Item 1.01 Entry into a Material Definitive Agreement
On May 28, 2021, the Registrant entered into a Share Exchange Agreement with
shareholders of Horizon Aircraft Inc., a privately held developer of advanced
eVTOLs. Pursuant to the terms of the Share Exchange Agreement, the Registrant
purchased all of the issued and outstanding Horizon shares in exchange for the
issuance of 5,000,000 common shares of the Registrant.
In addition to the 5,000,000 common shares, the Horizon shareholders shall be
entitled to earn, an aggregate of up to 2,000,000 common shares
(1) In the event that Horizon completes the development of a working 1:2 scale
test prototype of an eVTOL aircraft (such prototype, the "Working Prototype") in
accordance with the specifications and parameters set forth in Schedule "B-1" to
the Share Exchange Agreement, and such development is completed (as agreed upon
in writing by Horizon and the Registrant, each acting reasonably) by no later
than the twelve (12) month anniversary of the Closing Date (the "First
Completion Deadline"), then the Registrant will issue from treasury within ten
(10) Business Days of the First Completion Deadline, (i) to the Horizon
Shareholders, pro rata in proportion to their holdings of Purchased Shares at
the Time of Closing, an aggregate of 500,000 Earn Out Shares, free and clear of
any Liens; and (ii) in an allocation determined E. Brandon Robinson, to any
individual (or their designees) serving as senior management of Horizon
immediately prior to the Time of Closing, 1,500,000 Earn Out Shares (including
up to 300,000 Earn Out Shares to employees other than senior management and/or
to third party contractors, consultants and/or advisors), free and clear of any
Liens.
(2) In the event that Horizon completes the development of the Working Prototype
in accordance with the specifications and parameters set forth in Schedule "B-2"
of the Share Purchaser Agreement, and such development is completed (as agreed
upon in writing by Horizon and the Registrant, each acting reasonably) during
the period beginning on the day following the First Completion Deadline and
ending on the eighteen (18) month anniversary of the Closing Date (the "Final
Completion Deadline"), then the Registrant will issue from treasury within ten
(10) Business Days of the Final Completion Deadline, (i) to the Horizon
Shareholders, pro rata in proportion to their holdings of Purchased Shares at
the Time of Closing, an aggregate of 375,000 Earn Out Shares, free and clear of
any Liens; and (ii) in an allocation determined E. Brandon Robinson, to any
individual (or their designees) serving as senior management of Horizon
immediately prior to the Time of Closing, 1,125,000 Earn Out Shares (including
up to 225,000 Earn Out Shares to employees other than senior management and/or
to third party contractors, consultants and/or advisors), free and clear of any
Liens.
Corporate Reorganizations
(1) Subject to terms and conditions of the Share Exchange Agreement, Horizon
completed a reorganization (the "Horizon Reorganization") whereunder Horizon
caused each of the following steps to occur in the following chronological
order, with the last step occurring not later than two (2) Business Days prior
to the Closing Date:
(i) Horizon and Power Systems shall complete a statutory horizontal amalgamation
(the "Horizon Amalgamation") under the Business Corporations Act (Ontario)
("OBCA"), with the resulting amalgamated corporation (being, Amalco) having the
name "Horizon Aircraft Inc.", a corporation existing under the OBCA. In
connection with the Horizon Amalgamation, all Horizon Options, warrants and
other convertible securities of Horizon shall be adjusted in accordance with
their terms such that, following completion of the Horizon Amalgamation, each
holder of a Horizon Option, or warrant or other convertible security of Horizon
shall be entitled to exercise each such security held by such Person to acquire
one (1) Class B common share in the capital of Amalco;
(ii) all Horizon Optionholders, and holders of warrants and other convertible
securities of Horizon issued and outstanding shall exercise, in full (or a
portion thereof with any balance lapsing and being cancelled to treasury), all
such Horizon Options, warrants and other convertible securities of Horizon, to
acquire Class B common shares in the capital of Amalco (such that, for the
avoidance of doubt, following such exercise, there shall not be issued and
outstanding any options, warrants or other convertible securities of Horizon or
Amalco);
(iii) E. Brian Robinson converted his shareholder loan to Class B common shares
by way of loaning the funds to various optionees of Horizon as exercise price
proceeds, and as of the Effective Date the shareholder loan to E. Brian Robinson
is Nil;
(iv) Amalco shall be continued from Ontario into the Province of British
Columbia under the Business Corporations Act (British Columbia), under the name
"Northern Horizon Aircraft Inc.";
(v) Amalco shall be converted to an unlimited liability corporation under the
Business Corporations Act (British Columbia), under the name "Northern Horizon
Aircraft ULC"; and
vi) Amalco shall succeed to all obligations and liabilities of Horizon under and
pursuant to this Agreement.
