Mediashift (MSHFQ) PRE 14C Preliminary information

SCHEDULE 14C INFORMATION

Information Statement Pursuant to Section 14(c) of

The Securities Exchange Act of 1934

Check the appropriate box:

þ Preliminary Information Statement

o Confidential, for Use of the Commission Only (as permitted by Rule 14c-5(d)(2))

o Definitive Information Statement

JMG Exploration, Inc.

(Name of Registrant as Specified in its Charter)

Payment of Filing Fee (Check the appropriate box):

þ	No fee required.
o	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:
	(2)	Aggregate number of securities to which transaction applies:
	(3)	Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the filing fee is calculated and state how it was determined):
	(4)	Proposed maximum aggregate value of transaction:
	(5)	Total fee paid:

o		Fee paid previously with preliminary materials.
o		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

JMG EXPLORATION, INC.

600 North Brand Boulevard, Suite 230

Glendale, California 91203

(818) 557-3333

To Our Shareholders,

This Information Statement (this “Information Statement”) is being distributed to the holders of record of the common stock, par value $0.001 per share (the “Common Stock”) and to holders of record of the Class M Preferred Stock, par value $0.001 per share (the “Class M Preferred Stock”) (such holders of Common Stock and Class M Preferred being, the “Shareholders”) on September 26, 2012 (the “Record Date”) of JMG Exploration, Inc., a Nevada corporation (the “Company”), under Rule 14c-2 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”).  This Information Statement advises shareholders of actions described below taken and approved on September 26, 2012 by unanimous written consent of the Company’s board of directors (the “Board of Directors”).  The Company anticipates that the actions described below will be approved, by written consent, by the holders of a majority of the Company’s outstanding shares of Common Stock and by the holders of a majority of the Company’s outstanding shares of Class M Preferred Stock (collectively, the “Majority Shareholders”) prior to the mailing of this Information Statement to the shareholders:

1.

Approving an increase in the authorized number of shares of the Common Stock from 25,000,000 to 100,000,000 (the “Authorized Share Increase”);

2.

Approving changing the name of the Company from JMG Exploration, Inc. to Ad-Vantage Networks Holdings, Inc.in order to more accurately reflect the Company’s business (the “Name Change”); and

3.

Approving a reverse stock split of one share for every two (1-for-2) shares outstanding (the “Reverse Stock Split”).

The Board of Directors of the Company has unanimously approved the above corporate actions. This Information Statement is furnished to all of the Shareholders pursuant to Section 14(c) of Exchange Act and the rules promulgated thereunder, solely for the purpose of informing the Shareholders of these corporate actions.

Our Shareholders of record as of the close of business on the Record Date are entitled to receive this Information Statement. We are mailing this Information Statement on or about October__, 2011 to such Shareholders of record on the Record Date.

THIS IS NOT A NOTICE OF A SPECIAL MEETING OF SHAREHOLDERS AND NO SHAREHOLDER MEETING WILL BE HELD TO CONSIDER ANY MATTER DESCRIBED HEREIN. WE ARE NOT ASKING YOU FOR A PROXY AND YOU ARE REQUESTED NOT TO SEND US A PROXY.  

The Company believes that Shareholders owning of record more than 50% of our outstanding Common Stock and Class M Preferred Stock (voting together on an as-converted basis) will vote, by written consent, to approve and adopt the Authorized Share Increase, the Name Change and the Reverse Stock Split (collectively, the “Related Transactions”) prior to this Information Statement being mailed to shareholders and the Company is not asking you for a proxy and you are requested not to send us a proxy.

The Board of Directors anticipates that the corporate actions will be effected on or about October ___, 2012, representing 20 days after this Information Statement is first mailed to stockholders.

By Order of the Board of Directors,

/s/ David S. Grant

Chairman of the Board and Chief Executive Officer,

Glendale, California

September 26, 2012

2

JMG EXPLORATION, INC.

600 North Brand Boulevard, Suite 230

Glendale, California 91203

(818) 557-3333

INFORMATION STATEMENT

This Information Statement advises the holders of record of the common stock, par value $0.001 per share (the “Common Stock”) and the holders of record of the Class M Preferred Stock, par value $0.001 per share (the “Class M Preferred Stock”) (such holders of Common Stock and Class M Preferred being, the “Shareholders”) of the actions described below taken and approved on September 26, 2012 by unanimous written consent of the Company’s board of directors (the “Board of Directors”).  The Company anticipates that such actions described below will be approved, by written consent, by the holders of a majority of the Company’s outstanding shares of Common Stock and by the holders of a majority of the Company’s outstanding shares of Class M Preferred Stock (collectively, the “Majority Shareholders”) prior to the mailing of this Information Statement to the shareholders:  (i) an increase in the authorized number of shares of the Common Stock from 25,000,000 to 100,000,000, (ii) changing the name of the Company from JMG Exploration, Inc. to Ad-Vantage Networks Holdings, Inc. in order to more accurately reflect the Company’s business, and (iii) a reverse stock split of one share for every two (1-for-2) shares outstanding.  The Board of Directors anticipates that such actions will be effected on or about October __, 2012, representing 20 days after this Information Statement is first mailed to stockholders.

