SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Rule 13d-101
Under the Securities Exchange Act of 1934
(Amendment No. 1)*
Sports Arenas, Inc.
--------------------------------------------------------------------------------
(Name of Issuer)
Common Stock
--------------------------------------------------------------------------------
(Title of Class of Securities)
849169 10 7
--------------------------------------------------------------------------------
(CUSIP Number)
Harold S. Elkan
7415 Carroll Road, Suite C
San Diego, CA 92121
(858) 408-0364
--------------------------------------------------------------------------------
(Name, Address and Telephone Number of Person Authorized
to Receive Notices and Communications)
06/30/2004
--------------------------------------------------------------------------------
(Date of Event which Requires Filing of this Statement)
--------------------------------------------------------------------------------
If the filing person has previously filed a statement on Schedule 13G to
report the acquisition that is the subject of this Schedule 13D, and is filing
this schedule because of ss. 240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check
the following box. |_|
NOTE: Schedules filed in paper format shall include a signed original and
five copies of the schedule, including all exhibits. See Rule 13d-7 for other
parties to whom copies are to be sent.
* The remainder of this cover page shall be filled out for a reporting
person's initial filing on this form with respect to the subject class of
securities, and for any subsequent amendment containing information which
would alter disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be
deemed to be "filed" for the purpose of section 18 of the Securities Exchange
Act of 1934 ("Act") or otherwise subject to the liabilities of that section of
the Act but shall be subject to all other provisions of the Act (however, see
the Notes).
Page 1 of 5 Pages
CUSIP No. 849169 10 7
--------------------------------------------------------------------------------
(1) Names and I.R.S. Identification Nos.(entities only) of reporting persons.
Elkan, Harold
--------------------------------------------------------------------------------
(2) Check the appropriate box if a member of a group (see instructions) (a)|_|
(b)|X|
--------------------------------------------------------------------------------
(3) SEC use only.
--------------------------------------------------------------------------------
(4) Source of funds (see instructions).
AF
--------------------------------------------------------------------------------
(5) Check if disclosure of legal proceedings is required pursuant to Items |_|
2(d) or 2(e).
--------------------------------------------------------------------------------
(6) Citizenship or place of organization.
United States of America
--------------------------------------------------------------------------------
Number of shares beneficially owned by each reporting person with:
(7) Sole voting power:
5,441,734 (1)
(8) Shared voting power:
0
(9) Sole dispositive power:
5,441,734 (1)
(10) Shared dispositive power:
0
--------------------------------------------------------------------------------
(11) Aggregate amount beneficially owned by each reporting person.
5,441,734
--------------------------------------------------------------------------------
(12) Check if the aggregate amount in Row (11) excludes certain shares |_|
(see instructions).
--------------------------------------------------------------------------------
(13) Percent of class represented by amount in Row (11).
50.001% (2)
--------------------------------------------------------------------------------
(14) Type of reporting person (see instructions).
IN
--------------------------------------------------------------------------------
----------
(1) Until execution and delivery of a stock restriction agreement, ("SR
Agreement") due on or before 8/29/04, these shares will be held in trust
by Sports Arenas, Inc. with the Special Committee, comprised of the
independent director of Sports Arenas, Inc., having the power to vote
the shares; and on and after the execution and delivery of the SR
Agreement, Mr. Elkan will have sole voting and dispositive power over
the shares.
(2) Based on a total of 10,883,467 outstanding shares of common stock
following the June 30, 2004 transactions reported by the Issuer in its
report on Form 8-K dated July 9, 2004.
Page 2 of 5 Pages
CUSIP No. 849169 10 7
--------------------------------------------------------------------------------
(1) Names and I.R.S. Identification Nos.(entities only) of reporting persons.
ANDREW BRADLEY, INC.
33-0061005
--------------------------------------------------------------------------------
(2) Check the appropriate box if a member of a group (see instructions) (a)|_|
(b)|X|
--------------------------------------------------------------------------------
(3) SEC use only.
--------------------------------------------------------------------------------
(4) Source of funds (see instructions).