(2) Subject to the terms and conditions of the Share Exchange Agreement, the
Registrant completed a reorganization (the "Astro Reorganization") whereunder
the Registrant caused each of the following steps to occur in the following
chronological order, with the last step occurring not later than two (2)
Business Days prior to the Closing Date:
(i) the Registrant incorporated and registered in the United States Astro
Horizon Acquisition Corporation ("Astro Horizon"), which is governed under the
. . .
Item 5.02 Departure of Directors or Principal Officers; Appointment of Principal
Officer
In conjunction with the Share Exchange Agreement, on May 28, 2021, Bruce Bent
resigned as President of the Registrant and the Board of Directors appointed
Brandon Robinson to serve as President of the Registrant.
Brandon Robinson was the co-founder and Chief Executive Officer of Horizon
Aircraft, Inc., Mr. Robinson holds a Mechanical Engineering degree from the
Royal Military College of Canada, is a CF-18 Fighter Pilot Top Gun graduate, has
an MBA from Royal Roads University, and has led more than $400 million in
complex engineering projects.
On May 28, 2021, the Registrant entered into an employment agreement with
Brandon Robinson to act as President of the Registrant. The employment
agreement shall be for an indefinite period and may be terminated by Mr.
Robinson or the Registrant at will.
The annual salary shall be as established by the Board of Directors and in force
and effect as at the 28th day of May 2021, which is initially $275,000 and
thereafter shall be such other amount as may be determined by the Board of
Directors in its review of the annual salary in the fourth quarter of each
fiscal year to be effective January 1 of the following year, or as otherwise
adjusted during any given calendar year.
From time to time, the Board of Directors may decide to allocate funds based on
performance of Mr. Robinson into a management bonus. The timing, amount and
other factors involved in such a decision are solely at the discretion of the
Board of Directors and the Compensation Committee Chair.
In addition, subject to the approval of the Board of Directors, Mr. Robinson
will be granted common stock and/or options. The option will be granted under
stock plan (as amended from time to time, the Plan) and related stock option
documents. The option will have an exercise price per share equal to the fair
market value of one share of common stock on the date of grant, as determined by
the Board of Directors. As a condition of receipt of the option, Mr. Robinson
will be required to sign standard form of stock option agreement (the Option
Agreement) and the option will be subject to the terms and conditions of the
plan, the option agreement and the employment agreement. The option will vest
over a three-year period from the effective date subject to Mr. Robinson's
continued service.
Mr. Robinson shall also receive medical and dental benefits and any other
benefits which may be made available to employees or other executives of the
Registrant from time to time during the term of the employment agreement,
including but not limited to life or disability insurance and pension benefits.
Item 9.01 Financial Statements and Exhibits
(a) Financial statements of businesses acquired
To be provided by amendment, if required
(b) Pro forma financial information
To be provided by amendment, if required
(c) Exhibits
10.10 Share Exchange Agreement by and between Registrant and Horizon
Aircraft dated May 28, 2021
10.11 Amending Agreement to the Share Exchange Agreement by and between
Registrant and Horizon Aircraft dated May 28, 2021
10.12 Lock-Up Agreement with Robinson Family Ventures
10.13 Lock-Up Agreement with Remaining Shareholders
10.14 Investor Rights Agreement
10.15 Employment Agreement by and between the Registrant and Brandon
Robinson dated May 28, 2021
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