SCHEDULE 14C INFORMATION
Information Statement Pursuant to Section 14(c) of the Securities
Exchange Act of 1934
Check the appropriate box:
/ / Preliminary Information Statement
/ X / Definitive Information Statement
MAXIMUM AWARDS, INC.
(Name of Registrant As Specified In Charter)
(Name of Person(s) Filing the Information Statement if other than Registrant)
Payment of Filing Fee (Check the appropriate box):
/ X / No fee required.
/ / Fee computed on table below per Exchange Act Rules 14c-5(g) and
0-11.
1) Title of each class of securities to which transaction applies:
Common Stock, par value $0.001 per share
2) Aggregate number of securities to which transaction applies:
36,782,000 shares of Common Stock
3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11:
4) Proposed maximum aggregate value of transaction:
/__/ Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number, or
the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
2) Form, Schedule or Registration Statement No.:
3) Filing Party:
4) Date Filed:
1
Maximum Awards, Inc.
Level 1, 164 Wharf Street
Brisbane, Queensland 4000, Australia
617 33193110
Notice of Written Consent of Stockholders
March 30, 2007
Stockholders of MAXIMUM AWARDS, INC.:
This Information Statement is circulated to advise the stockholders of
action already approved by written consent of the stockholders who collectively
hold a majority of the voting power of our capital stock. Pursuant to Rule 14c-2
under the Securities Exchange Act of 1934, as amended, the proposals will not be
effective until 20 days after the date this Information Statement is mailed to
the stockholders. Therefore, this Information Statement is being sent to you for
informational purposes only.
WE ARE NOT ASKING YOU FOR A PROXY AND YOU
ARE REQUESTED NOT TO SEND US A PROXY
The actions to be effective twenty days after the mailing of this
Information Statement are as follows:
1. Effect a 1-for-15 reverse stock split (pro-rata reduction of
outstanding shares) of our issued and outstanding shares of
Common Stock. There will not be a reduction in authorized
shares.
Attached hereto for your review is an Information Statement relating to
the above-described actions.
By Order of the Board of Directors,
/s/ Maxwell Thomas
---------------------------
Maxwell Thomas
Chief Executive Officer and
Chief Financial Officer
March 30, 2007
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MAXIMUM AWARDS, INC.
--------------------
INFORMATION STATEMENT
---------------------
This Information Statement, which is being mailed to stockholders on or about
March 30, 2007, is furnished in accordance with the requirements of Regulation
14C promulgated under the Securities Exchange Act of 1934, as amended, by the
management of Maximum Awards Inc. (the "Company"). Maximum Awards, Inc., a
Nevada corporation, for use in connection with certain actions to be taken by
the written consent by the holders of the majority of the outstanding voting
capital stock of the Company. The actions to be taken pursuant to the written
consent shall be effective on or about April 23, 2007, twenty days after the
mailing of this Information Statement.
This Information Statement has been filed with the Securities and Exchange
Commission and is being furnished, pursuant to Section 14C of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), to the holders (the
"Stockholders") of the common stock, par value $0.10 per share (the "Common
Stock"), of Maximum Awards, Inc., a Nevada Corporation (the "Company"), to
notify such Stockholders that on or about October 19, 2006, the Company received
written consents in lieu of a meeting of Stockholders from holders of 17,559,000
shares representing approximately 54% of the 32,676,900 shares of the then total
issued and outstanding shares of voting stock of the Company (the "Majority
Stockholders") 1-for-15 reverse stock split (pro-rata reduction of outstanding
shares) of our issued and outstanding shares of Common Stock.
On October 19, 2006, the Board of Directors of the Company approved the
Amendment, subject to Stockholder approval. The Majority Stockholders approved
the Amendment by written consent in lieu of a meeting on October 19, 2006 in
accordance with the Nevada Business Corporation Act. Accordingly, your consent
is not required and is not being solicited in connection with the approval of
the Amendments.
THIS IS NOT A NOTICE OF A SPECIAL MEETING OF STOCKHOLDERS
AND NO STOCKHOLDER MEETING WILL BE HELD TO CONSIDER
ANY MATTER WHICH WILL BE DESCRIBED HEREIN.
