WASHINGTON, D.C. 20549
SCHEDULE 14C
(RULE 14C-101)
SCHEDULE 14C INFORMATION
Information Statement Pursuant to Section 14(c) of the Securities Exchange Act of 1934
Check the appropriate box:
[ X ] Preliminary Information Statement
[ ] Confidential, for Use of the Commission Only (as permitted by Rule 14a-5(d) (1))
[ ] Definitive Information Statement
HYBRID COATING TECHNOLOGIES INC.
(Name of Registrant as Specified In Its Charter)
Payment of Filing Fee (Check appropriate box):
| [ X ] | No fee required. | |
| [ ] | Fee computed on table below per Exchange Act Rules 14a-6(1) and 0-11. | |
| (1) | Title of each class of securities to which transaction applies: Not Applicable | |
| (2) | Aggregate number of securities to which transaction applies: Not Applicable | |
| (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): Not Applicable | |
| (4) | Proposed maximum aggregate value of transaction: Not Applicable | |
| (5) | Total fee paid: Not Applicable | |
| [ ] | Fee paid previously with preliminary materials. | |
| [ ] | Check box if any part of the fee is offset as provided by the 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 date of its filing: | |
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Form, Schedule or Registration Statement No.: Not Applicable
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Date Filed: Not Applicable
| HYBRID COATING TECHNOLOGIES INC. |
| 950 John Daly Blvd., Suite 260, |
| Daly City, CA 94015 |
| , 2015 |
Dear Stockholder:
This Information Statement is furnished to holders of shares of common stock, par value $0.001 per share (the "Common Stock"), of Hybrid Coating Technologies Inc. (the "Company"). Our Board of Directors approved on April 17, 2015, and recommended the approval by our stockholders, of the following corporate action (“Corporate Action”):
| 1. | To approve the increase in authorized share capital from 150 million shares to 650 million shares of common stock (“Common stock”) (the “Authorized Share Capital Increase”); |
Certain of our stockholders, holding a majority of our voting power on April 20, 2015 (the “Record Date”), approved the Corporate Action by written consent in lieu of a special meeting of stockholders.
As a matter of regulatory compliance, we are sending to you this Information Statement which describes the purpose and provisions of the contemplated Corporate Action.
| For the Board of Directors of | |
| HYBRID COATING TECHNOLOGIES | |
| INC. | |
| By: | |
| Joseph Kristul | |
| President and CEO |
| HYBRID COATING TECHNOLOGIES INC. |
| 950 John Daly Blvd., Suite 260, |
| Daly City, CA 94015 |
| , 2015 |
| INFORMATION STATEMENT PURSUANT TO SECTION 14(C) |
| OF THE SECURITIES EXCHANGE ACT OF 1934 AND RULE 14C-2 |
| THEREUNDER |
| NO VOTE OR OTHER ACTION OF THE COMPANY'S STOCKHOLDERS IS |
| REQUIRED IN CONNECTION WITH THIS INFORMATION STATEMENT |
| WE ARE NOT ASKING YOU FOR A PROXY AND |
| YOU ARE REQUESTED NOT TO SEND US A PROXY |
GENERAL
We are sending you this Information Statement to inform you of the adoption of the Corporate Action amendment to the Company's Articles of Incorporation (the "Amendment"), on April 20, 2015, by a vote of stockholders holding a majority of the Company's voting power. The purpose of this Information Statement is to provide notice that the Company’s majority stockholders, holding an aggregate of 39,594,540 votes, representing 51.20% of the voting power of the Company as of the Record Date, executed a written consent authorizing and approving the following corporate action (the “Corporate Action”):
| 1. | To approve the increase in authorized share capital from 150 million shares to 650 million shares of Common Stock (the “Authorized Share Capital Increase”). |
The written consent of the stockholders holding a majority of the voting power of the Company is attached hereto asExhibit A. The Certificate of Amendment to the Company’s Articles of Incorporation is attached hereto asExhibit B.
The adoption of the foregoing Corporate Action will become effective 20 calendar days after the mailing of this Information Statement. The Board of Directors is not soliciting your proxy in connection with the adoption of this Corporate Action and proxies are not being requested from stockholders.
The Company is distributing this Information Statement to its stockholders in full satisfaction of any notice requirements it may have under the Nevada Revised Statutes. No additional action will be undertaken by the Company with respect to the receipt of written consents, and no dissenters' rights with respect to the receipt of the written consents, and no dissenters' rights under the Nevada Revised Statutes are afforded to the Company's stockholders as a result of the adoption of this Corporate Action.