AF
--------------------------------------------------------------------------------
(5) Check if disclosure of legal proceedings is required pursuant to Items |_|
2(d) or 2(e).
--------------------------------------------------------------------------------
(6) Citizenship or place of organization.
Nevada
--------------------------------------------------------------------------------
Number of shares beneficially owned by each reporting person with:
(7) Sole voting power:
0
(8) Shared voting power:
0
(9) Sole dispositive power:
0
(10) Shared dispositive power:
0
--------------------------------------------------------------------------------
(11) Aggregate amount beneficially owned by each reporting person.
0
--------------------------------------------------------------------------------
(12) Check if the aggregate amount in Row (11) excludes certain shares |_|
(see instructions).
--------------------------------------------------------------------------------
(13) Percent of class represented by amount in Row (11).
0%
--------------------------------------------------------------------------------
(14) Type of reporting person (see instructions).
CO
--------------------------------------------------------------------------------
Page 3 of 5 Pages
Item 1. Security and Issuer.
Common Stock, par value $.01 per share
Sports Arenas, Inc., a Delaware corporation (the "Issuer")
7415 Carroll Road, Suite C
San Diego, CA 92121
Item 2. Identity and Background.
(a) The Reporting Persons, Harold S. Elkan ("HE") and Andrew
Bradley, Inc. ("ABI"), a Nevada corporation, filed their initial
Schedule 13D dated November 22, 1983 (the "Original Schedule 13D")
pursuant to Regulation 13D-G of the General Rules and Regulations
under the Act and are filing this Amendment No. 1 ("Amendment No.
1") for purpose of reporting a grant by the Issuer to ABI of certain
shares of common stock as compensation, the foreclosure by the
Issuer on all shares of common stock owned by ABI pursuant to a
previously reported promissory note and related pledge agreement ,
the grant by the Issuer of certain shares of restricted common stock
to HE as compensation for providing guarantees for subsidiaries of
the Issuer, and execution and delivery of a Debt Payment and Extra
Compensation Agreement, as well as reporting a history that was
inadvertently not previously reported pursuant to Regulation 13D-G.
The Reporting Persons are making this single, joint filing because
they may be deemed to constitute a "group" within the meaning of
Section 13(d)(3) of the Act, although neither the fact of this
filing nor anything contained herein shall be deemed to be an
admission by the Reporting Persons that a group exists.
(b) HE's business address is 7415 Carroll Road, Suite C, San Diego,
CA 92121. His occupation is that of President of the Issuer.
ABI, a Nevada corporation, has its registered office at 6100 Neil
Road, Suite 500, Reno, NV 89511.
(c) HE: President of the Issuer.
ABI: The business of ABI is that of a holding company. Other than
Harold S. Elkan, there are no other directors, executive officers or
controlling persons of ABI. The shareholders of ABI are as follows:
88%-Harold S. Elkan, 7415 Carroll Road, Suite C, San Diego, CA
92121
6%-S. Robert Elkan, successor trustee of the Andrew R. Elkan
Exempt Trust dated 12/5/96
6%-S. Robert Elkan, successor trustee of the Bradley J. Elkan
Exempt Trust dated 12/5/96
(d) None
(e) None
(f) HE: United States of America ABI: a Nevada corporation
Item 3. Source and Amount of Funds or Other Consideration.
HE acquired the 5,441,734 restricted shares which he now directly owns
as extra compensation that was due him pursuant to the Debt Payment &
Extra Compensation Agreement described more fully in Item 4.
The shares previously owned directly by ABI were acquired as follows:
(a) The initial 21,808,267 shares were initially purchased from a third
party seller in 1983 with credit supplied by the seller, which credit
was refinanced in 1990 by the Issuer, as more fully described in Item
4.
(b) An additional 1,360,433 shares were acquired by ABI as
compensation pursuant to the Debt Payment & Extra Compensation
Agreement described more fully in Item 4.
Item 4. Purpose of Transaction.
As previously reported in the Original Schedule 13D filed November 22,
1983, ABI, then a newly formed corporation then wholly owned by HE,
purchased 21,808,267 shares of the Issuer's common stock from MAS, Inc.