Background

On August 31, 2012, pursuant to that certain Amended and Restated Agreement and Plan of Merger (the “Merger Agreement”) by and among the Company, Ad-Vantage, Networks, Inc., a Delaware corporation (“Ad-Vantage”), and Ad-Vantage Acquisition. Inc. (“MergerSub”), a Delaware corporation wholly owned by the Company, MergerSub merged with and into Ad-Vantage (the “Merger”), with Ad-Vantage being the surviving entity of such Merger and becoming a wholly-owned subsidiary of the Company.  

The Company issued 169,973.88 shares of Class M Preferred Stock (the “Class M Preferred”), a newly authorized class of Company preferred stock, as consideration for the Merger.  Each issued and outstanding share of Ad-Vantage common stock and Ad-Vantage preferred stock (collectively, “Ad-Vantage Capital Stock”) was exchanged for 0.01 fully paid and nonassessable share of Class M Preferred.

As part of the Merger and pursuant to the Merger Agreement, the Company agreed to, as soon as reasonably practicable following the closing of the Merger, (i) increase the authorized number of shares of the Common Stock from 25,000,000 to 100,000,000 (the “Authorized Share Increase”), (ii) approve changing the name of the Company from JMG Exploration, Inc. to Ad-Vantage Networks Holdings, Inc. in order to more accurately reflect the Company’s business (the “Name Change”), (iii) approve a reverse stock split of one share for every two (1-for-2) shares outstanding (the “Reverse Stock Split” and, with the Authorized Share Increase and the Name Change, each, a “Related Transaction” and collectively, the “Related Transactions”).

Additionally, in connection with the Merger, the Company agreed to, as soon as practicable after the Closing of the Merger, sell all of the “Oil and Gas Properties” identified in the Company’s most recent 10-K filed with the SEC (the “O&G Operations” and the “O&G Sale”) or at its option cause the O&G Operations to be spun off for the benefit of the Company’s pre-Merger stockholders as soon as may be practicable following completion of the Merger (the “O&G Spinoff”).  The Board of Directors is still reviewing whether to proceed with an O&G Sale or an O&G Spinoff.  If the Board of Directors elects to sell the O&G Operations, all net proceeds from such sale shall be distributed  pro-rata to the Company’s pre-Merger stockholders and not to any of the stockholders of Ad-Vantage (unless, and in such event solely to the extent that such stockholders were also pre-Merger stockholders of the Company (the “Pre-Merger Stockholders”)).  If the Board of Directors elects to proceed with the O&G Spinoff the Board of Directors will create a new entity to own and operate the current oil and gas operations (“New JMG”) and will spinoff New JMG shares of common stock to the Pre-Merger Stockholders.

3

Upon the consummation of the Authorized Share Increase and the Reverse Stock Split, the shares of Class M Preferred issued in exchange for the shares of Ad-Vantage Capital Stock shall automatically convert (the “Automatic Conversion”) into shares of the Company’s common stock, at the ratio of 100 shares of Common Stock for each share of Class M Preferred (the “Conversion Ratio”).  After giving effect to the Reverse Stock Split and the Automatic Conversion, the Company will have approximately 19,726,603 shares of Common Stock outstanding, of which 16,997,388 shares will have been issued (giving effect to the Automatic Conversion) to complete the Merger.

The Board of Directors of the Company (the “Board of Directors”) approved the Authorized Share Increase, the Name Change and the Reverse Stock Split, as it believes that all of such actions are in the best interests of the Company. As of the Record Date, there are5,458,405 outstanding shares of Common Stock and 169,973.88 outstanding shares of the Class M Preferred. Each share of Common Stock entitles the holder thereof to one vote on all matters on which holders are permitted to vote and each share of Class M Preferred Stock entitles the holder thereof to two hundred votes on all matters on which holders are permitted to vote (the “two hundred” votes is equivalent to one vote per share of Common Stock after giving effect to the Reverse Stock Split and the Automatic Conversion).

WE ARE NOT ASKING YOU FOR A PROXY AND YOU ARE REQUESTED NOT TO SEND US A PROXY. THE COMPANY BELIEVES THAT SHAREHOLDERS OWNING OF RECORD MORE THAN 50% OF OUR OUTSTANDING COMMON STOCK AND CLASS M PREFERRED (VOTING ON A POST-AUTOMATIC CONVERSION BASIS), BY WRITTEN CONSENT, WILL VOTE TO APPROVE AND ADOPT THE AUTHORIZED SHARE INCREASE, THE NAME CHANGE AND THE REVERSE STOCK SPLIT. ACCORDINGLY, NO ADDITIONAL VOTES WILL BE NEEDED TO APPROVE THIS ACTION.