WE ARE NOT ASKING YOU FOR A PROXY AND YOU
ARE REQUESTED NOT TO SEND US A PROXY
NOTICE IS HEREBY GIVEN that the following action will be taken pursuant
to the written consent of the holders of the majority of the outstanding voting
capital stock of the Company in lieu of a special meeting of the stockholders.
The following action will be effective on or about April 23, 2007:
1. Effect a 1-for-15 reverse stock split (pro-rata reduction of
outstanding shares) of our issued and outstanding shares of
Common Stock. There will not be a reduction in authorized
shares.
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THE APPROXIMATE DATE OF MAILING OF
THIS INFORMATION STATEMENT IS FEBRUARY 21, 2007
Stockholders of record at the close of business on March 30, 2007 (the
"Record Date") are entitled to notice of the action to be effective on or about
April 23, 2007. As of the Record Date, our authorized capitalization consisted
of 100,000,000 shares of common stock, par value $0.001 per share (the "Common
Stock"), of which 36,782,000 were issued and outstanding. Each share of our
common stock entitles its holder to one vote on each matter submitted to the
stockholders. However, because the stockholders holding at least a majority of
the voting rights of all outstanding shares of capital stock as of the Record
Date have voted in favor of the foregoing actions by resolution; and having
sufficient voting power to approve such proposals through their ownership of the
capital stock, no other consents will be solicited in connection with this
Information Statement.
Pursuant to Rule 14c-2 under the Securities Exchange Act of 1934, as
amended, the actions will not be effective until 20 days after the date of this
Information Statement is mailed to the stockholders. We anticipate that the
actions contemplated by this Information Statement will be effected on or about
the close of business on April 23, 2007.
This Information Statement will serve as written notice to stockholders
pursuant to the Nevada Revised Statutes.
Our stockholders are not entitled to appraisal rights under the Nevada
Revised Statutes in connection with the reverse stock split or the transfer of
all assets and liabilities.
CURRENT INFORMATION REGARDING THE COMPANY
The following is a description of the current operations of the Company.
About Our Company
-----------------
Maximum Awards, Inc. operates a loyalty and rewards program known as
Maximum Awards. Under this program, consumers earn points by purchasing products
and services from a range offered by the Company's subsidiaries, Global Business
and Travel Easy, or program partners. Accumulated points then can be redeemed to
acquire additional desired products or services from the same list of such items
offered by the Company's subsidiaries. The Company's subsidiary, Global
Business, maintains a catalogue of available goods and services which a member
can purchase, or acquire through the redemption of points. Travel Easy is a
licensed travel agency which services the public and also allows members to
purchase travel services or redeem points for airline tickets or travel
packages.
How We Are Organized
--------------------
Maximum Awards, Inc, formerly known as Rising Fortune Incorporated (the
"Company"), was incorporated in the State of Nevada on March 7, 1995. The
Company was inactive between 1996 and 2000. In 2000 the Company entered into an
agreement to distribute product. However, the agreement never materialized and
the Company continued to remain inactive until November 18, 2003. On November
19, 2003, the Company amended its Articles of Incorporation to change its name
to Maximum Awards, Inc.
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On December 9, 2003, the Company entered into a definitive Share
Exchange Agreement (the "Agreement") with Maximum Awards Pty Ltd., an Australian
corporation operating a consumer rewards program, whereby the Company acquired
all of the issued and outstanding shares of the Subsidiary in exchange for
22,000,000 common shares and 1,000,000 preferred shares Series "A" of the
Company. The preferred shares Series "A" are non-participating, but each share
is entitled to 50 votes in a general meeting. In addition, the Company issued
2,200,000 common shares as a finder's fee for assistance in the acquisition of
the Subsidiary. As a result of the Agreement, the shareholder of Maximum Awards
Pty Ltd. controls 96% of the Company. While the Company is the legal parent, as
a result of the reverse takeover, Maximum Awards Pty Ltd. became the parent
company for accounting purposes.