("MAS"), an unaffiliated third party. The consideration ("Stock
Purchase Agreement") was to be $3,500,000 if paid within two years,
$4,000,000 if paid within three years, $4,500,000 if paid within four
years, or the greater of $6,000,000 or fifty percent of dividends if
paid after four years. The Stock Purchase Agreement was secured by a
security interest in all of the issued and outstanding shares of ABI.
On August 3, 1990 ABI entered into an Agreement for Prepayment Under
Stock Purchase Agreement ("Settlement Agreement") with the bankruptcy
estate of MAS as part of a discounted settlement of amounts owed by ABI
to MAS as well as settlement of other claims by the bankruptcy estate
of MAS against ABI. The Settlement Agreement provided for a discounted
payment of $1,000,000. In conjunction with the Settlement Agreement,
the Issuer loaned ABI $1,061,009 to fund the discounted payment as well
as fund transaction costs associated with the Settlement Agreement.
The loan from the Issuer to ABI (the "ABI Loan"), among other things,
allowed HE to maintain ownership of at least a majority of the
outstanding capital stock of the Issuer. Failure to have maintained
such majority ownership at the time would have been deemed a "change of
control" of the Issuer under certain credit agreements between the
Issuer or its subsidiaries and third party creditors and would have
constituted an event of default thereunder allowing an acceleration of
the payment obligations under those agreements. SAI's source of funds
was primarily a loan from Temecula Valley Bank, which was paid in June
2001. The ABI Loan provided for no monthly payments and for interest
to accrue and to be added to the principal balance annually. The
balance was due in November 2003. The ABI Loan was secured by all of
the Issuer's stock held by ABI.
On June 30, 2004, the Issuer, ABI and HE entered into a Debt Payment &
Extra Compensation Agreement ("Agreement") whereby:
The Issuer agreed to issue 1,360,433 shares of the Issuer's common
stock to ABI as extra compensation in recognition of credit support for
guarantees provided to subsidiaries of the Issuer.
ABI agreed to the foreclosure and sale to the Issuer of all 23,168,700
shares of the Issuer's common stock owned by ABI in partial
satisfaction of SAI's note receivable from ABI (including the
additional shares of the Issuer's common stock awarded to ABI, valued
at $.03951 per share).
The Issuer agreed to issue 5,441,734 restricted shares ("Extra
Compensation Shares") of the Issuer's common stock to HE as extra
compensation in recognition of guarantees HE has provided to
subsidiaries of the Issuer and to allow HE to maintain ownership of at
least a majority of the outstanding capital stock of the Issuer.
Failure to maintain such majority ownership would be deemed a "change
of control" of the Issuer under certain credit agreements between the
Issuer or its affiliates and third party creditors and could result in
an event of default or an acceleration of the payment obligations under
those agreements.
Pursuant to the Debt Payment & Extra Compensation Agreement, HE and the
Issuer are to negotiate and enter into a stock restriction agreement on
or before August 29, 2004 that shall contain such terms and provisions
as would customarily be included in a commercially reasonable
restriction agreement governing restricted stock subject to a
substantial risk of forfeiture. The stock restriction agreement is also
to provide in substance that:
The Extra Compensation Shares will be forfeitable prior to a certain
date in limited circumstances (e.g. if the employment of HE is
terminated with cause or if HE voluntarily terminates his employment).
The Issuer may purchase any or all of the Extra Compensation Shares
from HE at $.05936 per share in limited circumstances.
The Extra Compensation Shares are being held by the Issuer in trust
pending execution and delivery of a stock restriction agreement.