Expenses in connection with the distribution of this Information Statement, will be paid by the Company.
VOTE REQUIRED; MANNER OF APPROVAL
Approval to amend and restate the current Articles of Incorporation of the Company under the Nevada Revised Statutes ("NRS") requires the affirmative vote of the holders of a majority of the voting power of the Company.
Section 78.320 of the NRS provides, in substance, that, unless the Company's Articles of Incorporation provides otherwise, stockholders may take action without a meeting of stockholders and without prior notice if a consent or consents in writing, setting forth the action so taken, is signed by the holders of outstanding voting stock holding not less than the minimum number of votes that would be necessary to approve such action at a stockholders meeting. Under the applicable provisions of the NRS, this action is effective when written consents from holders of record of a majority of the outstanding voting power are executed and delivered to the Company.
In accordance with the NRS, the affirmative vote on the Corporate Actions of at least a majority of the outstanding voting power has been obtained. As a result, no vote or proxy is required by the stockholders to approve the Corporate Actions.
Under Rule 14c-2 promulgated under the Securities Exchange Act of 1934, as amended (the "Act"), the Corporate Actions cannot take effect until 20 days after this Information Statement is sent to the Company's stockholders. As mentioned earlier, the Company expects to effect the Authorized Share Capital Increase by filing a Certificate of Amendment with the Nevada Secretary of State approximately twenty (20) days after the Mailing Date, which is anticipated to be on or about ____, 2015.
OTHER INFORMATION REGARDING THE COMPANY
As of the record date, there were 57,335,602 shares of our Common Stock issued and outstanding and 40,000 shares of Series B Preferred Stock issued and outstanding. Each share of Common Stock is entitled to one vote, each share of Series B Preferred Stock is entitled to 500 votes. For the approval of the Authorized Share Capital Increase, the Company received written consents from 8 stockholders of the Company together holding 51.20% of the voting power of the Company.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth certain information concerning the number of shares of the Company’s stock owned beneficially as of the Record Date by: (i) each person (including any group) known by the Company to own more than five percent (5%) of any class of its voting securities, (ii) each of the Company’s directors and each of its named executive officers, and (iii) officers and directors as a group. Unless otherwise indicated, the stockholders listed possess sole voting and investment power with respect to the shares shown.
| Amount | Percentage | Percentage | |||
| and Nature | Percentage | of | of | ||
| Name and Address of | of | Series B | Voting | ||
| Title of | of Beneficial | Beneficial | Common | Preferred | Capital |
| Class | Owner | Ownership | Stock | Stock | (2) |
| DIRECTORS AND OFFICERS | |||||
| Common | Joseph Kristul | 2,740,465 | 4.78% | ---- | 3.54% |
| Stock | Director | Direct | |||
| CEO, President | 100,000(1) | 0.174% | 0.129% | ||
| Indirect | |||||
| Common | Darin Nellis | 565,355 | 0.99% | ---- | 0.73% |
| Stock | Secretary | Direct | |||
| Common | Alex Trossman | 62,000 | 0.11% | ---- | 0.08% |
| Stock | Director | Direct | |||
| Common | All Officers and | 3,467,820 | 6.05% | ----- | 4.48% |
| Stock | Directors as a | ||||
| Group (3 persons) | |||||
| 5% STOCKHOLDERS | |||||
| Common | Nanotech | 8,113,116 | 14.15% | 10.49% | |
| Stock | Industries Inc. | Direct | |||
| Series B | 40,000 | 4% | 25.86% | ||
| Preferred | Direct | ||||
| Stock | |||||
| Total: | |||||
| 36.35% | |||||
Notes
(1) Represents 100,000 shares owned by Mr. Kristul’s wife, Maria Kristul.
(2) Includes the 40,000 Series B Preferred Shares which in the aggregate carry the voting power of 25.86% of the Company’s voting capital as of the Record Date.
COMPENSATION OF DIRECTORS AND EXECUTIVE OFFICERS
The table below sets forth all compensation awarded to, paid to or earned by the Registrant’s President, Chief Executive Officer and Chief Financial Officer, and by the Secretary and Director or Sales and Marketing for the fiscal year of the Company indicated.