On June 1, 2004, the Company, through its subsidiary, Maximum Awards
Pty Ltd., acquired 100% of the issued and outstanding share capital of both
Global Business Group Australia Pty Ltd. ("Global Business") and Travel Easy
Holidays Pty Ltd. ("Travel Easy") from the directors of the respective companies
for $1.00. Global Business and Travel Easy are controlled by the same
shareholder, who controls the Company and Maximum Awards Pty Ltd. As such, this
transfer of equity interests between common controlled entities is accounted for
as a recapitalization of the Company.
Market For Common Equity And Other Stockholder Matters
------------------------------------------------------
RECOMMENDATION OF THE BOARD OF DIRECTORS
The Board of Directors of the Company (the "Board") believes that
the stockholders of the Company will benefit from the acquisition of additional
businesses. In order to facilitate such transaction, the Board has determined
that the capitalization structure of the Company should be simplified. No
assurances can be given that such acquisitions will be achieved.
Accordingly, it is the Board's opinion that the restructuring
transactions described above would better position the Company to attract
potential business candidates and provide the stockholders of the Company with
the greatest potential return. The Board approved the above actions on October
19, 2006, pending shareholder approval.
ACTIONS TO BE TAKEN
-------------------
This Information Statement contains a brief summary of the material
aspects of the actions approved by the Board and the holders of the majority of
the outstanding voting capital stock of the Company.
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DECREASE THE NUMBER OF ISSUED AND OUTSTANDING
---------------------------------------------
SHARES OF OUR COMMON STOCK
--------------------------
General
-------
The Board approved resolutions to effect a one-for-fifteen stock split.
Under this reverse stock split each fifteen shares of our Common Stock will be
converted automatically into one share of Common Stock. To avoid the issuance of
fractional shares of Common Stock, the Company will issue an additional share to
all holders of a fractional share .50 or greater and no additional shares shall
be issued to a holder of a fractional share less than .50 and the fractional
shares shall be issued. The effective date of the reverse stock split will be
April 23, 2007.
PLEASE NOTE THAT THE REVERSE STOCK SPLIT WILL NOT CHANGE YOUR
PROPORTIONATE EQUITY INTERESTS IN THE COMPANY, EXCEPT AS MAY RESULT FROM THE
ISSUANCE OR CANCELLATION OF SHARES PURSUANT TO THE FRACTIONAL SHARES.
Purpose and Material Effects of the Reverse Stock Split
-------------------------------------------------------
The Board of Directors believes that, among other reasons, the number
of outstanding shares of our Common Stock have contributed to a lack of investor
interest in the Company and has made it difficult to attract new investors and
potential business candidates. The Board of Directors had proposed the Reverse
Stock Split as one method to attract business opportunities in the Company.
When a company engages in a reverse stock split, it substitutes one
share of stock for a predetermined amount of shares of stock. It does not
increase the market capitalization of the company. An example of a reverse split
is the following. For example, a company has 10,000,000 shares of common stock
outstanding. Assume the market price is $.01 per share. Assume that that company
declares a 1 for 5 reverse stock split. After the reverse split, that company
will have 1/5 as many shares outstanding or 2,000,000 shares outstanding. The
stock will have a market price of $0.05. If an individual investor owned 10,000
shares of that company before the split at $.01 per share, he will own 2,000
share at $.05 after the split. In either case, his stock will be worth $100.
He's no better off before or after. Except that such company hopes that the
higher stock price will make that company look better and thus the company will
be a more attractive merger target for potential business. There is no assurance
that that company's stock will rise in price after a reverse split or that a
suitable merger candidate will emerge.
We believe that the Reverse Stock Split may improve the price level of
our Common Stock and that the higher share price could help generate interest in
the Company among investors and other business opportunities. However, the
effect of the reverse split upon the market price for our Common Stock cannot be
predicted, and the history of similar stock split combinations for companies in
like circumstances is varied. There can be no assurance that the market price
per share of our Common Stock after the reverse split will rise in proportion to
the reduction in the number of shares of Common Stock outstanding resulting from
the reverse split. The market price of our Common Stock may also be based on our
performance and other factors, some of which may be unrelated to the number of
shares outstanding.