Except for the foregoing, the remaining Reporting Person, HE acquired
and continues to hold the shares of common stock reported herein for
investment purposes. Subject to the restrictions of the Stock
Restriction Agreement, HE intends to review continuously his equity
position in the Issuer. Depending upon future evaluations of the
business prospects of the Issuer and upon other developments,
including, but not limited to, general economic and business conditions
and money market and stock market conditions, HE may determine to
increase or decrease his equity interest in the Issuer by acquiring
additional shares of common stock or warrants therefor or by disposing
of all or a portion of his holdings, subject to any applicable legal
and contractual restrictions on his ability to do so. In addition, in
connection with the Issuer's ongoing needs for additional capital, HE
has from time to time engaged in discussions with respect to, and may
continue to engage in discussions from time to time with respect to:
(a) one or more privately negotiated investments in the Issuer which
may be purchases of additional common stock, loans or direct
investments in assets of the Issuer, or a combination of all, and which
may involve one or more additional accredited individual or
institutional investors or lenders,; and (b) one or more potential (i)
extraordinary corporate transactions, such as a merger, reorganization
or liquidation, involving one or more subsidiaries of the Issuer, or
(ii) sales or transfers of material amounts of assets of the issuer or
one or more of its subsidiaries, in each case for the purpose of
generating cash and/or improving the cash flow of the Issuer and
enhancing value for its shareholders.
Except as set forth above, HE has no plans or proposals which may
related to or would result in any of the actions or events described in
paragraphs (a) through (j) of Item 4 of Schedule 13D, but HE reserves
the right to consider in the future any and all other actions or
events, and to develop any and all other plans or proposals, which may
relate to or would result in any of the actions or events described in
paragraphs (a) through (j) of Item 4 of Schedule 13D.
ABI has no present intention to effect any of the transactions
specified in Item 4 of Schedule 13D.
Item 5. Interest in Securities of the Issuer.
(a) HE:
5,441,734 shares
50.01% of the outstanding common stock, based on a total of
10,883,467 outstanding shares of common stock following the June
30, 2004 transactions reported by the Issuer in its report on Form
8-K dated July 9, 2004.
ABI:
-0- shares
(b) HE: 5,441,734 shares with sole voting power; provided, however,
that until execution and delivery of a stock restriction agreement,
(an "SR Agreement") due on or before 8/29/04, these shares will be
held in trust by the Issuer with the Special Committee, comprised of
the independent director of the Issuer, having the power to vote the
shares; and on and after the execution and delivery of the SR
Agreement, HE will have sole voting and dispositive power over the
shares
ABI: -0- shares
(c) By ABI:
June 30, 2004- In a private transaction, the Issuer issued 1,360,433
shares of common stock as consideration awarded to ABI in
recognition of credit support for guarantees provided to
subsidiaries of the Issuer at a value of $.03951 per share.
June 30, 2004- In a private transaction, the Issuer foreclosed on
and acquired from SAI the 23,168,700 shares of the Issuer's common
stock then owned by ABI (including the additional shares of common
stock awarded to ABI) valued at $.03951 per share in partial
satisfaction of the Issuer's note receivable from ABI.
By HE:
June 30, 2004- In a private transaction, the Issuer issued 5,441,734
restricted shares of common stock of the Issuer as extra
compensation in recognition of guarantees HE has provided to
subsidiaries of the Issuer.
(d) None
(e) ABI ceased to be a beneficial owner of 5% or more of the
Issuer's common stock on June 30, 2004
Item 6. Contracts, Arrangements, Understandings or Relationships With Respect to
Securities of the Issuer.
ABI: As previously reported on Schedule 13D filed November 22, 1983,
ABI, then a newly formed corporation then wholly owned by HE,
purchased 21,808,267 shares of the Issuer's common stock from MAS, Inc.
("MAS"), an unaffiliated third party. The consideration ("Stock
Purchase Agreement") was to be $3,500,000 if paid within two years,
$4,000,000 if paid within three years, $4,500,000 if paid within four
years, or the greater of $6,000,000 or fifty percent of dividends if
paid after four years. The Stock Purchase Agreement was secured by a
security interest in all of the issued and outstanding shares of ABI.
On August 3, 1990 ABI entered into an Agreement for Prepayment Under
Stock Purchase Agreement ("Settlement Agreement") with the bankruptcy
estate of MAS as part of a discounted settlement of amounts owed by ABI
to MAS as well as settlement of other claims by the bankruptcy estate
of MAS against ABI. The Settlement Agreement provided for a discounted
payment of $1,000,000. In conjunction with the Settlement Agreement,
the Issuer loaned ABI $1,061,009 to fund the discounted payment as well
as fund transaction costs associated with the Settlement Agreement.
