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): SEPTEMBER 3, 2004
Sports Arenas, Inc.
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(Exact name of registrant as specified in its charter)
Delaware 0-2380 13-1944249
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(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
7415 Carroll Road, Suite C, San Diego, CA 92121
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (858) 408-0364
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filng obligation of the registrant under any of the
following provisions:
[ ] Written communications pursuant to Rule 425 under 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))
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Act of 1934
Item 1.01. Entry into a Material Definitive Agreement.
On September 2, 2004, Sports Arenas, Inc. ("SAI") and Harold S. Elkan ("Elkan")
entered into the Stock Restriction Agreement ("Agreement") , with an effective
date of June 30, 2004 pursuant to, and as contemplated by, the Debt Payment and
Compensation Agreement which was entered into on June 30, 2004 and previously
reported on Form 8-K filed July 6, 2004. Elkan is Chief Executive Officer, a
director and chairman of the board of SAI, and beneficial owner of 50.01% of
SAI's outstanding common stock. The Agreement applies to the 5,441,734 of shares
of SAI common stock ("Restricted Shares") issued to Elkan pursuant to the Debt
Payment and Compensation Agreement as extra compensation in recognition of
guarantees Elkan has provided to subsidiaries of SAI. The Agreement provides
for, among other things:
(a) Restrictions on Elkan's ability to transfer the Restricted Shares for
five years;
(b) Elkan's forfeiture to SAI of the Restricted Shares in certain
circumstances, including if there occurs an event of default, if Elkan
is terminated with cause, or if the net fair market value of SAI's
assets shall have failed to increase by at least 2.5 percent per
annum, compounded annually, over the period between the effective date
of the Agreement and the 90th day prior to the fifth anniversary of
such effective date;
(c) SAI's right to purchase any or all of the Restricted Shares from Elkan
at $.05936 per share in limited circumstances; and
(d) the grant of certain anti-dilution and piggyback registration rights
to Elkan as set forth in the Agreement.
The foregoing summary of the Agreement is qualified in its entirety by this
reference to the Agreement, a copy of which is attached to this Report as
Exhibit 99.1.
Item 9.01. Financial Statements and Exhibits.
(c) Exhibits
Exhibit 99.1- Stock Restriction Agreement
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.
Date: September 3, 2004 Sports Arenas, Inc.
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By: /s/ Harold S. Elkan
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Harold S. Elkan, President