Name and Principal Position | Year | Salary | Bonus | Stock | Option | Nonequity
| Nonqualified
|
|
|
| Joseph Kristul Director, President, Chief Executive Officer and Chief Financial Officer | 2014 | 0 | 0 | $247,451 | 0 | 0 | 0 | 0 | 247,451 |
Darin Nellis, Secretary, Director of Sales and Marketing | 2014 | 0 | 0 | $57,206 0 | 0 | 0 | 0 | 57,206 |
Compensation of Executive Officers
Mr. Kristul received 2,340,465 shares of Common Stock for a fair value of $257,451 in 2014 and Mr. Nellis received 520,050 shares of Common Stock for fair value of $57,206 included in stock based compensation.
Compensation of Directors
The Company has not compensated our directors for service on the board of directors.
Employment Agreements
The Company has not entered into any employment agreements with our executive officers or other employees to date.
Long-Term Incentive Plans
The Company currently has no long-term incentive plans.
Stock Option Plans
On June 15, 2011, the Company’s Board of Directors established the 2011 Stock Incentive Plan expiring on June 15, 2016.
Grants of Plan-Based Awards
No plan-based awards were granted to any of our named executive officers during the fiscal year ended December 31, 2014 or since December 31, 2014.
Outstanding Equity Awards at Fiscal Year End
Joseph Kristul holds 300,000 warrants expiring July 8, 2015 and 480,000 warrants expiring March 14, 2018, at December 31, 2014.
Option Exercises and Stock Vested
No options to purchase our capital stock were exercised by any of our named executive officers, nor was any restricted stock held by such executive officers vested during the fiscal year ended December 31, 2014.
Pension Benefits
No named executive officers received or held pension benefits during the fiscal year ended December 31, 2014 or since December 31, 2014.
Nonqualified Deferred Compensation
No nonqualified deferred compensation was offered or issued to any named executive officer during the fiscal year ended December 31, 2014.
APPROVAL OF INCREASE IN AUTHORIZED SHARE CAPITAL
Purpose
The Authorized Share Capital Increase would give the Board of Directors flexibility, without further stockholder action, to issue shares of common stock for purposes including equity financings, share issuances upon the exercise of convertible securities and stock purchase warrants, stock based acquisitions in keeping with the Company’s business development and share issuances as part or all of the consideration required to be paid by the Company for potential licenses and exclusivity thereof.
At the present time, the Board has not made any specific plan with respect to the shares of Common Stock that will be available for issuance after the Authorized Share Capital Increase.
WE ARE NOT ASKING YOU FOR A PROXY AND YOU ARE REQUESTED NOT TO SEND US A PROXY.
Effective Time
The Corporate Action described above automatically will be effective, and may be implemented by the Company, 20 days after the date that this Information Statement is mailed to the stockholders of the Company.
INTEREST OF CERTAIN PERSONS IN OR IN OPPOSITION TO THE MATTERS TO BE ACTED UPON
No director, executive officer, associate of any officer or director or executive officer, or any other person has any interest, direct or indirect, by security holdings or otherwise, in the amendment to the Certificate of Incorporation referenced herein which is not shared by the majority of the stockholders.
OTHER MATTERS
If you and others who share your mailing address own Common Stock in street name, meaning through bank or brokerage accounts, you may have received a notice that your household will receive only one annual report and proxy statement from each company whose stock is held in such accounts. This practice, known as "householding" is designed to reduce the volume of duplicate information and reduce printing and postage costs. Unless you responded that you did not want to participate in householding, you were deemed to have consented to it, and a single copy of this Information Statement has been sent to your address. Each stockholder will continue to receive a separate notice.
If you would like to receive an individual copy of this Information Statement, we will promptly send a copy to you upon request by mail to the Company at 950 John Daly Blvd., Suite 260, Daly City, CA 94015, or by calling (650) 491-3449. This document is also available in digital form for download or review by visiting the website of the Securities and Exchange Commission atwww.sec.gov.
ADDITIONAL INFORMATION
We are subject to the informational requirements of the Securities Exchange Act of 1934, as amended, and in accordance with the requirements thereof, file reports, proxy statements and other information with the Securities and Exchange Commission ("SEC"). Copies of these reports, proxy statements and other information can be obtained at the SEC's public reference facilities at Judiciary Plaza, Room 1024, 450 Fifth Street, N.W., Washington, D.C., 20549. Additionally, these filings may be viewed at the SEC's website athttp://www.sec.gov.
