UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 14C INFORMATION
Information Statement Pursuant to Section 14(c)
of the Securities Exchange Act of 1934
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Preliminary Information Statement
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Confidential, for Use of the Commission Only (as permitted by Rule 14c-5(d)(2))
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Definitive Information Statement
STANDARD DRILLING, INC.
(Name of Registrant as Specified In Its Charter)
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STANDARD DRILLING, INC.
870 Market Street, Suite 828
San Francisco, CA 94597
March [__], 2013
To:
The Holders of the Common Stock of Standard Drilling, Inc.
Re:
Action by Written Consent in Lieu of Meeting of Stockholders
This Information Statement is furnished by the Board of Directors of Standard Drilling, Inc., a Nevada corporation (the “Company”), to holders of record of the Company’s common stock, $0.001 par value per share, at the close of business on March 8, 2013. The purpose of this Information Statement is to inform the Company’s stockholders of a certain actions taken by the written consent of the holders of a majority of the Company’s voting stock, dated as of March 1, 2013. This Information Statement is prepared and delivered to meet the requirements of Section 78.390 of the Nevada Revised Statutes. This Information Statement provides notice that the Board of Directors has recommended, and holders of a majority of the voting power of our outstanding stock have voted, to approve the following items:
1.
To elect five (5) directors to serve until the next Annual Meeting of Shareholders and thereafter until their successors are elected and qualified; and
2.
To approve an amendment to the Company’s Articles of Incorporation to: (a) change the Company’s name to EFactor Group Corp., (b) increase the authorized preferred stock from 10,000,000 shares, par value $0.001, to 20,000,000 shares of preferred stock, par value $0.001, (c) increase the authorized common stock from 100,000,000 shares, par value $0.001, to 175,000,000 shares of common stock, par value $0.001, and (d) to approve a reverse stock split of the Company’s outstanding common stock at a ratio of 1-for-40.
The above actions taken by the Company’s stockholders will become effective on or about April [__], 2013 and are more fully described in the Information Statement accompanying this Notice.
Under the rules of the Securities and Exchange Commission, the above actions cannot become effective until at least 20 days after the accompanying Information Statement has been distributed to the stockholders of the Company.
This is not a notice of a special meeting of stockholders and no stockholder meeting will be held to consider any matter that will be described herein.
By Order of the Board of Directors
Adriaan Reinders, Chief Executive Officer
March [_], 2013
San Francisco, CA
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WE ARE NOT ASKING YOU FOR A PROXY
AND YOU ARE REQUESTED NOT TO SEND US A PROXY
INFORMATION STATEMENT
INFORMATION STATEMENT PURSUANT TO SECTION 14C OF THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED
THIS IS NOT A NOTICE OF A SPECIAL MEETING OF STOCKHOLDERS AND NO STOCKHOLDER MEETING WILL BE HELD TO CONSIDER ANY MATTER DESCRIBED HEREIN. THE ACTIONS DESCRIBED IN THIS INFORMATION STATEMENT HAVE BEEN APPROVED BY HOLDERS OF A MAJORITY OF OUR COMMON STOCK. WE ARE NOT ASKING YOU FOR A PROXY AND YOU ARE REQUESTED NOT TO SEND US A PROXY. THERE ARE NO DISSENTERS’ RIGHTS WITH RESPECT TO THE ACTIONS DESCRIBED IN THIS INFORMATION STATEMENT.
INTRODUCTION
This Information Statement is being mailed or otherwise furnished to the holders of common stock, $0.001 par value per share (the “Common Stock”) of Standard Drilling, Inc., a Nevada corporation (“We” or the “Company”) by the Board of Directors to notify them about a certain action that the holders of a majority of the Company’s outstanding voting stock have taken by written consent, in lieu of a special meeting of the stockholders. The action was taken on March 1, 2013.
Copies of this Information Statement are first being sent on or before March [__], 2013 to the holders of record on March 8, 2013 of the outstanding shares of the Company’s Common Stock.
General Information
Stockholders of the Company owning a majority of the Company’s outstanding voting securities have approved the following action (the “Action”) by written consent dated March 1, 2013, in lieu of a special meeting of the stockholders:
1.
To elect five (5) directors to serve until the next Annual Meeting of Shareholders and thereafter until their successors are elected and qualified; and
2.
To approve an amendment to the Company’s Articles of Incorporation to: (a) change the Company’s name to EFactor Group Corp., (b) increase the authorized preferred stock from 10,000,000 shares, par value $0.001, to 20,000,000 shares of preferred stock, par value $0.001, (c) increase the authorized common stock from 100,000,000 shares, par value $0.001, to 175,000,000 shares of common stock, par value $0.001, and (d) To approve a reverse stock split of the Company’s outstanding common stock at a ratio of 1-for-40.
The Company has asked brokers and other custodians, nominees and fiduciaries to forward this Information Statement to the beneficial owners of the common stock held of record by such persons and will reimburse such persons for out-of-pocket expenses incurred in forwarding such material.
Dissenters’ Right of Appraisal
No dissenters’ or appraisal rights under Nevada law are afforded to the Company’s stockholders as a result of the approval of the Action.
Vote Required
The vote, which was required to approve the above Actions, was the affirmative vote of the holders of a majority of the Company’s voting stock. Each holder of Common Stock is entitled to one (1) vote for each share of
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Common Stock held. Each holder of Series A Convertible Preferred Stock is entitled to twenty-five (25) votes for each share of Series A Convertible Preferred Stock held.
The date used for purposes of determining the number of outstanding shares of voting stock of the Company entitled to vote is March 1, 2013. The record date for determining those shareholders of the Company entitled to receive this Information Statement is the close of business on March 8, 2013 (the “Record Date”). As of the Record Date, the Company had outstanding 93,458,880 shares of Common Stock. Holders of the Common Stock have no preemptive rights. All outstanding shares are fully paid and nonassessable. The transfer agent for the Common Stock is Pacific Stock Transfer Company, 4045 S. Spencer Street, Suite 403, Las Vegas, NV 89119, Telephone: 702-361-3033.
Vote Obtained – Section 78.320 of the Nevada Revised Statutes
Section 78.320 of the Nevada Revised Statutes generally provides that any action required to be taken at any annual or special meeting of stockholders of a corporation, or any action which may be taken at any annual or special meeting of such stockholders, may be taken without a meeting, without prior notice and without a vote, if a consent or consents in writing, setting forth the action so taken, shall be signed by the holders of outstanding stock having not less than the minimum number of votes that would be necessary to authorize or take such action at a meeting at which all shares entitled to vote thereon were present and voted.
In order to eliminate the costs and management time involved in soliciting and obtaining proxies to approve the Actions and in order to effectuate the Actions as early as possible in order to accomplish the purposes of the Company as hereafter described, the Board of Directors of the Company voted to utilize, and did in fact obtain, the written consent of the holders of a majority of the voting power of the Company. The consenting shareholders and their respective approximate ownership percentage of the voting stock of the Company, which total in the aggregate 57.2% of the outstanding voting stock, are as follows: Adriaan Reinders (28.6%) and Marion Freijsen (28.6%), respectively
This Information Statement is being distributed pursuant to the requirements of Section 14(c) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) to the Company’s stockholders on the Record Date. The corporate action described herein will be effective approximately 20 days (the “20-day Period”) after the mailing of this Information Statement. The 20-day Period is expected to conclude on or about April [__], 2013.
The entire cost of furnishing this Information Statement will be borne by the Company.