This Information Statement is being furnished to the Shareholders of record as of September 26, 2012 (the “Record Date”) n accordance with the Securities Exchange Act of 1934, as amended from time to time (the “Exchange Act and Nevada Revised Statutes requiring notice to stockholders.

OUTSTANDING SHARES AND VOTING RIGHTS

As of the Record Date, the Company’s authorized capitalization consists of 25,000,000 shares of Common Stock, of which 5,458,405 shares were issued and outstanding, and 10,000,000 shares of Preferred Stock, of which 169,973.88 shares of Class M Preferred were issued and outstanding. Holders of Common Stock have no preemptive rights to acquire or subscribe to any additional shares of Common Stock or Preferred Stock. Except for those shares of Common Stock issuable upon the Automatic Conversion, holders of Class M Preferred have no preemptive rights to acquire or subscribe to any additional shares of Common Stock or Preferred Stock. Each share of Common Stock entitles the holder thereof to one vote on each matter submitted to the Shareholders and each share of Class M Preferred Stock entitles the holder thereof to two hundred votes on each matter submitted to the Shareholders (the “two hundred” votes is equivalent to one vote per share of Common Stock after giving effect to the Reverse Stock Split and the Automatic Conversion).

Our principal executive offices are located at the address indicated above. This Information Statement will be mailed on or about October __, 2012 to shareholders of record as of the Record Date. It is contemplated that brokerage houses, custodians, nominees and fiduciaries will be requested to forward this Information Statement to the beneficial owners of our Common Stock held of record by such persons and that we will reimburse them for their reasonable expenses incurred in connection therewith.   The Company will send this Information Statement to the beneficial owners of our Class M Preferred held of record by such persons.

The expenses of mailing this Information Statement will be borne by the Company, including expenses in connection with the preparation and mailing of this Information Statement and all documents that now accompany or may hereafter supplement it.

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The following table sets forth information regarding beneficial ownership of our Common Stock as of the date of this report by:

4

·

each of our executive officers and directors;

·

all executive officers and directors as a group; and

·

each person who is known by us to beneficially own more than 5% of our outstanding Common Stock.          

As of the Record Date there were 5,458,405 shares of Common Stock issued and outstanding and 169,973.88 shares of Class M Preferred issued and outstanding. Shares of Common Stock not outstanding but deemed beneficially owned because an individual has the right to acquire the shares of Common Stock within 60 days upon the exercise of warrants or options or the conversion of convertible securities, are treated as outstanding when determining the amount and percentage of Common Stock owned by that individual and by all directors and executive officers as a group. The address of each executive officer and director is 600 North Brand Boulevard, Suite 230, Glendale, California 91203. The address of for each the other beneficial owners is set forth below.

Name of beneficial owner	Number of Shares beneficially owned	Percentageof shares outstanding(1)
Executive officers and directors:
David S. Grant, Chairman, Chief Executive Officer and President(2)	7,980,474	37.3%
Sanjeev Kuwadekar, Director and Chief Technology Officer(3)	3,504,557	17.1%
Ed Cerkovnic, Director(4)	16,250	*
Donald Wells, Director(5)	14,000	*
Robert Burg, Director (6)	20,417	*
David J. Eastman, Chief Financial Officer (7)	1,423,485	7.1%
All executive officers and directors as a group (6 persons)	12,959,183	57.6%
Stockholders owning  of record 5% or more:
Justin Yorke(8)	2,536,946	12.8%

(1)	For each of the persons or groups identified in this table, the percentage is based on the sum of (a) 19,726,603 shares of our common stock issued and outstanding after giving effect to the issuance of shares pursuant to the Merger, the Reverse Stock Split and the Automatic Conversion and (b) any shares of common stock underlying stock options beneficially owned by such person or group, including options for our common stock existing prior to the Merger, options for shares of Ad-Vantage common stock exchanged for options for Class M Preferred Stock (which will automatically convert into options for our common stock upon the Automatic Conversion) and any warrants for our common stock exercisable within sixty days of the date hereof.
(2)	Includes (a) 6,286,507 shares of our common stock issuable upon the Automatic Conversion of 62,865.07 shares of Class M Preferred Stock received pursuant to the Merger in exchange for 6,286,507 shares of Ad-Vantage Capital Stock owned prior to the Merger, and (b) 1,693,967 shares of our common stock underlying options for 16,939.67 shares of our Class M Preferred Stock exchanged pursuant to the Merger for options for Ad-Vantage common stock (which will automatically convert into options for our common stock upon the Automatic Conversion).
(3)	Includes (a) 2,760,666 shares of our common stock issuable upon the Automatic Conversion of 27,606.66 shares of Class M Preferred Stock received pursuant to the Merger in exchange for 2,760,666 shares of Ad-Vantage Capital Stock owned prior to the Merger, and (b) 743,891 shares of our common stock underlying options for 7,438.91 shares of our Class M Preferred Stock exchanged pursuant to the Merger for options for Ad-Vantage common stock (which will automatically convert into options for our common stock upon the Automatic Conversion).