The following documents as filed with the Commission by the Company are incorporated herein by reference:
| 1. | Annual Report on Form 10-K and 10K/A for the year ended December 31, 2014; |
| 2. | Quarterly Report on Form 10-Q and 10Q/A for the quarter ended March 31, 2014; |
| 3. | Quarterly Report on Form 10-Q and 10Q/A for the quarter ended June 30, 2014; and |
| 4. | Quarterly Report on Form 10-Q for the quarter ended September 30, 2014; |
SIGNATURE
Pursuant to the requirements of the Exchange Act of 1934, as amended, the Registrant has duly caused this Information Statement to be signed on its behalf by the undersigned hereunto authorized.
| BY ORDER OF THE BOARD OF | |
| DIRECTORS | |
| HYBRID COATING TECHNOLOGIES INC. | |
| By: | |
| Joseph Krisul | |
| President and CEO |
EXHIBIT A
WRITTEN CONSENT OF THE STOCKHOLDERS
OF
HYBRID COATING TECHNOLOGIES INC.
a Nevada Corporation
IN LIEU OF A SPECIAL MEETING OF STOCKHOLDERS
The undersigned, constituting the holders of more than fifty percent (50%) of the outstanding voting capital (collectively, the "Stockholders") of Hybrid Coating Technologies Inc., a Nevada corporation (the "Corporation"), acting pursuant to the authority granted by Sections 78.320 and 78.390 of the Nevada Revised Statutes (the “Corporations Law”) and pursuant to the Corporation’s Articles of Incorporation, do hereby adopt the following resolutions by written consent as of April 20¸ 2015.
INCREASE IN AUTHORIZED CAPITAL STOCK
WHEREAS,the Board of Directors of the Corporation has considered and unanimously approved the Authorized Share Capital Increase;
NOW, THEREFORE, BE IT VOTED BY THE UNDERSIGNED, that the Authorized Share Capital Increase is hereby ratified, adopted and approved by the undersigned; and
BE IT FURTHER VOTED BY THE UNDERSIGNED, that the officers of the Corporation are hereby authorized and approved to take all actions deemed necessary or desirable by them, or each acting alone, to effect the Authorized Share Capital Increase.
AMENDMENT TO THE
ARTICLES OF INCORPORATION
WHEREAS,it is deemed by the Board of Directors to be in the best interests of the Corporation and its stockholders that the Articles of Incorporation be amended to reflect the Authorized Share Capital Increase and that the amendment is necessary to effect the Authorized Share Capital Increase (‘Amendment”);
NOW, THEREFORE, BE IT VOTED BY THE UNDERSIGNED, that the Amendment be and hereby is ratified, adopted and approved by the undersigned; and
BE IT FURTHER VOTED BY THE UNDERSIGNED, that the officers of the Corporation are hereby authorized and approved to take all actions deemed necessary or desirable by them, or each acting alone, to cause the Corporation to effect the Authorized Share Capital Increase and to duly file the Amendment in the State of Nevada, with any changes or modifications the officers of the Corporation may deem necessary or desirable.
| [SIGNATURE PAGE FOLLOWS] |
This Written Consent shall be added to the corporate records of the Corporation and made a part thereof, and the votes set forth below shall have the same force and effect as if adopted at a meeting duly noticed and held.
This Written Consent may be executed in counterparts and with facsimile signatures with the effect as if all parties hereto had executed the same document. All counterparts shall be construed together and shall constitute a single Written Consent as of the date of the final signature hereto.
This Written Consent may be revoked by the undersigned at any time prior to the timeupon which written consents of the number of shares required to authorize the aboveproposed action have been filed with the Secretary of the Corporation.
| By:/s/ Joseph Kristul |
| Name:Nanotech Industries Inc. |
| Common Stock and Series B Preferred Stock Stockholder |
| Dated: April 20, 2015 |
| Number of Common Shares Voted:8,113,116 |
| Number of Series B Preferred Shares voted:40,000 |
CERTIFICATE OF VOTING CONTROL
I,Nanotech Industries Inc., the above executing Stockholder, do hereby represent, warrant and certify to the Corporation, that I have the sole and full right, power and authority, to exercise sole voting, investment and control over the shares of Common Stock and Series B Preferred Stock of the Corporation so voted by me, acting alone, in the foregoing Written Consent.
By:/s/ Joseph Kristul
Name: Nanotech Industries Inc.
Common Stock and Series B Preferred Stock Stockholder
Dated: April 20, 2015
Number of Common Shares Voted:8,113,116
Number of Series B Preferred Shares voted: 40,000
This Written Consent may be revoked by the undersigned at any time prior to the timeupon which written consents of the number of shares required to authorize the aboveproposed action have been filed with the Secretary of the Corporation.