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ACTION ONE
ELECTION OF DIRECTORS
Directors are normally elected by the shareholders at each annual meeting to hold office until their respective successors are elected and qualified, and need not be shareholders of the Company. Directors may receive compensation for their services as determined by the Board of Directors. See “Compensation of Directors.” Presently, the Board of Directors consists of four (4) members, namely, Adriaan Reinders, Marion Freijsen, James E. Solomon and Thomas Trainer. Brian Banmiller is a nominee to the Company’s Board of Directors and his appointment will be effective upon the expiration of the 20-day Period.
On January 15, 2013, the Company filed a Schedule 14f-1 announcing that a change in the majority of the Company’s Board of Directors would occur upon the closing of a change of control transaction with The E-Factor Corp. and certain of its shareholders. The Schedule 14f-1 was mailed to the Company’s shareholders of record on January 15, 2013. On February 1, 2013, the Company entered into an Acquisition and Share Exchange Agreement (the “Exchange Agreement”) by and among (i) the Company, (ii) The E-Factor Corp. (“EFactor”), and (iii) certain shareholders of EFactor. This transaction closed on February 11, 2013. As a result of the Exchange Agreement with EFactor, certain EFactor shareholders were appointed to the Company’s Board of Directors and David Rector, the Company’s sole officer and director, resigned. The resignation of Mr. Rector, and the appointment of new directors, which actions effect a change in the majority of our Board of Directors were effective with the close of the Exchange Agreement. Regarding the changes to our Board of Directors, the following occurred February 11, 2013:
·
David S. Rector resigned from the Company’s Board of Directors;
·
Adriaan Reinders was appointed to the Company’s Board of Directors;
·
Marion Freijsen was appointed to the Company’s Board of Directors;
·
James E. Solomon was appointed to the Company’s Board of Directors; and
·
Thomas Trainer was appointed to the Company’s Board of Directors
Mr. Rector submitted his resignation from the Board of Directors to the Board of Directors, effective upon the Company’s completion of the appropriate procedures to appoint additional members to the Company’s Board of Directors under Rule 14f-1 or Regulation 14-C, as applicable.
Voting for the election of directors is non-cumulative, which means that a simple majority of the shares voting may elect all of the directors. Each share of common stock is entitled to one (1) vote and, therefore, has a number of votes equal to the number of authorized directors. Each share of Series A Convertible Preferred Stock is entitled to twenty-five (25) votes and therefore, has a number of votes equal to twenty-five times the number of directors.
Although the Company’s management expects that each of the following nominees will be available to serve as a director, in the event that any of them should become unavailable prior to being appointed, a replacement will be appointed by a majority of the then-existing Board of Directors. Management has no reason to believe that any of its nominees, if elected, will be unavailable to serve. All nominees are expected to serve until the next Annual Meeting of Shareholders or until their successors are duly elected and qualified.
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Nominees For Election As Director
The following table sets forth certain information with respect to persons nominated by the Board of Directors of the Company for election as Directors of the Company and who will be elected following the effective date of the actions in this Information Statement:
Name |
| Age |
| Position(s) |
|
|
|
|
|
Adriaan Reinders |
| 68 |
| President, Chief Executive Officer and Director |
|
|
|
|
|
Marion Freijsen |
| 50 |
| Chief Operating Officer and Director |
|
|
|
|
|
James E. Solomon |
| 62 |
| Chief Financial Officer and Director |
|
|
|
|
|
Thomas Trainer |
| 66 |
| Director |
|
|
|
|
|
Brian Banmiller |
| 68 |
| Nominee for Director |
Adriaan Reindershas launched numerous businesses from the ground-up, growing and selling them through all economic cycles. He has created multiple businesses through a roll-up strategy, the largest of which had 1,110 employees and was sold to British Telecom. He is the Co-Founder and Chief Executive Officer (CEO) of The E-Factor Corp., a global social network for entrepreneurs providing them with online and offline support regarding funding, business development, cost savings and knowledge Mr. Reinders oversees the daily operations of the company, and his responsibilities include locating funds for company expansion. Mr. Reinders is also the Co-Founder and until 2010 served as an Executive Board Member of OHM Inc., a sales consulting firm serving emerging technology companies. Further, he was a founder and served as the Acting Chief Executive Officer of Supply Chain Solutions B.V., a global business solutions firm specializing in supply chain management and software services for the U.S. pharmaceutical manufacturers and large European retailers. In 1989, Mr. Reinders founded Rijnhaave, a Netherlands information technology company specializing in systems integration, and subsequently executed six acquisition transactions in the Netherlands and the U.S. before selling the company to Syntegra, a subsidiary of British Telecom. In 1975, Mr. Reinders founded Microlife, a Netherlands information technology firm specializing in customer services and training for mainframe environments. Mr. Reinders’ extensive engagements include serving as a board member of the Kelley School of Business at the University of Indiana, the Executive Chairman of Artilium (a publicly held company), and a former Board Member of Global IT Division of British Telecom. He is also a frequent speaker and a published author with books on entrepreneurial networking and social media. Mr. Reinders holds a degree in Social Geography from the University of Amsterdam.
Marion Freijsenis the Co-Founder and Chief Operating Officer (COO) of E-Factor Corp., the world’s largest global social network for entrepreneurs providing members with online and offline support regarding funding, business development, cost savings and knowledge. Ms. Freijsen was responsible for and managed the build of the E-Factor platform supporting the now more than 1 million members. E-Factor has approximately 700,000 members in the U.S. and provides 60 events annually across the U.S. Ms. Freijsen is also the owner of Elegio BV, a Netherlands company providing business consulting and management expertise in the areas of strategy, vision, finance, international expansion and business development for clients such as ING, Lloyds, BASF and Numico. In addition, Ms. Freijsen is the founder and the former Chief Executive Officer (CEO) and Executive Board Member of OHM Inc., a sales consulting firm serving emerging technology companies. Ms. Freijsen co-launched OHM Business Development with no outside investment, and in five years established a portfolio of more than 100 clients. Her expertise includes arranging meetings for clients with the senior management and/or board members of Fortune 1500 companies, such as HSBC, Barclays Bank, ING, BP, Shell and Exxon. Ms. Freijsen’s background includes serving as a former Vice President (Central Europe) for Currenex Ltd., Commercial Director of Speedport NV, Country Manager (Benelux) for Newsedge Corp., Major Account Manager for ICV Ltd. / S&P Comstock, and Account Manager for Bloomberg Financial Markets. Ms. Freijsen is the co-author of two books (the most recent published in November 2012 called “The E-Factor: Entrepreneurship in the Social Media Age”). She is a frequent speaker at global conferences in cities such as New York, Boston, San Francisco, London, Amsterdam
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and Berlin. In 2012 she was invited to participate in the debate by the White House committee on Job Creation and she critiqued one of the presidential debates on Wall Street Journal TV from a Small Business perspective. Ms. Freijsen holds a marketing degree from the Chartered Institute of Marketing in London.
Brian Banmiller is one of the nation's most respected broadcast journalists, commentators and public speakers. Mr. Banmiller has reported on the rise, decline and rebirth of Silicon Valley, the fall of communism in Russia, the rise of capitalism in China, the threat of war in Korea, the future of Hong Kong, economic instability in the Philippines, the crisis in Northern Ireland and the economic impact of Germany's reunification. He has interviewed Presidents Bill Clinton and George H.W. Bush, Soviet President Mikhail Gorbachev and entrepreneurs Bill Gates, Charles Schwab, Donald Trump, William Hewlett, David Packard and Michael Dell among many others. Mr. Banmiller’s professional credentials include working as a business journalist, commentator and public speaker. He has a 30-year affiliation with CBS News Radio as a National Business Reporter. As the Business Editor for KTVU Channel 2 News, Oakland, California, from 1989 to 2005, Mr. Banmiller established himself as one of northern California's authorities on the economy. For seven years, he served as Executive Producer, Anchor & Chief Correspondent of the national television business news magazine, “On the Money with Brian Banmiller,” and for five years as Managing Editor and Co-Anchor of “Silicon Valley Business”. Prior to joining KTVU, Mr. Banmiller was a Contributing Correspondent for “The Wall Street Journal Report on Television.” Mr. Banmiller received a business degree from Villanova University 1966. He has also served five years in the United States Air Force where he obtained the rank of Captain. While in the military service Mr. Banmiller’s last assignment was as a top-secret courier while based in Teheran, Iran.
