UNITED STATES 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): May 23, 2006
ADSOUTH PARTNERS, INC.
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(Exact name of registrant as specified in its charter)
Nevada 0-33135 68-0448219
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(State or other jurisdiction (Commission File Number) (I.R.S. Employer
of incorporation) Identification No.)
1141 South Rogers Circle, Suite 11, Boca Raton, FL 33487
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (561) 750-0410
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions (see General Instruction A.2. below):
[ ] Written communications pursuant to Rule 425 under the 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))
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Item 1.01 Entry into a Definitive Material Agreement.
On May 23, 2006, the Company's Board of Directors approved and executed
an amendment to the October 7, 2005 employment agreement with Anton Lee
Wingeier, the Company's Chief Financial Officer. Pursuant to the amendment, Mr.
Wingeier's employment term was extended to December 31, 2011, his annual salary
was increased to $225,000 per year, and he receive a monthly auto allowance of
$1,200. In the event Mr. Wingeier is eligible for severance, pursuant to the
terms of his agreement, such amount will be the greater of $225,000 or one
year's salary. In addition, in exchange for forgoing the bonus provisions of his
employment agreement, as set forth prior to this amendment, with the exception
to any bonus he may be entitled to resulting from the sale of the products
sector, if any, he will be compensated $200,000. Thereafter, any bonus he
receives will be at the discretion of the Board of Directors.
Item 2.02 Results of Operations and Financial Condition
On May 23, 2006, the Company issued a press release reporting the
results of operations for the three months ended March 31, 2006.
Item 8.01 Other Events.
As reported in Note 7 (g) of the Notes to Financial Statement in the
registrant's Form 10-QSB for the quarter ended March 31, 2005, on May 9, 2006,
Genco Power Solutions, Inc, a majority owned subsidiary of the Company,
("Genco") entered into a loan agreement with a non-affiliated lender which
provides for a $2,100,000 loan commitment. The Company used $1,437,000 of the
loan proceeds to pay-off principal and interest owed on Genco's existing loans
to the lender and its affiliates, $21,000 was paid as a loan commitment fee to
the lender and $5,800 was paid for legal fees related to the loan. The loan
bears interest at the prime rate plus 7.5%, an effective rate of 15.25% per
annum on the date of the loan. Commencing June 8, 2006, Genco is required to
make monthly payments of $58,333 plus accrued interest, until June 8, 2007, when
the entire unpaid balance is due. If the loan is prepaid prior to December 8,
2006, Genco is required to pay a prepayment penalty equal to 1% of the amount
prepaid The loan is guaranteed by Adsouth Partners, Inc. and John P. Acunto,
Jr., the Company's principal stockholder, for which he received consideration of
$32,500 from Genco. In addition the lender holds a security interest in all of
Genco's assets and has a right of first refusal to provide customer financing
for the sale of Genco's generator systems. In connection with the loan, the
Company issued 100 additional shares, or 10%, of Genco common stock it owned to
two individuals who arranged the financing and who have agreed to provide
additional consulting services to Genco. Upon issuance of the shares of the
common stock of Genco, the Company holds 80% of the authorized and issued shares
of common stock of Genco and the two individuals hold 20% of the authorized and
issued shares of Genco's common stock. Also, after 12 months, the two
individuals have the right to cause the Company to purchase the lender's shares
of Genco common stock at a negotiated price of no less than 3.5 times Genco's
trailing twelve month's income before interest, depreciation, amortization and
income taxes.
Item 9.01 Financial Statements and Exhibits.
(c) Exhibits
99.1 Copy of Press Release dated May 23, 2006
99.2 Copy of Amendment to Employment Contract with Anton Lee Wingeier
99.3 Loan Agreement between Genco Power Solutions, Inc. and New Valu,
Inc.
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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.
ADSOUTH PARTNERS, INC.
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(Registrant)
Date: May 24, 2006 /s/ Anton Lee Wingeier
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Anton Lee Wingeier
Chief Financial Officer
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