) the application for $10M in grants and/or
the (b) the award of $1.0 million in grants in the first 18 months; (iii) an
additional 2.5% of the issued and outstanding USBL common stock outstanding upon
the completion of acquisitions in the first 24 months generating no less than
$3.0 million in gross revenues and (iv) an additional 500,000 shares of USBL
common stock upon acquiring or hiring the following key personnel in the first
six months after the effective date of the merger: (a) three or more qualified
Board members and (b) at least three of the following four individuals having
the following qualifications: one sales/marketing person, one grant
writer/Government relations person, one technician/maintenance person and one
software programmer/engineer.
Following the closing, Shorepower will transfer its current debt obligations not
to exceed $1,400,000, Shorepower agreed that USBL's new management shall not pay
more than $2,000 per month from the proceeds of the USBL Pre-Merger Financing
towards reduction of such debt obligations for the first 12 months and that the
compensation of USBL's new CEO will not exceed $10,000 per month for the first
nine months after the merger is effective.
The foregoing description of the Merger Agreements does not purport to be
complete and is qualified in its entirety by reference to the Merger Agreement
which is filed as Exhibit 10.1 to this Current Report on Form 8-K.
Item 9.01 Financial Statements and Exhibits.
Exhibits
10.1 Agreement and Plan of Merger dated November 23, 2022 between
Untied States Basketball League, Inc. and Shurepower, LLC
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