James E. Solomonis a Certified Public Accountant (CPA) and has served as a Chief Financial Officer (CFO), Director and Audit Committee Chairman of several publicly held companies. Since 2008, Mr. Solomon has been the Chief Financial Officer and a Director of Broadcast International. From 2001 – 2008, he served as a Director of Nevada Chemicals Company, and from 1990 – 2001, he was a Director of Lifshultz Industries. Mr. Solomon has served as the Audit Committee Chairman for Broadcast International, Nevada Chemicals Company, and Lifshultz Industries, all publicly held companies.
Thomas Trainer is a well-recognized and awarded leader in the business technology field. Throughout the course of his 40-year career, he has assisted companies such Citigroup, PepsiCo, Reebok , Eli Lilly &Company and Joseph E. Seagram to the forefront of their Industries, in his role as their Global Chief Information Officer. His list of accomplishments include;
·
Recipient of “The Albert Einstein Award” for career achievement in Information Technology [2005].
·
Receipt of InformationWeek Magazine’s “CIO of The Year” award, for his leadership of Reebok’s Global Business Process/Technology Redesign [1994].
·
Tribute in CIO Magazine’s 10th Anniversary Edition as “The Quintessential CIO”, for his vision and leadership [1998].
·
Inclusion as a member of select Industry and Government Task Forces on Technology [1996-1999]
·
Leadership of a Cross-Healthcare Industry study, on “The Internet’s Impact on Healthcare”.
In 1996, Mr. Trainer helped found “The Working Council of CIOs of The Advisory Board” and “The Pharmaceutical Research and Manufacturers Association (PHARMA) CIO Forum. He has lectured internationally on business and technology issues, including “The World Congress of Information Technology” in Washington, DC in 1998; and various conferences sponsored by The Economist, Forbes, BusinessWeek, Fortune, and Financial Times. In 2009 he keynoted in Beijing the “Inaugural Sino-American CIO Conference”. Mr. Trainer has also been profiled on CBS TV’s “American Edition” and CNBC’s “Technology Edge” Broadcast programs.
Family Relationships
There are no family relationships between or among the above Directors, executive officers or persons nominated or charged by us to become directors or executive officers.
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Conflicts of Interest
Potential conflicts of interest are inherent in the relationships between the Company and our officers and directors. From time to time, one or more of our affiliates may form or hold an ownership interest in and/or manage other businesses both related and unrelated to the type of business that we own and operate. These persons expect to continue to form, hold an ownership interest in and/or manage additional other businesses which may compete with our business with respect to operations, including financing and marketing, management time and services and potential customers. These activities may give rise to conflicts between or among the interests of us and other businesses with which our affiliates are associated. Our affiliates are in no way prohibited from undertaking such activities, and neither we nor our shareholders will have any right to require participation in such other activities. Further, because we intend to transact business with some of our officers, directors and affiliates, as well as with firms in which some of our officers, directors or affiliates have a material interest, potential conflicts may arise between the respective interests of us and these related persons or entities. We believe that such transactions will be effected on terms at least as favorable to us as those available from unrelated third parties.
With respect to transactions involving real or apparent conflicts of interest, we have adopted policies and procedures which require that: (i) the fact of the relationship or interest giving rise to the potential conflict be disclosed or known to the directors who authorize or approve the transaction prior to such authorization or approval, (ii) the transaction be approved by a majority of our disinterested outside directors, and (iii) the transaction be fair and reasonable to us at the time it is authorized or approved by our directors.
Our policies and procedures regarding transactions involving potential conflicts of interest are not in writing. We understand that it will be difficult to enforce our policies and procedures and will rely and trust our officers and directors to follow our policies and procedures. We will implement our policies and procedures by requiring the officer or director who is not in compliance with our policies and procedures to remove himself and the other officers and directors will decide how to implement the policies and procedures, accordingly.
Involvement in Certain Legal Proceedings
To the best of our knowledge, none of our directors or executive officers has been convicted in a criminal proceeding, excluding traffic violations or similar misdemeanors, or has been a party to any judicial or administrative proceeding during the past five years that resulted in a judgment, decree, or final order enjoining the person from future violations of, or prohibiting activities subject to, federal or state securities laws, or a finding of any violation of federal or state securities laws, except for matters that were dismissed without sanction or settlement. Except as set forth in our discussion below in “Certain Relationships and Related Transactions, and Director Independence – Transactions with Related Persons,” none of our directors, director nominees, or executive officers has been involved in any transactions with us or any of our directors, executive officers, affiliates, or associates which are required to be disclosed pursuant to the rules and regulations of the Commission.
Compliance with Section 16(a) of the Securities Exchange Act of 1934
Section 16(a) of the Securities Exchange Act of 1934 requires the Company’s directors and executive officers and persons who own more than ten percent of a registered class of the Company’s equity securities to file with the SEC initial reports of ownership and reports of changes in ownership of common stock and other equity securities of the Company. Officers, directors and greater than ten percent shareholders are required by SEC regulations to furnish the Company with copies of all Section 16(a) forms they file. During the most recent fiscal year, to the Company’s knowledge, the following delinquencies occurred:
Name | No. of Late Reports | No. of Transactions Reported Late | No. of Failures to File |
Adriaan Reinders | 0 | 0 | 0 |
Marion Freijsen | 0 | 0 | 0 |
James E. Solomon | 0 | 0 | 0 |
Thomas Trainer | 0 | 0 | 0 |
David S. Rector | 0 | 0 | 0 |
Board Meetings and Committees
During the 2011 and 2012 fiscal year to date, the Board of Directors met on a regular basis and took written action on numerous other occasions. All the members of the Board of Directors attended the meetings. The written actions were by unanimous consent.
Code of Ethics
We have not adopted a written code of ethics, because we believe and understand that our officers and directors adhere to and follow ethical standards without the necessity of a written policy.
Audit Committee
We do not currently have an audit committee.
Compensation Committee
We do not currently have a compensation committee.
Director Compensation
The following table sets forth director compensation for fiscal year 2012 through September 30, 2012:
Name | Fees Earned or Paid in Cash ($) | Stock Awards ($) | Option Awards ($) | Non-Equity Incentive Plan Compensation ($) | Nonqualified Deferred Compensation Earnings ($) | All Other Compensation ($) | Total ($) |
|
|
|
|
|
|
|
|
Adriaan Reinders | -0- | -0- | -0- | -0- | -0- | -0- | -0- |
|
|
|
|
|
|
|
|
Marion Freijsen | -0- | -0- | -0- | -0- | -0- | -0- | -0- |
|
|
|
|
|
|
|
|
James E. Solomon | -0- | -0- | -0- | -0- | -0- | -0- | -0- |
|
|
|
|
|
|
|
|
Thomas Trainer | -0- | -0- | -0- | -0- | -0- | -0- | -0- |
|
|
|
|
|
|
|
|
David S. Rector | -0- | -0- | -0- | -0- | -0- | -0- | -0- |
Certain Relationships and Related Transactions, and Director Independence
We have not entered into or been a participant in any transaction in which a related person had or will have a direct or indirect material interest in an amount that exceeds the lesser of $120,000 or 1% of the average of the Company’s total assets for the last three completed fiscal years.