The loan from the Issuer to ABI (the "ABI Loan"), among other things,
allowed HE to maintain ownership of at least a majority of the
outstanding capital stock of the Issuer. Failure to have maintained
such majority ownership at the time would have been deemed a "change of
control" of the Issuer under certain credit agreements between the
Issuer or its subsidiaries and third party creditors and would have
constituted an event of default thereunder allowing an acceleration of
the payment obligations under those agreements. SAI's source of funds
was primarily a loan from Temecula Valley Bank, which was paid in June
2001. The ABI Loan provided for no monthly payments and for interest
to accrue and to be added to the principal balance annually. The
balance was due in November 2003. The ABI Loan was secured by all of
the Issuer's stock held by ABI.
HE: Pursuant to the Debt Payment & Extra Compensation Agreement more
fully described in Item 4, the 5,441,734 shares being issued to HE are
subject to the following conditions: HE and the Issuer are to
negotiate and enter into an SR Agreement on or before August 29, 2004
that shall contain such terms and provisions as would customarily be
included in a commercially reasonable restriction agreement governing
restricted stock subject to a substantial risk of forfeiture. The SR
Agreement is also to contain substantially the following provisions:
(a) The shares will be forfeitable prior to a certain date in
limited circumstances (e.g. termination of HC's employment with cause
or HE voluntarily terminating his employment).
(b) The Issuer may purchase any or all of the shares from HE at
$.05936 per share in limited circumstances.
(c) The shares are being held by the Issuer in trust pending
execution and delivery of the SR Agreement.
Item 7. Material to be Filed as Exhibits.
1- Joint filing agreement pursuant to Rule 13d-1(k)
2 - ABI purchase agreement from MAS, Inc. dated November 22, 1983
3 - ABI note payable and pledge agreement to SAI dated December 21,
1990.
4 - Debt Payment & Extra Compensation Agreement dated June 30, 2004.
5 - Confession of Judgment of ABI filed June 30, 2004.
Page 4 of 5 Pages
After reasonable inquiry and to the best of my knowledge and belief, I certify
that the information set forth in this statement is true, complete and correct.
Date: 07/14/2004 /s/ HAROLD S. ELKAN
Name: HAROLD S. ELKAN
ANDREW BRADLEY, INC.
Date: 07/14/2004 /s/ HAROLD S. ELKAN
Name: HAROLD S. ELKAN
Title: PRESIDENT
The original statement shall be signed by each person on whose behalf the
statement is filed or his authorized representative. If the statement is signed
on behalf of a person by his authorized representative (other than an executive
officer or general partner of the filing person), evidence of the
representative's authority to sign on behalf of such person shall be filed with
the statement: Provided, however, That a power of attorney for this purpose
which is already on file with the Commission may be incorporated by reference.
The name and any title of each person who signs the statement shall be typed or
printed beneath his signature.
ATTENTION--Intentional misstatements or omissions of fact constitute Federal
criminal violations (See 18 U.S.C. 1001). (Secs. 13(d), 13(g), 14(d), 23, 48
Stat. 894, 895, 901; sec. 8, 49 Stat. 1379; sec. 203(a), 49 Stat. 704; sec. 10,
78 Stat. 88a; Secs. 2, 3, 82 Stat. 454, 455; secs. 1, 2, 3-5, 84 Stat. 1497;
sec. 18, 89 Stat. 155; secs. 202, 203, 91 Stat. 1494, 1498, 1499; 15 U.S.C.
78m(d), 78m(g), 78n(d), 78w) [44 FR 2145, Jan. 9, 1979; 44 FR 11751, Mar. 2,
1979; 44 FR 70340, Dec. 6, 1979; 47 FR 11466, Mar. 16, 1982; 61 FR 49959, Sept.
24, 1996; 62 FR 35340, July 1, 1997; 63 FR 2867, Jan. 16, 1998; 63 FR 15287,
Mar. 31, 1998]
Page 5 of 5 Pages