5

(4)	Includes (a) 10,000 shares of our common stock issuable upon the Automatic Conversion of 100.00 shares of Class M Preferred Stock received pursuant to the Merger in exchange for 10,000 shares of Ad-Vantage Capital Stock owned prior to the Merger, and (b) 6,250 shares of our common stock underlying options for 62.50 shares of our Class M Preferred Stock exchanged pursuant to the Merger for options for Ad-Vantage common stock (which will automatically convert into options for our common stock upon the Automatic Conversion).
(5)	Includes (a) 3,000 shares of our common stock owned prior to the Merger (which will be reduced to 1,500 shares upon the consummation of the Reverse Stock Split) and (b) 12,500 shares of our common stock underlying options for 125.00 shares of our Class M Preferred Stock exchanged pursuant to the Merger for options for Ad-Vantage common stock (which will automatically convert into options for our common stock upon the Automatic Conversion).
(6)	Includes (a) 10,000 shares of our common stock issuable upon the Automatic Conversion of 100.00 shares of Class M Preferred Stock received pursuant to the Merger in exchange for 10,000 shares of Ad-Vantage Capital Stock owned prior to the Merger, and (b) 10,417 shares of our common stock underlying options for 104.17 shares of our Class M Preferred Stock exchanged pursuant to the Merger for options for Ad-Vantage common stock (which will automatically convert into options for our common stock upon the Automatic Conversion).
(7)	Includes (a) 1,121,331 shares of our common stock issuable upon the Automatic Conversion of 11,213.31 shares of Class M Preferred Stock received pursuant to the Merger in exchange for 1,121,331 shares of Ad-Vantage Capital Stock owned prior to the Merger, and (b) 302,154 shares of our common stock underlying options for 3,021.54 shares of our Class M Preferred Stock exchanged pursuant to the Merger for options for Ad-Vantage common stock (which will automatically convert into options for our common stock upon the Automatic Conversion).
(8)	Includes (a) 2,000 shares of our common stock owned prior to the Merger (which will be reduced to 1,000 shares upon the consummation of the Reverse Stock Split), (b) 2,493,446 shares of our common stock issuable upon the Automatic Conversion of 24,934.46 shares of Class M Preferred Stock received pursuant to the Merger in exchange for 2,493,446 shares of Ad-Vantage Capital Stock deemed beneficially owned prior to the Merger, and (c) 85,000 (which will be reduced to 42,500 upon the consummation of the Reverse Stock Split) shares of our common stock underlying warrants exercisable within sixty days of the date hereof .   Mr. Yorke may be deemed to be the beneficial owner of JMW Fund LLC, which owns 11,866.55 shares of our Class M Preferred Stock (which will convert into 1,186,655 shares of our common stock upon the Automatic Conversion) and of San Gabriel Fund LLC which owns 12,322.91 shares of our Class M Preferred Stock (which will convert into 1,232,291 shares of our common stock upon the Automatic Conversion) due to his position as manager of both funds. As a result, when including the (a) 2,000 shares of our common stock owned prior to the Merger (which will be reduced to 1,000 shares upon the consummation of the Reverse Stock Split), (b) 2,493,446 shares of our common stock issuable upon the Automatic Conversion of 249,934.46 shares of Class M Preferred Stock received pursuant to the Merger in exchange for 2,493,446 shares of Ad-Vantage Capital Stock deemed beneficially owned prior to the Merger, and (c) 85,000 (which will be reduced to 42,500 upon the consummation of the Reverse Stock Split) shares of our common stock underlying warrants exercisable within sixty days of the date hereof, Mr. Yorke may be deemed to be the beneficial owner of 2,536,946 shares of common stock, or approximately 12.8% of our common stock.  The address for Mr. Yorke is 4 Richland Place, Pasadena, CA  91103.
*	Less than one percent.

PROPOSAL 1 – AMENDMENT OF ARTICLES OF INCORPORATION TO INCREASE THE AUTHORIZED NUMBER OF SHARES OF COMMON STOCK

The proposal to amend the Company's Articles of Incorporation to increase the authorized number of shares of Common Stock from 25,000,000 to 100,000,000 is described below. A copy of the certificate of amendment effecting the changes contemplated by this proposal (along with the proposal changing the name of the Company from JMG Exploration, Inc. to Ad-Vantage Networks Holdings, Inc.) is attached to this Information Statement as Exhibit A.

6

The actions taken by the board and the Majority Shareholders to amend the Company's Articles of Incorporation to increase the authorized number of shares of Common Stock from 25,000,000 to 100,000,000 because the Company's Board unanimously determined that (i) the Company is obligated pursuant to the terms of the Merger Agreement to effectuate this increase, (ii) this increase is required in order to allow for the issuance of shares of Common Stock issuable upon the conversion of the Class M Preferred, (iii) that this increase in the number of authorized shares is in the best interest of the Company in that it is obligated to issue shares of the Company’s Common Stock  upon conversion of certain outstanding warrants and options and (iv) that it will provide the Company with available shares that could be issued for various corporate purposes, including acquisitions, stock dividends, stock splits, stock options, convertible debt and equity financings, as the Board may determine in its discretion.  