We do not have a written policy concerning the review, approval, or ratification of transactions with related persons.
We do not have an audit, compensation, or nominating committee.
Currently, one of our directors, Thomas Trainer, is considered independent. Following the 20-day Period, with the addition of Brian Banmiller to the Board of Directors, we will have two independent directors. Because our common stock is not currently listed on a national securities exchange, we have used the definition of “independence” of The NASDAQ Stock Market to make this determination. NASDAQ Listing Rule 5605(a)(2) provides that an “independent director” is a person other than an officer or employee of the company or any other
9
individual having a relationship that, in the opinion of the company’s Board of Directors, would interfere with the exercise of independent judgment in carrying out the responsibilities of a director. The NASDAQ listing rules provide that a director cannot be considered independent if:
·
the director is, or at any time during the past three years was, an employee of the company;
·
the director or a family member of the director accepted any compensation from the company in excess of $120,000 during any period of 12 consecutive months within the three years preceding the independence determination (subject to certain exclusions, including, among other things, compensation for board or board committee service);
·
a family member of the director is, or at any time during the past three years was, an executive officer of the company;
·
the director or a family member of the director is a partner in, controlling stockholder of, or an executive officer of an entity to which the company made, or from which the company received, payments in the current or any of the past three fiscal years that exceed 5% of the recipient’s consolidated gross revenue for that year or $200,000, whichever is greater (subject to certain exclusions);
·
the director or a family member of the director is employed as an executive officer of an entity where, at any time during the past three years, any of the executive officers of the company served on the compensation committee of such other entity; or
·
·
the director or a family member of the director is a current partner of the company’s outside auditor, or at any time during the past three years was a partner or employee of the company’s outside auditor, and who worked on the company’s audit.
Mr. Reinders, Mr. Solomon and Ms. Freijsen are not considered independent because they each serves as an executive officer of the Company.
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ACTION TWO
AMENDMENT TO THE COMPANY’S
ARTICLES OF INCORPORATION TO CHANGE
THE NAME OF THE COMPANY, INCREASE THE
AUTHORIZED PREFERRED AND COMMON STOCK,
AND EFFECT A 1-FOR-40 REVERSE STOCK SPLIT
Name Change
On March 1, 2013, the Board of Directors of the Company approved, declared it advisable and in the Company’s best interest, and directed that there be submitted to the holders of a majority of the Company’s common stock for approval, the prospective amendment to the Company’s Articles of Incorporation to change the name of the Company to EFactor Group Corp. (the “Name Change Amendment”). On March 1, 2013, stockholders of the Company owning a majority of the Company’s outstanding voting stock (the “Majority Stockholders”) approved the Name Change Amendment by written consent, in lieu of a special meeting of the stockholders.
The Board of Directors of the Company and the Majority Stockholders believe that it is advisable and in the Company’s best interests to authorize and approve the Name Change Amendment in order to more accurately reflect changes in the Company’s business focus. As disclosed in the Company’s Current Report on Form 8-K filed with the SEC on February 14, 2013, the Company’s new business focus is owning, operating and administering certain assets related to a social media network, on- and offline content and interest in a subsidiary that conducts business operations as EQMentor and certain other intellectual property.
The Name Change Amendment, a copy of which is attached to this Information Statement asExhibit A, will be filed with the Nevada Secretary of State with an expected effective date of April [__], 2013.
Increase the Authorized Preferred and Common Stock
General
On March 1, 2013, the Board of Directors of the Company approved, declared it advisable and in the Company’s best interest and directed that there be submitted to the holders of a majority of the Company’s voting stock for approval, the prospective amendment to the Fourth Article of the Company’s Articles of Incorporation to (i) increase the authorized preferred stock from 10,000,000 shares, par value $0.001, to 20,000,000 shares, par value $0.001; and (ii) increase the authorized common stock from 100,000,000 shares, par value $0.001, to 175,000,000 shares, par value $0.001 (the “Increase in Authorized Amendment”). On March 1, 2013, the Majority Stockholders approved the Increase in Authorized Amendment by written consent, in lieu of a special meeting of the stockholders.
Reasons for the Increase in Authorized Amendment
Currently, the Company is authorized to issue 10,000,000 shares of Preferred Stock and 100,000,000 shares of Common Stock. Of the 10,000,000 of Preferred Stock authorized, as of the Record Date, there were 5,000,000 shares of Series A Convertible Preferred Stock outstanding. Of the 5,000,000 shares Series A Convertible Preferred Stock outstanding, 50% are convertible into 12,906,222 shares of our common stock upon the effectiveness of a 40-for-1 reverse stock split of the Company’s common stock.
Of the 100,000,000 shares of Common Stock authorized, as of the Record Date, there were 93,458,880 shares of Common Stock issued and outstanding, and 1,000,000 shares of Common Stock reserved for issuance upon the exercise of outstanding options. Consequently, the Company has a limited number of shares of Common Stock available for general corporate purposes.
As a general matter, the Board of Directors does not believe the currently available number of unissued shares of Preferred and Common Stock is an adequate number of shares to assure that there will be sufficient shares available for issuance in connection with possible future acquisitions, equity and equity-based financings, possible
11
future awards under employee benefit plans, stock dividends, stock splits, and other corporate purposes. Therefore, the Board of Directors and Majority Stockholders approved the increase inauthorized shares ofPreferred and Common Stock as a means of providing the Company with the flexibility to act with respect to the issuance of either the Preferred or Common Stock or securities exercisable for, or convertible into, Preferred or Common Stock in circumstances which they believe will advance the interests of the Company and its stockholders without the delay of seeking an amendment to the Certificate of Incorporation at that time.
The Board of Directors is considering, and will continue to consider, various financing options, including the issuance of either Preferred or Common Stock or securities convertible into Common Stock from time to time to raise additional capital necessary to support future growth of the Company. As a result of the Increase in Authorized Amendment, the Board of Directors will have more flexibility to pursue opportunities to engage in possible future capital market transactions involving either the Preferred or Common Stock or other securities convertible into Common Stock, including, without limitation, public offerings or private placements of such Common Stock or securities convertible into Common Stock.
In addition, the Company’s growth strategy may include the pursuit of selective acquisitions to execute its business plan. The Company could also use the additional Preferred and Common Stock for potential strategic transactions, including, among other things, acquisitions, spin-offs, strategic partnerships, joint ventures, restructurings, divestitures, business combinations and investments.
Ability of the Board to Issue Stock; Certain Issuances Requiring Shareholder Approval
The additional shares of Preferred and Common Stock authorized by the Increase in Authorized Amendment may be issued for any proper purpose from time to time upon authorization by the Board of Directors, without further approval by the stockholders unless required by applicable law, rule or regulation, including, without limitation, rules of any trading market that the Company’s Common Stock may trade on at that time. Shares may be issued for such consideration as the Board of Directors may determine and as may be permitted by applicable law.
Interest of the Directors and Officers of the Company in the Increase in Authorized Amendment
The current officers and directors of the Company and the officers and directors of the Company when the Increase in Authorized Amendment was approved by the Board of Directors do not have any substantial interest, direct or indirect, in the approval of the Increase in Authorized Amendment, other than as stockholders of the Company.
Effects of the Increase in Authorized Amendment
The increase inauthorized shares ofPreferred and Common Stock was not approved as a means of preventing or dissuading a change in control or takeover of the Company. However, use of these shares for such a purpose is possible. Authorized but unissued or unreserved shares of either Preferred and/or Common Stock, for example, could be issued in an effort to dilute the stock ownership and voting power of persons seeking to obtain control of the Company or could be issued to purchasers who would support the Board of Directors in opposing a takeover proposal. In addition, the increase inauthorized shares ofPreferred and Common Stock may have the effect of discouraging a challenge for control or make it less likely that such a challenge, if attempted, would be successful. The Board of Directors and executive officers of the Company have no knowledge of any current effort to obtain control of the Company or to accumulate large amounts of Common Stock.