The reverse split will affect all of our stockholders uniformly and
will not affect any stockholder's percentage ownership interests in the Company
or proportionate voting power, except to the extent that the reverse split
results in any of our stockholders owning a fractional share. In lieu of issuing
fractional shares, stockholders will be issued to all holders of a fractional
share .50 or greater and no additional shares shall be issued to a holder of a
fractional share less than .50 and the fractional share will be cancelled.
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The principal effect of the reverse split will be that the number of
shares of Common Stock issued and outstanding will be reduced from 36,782,000
shares as of March 30, 2007 to approximately 2,452,134 shares (depending on the
number of fractional shares that are issued or cancelled). The number of
authorized shares of Common Stock will not be affected.
The reverse split will not change the proportionate equity interests of
our stockholders, nor will the respective voting rights and other rights of
stockholders be altered, except for possible immaterial changes due to the
cancellation of fractional shares. The Common Stock issued pursuant to the
reverse split will remain fully paid and non-assessable. The reverse split is
not intended as, and will not have the effect of, a "going private transaction"
covered by Rule 13e-3 under the Securities Exchange Act of 1934. We will
continue to be subject to the periodic reporting requirements of the Securities
Exchange Act of 1934.
Stockholders should recognize that they will own a fewer number of
shares than they presently own (a number equal to the number of shares owned
immediately prior to the filing of the certificate of amendment divided by
five). While we expect that the reverse split will result in an increase in the
potential market price of our Common Stock, there can be no assurance that the
reverse split will increase the potential market price of our Common Stock by a
multiple equal to the exchange number or result in the permanent increase in any
potential market price (which is dependent upon many factors, including our
performance and prospects). Also, should the market price of our Common Stock
decline, the percentage decline as an absolute number and as a percentage of our
overall market capitalization may be greater than would pertain in the absence
of a reverse split. Furthermore, the possibility exists that potential liquidity
in the market price of our Common Stock could be adversely affected by the
reduced number of shares that would be outstanding after the reverse split. In
addition, the reverse split will increase the number of stockholders of the
Company who own odd lots (less than 100 shares). Stockholders who hold odd lots
typically will experience an increase in the cost of selling their shares, as
well as possible greater difficulty in effecting such sales. Consequently, there
can be no assurance that the reverse split will achieve the desired results that
have been outlined above.
Procedure for Exchange of Stock Certificates
--------------------------------------------
The reverse split will become effective on April 23, 2007 which we will
refer to as the "effective date." Beginning on the effective date, each
certificate representing pre-reverse split shares will be deemed for all
corporate purposes to evidence ownership of post-reverse split shares.
Our transfer agent, Nevada Agency and Trust, will act as exchange agent
for purposes of implementing the exchange of stock certificates and payment of
fractional share interests. We refer to such person as the "exchange agent."
Holders of pre-reverse split shares are asked to surrender to the exchange agent
certificates representing pre-reverse split shares in exchange for certificates
representing post-reverse split shares in accordance with the procedures set
forth in the letter of transmittal enclosed with this Information Statement. No
new certificates will be issued to a stockholder until that stockholder has
surrendered the stockholder's outstanding certificate(s) together with the
properly completed and executed letter of transmittal.
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Our stockholders are not entitled to appraisal rights under the Nevada
Revised Statutes in connection with the reverse stock split.
STOCKHOLDERS SHOULD NOT DESTROY ANY STOCK CERTIFICATE AND SHOULD NOT SUBMIT ANY
CERTIFICATES WITHOUT THE LETTER OF TRANSMITTAL.
Fractional Shares
-----------------
We will not issue fractional certificates for post-reverse split shares
in connection with the reverse split. Instead, an additional share shall be
issued to all holders of a fractional share .50 or greater and no additional
shares shall be issued to a holder of a fractional share less than .50. To the
extent any holders of pre-reverse split shares are entitled to fractional shares
as a result of the Reverse Stock Split, the Company will issue an additional
share to holders of a fractional share .50 or greater and cancel the fractional
shares without issuing an additional shares to holders of a fractional share
less than .50.
STOCKHOLDERS SHOULD NOT DESTROY ANY STOCK CERTIFICATE AND SHOULD NOT SUBMIT ANY
CERTIFICATES WITHOUT THE LETTER OF TRANSMITTAL.