At August 31, 2012, the date that the Merger was consummated, the Company was authorized to issue 25,000,000 shares of Common Stock, there were 5,458,409 shares of Common Stock issued and outstanding, there were outstanding options to purchase an aggregate of 110,000 shares of our Common Stock and there were outstanding warrants to purchase 4,062,552 shares of our Common Stock.  Accordingly, as of August 31, 2012, the Company was authorized to issue 25,000,000 shares of Common Stock, of which amount 9,630,961 were either issued and outstanding or reserved for issuance upon exercise of outstanding options or warrants, leaving only 15,369,039 shares of Common Stock available for issuance.  

If the Company had been required to issue shares of Common Stock in consideration of the Merger in lieu of the shares of Class M Preferred and if the Company had implemented the Reverse Stock Split, the Company would have had to issue 16,997,388 shares of Common Stock, as opposed to the 169,973.88 shares of Class M Preferred it actually issued.  Additionally, the Company assumed the option plans of Ad-Vantage, under which options for the purchase of 3,784,916 shares of Ad-Vantage common stock were outstanding at the closing of the Merger (the “Outstanding Ad-Vantage Options”).  The Outstanding Ad-Vantage Options were converted into options to purchase 37,849.16 shares of Class M Preferred (which represents 3,784,916 shares of the Company’s Common Stock after giving effect to the Automatic Conversion).

The number of authorized but unissued shares of our Common Stock would not have been sufficient to have issued Common Stock in consideration of the Merger (and the assumption of the Outstanding Ad-Vantage Options) and will not be sufficient to issue the 16,997,388 shares of Common Stock issuable upon the conversion of the Class M Preferred and the 3,784,916 shares of our Common Stock issuable upon exercise of the Outstanding Ad-Vantage Options which we have assumed.   Additionally, if the Company does not effect the Reverse Stock Split, the Company would need to issue twice as many shares (33,994,796 shares of Common Stock upon the conversion of the Class M Preferred and 7,569,832 shares of our Common Stock upon exercise of the assumed Outstanding Ad-Vantage Options) as otherwise would be issuable upon the occurrence of the Reverse Stock Split.

The Board determined that it is necessary that the authorized number of shares of Common Stock be increased to 100,000,000.   The Board believes that the increase in the number of authorized shares of Common Stock to 100,000,000 will not only allow the Company to satisfy its existing obligations, but will also enable the Company to promptly take advantage of market conditions and the availability of business and strategic opportunities, e.g., acquisitions, without the delay and expense associated with holding a special meeting of Shareholders.  The Company believes that Shareholders constituting a majority of outstanding votes entitled to vote will approve the Authorized Share Increase by written consent prior to the mailing of this Information Statement to the Shareholders and no proxy is being requested in connection herewith.

The issuance by the Company of any additional shares of Common Stock would dilute both the equity interests and the earnings per share of existing holders of the Common Stock. Such dilution may be substantial, depending upon the amount of shares issued. The newly authorized shares of Common Stock will have voting and other rights identical to those of the currently authorized shares of Common Stock. However, the increase could have a dilutive effect on the voting power of existing shareholders.  Such increase could have an anti-takeover effect, in that additional shares could be issued (within the limits imposed by applicable law) in one or more transactions that could make a change in control or takeover of the Company more difficult. For example, additional shares could be issued by the Company so as to dilute the voting rights of persons seeking to obtain control of the Company, even if the persons seeking to obtain control of the Company offer an above-market premium that is favored by a majority of the independent shareholders. Similarly, the issuance of additional shares to certain persons allied with the Company’s management could have the effect of making it more difficult to remove the Company’s current management by diluting the stock ownership or voting rights of persons seeking to cause such removal. The

7

Company has no plans or proposals to adopt other provisions or enter into other arrangements, except as disclosed, that may have material anti-takeover consequences.

PROPOSAL 2 – NAME CHANGE

The Board believes that it is in the best interests of the Company and its shareholders to change the name of the Company from “JMG Exploration, Inc.” to “Ad-Vantage Networks Holdings, Inc.” in order to reflect the change in the Company’s business from oil and gas exploration to providing digital advertising software and service solutions that enable access providers and network operators to generate advertising revenues on their free and fee-based networks and to allow the Company, going forward, to distinguish itself from the Company’s business as conducted  prior to the Merger.  A copy of the certificate of amendment effecting the changes contemplated by this proposal (along with the proposal relating to the Authorized Share Increase) is attached to this Information Statement as Exhibit A.  The Company believes that Shareholders constituting a majority of outstanding votes entitled to vote will approve the Name Change by written consent prior to the mailing of this Information Statement to the Shareholders and no proxy is being requested in connection herewith.

The Name Change will not have any effect on the ownership or control of the Company and will not affect any of the rights of any holder of the Company’s securities.