The holders of Common Stock are not entitled to preemptive rights with respect to the issuance of additional Common Stock or securities convertible into or exercisable for Common Stock. Accordingly, the issuance of additional shares of Common Stock or such other securities might dilute the ownership and voting rights of stockholders.
The holders of Common Stock will not realize any dilution in their percentage of ownership of our company or their voting rights as a result of the increase. However, issuances of significant numbers of additional shares of Common Stock in the future (i) will dilute stockholders’ percentage ownership of our company and (ii) if such shares are issued at prices below what current stockholders paid for their shares, may dilute the value of current
12
stockholders’ shares.
The Increase in Authorized Amendment does not change the terms of the Preferred or Common Stock. The additional shares of Preferred Stock will be subject to those rights, preferences and privileges the Company’s Board of Director’s determine at their discretion. The Common Stock for which authorization is sought will have the same voting rights and liquidation rights, the same rights to dividends and distributions and will be identical in all other respects to the Common Stock now authorized.
The Increase in Authorized Amendment, a copy of which is attached to this Information Statement asExhibit A, will be filed with the Nevada Secretary of State with an expected effective date of April [__], 2013.
Reverse Stock Split
General
On March 1, 2013, the Board of Directors and Majority Stockholders of the Company approved by written consent, in lieu of a special meeting of stockholders, amend the Company’s Articles of Incorporation to effect a 1-for-40 reverse split of the Company’s Common Stock (the “Reverse Stock Split”).
Effects of Reverse Split
The corporate action provides for the combination of our presently issued and outstanding shares of Common Stock into a smaller number of shares of identical Common Stock. This is known as a "reverse stock split." Under the proposal, each forty (40) shares of our presently issued and outstanding Common Stock as of the close of business on the effective date of the approved director’s resolution will be converted automatically into one (1) share of our post-reverse stock split Common Stock. Fractional shares and "odd lots" of less than 100 shares of Common Stock will not be issued. Instead, we will issue one hundred full shares of our post-reverse stock split Common Stock to any stockholder who would have been entitled to receive a fractional share or an "odd lot" of less than 100 shares of Common Stock as a result of the reverse stock split.
Each stockholder will hold the same percentage of our outstanding Common Stock immediately following the reverse stock split as he or she did immediately prior to the reverse stock split, except for adjustments required due to the treatment of fractional shares and "odd lots" of less than 100 shares. The Reverse Split does not change the number of authorized shares of Common Stock.
Reasons for the Reverse Stock Split
The primary purposes of the reverse stock split are to:
• Increase the per share price of our Common Stock; and
• Provide the Company with the flexibility to issue additional shares to facilitate future acquisitions and financings.
The reduction in the number of issued and outstanding shares of Common Stock to result from the reverse stock split is expected to increase the market price of the Common Stock to a level above the current market trading price. While the Board believes that the shares of Common Stock will trade at higher prices than those which have prevailed in the recent past, there can be no assurance that such increase in the trading price will occur or, if it does occur, that it will equal or exceed the direct arithmetical result of the reverse stock split because there are numerous factors and contingencies which could affect our market price.
The Company’s Common Stock is currently quoted on the OTC Market Groups, Inc. OTCQB under the symbol “STDR.” A higher per share price for the Common Stock may enable the Company to meet minimum bid price criteria for initial listing of the Common Stock on a national securities exchange at such time as we implement our future business plans. Because trading of our Common Stock is conducted in the over-the-counter market, an investor could find it more difficult to dispose of, or to obtain accurate quotations as to the market value of, the
13
Common Stock. In addition, because the Common Stock is not listed on a national securities exchange and presently trades at less than $5.00 per share, trading in our Common Stock is subject to the requirements of certain rules promulgated under the Exchange Act, which require additional disclosure by brokers or dealers in connection with any trades involving a stock defined as a "penny stock." Because our Common Stock is presently classified as a "penny stock," prior to effectuating any transaction in our Common Stock, a broker or dealer is required to make a suitability determination as to the proposed purchaser of our Common Stock and to receive a written agreement, meeting certain requirements. The additional burdens imposed upon brokers or dealers by such requirements could discourage brokers or dealers from effecting transactions in our Common Stock, which could limit the market liquidity of our Common Stock and the ability of investors to trade our Common Stock.
The Board believes that the reverse stock split also could result in a broader market for our Common Stock than the current market. Many institutional investors are unwilling or unable due to investment restrictions to invest in companies whose stock trades at less than $5.00 per share. Many investment advisors are subject to internal restrictions on their ability to recommend stocks trading at less than $5.00 per share because of a general presumption that such stocks may be highly speculative. In addition, stocks trading at less than $5.00 per share may not be marginable under the internal policies of some investment firms. The reverse stock split is anticipated to result in a price increase for our Common Stock relieving, to some extent, the effect of such limitations on the market for our Common Stock. Additionally, brokerage commissions on the sale of lower priced stocks often represent a higher percentage of the sales price than commissions on relatively higher priced stocks. The expected increase in trading price may also encourage interest and trading in our Common Stock and possibly promote greater liquidity for our stockholders. We also believe that the current per share price of our Common Stock has or may have a negative effect on our ability to use our Common Stock in connection with possible future transactions such as financings, strategic alliances, acquisitions and other uses not presently determinable. However, there can be no assurances that the reverse stock split will have the desired consequences.
Effects of the Reverse Stock Split
The reverse stock split will be effected and will be effective upon a date on or after the expiration of the 20-day Period after the mailing of this Information Statement. The 20-day Period is expected to conclude on or about April [__], 2013.
Adoption of the reverse stock split will reduce the shares of Common Stock outstanding on the record date but will not affect the number of authorized shares of Common Stock. The reverse stock split also will have no effect on the par value of the Common Stock. The effect of the reverse split upon holders of Common Stock will be that the total number of shares of our Common Stock held by each stockholder will be automatically converted into the number of whole shares of Common Stock equal to the number of shares of Common Stock owned immediately prior to the reverse stock split divided by forty (40), adjusted for any fractional shares or "odd lots" of less than 100 shares. Each of our stockholders will continue to own shares of Common Stock and will continue to share in the assets and future growth of the Company as a stockholder. Each stockholder that currently owns fewer than four thousand (4,000) shares of Common Stock will receive one hundred (100) whole shares of Common Stock as a result of the reverse stock split.
Each stockholder's percentage ownership interest in the Company and proportional voting power will change due to adjustments for fractional shares or "odd lots" of less than 100 shares. The rights and privileges of the holders of shares of Common Stock will be substantially unaffected by the reverse stock split. As soon as practicable after the expiration of the 20-day Period, we will cause a letter of transmittal to be forwarded to each holder of record of shares of our Common Stock outstanding as of such date. The letter of transmittal will contain instructions for the surrender of certificates representing shares of pre-reverse stock split Common Stock to our transfer agent in exchange for certificates representing the number of whole shares of post-reverse stock split Common Stock into which the shares of pre-reverse stock split common stock have been converted as a result of the reverse stock split.
No Dissenters Rights
In connection with the approval of the Reverse Split, shareholders of the Company will not have a right to dissent and obtain payment for their shares under the Nevada Revised Statutes, the Articles of Incorporation or Bylaws.