By:/s/ Joel Cohen
Name: Joel Cohen
Common Stock Stockholder
Dated: April 20, 2015
Number of Shares Voted:1,400,000
CERTIFICATE OF VOTING CONTROL
I,Joel Cohen, the above executing Stockholder, do hereby represent, warrant and certify to the Corporation, that I have the sole and full right, power and authority, to exercise sole voting, investment and control over the shares of Common Stock of the Corporation so voted by me, acting alone, in the foregoing Written Consent.
By:/s/ Joel Cohen
Name: Joel Cohen
Common Stock Stockholder
Dated: April 20, 2015
Number of Shares Voted:1,400,000
This Written Consent may be revoked by the undersigned at any time prior to the timeupon which written consents of the number of shares required to authorize the aboveproposed action have been filed with the Secretary of the Corporation.
By:/s/ Joseph Kristul
Name: Joseph Kristul.
Common Stock Stockholder
Dated: April 20, 2015
Number of Shares Voted:2,740,465
CERTIFICATE OF VOTING CONTROL
I,Joseph Kristul, the above executing Stockholder, do hereby represent, warrant and certify to the Corporation, that I have the sole and full right, power and authority, to exercise sole voting, investment and control over the shares of Common Stock of the Corporation so voted by me, acting alone, in the foregoing Written Consent.
By:/s]/ Joseph Kristul
Name: Joseph Kristul.
Common Stock Stockholder
Dated: April 20, 2015
Number of Shares Voted:2,740,465
This Written Consent may be revoked by the undersigned at any time prior to the timeupon which written consents of the number of shares required to authorize the aboveproposed action have been filed with the Secretary of the Corporation.
By:/s/ Gene Kristul
Name:Gene Kristul
Common Stock Stockholder
Dated: April 20, 2015
Number of Shares Voted:875,604
CERTIFICATE OF VOTING CONTROL
I,Gene Kristul, the above executing Stockholder, do hereby represent, warrant and certify to the Corporation, that I have the sole and full right, power and authority, to exercise sole voting, investment and control over the shares of Common Stock of the Corporation so voted by me, acting alone, in the foregoing Written Consent.
By:/s/ Gene Kristul
Name:Gene Kristul
Common Stock Stockholder
Dated: April 20, 2015
Number of Shares Voted:875,604
This Written Consent may be revoked by the undersigned at any time prior to the timeupon which written consents of the number of shares required to authorize the aboveproposed action have been filed with the Secretary of the Corporation.
By:/s/ Jeannine Lumbroso
Name:Jeannine Lumbroso
Common Stock Stockholder
Dated: April 20, 2015
Number of Shares Voted:1,950,000
CERTIFICATE OF VOTING CONTROL
I,Jeannine Lumbroso, the above executing Stockholder, do hereby represent, warrant and certify to the Corporation, that I have the sole and full right, power and authority, to exercise sole voting, investment and control over the shares of Common Stock of the Corporation so voted by me, acting alone, in the foregoing Written Consent.
By:/s/ Jeannine Lumbroso
Name:Jeannine Lumbroso
Common Stock Stockholder
Dated: April 20, 2015
Number of Shares Voted:1,950,000
This Written Consent may be revoked by the undersigned at any time prior to the timeupon which written consents of the number of shares required to authorize the aboveproposed action have been filed with the Secretary of the Corporation.
By:/s/ Alex Korot
Name:Alex Korot
Common Stock Stockholder
Dated: April 20, 2015
Number of Shares Voted: 2,000,000
CERTIFICATE OF VOTING CONTROL
I,Alex Korot, the above executing Stockholder, do hereby represent, warrant and certify to the Corporation, that I have the sole and full right, power and authority, to exercise sole voting, investment and control over the shares of Common Stock of the Corporation so voted by me, acting alone, in the foregoing Written Consent.
By:/s/ Alex Korot
Name:Alex Korot
Common Stock Stockholder
Dated: April 20, 2015
Number of Shares Voted: 2,000,000
This Written Consent may be revoked by the undersigned at any time prior to the timeupon which written consents of the number of shares required to authorize the aboveproposed action have been filed with the Secretary of the Corporation.
By:/s/ Garett Parsons
Name:Garett Parsons
Common Stock Stockholder
Dated: April 20, 2015
Number of Shares Voted:1,950,000
CERTIFICATE OF VOTING CONTROL
I,Garett Parsons, the above executing Stockholder, do hereby represent, warrant and certify to the Corporation, that I have the sole and full right, power and authority, to exercise sole voting, investment and control over the shares of Common Stock of the Corporation so voted by me, acting alone, in the foregoing Written Consent.