Summary of Reverse Stock Split
------------------------------
Below is a brief summary of the reverse stock split:
o The issued and outstanding Common Stock shall be reduced on the basis
of one post-split share of the Common Stock for every fifteen pre-split
shares of the Common Stock outstanding. The consolidation shall not
affect any rights, privileges or obligations with respect to the shares
of the Common Stock existing prior to the consolidation.
o Stockholders of record of the Common Stock as of March 30, 2007 shall
have their total shares reduced on the basis of one post-split share of
Common Stock for every 15 pre-split shares outstanding.
o As a result of the reduction of the Common Stock the pre-split total of
issued and outstanding shares of 36,782,000 shall be consolidated to a
total of approximately 2,452,134 issued and outstanding shares
(depending on the number of fractional shares that are be issued or
cancelled)
o The Company's authorized number of common stock shall remain at
100,000,000 shares of the Common Stock.
This action has been approved by the Board and the written consents of the
holders of the majority of the outstanding voting capital stock of the Company.
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DESCRIPTION OF SECURITIES
-------------------------
The following is a summary description of our capital stock and certain
provisions of our certificate of incorporation and by-laws, copies of which have
been incorporated by reference as exhibits to the registration statement of
which this prospectus forms a part. The following discussion is qualified in its
entirety by reference to such exhibits.
General
-------
Our authorized capital stock consists of 100,000,000 shares of common
stock, par value $.001 per share and ten million (100,000,000) shares of
Preferred Stock at $.001 par value per share.
Common Stock
------------
The holders of our common stock are entitled to one vote for each share
held of record on all matters submitted to a vote of stockholders. Our
certificate of incorporation and by-laws do not provide for cumulative voting
rights in the election of directors. Accordingly, holders of a majority of the
shares of our common stock entitled to vote in any election of directors may
elect all of our directors standing for election. Holders of our common stock
are entitled to receive ratably such dividends as may be declared by the Board
out of funds legally available therefor. In the event of our liquidation,
dissolution or winding up, holders of common stock are entitled to share ratably
in the assets remaining after payment of liabilities. Holders of common stock
have no preemptive, conversion or redemption rights. All of the outstanding
shares of common stock are fully-paid and non-assessable.
Preferred Stock
---------------
The Preferred Stock may be issued from time to time in one or more
series. The Board of Directors is authorized to fix the number of shares of any
series of Preferred Stock and to determine the designation of any such series.
The Board of Directors is also authorized to determine or alter the rights,
preferences, privileges and restrictions granted to or imposed upon any wholly
unissued series of Preferred Stock and, within the limits and restrictions
stated in any resolution or resolutions of the Board of Directors originally
fixing the number of shares constituting any series, to increase or decrease
(but not below the number of shares of any such series then outstanding) the
number of shares of any such series subsequent to the issue of shares of that
series.
MANAGEMENT
----------
Directors and Executive Officers
--------------------------------
The following sets forth the age and position held by our sole director
and sole executive officer as of the date of this prospectus:
Name Age Positions and Offices Held
---- --- --------------------------
Maxwell Thomas 45 CEO, CFO, and Director
Enzo Taddei 34 Director
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The following is a biographical summary of the directors and officers of the
Company:
Maxwell A. Thomas, Age 45 (Chief Executive Officer and Chief Financial
Officer). Mr. Thomas has been involved in the European and Australian travel
industries for more than 20 years. Having worked in the travel industry in
Europe for 20 years, Mr. Thomas returned to Australia in 1998 when he
established a consultancy business. Over the last 5 years he has advised
Australian travel companies entering international markets. Specifically, Mr.
Thomas worked for Flight Centre LTD ASX FTL from 1998 to 1999 as a Special
Projects Manager. From 1999 to 2000, Mr. Thomas worked as the Director of
Marketing for Pangaea Corporation. From 2000 until 2002 he has developed the
loyalty program which is the basis of the Company's program. From 2002 to
present, he has actively worked at and promoted the Company's business.