14
Accounting Matters
TheReverse Split will not affect the par value of the Company’s Common Stock. As a result, on the effective date of the Reverse Split approved by the Company’s Board of Directors, the stated capital on the Company’s balance sheet attributable to Common Stock would be increased from then current amount by a factor that equals the Reverse Split ratio, and the additional paid-in capital account would be debited with the amount by which the stated capital is increased. The per share net income or loss and net book value per share will be increased because there will be less shares issued and outstanding.
Tax Consequences to Common Stockholders
The following discussion sets forth the material United States federal income tax consequences that the Company’s management believes will apply with respect to the Company and the shareholders of the Company who are United States holders at the effective time of the Reverse Split. This discussion does not address the tax consequences of transactions effectuated prior to or after the Reverse Split, including, without limitation, the tax consequences of the exercise of options, warrants or similar rights to purchase stock. For this purpose, a United States holder is a shareholder that is: (i) a citizen or resident of the United States, (ii) a domestic corporation, (iii) an estate whose income is subject to United States federal income tax regardless of its source, or (iv) a trust if a United States court can exercise primary supervision over the trust’s administration and one or more United States persons are authorized to control all substantial decisions of the trust. This discussion does not describe all of the tax consequences that may be relevant to a holder in light of his particular circumstances or to holders subject to special rules (such as dealers in securities, financial institutions, insurance companies, tax-exempt organizations, foreign individuals and entities and persons who acquired their Common Stock as compensation). In addition, this summary is limited to shareholders who hold their Common Stock as capital assets. This discussion also does not address any tax consequences arising under the laws of any state, local, or foreign jurisdiction. Accordingly, each shareholder is strongly urged to consult with a tax adviser to determine the particular federal, state, local or foreign income or other tax consequences to such shareholder related to any Reverse Split.
The Reverse Split is intended to be a tax-free recapitalization to the Company and its stockholders, except for those stockholders who receive 100 whole shares of Common Stock in lieu of a fractional share or "odd lots" of less than 100 shares. Stockholders will not recognize any gain or loss for federal income tax purposes as a result of the Reverse Split, except for those stockholders receiving 100 whole shares of Common Stock in lieu of a fractional share or “odd lots” of less than 100 shares (as described below). The holding period for shares of Common Stock after the Reverse Split will include the holding period of shares of Common Stock before the Reverse Split, provided that such shares of Common Stock are held as a capital asset at the effective time of the Amendment. The adjusted basis of the shares of Common Stock after the Reverse Split will be the same as the adjusted basis of the shares of Common Stock before the Reverse Split, excluding the basis of fractional shares and “odd lots” of less than 100 shares. A stockholder who receives 100 whole shares of Common Stock in lieu of a fractional share or “odd lots” of less than 100 shares generally may recognize gain in an amount not to exceed the excess of the fair market value of such 100 whole shares over the fair market value of the fractional share or "odd lots" of less than 100 shares to which the stockholder was otherwise entitled.
THIS SUMMARY IS NOT INTENDED AS TAX ADVICE TO ANY PARTICULAR PERSON. IN PARTICULAR, AND WITHOUT LIMITING THE FOREGOING, THIS SUMMARY ASSUMES THAT THE SHARES OF COMMON STOCK ARE HELD AS “CAPITAL ASSETS” AS DEFINED IN THE CODE, AND DOES NOT CONSIDER THE FEDERAL INCOME TAX CONSEQUENCES TO THE COMPANY’S STOCKHOLDERS IN LIGHT OF THEIR INDIVIDUAL INVESTMENT CIRCUMSTANCES OR TO HOLDERS WHO MAY BE SUBJECT TO SPECIAL TREATMENT UNDER THE FEDERAL INCOME TAX LAWS (SUCH AS DEALERS IN SECURITIES, INSURANCE COMPANIES, FOREIGN INDIVIDUALS AND ENTITIES, FINANCIAL INSTITUTIONS AND TAX EXEMPT ENTITIES). IN ADDITION, THIS SUMMARY DOES NOT ADDRESS ANY CONSEQUENCES OF ANY FORWARD SPLIT UNDER ANY STATE, LOCAL OR FOREIGN TAX LAWS. THE STATE AND LOCAL TAX CONSEQUENCES OF ANY FORWARD SPLIT MAY VARY AS TO EACH STOCKHOLDER DEPENDING ON THE STATE IN WHICH SUCH STOCKHOLDER RESIDES.
15
AS A RESULT, IT IS THE RESPONSIBILITY OF EACH STOCKHOLDER TO OBTAIN AND RELY ON ADVICE FROM HIS, HER OR ITS TAX ADVISOR AS TO, BUT NOT LIMITED TO, THE FOLLOWING: (A) THE EFFECT ON HIS, HER OR ITS TAX SITUATION OF ANY FORWARD SPLIT, INCLUDING, BUT NOT LIMITED TO, THE APPLICATION AND EFFECT OF STATE, LOCAL AND FOREIGN INCOME AND OTHER TAX LAWS; (B) THE EFFECT OF POSSIBLE FUTURE LEGISLATION OR REGULATIONS; AND (C) THE REPORTING OF INFORMATION REQUIRED IN CONNECTION WITH ANY REVERSE SPLIT ON HIS, HER OR ITS OWN TAX RETURNS. IT WILL BE THE RESPONSIBILITY OF EACH STOCKHOLDER TO PREPARE AND FILE ALL APPROPRIATE FEDERAL, STATE, LOCAL, AND, IF APPLICABLE, FOREIGN TAX RETURNS.
Tax Consequences for the Company
The Company should not recognize any gain or loss as a result of the Reverse Split.
Share Certificate Transfer Instructions
SHARE CERTIFICATES SHOULD NOT BE SENT TO US OR THE TRANSFER AGENT BEFORE RECEIPT OF SUCH LETTER OF TRANSMITTAL FROM THE COMPANY.
Until a stockholder forwards a completed letter of transmittal, together with certificates representing such stockholder's shares of pre-Reverse Split Common Stock to the transfer agent and receives in return a certificate representing shares of post-Reverse Split Common Stock, such stockholder's pre-Reverse Split Common Stock shall be deemed equal to the number of whole shares of post-Reverse Split Common Stock to which such stockholder is entitled as a result of the Reverse Split.
16
Security Ownership of Certain Beneficial Owners and Management
The following table sets forth, as of the Record Date, certain information with respect to the Company’s equity securities owned of record or beneficially by (i) each Officer and Director of the Company; (ii) each person who owns beneficially more than 5% of each class of the Company’s outstanding equity securities; and (iii) all Directors and Executive Officers as a group.
Common Stock
Title of Class |
| Name and Address of Beneficial Owner(2) |
| Nature of Beneficial Ownership |
| Amount |
|
| Percent of Class (1) |
|
|
|
|
|
|
|
|
|
|
Common Stock |
| Adriaan Reinders(3) |
| President, CEO and Director |
| 6,453,111 | (4) |
| 17.8%(4) |
|
|
|
|
|
|
|
|
|
|
Common Stock |
| Marion Freijsen(3) |
| COO and Director |
| 6,453,111 | (5) |
| 17.8%(5) |
|
|
|
|
|
|
|
|
|
|
Common Stock |
| James E. Solomon(3) |
| Director |
| 508,138 | (6) |
| 1.4%(6) |
|
|
|
|
|
|
|
|
|
|
Common Stock |
| Thomas Trainer(3) |
| Director |
| 475,788 | (7) |
| 1.3%(7) |
|
|
|
|
|
|
|
|
|
|
Common Stock |
| Roeland Reinders |
| Shareholder |
| 5,926,346 |
|
| 11.76% |
|
|
|
|
|
|
|
|
|
|
Common Stock |
| DASPV PTE LTD |
| Shareholder |
| 3,686,530 |
|
| 6.92% |
|
|
|
|
|
|
|
|
|
|
|
| All Officers and Directors as a Group (4 persons) |
|
|
| 13,890,148 | (4)(5) | 38.3% |
(1)
As of the Record Date, March 8, 2013, there were 93,458,880 shares of common stock outstanding (pre-prospective split). Shares of common stock subject to options or warrants currently exercisable, or exercisable within 60 days, are deemed outstanding for purposes of computing the percentage of the person holding such options or warrants, but are not deemed outstanding for the purposes of computing the percentage of any other person.