PROPOSAL 3 – REVERSE STOCK SPLIT

The Board of Directors believes that it is in the best interests of the Company and its stockholders to reduce the number of issued and outstanding shares through a one-for-two reverse stock split implemented in conjunction with the Authorized Share Increase. Immediately following the completion of the Reverse Stock Split, without giving effect to the Automatic Conversion, the number of shares of our Common Stock issued and outstanding or held in treasury will be reduced proportionately based on the reverse stock split ratio of 1-for-2 so that our current 5,458,406 issued and outstanding shares will become a total of 2,729,205.  After giving effect to the Reverse Stock Split and the Automatic Conversion, the number of shares of our Common Stock issued and outstanding will be a total of 19,726,593.   Those options and warrants for shares of our Common Stock outstanding prior to the Merger will also be subject to the Reverse Stock Split and, after giving effect to the Reverse Stock Split, those options and warrants will be exercisable for a total of 2,031,273 shares of Common Stock and 3,784,916 shares of Common Stock, respectively.  The shares of Class M Preferred issued to the holders of the Ad-Vantage Capital Stock in the Merger and issuable upon exercise of the Outstanding Ad-Vantage Options assumed by the Company pursuant to the Merger are not subject to the Reverse Stock Split.

Upon consummation of the Reverse Stock Split and the Automatic Conversion, the Company will have 100,000,000 shares of Common Stock authorized, of which approximately 19,726,592 shares will be issued and outstanding and of which 5,816,192 shares will be issuable upon exercise of outstanding options and warrants (including the Outstanding Ad-Vantage Options assumed by the Company), and 10,000,000 shares of Preferred Stock authorized, of which zero will be outstanding (all of the Class M Preferred having been converted into shares of Common Stock pursuant to the Automatic Conversion).

 The Board of Directors believes implementing the Reverse Stock Split is likely to increase the market price for our Common Stock as fewer shares will be outstanding. The Board of Directors further believes that the increased market price of our Common Stock expected as a result of implementing the Reverse Stock Split may improve marketability and liquidity of our Common Stock and may encourage interest and trading in our Common Stock.

 For example, the Board of Directors believes that some institutional investors and investment funds may be reluctant to invest, and in some cases may be prohibited from investing, in lower-priced stocks and that brokerage firms may be reluctant to recommend lower-priced stocks to their clients. Further, brokerage commissions, as a percentage of the total transaction, tend to be higher for lower-priced stocks. As a result, certain investors may also be dissuaded from purchasing lower-priced stocks. A higher stock price after the reverse stock split may reduce this concern.

Certain Risks Associated with the Reverse Stock Split

 There can be no assurance that following the Reverse Stock Split the market price of our Common Stock will increase in proportion to the reduction in the number of shares of our Common Stock issued and outstanding before the proposed Reverse Stock Split. Our total market capitalization after the proposed Reverse Stock Split may

8

be lower than the total market capitalization before the proposed Reverse Stock Split for reasons unrelated to the Reverse Stock Split.

Impact of the Proposed Reverse Stock Split

 The Reverse Stock Split would affect all of our common stockholders uniformly and would not affect any stockholder’s percentage ownership interests or proportionate voting power, except to the extent that the Reverse Stock Split could result in any of our stockholders having a marginally greater percentage ownership as the result of a fractional share being rounded up to the next whole number. As described below, stockholders otherwise entitled to fractional shares as a result of the Reverse Stock Split will receive a whole share in lieu of any fractional share interest in our Common Stock arising from the Reverse Stock Split. The other principal effects of the Reverse Stock Split will be that:

·

the number of issued and outstanding shares of our Common Stock will be reduced proportionately based on the Reverse Stock Split ratio of 1-for-2 from 5,458,409 to a total of 2,729,205, without giving effect to the Automatic Conversion, and from 5,458,409 to a total of 19,726,592, after giving effect to the Reverse Stock Split and the Automatic Conversion;

·

based on the Reverse Stock Split 1-for-2 ratio, the per share exercise price of all option awards and warrants outstanding prior to the Merger will be increased proportionately and the number of shares of our Common Stock issuable upon the exercise of all such option awards and warrants will be reduced proportionately. These adjustments will result in approximately the same aggregate exercise price being required to be paid for all outstanding option awards upon exercise, although the aggregate number of shares issuable upon the exercise of such option awards and warrants will be reduced proportionately following the Reverse Stock Split; and

·

the Reverse Stock Split will likely increase the number of stockholders who own odd lots (less than 100 shares). Stockholders who hold odd lots may experience an increase in the cost of selling their shares and may have greater difficulty in executing sales.

The Board of Directors does not intend for the Reverse Stock Split to be the first step in a “going private transaction” within the meaning of Rule 13e-3 of the Securities Exchange Act of 1934.

 Fractional Shares Will be Rounded Up

Our common stockholders will not receive fractional post- Reverse Stock Split shares in connection with the Reverse Stock Split. Instead, the Company will round up to the next whole share any fractional share interest in our Common Stock arising from the Reverse Stock Split.