Enzo Taddei, Age 34, (Director). Mr Taddei holds degrees in economics from
the University of Malaga, Spain, a degree in Business Administration from the
University of Wales, UK, and a Master Degree in Taxation and fiscal related
subjects from the University of E.A.D.E in Malaga, Spain. He was previously the
sole shareholder and director of a private accountancy firm, Adesso Res Asesores
in Spain, which he operated for eight years between 1999 and 2006. Prior to
setting up his own accountancy company, Mr Taddei worked for a firm of chartered
accountants based in Marbella, Malaga whilst completing his BBA degree. He is
fluent in English, Spanish and Italian
BOARD COMMITTEES
----------------
Our Board has established no committees. Compliance with Section 16(a)
of the Securities Exchange Act of 1934 Section 16(a) of the Securities Exchange
Act of 1934, as amended, requires the Company's executive officers and directors
and persons who own more than 10% of a registered class of the Company's equity
securities, to file with the Securities and Exchange Commission (hereinafter
referred to as the "Commission") initial statements of beneficial ownership,
reports of changes in ownership and annual reports concerning their ownership,
of Common Stock and other equity securities of the Company on Forms 3, 4, and 5,
respectively. Executive officers, directors and greater than 10% stockholders
are required by Commission regulations to furnish the Company with copies of all
Section 16(a) reports they file. To the Company's knowledge, all of the
Company's executive officers, directors and greater than 10% beneficial owners
of its common Stock, have complied with Section 16(a) filing requirements
applicable to them during the Company's most recent fiscal year.
SECURITY OWNERSHIP OF
---------------------
CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
----------------------------------------
The table below sets forth, as of March 30, 2006, the shares of our
voting capital stock beneficially owned by each person, including management,
known to us to be the beneficial owner of more than 5% of the outstanding shares
of common stock. This does not include shares of preferred stock converted into
common shares subsequent to the Record Date.
All persons named in the table have the sole voting and dispositive
power, unless otherwise indicated, with respect to common stock beneficially
owned. Beneficial ownership of shares of common stock that are acquirable within
60 days upon the exercise or conversion of convertible securities are listed
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separately, and for each person named in the table, the calculation of percent
of class gives effect to those acquirable shares.
Number of Shares % of
Name of Beneficial Owner/ of Common Stock Beneficial
Identity of Group Beneficially Owned Ownership
----------------- ------------------ ----------
Maxwell Thomas for Geld Vieles Trust 9,539,000 25.9
Michael Sullivan for Cutan Trust and Posthaste
Pty Ltd 3,980,000 10.8
Winterman Group Ltd 4,105,100 11.2
INDEMNIFICATION OF DIRECTORS AND OFFICERS
-----------------------------------------
Nevada Revised Statutes 78.7502 (1) provides that a corporation may
indemnify any person who was or is a party or is threatened to be made a party
to any threatened, pending or completed action, suit or proceeding, whether
civil, criminal, administrative or investigative, except an action by or in the
right of the corporation, by reason of the fact that he is or was a director,
officer, employee, or agent of the corporation or is or was serving at the
request of the corporation as a director, officer, employee or agent of another
corporation, partnership, joint venture, trust or other enterprise, against
expenses, including attorneys' fees, judgments, fines and amount paid in
settlement actually and reasonably incurred by him in connection with the
action, suit or proceeding if he acted in good faith and in a manner which he
reasonably believed to be in or not opposed to the best interests of the
corporation, and, with respect to any criminal action or proceeding, had no
reasonable cause to believe his conduct was unlawful.
NRS 78.7502 (2) provides that a corporation may indemnify any person
who was or is a party or is threatened to be made a party to any threatened,
pending or completed action, suit by or in the right of the corporation to
procure a judgment in its favor by reason of the fact that he is or was a
director, officer, employee or agent of the corporation, or is or was serving at
the request of the corporation as a director, officer, employee or agent of
another corporation, partnership, joint venture, trust or other enterprise
against expenses, including amounts paid in settlement and attorneys' fees
actually and reasonably incurred by him in connection with the defense or
settlement of the action or suit if he acted in good faith and in a manner which
he reasonably believed to be in or not opposed to the best interests of the
corporation. Indemnification may not be made for any claim, issue or matter as
to which such a person has been adjudged by a court of competent jurisdiction,
after exhaustion of all appeals therefrom, to be liable to the corporation or
for amounts paid in settlement to the corporation, unless and only to the extent
that the court in which the action or suit was brought or other court of
competent jurisdiction determines upon application that in view of all the
circumstances of the case, the person is fairly and reasonably entitled to
indemnity for such expenses as the court deems proper.