(2)
Unless indicated otherwise, the address of the shareholder is 870 Market Street, Suite 828, San Francisco, CA 91402.
(3)
Indicates an officer and/or director of the Company.
(4)
Includes 2,500,000 shares of our Series A Convertible Preferred Stock, 50% of which shares are convertible into 6,453,111 shares of our common stock (post-prospective split) upon the effectiveness of a 40-for-1 reverse stock split of our common stock. After giving effect to the 40-for-1 reverse stock split and the additional share issuances to be issued in the Exchange Agreement, the 6,453,111 shares of our common stock will represent approximately 17.8% of our common stock with the remaining 50% of the Series A Convertible Preferred Stock (non-convertible) able to vote at 25 votes per share, or a total of 31,250,000 additional votes on any matter brought before the holders of our common stock for a vote.
(5)
Includes 2,500,000 shares of our Series A Convertible Preferred Stock, 50% of which shares are convertible into 6,453,111 shares of our common stock (post-prospective split) upon the effectiveness of a 40-for-1 reverse stock split of our common stock. After giving effect to the 40-for-1 reverse stock split and the additional share issuances to be issued in the Exchange Agreement, the 6,453,111 shares of our common stock will represent approximately 17.8% of our common stock with the remaining 50% of the Series A Convertible Preferred Stock (non-convertible) able to vote at 25 votes per share, or a total of 31,250,000 additional votes on any matter brought before the holders of our common stock for a vote.
(6)
Includes 1,082,012 shares of our common stock issued to Mr. Solomon, plus an additional 481,087 post-split shares of our common stock to be issued to Mr. Solomon after the effect of a 40-for-1 reverse split (which reduces the 1,082,212 shares to 27,050 shares), bringing Mr. Solomon’s total share ownership post-split and new issuance to 508,138 shares of our common stock.
(7)
Includes 1,013,128 shares of our common stock issued to Mr. Trainer, plus an additional 450,460 post-split shares of our common stock to be issued to Mr. Trainer after the effect of a 40-for-1 reverse split (which reduces the 1,013,128 shares
17
to 25,328 shares), bringing Mr. Trainer’s total share ownership post-split and new issuance to 475,788 shares of our common stock.
Series A Preferred Stock
Title of Class |
| Name and Address of Beneficial Owner(2) |
| Nature of Beneficial Ownership |
| Amount |
|
| Percent of Class (1) |
| Percent of Total Voting Rights(6) |
|
|
|
|
|
|
|
|
|
|
|
|
Series A Preferred Stock |
| Adriaan Reinders(3) |
| President, CEO and Director |
| 2,500,000 | (4) |
| 50% | 40.1% | |
|
|
|
|
|
|
|
|
|
|
|
|
Series A Preferred Stock |
| Marion Freijsen(3) |
| COO and Director |
| 2,500,000 | (5) |
| 50% |
| 40.1% |
|
|
|
|
|
|
|
|
|
|
|
|
Series A Preferred Stock |
| James E. Solomon(3) |
| Director |
| 0 |
|
| 0% |
| 0% |
|
|
|
|
|
|
|
|
|
|
|
|
Series A Preferred Stock |
| Thomas Trainer(3) |
| Director |
| 0 |
|
| 0% |
| 0% |
|
|
|
|
|
|
|
|
|
|
|
|
|
| All Officers and Directors as a Group (4 persons) |
|
|
| 5,000,000 | (4)(5) |
| 100% |
| 57.2% |
(1)
As of the Record Date, March 8, 2013, there were 5,000,000 shares of Series A Convertible Preferred Stock outstanding. Shares of Series A Preferred Stock subject to options or warrants currently exercisable, or exercisable within 60 days, are deemed outstanding for purposes of computing the percentage of the person holding such options or warrants, but are not deemed outstanding for the purposes of computing the percentage of any other person.
(2)
Unless indicated otherwise, the address of the shareholder is 870 Market Street, Suite 828, San Francisco, CA 91402.
(3)
Indicates an officer and/or director of the Company.
(4)
Includes 2,500,000 shares of our Series A Convertible Preferred Stock, able to vote at 25 votes per share, or a total of 62,500,000 additional votes on any matter brought before the holders of our common stock for a vote. One-half of these shares are automatically converted into 6,453,111 after the Reverse Stock Split, leaving the remaining Series A Convertible Preferred Stock with 31,250,000 votes on any matter brought before the holders of our common stock for a vote.
(5)
Includes 2,500,000 shares of our Series A Convertible Preferred Stock, able to vote at 25 votes per share, or a total of 62,500,000 additional votes on any matter brought before the holders of our common stock for a vote. One-half of these shares are automatically converted into 6,453,111 after the Reverse Stock Split, leaving the remaining Series A Convertible Preferred Stock with 31,250,000 votes on any matter brought before the holders of our common stock for a vote.
(6)
Calculated based on 93,458,880 shares of common stock outstanding (pre-prospective split) with each share of Series A Preferred Stock having 25 votes per share. The percentages for Mr. Reinders and Ms. Freijsen are calculated separately for their individual ownership and together for the percentage for all officers and directors together.
Change in Control
As a result of the Exchange Agreement with EFactor, certain EFactor shareholders were appointed to the Company’s Board of Directors and our sole officer and director resigned. The resignation of our existing director, and the appointment of new directors, which actions effect a change in the majority of our Board of Directors were effective with the close of the Share Exchange Agreement detailed herein. Regarding the changes to our Board of Directors, the following occurred February 11, 2013:
·
David S. Rector resigned from our Board of Directors;
·
Adriaan Reinders was appointed to our Board of Directors;
·
Marion Freijsen was appointed to our Board of Directors;
·
James Earl Solomon was appointed to our Board of Directors; and
·
Thomas Trainer was appointed to our Board of Directors.
18
Executive Compensation
The following sets forth information with respect to the compensation awarded or paid to Adriaan Reinders, our current President and Chief Executive Officer, Marion Freijsen, our Chief Operating Officer, James E. Solomon, our Chief Financial Officer, and David S. Rector, our former President, Chief Executive Officer, Secretary and Treasurer for all services rendered in all capacities to us for the fiscal years ended December 31, 2011, 2010, and 2009.
Summary Compensation Table
The following table sets forth information regarding each element of compensation that we paid or awarded to our named executive officers for the fiscal years ended fiscal years ended December 31, 2011, 2010 and 2009.