Effect on Registered and Beneficial Stockholders

 Upon effectiveness of the Reverse Stock Split, we intend to treat stockholders holding shares of our Common Stock in “street name” (that is, held through a bank, broker or other nominee) in the same manner as registered stockholders whose shares of our common stock are registered in their names. Banks, brokers or other nominees will be instructed to effect the Reverse Stock Split for their beneficial holders holding shares of our Common Stock in “street name;” however, these banks, brokers or other nominees may apply their own specific procedures for processing the Reverse Stock Split. If you hold your shares of our Common Stock with a bank, broker, or other nominee, and if you have any questions in this regard, we encourage you to contact your nominee.

 Effect on Registered “Book-Entry” Stockholders

 The Company’s registered stockholders may hold some or all of their shares electronically in book-entry form. These stockholders will not have stock certificates evidencing their ownership of our Common Stock. They are, however, provided with a statement reflecting the number of shares of our common stock registered in their accounts.

If you hold registered shares of our Common Stock in a book-entry form, you do not need to take any action to receive your post- Reverse Stock Split shares of our Common Stock in registered book-entry form.

If you are entitled to post- Reverse Stock Split shares of our Common Stock, a transaction statement will automatically be sent to your address of record as soon as practicable after the effective date of the Reverse Stock Split indicating the number of shares of our Common Stock you hold.

9

Effect on Registered Certificated Shares

 Some registered stockholders hold their shares of our Common Stock in certificate form or a combination of certificate and book-entry form. If any of your shares of our Common Stock are held in certificate form, you will receive a transmittal letter from the Company’s transfer agent as soon as practicable after the effective date of the Reverse Stock Split. The transmittal letter will be accompanied by instructions specifying how you can exchange your certificate representing the pre-Reverse Stock Split shares of our Common Stock for a statement of holding. When you submit your certificate representing the pre-Reverse Stock Split shares, your post-Reverse Stock Split shares will be held electronically in book-entry form. This means that, instead of receiving a new stock certificate, you will receive a statement of holding that indicates the number of post-Reverse Stock Split shares you own in book-entry form. We will no longer issue physical stock certificates unless you make a specific request for a share certificate representing your post-Reverse Stock Split ownership interest.

 Beginning on the effective date of the Reverse Stock Split, each certificate representing pre- Reverse Stock Split shares will be deemed for all corporate purposes to evidence ownership of post- Reverse Stock Split shares.

 STOCKHOLDERS SHOULD NOT DESTROY ANY SHARE CERTIFICATE(S) AND SHOULD NOT SUBMIT ANY CERTIFICATE(S) UNTIL REQUESTED TO DO SO.

Accounting Consequences

The par value per share of our common stock will not be changed and will remain $0.001 per share after the Reverse Stock Split. After the Reverse Stock Split (and for purposes hereof, having given effect to the Automatic Conversion on both a pre- Reverse Stock Split and post- Reverse Stock Split basis), net income or loss per share, and other per share amounts will be increased because there will be fewer shares of our Common Stock outstanding. In future financial statements, net income or loss per share and other per share amounts for periods ending before the Reverse Stock Split would be recast to give retroactive effect to the Reverse Stock Split. As described above, the per share exercise price of outstanding option awards and warrants would increase proportionately, and the number of shares of our Common Stock issuable upon the exercise of outstanding options and warrants would decrease proportionately, in each case based on the reverse stock ratio. The Company does not anticipate that any other accounting consequences would arise as a result of the Reverse Stock Split.

Tax Consequences of the Reverse Stock Split

The Company believes that, for federal income tax purposes, no gain or loss should be recognized by shareholders upon the consummation of the Reverse Stock Split. Each shareholder whose shares of Common Stock were subject to the Reverse Stock Split should have the same basis in the our Common Stock as such Shareholder had in our Common Stock held immediately prior to the effectiveness of the Reverse Stock Split.

We should recognize no gain or loss as a result of the Related Transactions and the Related Transactions will not affect the amount of the corporate income and other taxes payable by the Company.

The foregoing is only a summary of the federal income tax consequences and is not tax advice. Each shareholder should consult his, her, or its tax advisor regarding the tax consequences of any of the Related Transactions.

This Information Statement does not contain any information regarding the tax consequences, if any, under applicable, state, local or foreign laws, and each shareholder is advised to consult his or her personal attorney or tax advisor as to the federal, state, local, or foreign tax consequences of the proposed Reincorporation in view of the shareholder's individual circumstances.

Distribution and Costs

We will pay all costs associated with the distribution of this Information Statement, including the costs of printing and mailing. In addition, we will only deliver one information statement to multiple Shareholders sharing an address, unless we have received contrary instructions from one or more of the Shareholders. Also, we will promptly deliver a separate copy of this Information Statement and future shareholder communication documents to any Shareholder at a shared address to which a single copy of this Information Statement was delivered, or deliver a single copy of this Information Statement and future Shareholder communication documents to any Shareholder or Shareholders sharing an address to which multiple copies are now delivered, upon written request to us at our address noted above, or upon request by telephone at (818) 649-5710.  