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NRS 78.7502 (3) Provide that, to the extent that a director, officer,
employee or agent of a corporation has been successful on the merits or
otherwise in defense of any action, suit or proceeding referred to in
subsections 78.7502 (1) or 78.7502 (2), or in defense of any claim, issue or
matter therein, the corporation shall indemnify him against expenses, including
attorneys' fees, actually and reasonably incurred by him in connection with the
defense.
NRS 78.751 provides that authorization is required for discretionary
indemnification of directors, officers, employees or agents, advancement of
expenses to those parties and a limitation on indemnification and advancement of
expenses.
NRS 78.751 (1) provides that any discretionary indemnification under
NRS 78.7502, unless ordered by a court or advancement pursuant to subsection 2,
may be made by the corporation only as authorized in the specific case upon a
determination that indemnification of the director, officer, employee or agent
is proper in the circumstances. The determination must be made:
(a) By the stockholders;
(b) By the board of directors by majority vote of a quorum consisting of
directors who were not parties to the action, suit or proceeding;
(c) If a majority vote of a quorum consisting of directors who were not
parties to the action, suit or proceeding so orders, by independent
legal counsel in a written opinion; or
(d) If a quorum consisting of directors who were not parties to the
action, suit or proceeding cannot be obtained, by independent legal
counsel in a written opinion.
NRS 78.751 (2) provides that the articles of incorporation, the by-laws
or an agreement made by the corporation may provide that the expenses of
officers and directors incurred in defending a civil or criminal action, suit or
proceeding must be paid by the corporation as they are incurred and in advance
of the final disposition of the action, suit or proceeding, upon receipt of an
undertaking by or on behalf of the director or officer to repay the amount if it
is ultimately determined by a court of competent jurisdiction that he is not
entitled to be indemnified by the corporation. The provisions of this subsection
do not affect any rights to advancement of expenses to which corporate personnel
other than directors or officers may be entitled under any contract or otherwise
by law.
NRS 78.751 (3) provides that the indemnification and advancement of
expenses authorized in or ordered by a court pursuant to NRS 78.751:
(a) Does not exclude any other rights to which a person seeking
indemnification or advancement of expenses may be entitled under the
articles of incorporation or any bylaw, agreement, vote of
stockholders or disinterested directors or otherwise, for either an
action in his official capacity or an action in another capacity
while holding his office, except that indemnification, unless
ordered by a court pursuant to NRS 78.7502 or for the advancement of
expenses made pursuant to subsection 2, may not be made to or on
behalf of any director or officer if a final adjudication
establishes that his acts or omissions involved intentional
misconduct, fraud or a knowing violation of the law and was material
to the cause of action; and
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(b) Continues for a person who has ceased to be a director, officer,
employee or agent and inures to the benefit of the heirs, executors
and administrators of such a person. Articles of Incorporation
Our Articles of Incorporation, as amended, limit the personal liability
of directors and officers from damages for breach of fiduciary duty as a
director or officer but such provision does not eliminate or limit the liability
of a director or officer for:
(i) acts or omissions which involve intentional misconduct, fraud or a
knowing violation of law; or
(ii) the payments of distributions in violation of NRS 78.300.
SEC Policy on Indemnification
Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers and controlling persons of the
registrant pursuant to the foregoing provisions, or otherwise, we have been
advised that in the opinion of the SEC such indemnification is against public
policy as expressed in the Securities Act and is, therefore, unenforceable.