Name and Principal Position |
| Fiscal Year |
| Salary($) |
|
| Bonus($) |
|
| All Other Compensation ($) |
|
| Total($) |
| ||||
Adriaan Reinders (1) |
| 2011 |
| $ | 90,000 |
|
| $ | 0 |
|
| $ | 0 |
|
| $ | 90,000 |
|
President and |
| 2010 |
| $ | 90,000 |
|
| $ | 0 |
|
| $ | 0 |
|
| $ | 90,000 |
|
Chief Executive Officer |
| 2009 |
| $ | 90,000 |
|
| $ | 0 |
|
| $ | 0 |
|
| $ | 90,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Marion Freijsen (1) |
| 2011 |
| $ | 90,000 |
|
| $ | 0 |
|
| $ | 0 |
|
| $ | 90,000 |
|
Chief Operating Officer |
| 2010 |
| $ | 90,000 |
|
| $ | 0 |
|
| $ | 0 |
|
| $ | 90,000 |
|
|
| 2009 |
| $ | 90,000 |
|
| $ | 0 |
|
| $ | 0 |
|
| $ | 90,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
James E. Solomon (1) |
| 2011 |
| $ | 0 |
|
| $ | 0 |
|
| $ | 0 |
|
| $ | 0 |
|
Chief Financial Officer |
| 2010 |
| $ | 0 |
|
| $ | 0 |
|
| $ | 0 |
|
| $ | 0 |
|
|
| 2009 |
| $ | 0 |
|
| $ | 0 |
|
| $ | 0 |
|
| $ | 0 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
David S. Rector (2) |
| 2011 |
| $ | 0 |
|
| $ | 0 |
|
| $ | 0 |
|
| $ | 0 |
|
Former Pres., CEO, CFO, |
| 2010 |
| $ | 0 |
|
| $ | 0 |
|
| $ | 60,000 |
|
| $ | 60,000 |
|
Treasurer, and Secretary |
| 2009 |
| $ | 0 |
|
| $ | 0 |
|
| $ | 0 |
|
| $ | 0 |
|
(1) On February 11, 2013, we acquired EFactor in a reverse acquisition transaction and, in connection with that transaction, Mr. Reinders was appointed as our President and Chief Executive Officer, Ms. Freijsen Chief Operating Officer and Secretary and Mr. James E. Solomon, our Chief Financial Officer. All compensation reflected in the table was derived from EFactor, our now majority-owned subsidiary.
(2) David S. Rector resigned as an executive officer effective February 11, 2013. Mr. Rector’s compensation includes $60,000 per year in consulting fees to an entity owned by Mr. Rector under the terms of an oral agreement as compensation for his services to us for 2011 and 2010, respectively. No payments were made in 2011.
19
Outstanding Equity Awards at Fiscal Year-End
The following table sets forth certain information concerning outstanding stock awards held by the Named Executive Officers for fiscal year 2012:
| Option Awards | Stock Awards | |||||||
Name | Number of Securities Underlying Unexercised Options (#) Exercisable | Number of Securities Underlying Unexercised Options (#) Unexercisable | Equity Incentive Plan Awards: Number of Securities Underlying Unexercised Unearned Options (#) | Option Exercise Price ($) | Option Expiration Date | Number Of Shares or Units of Stock That Have Not Vested (#) | Market Value Of Shares Or Units Of Stock That Have Not Vested ($) | Equity Incentive Plan Awards: Number Of Unearned Shares, Units or Other Rights That Have Not Vested (#) | Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested ($) |
|
|
|
|
|
|
|
|
|
|
Adriaan Reinders | -0- | -0- | -0- | -0- | - | -0- | -0- | -0- | -0- |
|
|
|
|
|
|
|
|
|
|
Marion Freijsen | -0- | -0- | -0- | -0- | - | -0- | -0- | -0- | -0- |
|
|
|
|
|
|
|
|
|
|
James E. Solomon | -0- | -0- | -0- | -0- | - | -0- | -0- | -0- | -0- |
|
|
|
|
|
|
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Thomas Trainer | -0- | -0- | -0- | -0- | - | -0- | -0- | -0- | -0- |
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David S. Rector | 1,000,000 | 1,000,000 | -0- | $0.125 | 6/18/13 | -0- | -0- | -0- | -0- |
WHERE YOU CAN FIND MORE INFORMATION
The Company is subject to the informational requirements of the Exchange Act and files reports and other information with the SEC. Such reports and other information filed by the Company may be inspected and copied at the SEC’s Public Reference Room at 100 F Street, N.E., Washington, D.C.20549, as well as in the SEC’s public reference rooms in New York, New York and Chicago, Illinois. Please call the SEC at 1-800-SEC-0330 for further information on the operation of the SEC’s public reference rooms. The SEC also maintains an Internet site that contains reports, proxy statements and other information about issuers, like us, who file electronically with the SEC. The address of the SEC’s web site is http://www.sec.gov.
By order of the Board of Directors
/s/ Adriaan Reinders
Adriaan Reinders, Chief Executive Officer
March __, 2013
San Francisco, CA
20
Exhibit A
CERTIFICATE OF AMENDMENT
TO THE
ARTICLES OF INCORPORATION
OF
STANDARD DRILLING, INC.
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Exhibit A
CERTIFICATE OF AMENDMENT
TO THE
ARTICLES OF INCORPORATION
OF
STANDARD DRILLING, INC.
STANDARD DRILLING, INC. (the “Corporation”) a corporation organized and existing under and by virtue of the Nevada Revised Statutes, as amended, DOES HEREBY CERTIFY:
FIRST: The Corporation filed its original Articles of Incorporation with the Secretary of State of Nevada on July 27, 2001.
SECOND: The Corporation filed Amended and Restated Articles of Incorporation with the Secretary of State of Nevada on September 9, 2006 (the “Corporation’s Articles”).
THIRD: Pursuant to the Unanimous Written Consent of the Corporation’s Board of Directors, dated March 1, 2013, the following amendments to the Corporation’s Articles were approved:
Article I “NAME” of the Corporation’s Articles is amended to read in its entirety as follows:
“The name of the Corporation shall be: EFactor Group Corp.”
Article IV “AUTHORIZED SHARES” of the Corporation’s Articles is amended to read in its entirety as follows:
“This Corporation is authorized to issue two classes of shares of stock to be designated as “Common Stock” and “Preferred Stock”. The total number of shares of Common Stock which this Corporation is authorized to issue is One Hundred Seventy Million (175,000,000) shares, par value $0.001. The total number of shares of Preferred Stock which this Corporation is authorized to issue is Twenty Million (20,000,000) shares, par value $0.001.
The shares of Preferred Stock may be issued from time to time in one or more series. The Board of Directors of the Corporation (the “Board of Directors”) is expressly authorized to provide for the issue of all or any of the shares of the Preferred Stock in one or more series, and to fix the number of shares and to determine or alter for each such series, such voting powers, full or limited, or no voting powers, and such designations, preferences, and relative, participating, optional, or other rights and such qualifications, limitations, or restrictions thereof, as shall be stated and expressed in the resolution or resolutions adopted by the Board of Directors providing for the issue of such shares (a “Preferred Stock Designation”) and as may be permitted by the Nevada Revised Statutes. The Board of Directors is also expressly authorized to increase or decrease (but not below the number of shares of such series then outstanding) the number of shares of any series subsequent to the issue of shares of that series. In case the number of shares of any such series shall be so decreased, the shares constituting such decrease shall resume the status that they had prior to the adoption of the resolution originally fixing the number of shares of such series. The Board of Directors also has express authority over any wholly unissued shares.
Effective on April [__], 2013 the issued and outstanding shares of common stock of the Corporation shall be subject to a 1-for-40 reverse stock split. As a result of the stock split, each 40 shares of our Common Stock issued and outstanding before the effectiveness of the stock split shall be exchanged for 1 share of Common Stock after the split. Fractional shares will be rounded up to the next whole share.”
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FOURTH: That the foregoing amendment has been consented to and authorized by the holders of a majority of the issued and outstanding stock entitled to vote by written consent in lieu of meeting in accordance with Section 78.390 of the Nevada Revised Statutes, as amended.
FIFTH: That the aforesaid amendment was duly adopted in accordance with the laws of the State of Nevada.
SIXTH: This Certificate of Amendment shall be effective as of April [__], 2013.
IN WITNESS WHEREOF,said Corporation has caused this certificate to be signed this 1st day of March, 2013.
By:
Adriaan Reinders
Chief Executive Officer
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