By:/s/ Garett Parsons
Name:Garett Parsons
Common Stock Stockholder
Dated: April 20, 2015
Number of Shares Voted:1,950,000
This Written Consent may be revoked by the undersigned at any time prior to the timeupon which written consents of the number of shares required to authorize the aboveproposed action have been filed with the Secretary of the Corporation.
By:/s/ Darin Nellis
Name:Darin Nellis
Common Stock Stockholder
Dated: April 20, 2015
Number of Shares Voted:565,355
CERTIFICATE OF VOTING CONTROL
I,Darin Nellis, the above executing Stockholder, do hereby represent, warrant and certify to the Corporation, that I have the sole and full right, power and authority, to exercise sole voting, investment and control over the shares of Common Stock of the Corporation so voted by me, acting alone, in the foregoing Written Consent.
By:/s/ Darin Nellis
Name:Darin Nellis
Common Stock Stockholder
Dated: April 20, 2015
Number of Shares Voted:565,355
EXHIBIT B
CERTIFICATE OF AMENDMENT TO ARTICLES OF INCORPORATION
FOR PROFIT NEVADA CORPORATIONS
(Pursuant to NRS 78.385 and 78.390 - After Issuance of Stock)
The Articles of Incorporation of Hybrid Coating Technologies Inc. are amended as follows:
1. Article 4 of the Articles of Incorporation has been amended and restated as follows:
“Fourth.That the aggregate number of shares which this Corporation shall have the authority to issue is six hundred and fifty two million (652,000,000) shares, consisting of: (i) six hundred and fifty million (650,000,000) shares of Common stock with a par value of one tenth of one cent ($0.001) per share, (ii) one million (1,000,000) shares of Series A Preferred Stock with a par value of one tenth of one cent ($0.001) per share, and (iii) one million (1,000,000) shares of Series B Preferred Stock with a par value of one tenth of one cent ($0.001) per share. A description of the relative rights, voting power, preferences granted to, and restrictions imposed on each series of Preferred Stock are as set forth in this Article 4.
A. Series A Preferred Stock
The Shares of Series A Preferred Stock may be issued from time to time. The Board of Directors is hereby expressly authorized, by resolution adopted, to provide for the issue of any shares of Series A Preferred Stock. The Series A Preferred Stock shall bear the following characteristics:
(i) Any increase in the authorized share capital of the Series A Preferred Stock will require the consent of a majority of the holders of the Series A Preferred Stock;
(ii) The Series A Preferred Stock shall bear no voting rights;
(iii) The Series A Preferred Stock shall bear no dividend rights;
(iv) The Series A Preferred Stock shall bear no liquidation rights;
(v) The Series A Preferred Stock shall bear conversion rights and each Share of Series A Preferred Stock shall be convertible into a number of shares of common stock as is equal to the par value of the Series A Preferred Stock divided by the average closing price per share of common stock of the last 5 trading days immediately prior to conversion;
(vi) �� The Series A Preferred Stock shall be redeemable by the holder at any time prior to conversion, at a price per share equal to its par value; and
(vii) The Series A Preferred Stock shall be redeemable by the Corporation at any time prior to conversion, at a price per share equal to its par value.
B. Series B Preferred Stock
The Shares of Series B Preferred Stock may be issued from time to time. The Board of Directors is hereby expressly authorized, by resolution, to provide for the issue of any shares of Series B Preferred Stock. The Series B Preferred Stock shall bear the following characteristics:
(i) Any increase in the authorized share capital of the Series B Preferred Stock will require the consent of a majority of the holders of the Series B Preferred Stock;
(ii) Holders of Series B Preferred Stock shall be entitled to cast 500 votes per share of Series B Preferred Stock, on all matters presented to be voted by the holders of the Company’s Common Stock, and shall vote along with the holders of the Company’s Common Stock on such matters;
| (iii) | The Series B Preferred Stock shall bear no dividend rights; | |
| (iv) | The Series B Preferred Stock shall bear no liquidation rights; | |
| (v) | The Series B Preferred Stock shall bear no conversion rights; and | |
| (vi) | The Series B Preferred Stock shall not be redeemable. |
2. The vote by which the stockholders holding shares in the corporation entitling them to exercise at least a majority of the voting power, or such greater proportion of the voting power as may be required in the case of a vote by classes or series, or as may be required by the provisions of the articles of incorporation have voted in favor of the amendment is: 51.20%
3. Signatures: HYBRID COATING TECHNOLOGIES INC.
By:
_________________
Joseph Kristul, President and CEO
__________, 2015