CAUTIONARY STATEMENTS CONCERNING FORWARD-LOOKING INFORMATION
------------------------------------------------------------
This Information Statement contains forward-looking statements. Certain
matters discussed herein are forward-looking statements within the meaning of
the Private Litigation Reform Act of 1995. Certain, but not necessarily all, of
such statements can be identified by the use of forward-looking terminology,
such as "believes," "expects," "may," "will," "should," "estimates" or
"anticipates" or the negative thereof or comparable terminology. All
forward-looking statements involve known and unknown risks, uncertainties and
other factors, which may cause the actual transactions, results, performance or
achievements of the company to be materially different from any future
transactions, results, performance or achievements expressed or implied by such
forward-looking statements. These may include, but are not limited to matters
described in this Information Statement and matters described in "Note on
Forward-Looking Statements" in our Annual Report on Form 10-KSB for the year
ended December 31, 2005. Although we believe the expectations reflected in such
forward-looking statements are based upon reasonable assumptions and business
opportunities, we can give no assurance that our expectations will be attained
or that any deviations will not be material. We undertake no obligation to
publicly release the result of any revisions to these forward-looking statements
that may be made to reflect any future events or circumstances.
ADDITIONAL INFORMATION
----------------------
If you have any questions about the actions described above, you may
contact Gregg E. Jaclin, Esq., Anslow & Jaclin, LLP, 4400 Route 9, 2nd Floor,
Freehold, New Jersey 07728.
13
We are subject to the informational requirements of the Securities
Exchange Act of 1934 and in accordance with the requirements thereof, file
reports, proxy statements and other information with the Securities and Exchange
Commission ("SEC"). Copies of these reports, proxy statements and other
information can be obtained at the SEC's public reference facilities at
Judiciary Plaza, Room 1024, 450 Fifth Street, N.W., Washington, D.C., 20549.
Additionally, these filings may be viewed at the SEC's website at
http://www.sec.gov.
We filed our annual report for the fiscal year ended December 31, 2002
on Form 10-KSB with the SEC. A copy of the annual reports on Form 10-KSB (except
for certain exhibits thereto), may be obtained, free of charge, upon written
request by any stockholder to Gregg E. Jaclin, Anslow & Jaclin, LLP, 4400 Route
9, 2nd Floor, Freehold, New Jersey 07728. Copies of all exhibits to the annual
reports on Form 10-KSB are available upon a similar request, subject to payment
of a $.50 per page charge to reimburse us for expenses in supplying any exhibit.
INFORMATION INCORPORATED BY REFERENCE
-------------------------------------
The following documents are incorporated herein by reference and to be
a part hereof from the date of filing of such documents:
Annual Report on Form 10-KSB for the fiscal year ended December 31,
2005 and Quarterly Reports on Form 10-QSB for the quarterly periods ending March
31, 2006, June 30, 2006 and September 30, 2006.
All documents filed by the Company with the SEC pursuant to Sections
13(a), 13(c), 14 or 15(d) of the Exchange Act after the date of this Information
Statement and prior to the effective date of the action taken described herein,
including the Annual Report on Form 10-KSB for the fiscal year ended December
31, 2005.
Any statement contained in a document incorporated or deemed to be
incorporated by reference herein shall be deemed to be modified or superseded
for purposes of this Information Statement to the extent that a statement
contained herein or in any other subsequently filed document that also is, or is
deemed to be, incorporated by reference herein modifies or supersedes such
statement. Any such statement so modified or superseded shall not be deemed,
except as so modified or superseded, to constitute a part of this Information
Statement.
This Information Statement incorporates, by reference, certain
documents that are not presented herein or delivered herewith. Copies of any
such documents, other than exhibits to such documents which are not specifically
incorporated by reference herein, are available without charge to any person,
including any stockholder, to whom this Information Statement is delivered, upon
written or oral request to our Secretary at our address and telephone number set
forth herein.
14
DISTRIBUTION OF INFORMATION STATEMENT
-------------------------------------
The cost of distributing this Information Statement has been borne by
us and certain stockholders that consented to the action taken herein. The
distribution will be made by mail.
Pursuant to the requirements of the Exchange Act of 1934, as amended,
the Registrant has duly caused this Information Statement to be signed on its
behalf by the undersigned hereunto authorized.
By Order of the Board of Directors
/s/ Maxwell Thomas
------------------------------
Maxwell Thomas
Chief Executive Officer and
Chief Financial Officer
March 30, 2007
15
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