10

We are subject to the information and reporting requirements of the Securities Exchange Act of 1934, as amended, and in accordance with the Securities Exchange Act, we file periodic reports, documents, and other information with the Securities and Exchange Commission relating to our business, financial statements, and other matters. These reports and other information may be inspected and are available for copying at the offices of the Securities and Exchange Commission, 100 F Street, N.E., Washington, DC 20549. Our SEC filings are also available to the public on the SEC’s website athttp://www.sec.gov .

Shareholders may also address future requests regarding delivery of Information Statements and/or annual reports by contacting us at the address or telephone number noted above.

Dissenters’ Right of Appraisal

Shareholders do not have the statutory right to dissent and obtain an appraisal of their shares under Nevada law in connection with the proposed Authorized Share Increase, Name Change, Reverse Stock Split or Spin-Off.

11

ADDITIONAL INFORMATION

The Company has received no indication from any of its directors of any intent to oppose any action to be taken by the Company. There have been no proposals for action submitted to the Company by any shareholders other than the proposals which are the subject of this Information Statement.

SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

Section 16(a) of the Securities Exchange Act of 1934 requires our directors and executive officers, as well as persons who own more than 10% of a registered class of our equity securities, to file with the Commission initial reports of ownership and reports of changes in beneficial ownership. Directors, executive officers, and greater than 10% shareholders are required to furnish us with copies of all Section 16(a) forms they file. Based solely upon a review of the copies of such forms furnished to us we believe that during the fiscal year ended December 31, 2011 and through the date of this filing, our directors and officers complied with all Section 16(a) filing requirements.

DISSENTERS’ RIGHTS

Under Nevada law shareholders are not entitled to dissenters’ rights regarding the Authorized Share Increase, Name Change or Reverse Stock Split.

FORWARD-LOOKING STATEMENTS

This Information Statement includes forward-looking statements. You can identify our forward-looking statements by the words “expects,” “projects,” “believes,” “anticipates,” “intends,” “plans,” “predicts,” “estimates” and similar expressions. The forward-looking statements are based on management’s current expectations, estimates, and projections. The Company cautions you that these statements are not guarantees of future performance and involve risks, uncertainties, and assumptions that we cannot predict. In addition, the Company has based many of these forward-looking statements on assumptions about future events that may prove to be inaccurate. Accordingly, actual outcomes and results may differ materially from what the Company has expressed or forecast in the forward-looking statements.

You should rely only on the information the Company has provided in this Information Statement. The Company has not authorized any person to provide information other than that provided herein. The Company has not authorized anyone to provide you with different information. You should not assume that the information in this Information Statement is accurate as of any date other than the date of the front of the document.

DELIVERY OF DOCUMENTS AND HOUSEHOLDING

The Commission has adopted rules that permit companies and intermediaries such as brokers, to satisfy the delivery requirements for information statements with respect to two or more shareholders sharing the same address by delivering a single information statement addressed to those shareholders. This process, which is commonly referred to as “householding”, potentially provides extra convenience for stockholders, is environmentally friendly, and represents cost savings for companies.

For this Information Statement, the Company’s transfer agent or brokers may be householding this Information Statement and the documents incorporated by reference that we are enclosing with the Information Statement. A single Information Statement will be delivered to multiple shareholders sharing an address unless contrary instructions have been received from the effected shareholders. Once you have received notice from your broker or the Company that either of them will be householding communications to your address, householding will continue until you are notified otherwise or until you revoke your consent.

If at any time, you no longer wish to participate in householding and would prefer to receive separate periodic reports, or if you currently receive multiple copies of the Information Statement or other periodic reports at your address and would like to request householding by the Company, please notify your broker if your shares are not held directly in your name. If you own your shares directly rather than through a brokerage account, you should direct your written request directly to David J. Eastman, Chief Financial Officer, JMG Exploration, Inc., 600 North Brand Boulevard, Suite 230, Glendale, California 91203.

12

OTHER MATTERS

As of the date of this Information Statement, the Company’s Board of Directors knows of no other matters other than those described in this Information Statement which have been approved or considered by the holders of a majority of the shares of our voting stock.

Only one Information Statement is being delivered to multiple shareholders sharing an address. If you are a shareholder at a shared address to which a single copy of this Information Statement was delivered and you desire to obtain a separate copy of the documents delivered, please contact the person at the address or telephone number described below.

We hereby undertake to deliver promptly upon written or oral request a separate copy of the Information Statement to a shareholder at a shared address to which a single copy of the documents was delivered.

13

IF YOU HAVE ANY QUESTIONS REGARDING THIS INFORMATION STATEMENT, PLEASE CONTACT:

David J. Eastman, Chief Financial Officer

JMG Exploration, Inc.

600 North Brand Boulevard, Suite 230

Glendale, California 91203

(818) 649-5710

By Order of the Board of Directors,

/s/ David S. Grant

David S. Grant

Chairman and Chief Executive Officer

14