SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES EXCHANGE ACT OF 1934
FILED BY THE REGISTRANT [X]
FILED BY A PARTY OTHER THAN THE REGISTRANT [ ]
CHECK THE APPROPRIATE BOX:
[ ] PRELIMINARY PROXY STATEMENT
[ ] CONFIDENTIAL, FOR USE OF THE COMMISSION ONLY (AS PERMITTED BY RULE
14A-6(E)(2))
[X] DEFINITIVE PROXY STATEMENT
[ ] DEFINITIVE ADDITIONAL MATERIALS
[ ] SOLICITING MATERIAL PURSUANT TO RULE 14A-11(C) OR RULE 14A-12
AMERICAN JEWELRY CORP.
(Name of Registrant as Specified In Its Charter)
Payment of Filing Fee (Check the appropriate box):
[ ] NO FEE REQUIRED
[ ] FEE COMPUTED ON TABLE BELOW PER EXCHANGE ACT RULES 14A-6(I)(1) AND
0-11.
(1) TITLE OF EACH CLASS OF SECURITIES TO WHICH TRANSACTION APPLIES:
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(2) AGGREGATE NUMBER OF SECURITIES TO WHICH TRANSACTION APPLIES:
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(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):
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(4) PROPOSED MAXIMUM AGGREGATE VALUE OF TRANSACTION:
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(5) TOTAL FEE PAID:
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[ ] FEE PREVIOUSLY PAID WITH PRELIMINARY MATERIALS.
[ ] 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:
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(2) FORM, SCHEDULE OR REGISTRATION STATEMENT NO.:
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(3) FILING PARTY:
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(4) DATE FILED:
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AMERICAN JEWELRY CORP.
131 WEST 35TH STREET
NEW YORK, NEW YORK 10001
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NOTICE OF SPECIAL MEETING OF STOCKHOLDERS
APRIL 30, 2001
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NOTICE IS HEREBY GIVEN that a Special Meeting of Stockholders (the
"Meeting") of AMERICAN JEWELRY CORP., a Delaware corporation (the "Company"),
will be held at the offices of Jenkens & Gilchrist Parker Chapin LLP, The
Chrysler Building, 405 Lexington Avenue, 9th Floor, New York, New York, 10174,
on Tuesday, April 30, 2001, 10:00 A.M., to consider and act upon the following:
1. The approval of an amendment to the Company's Certificate of
Incorporation in order to effect a reverse stock split
pursuant to which the Company's outstanding shares of Common
Stock would be exchanged for new shares of common stock in an
exchange ratio to be approved by the Board of Directors,
ranging from one (1) newly issued share for each two hundred
fifty (250) outstanding shares to one (1) newly issued share
for each three hundred (300) outstanding shares; and
2. The transaction of such other business as may properly come
before the Meeting or any adjournments thereof.
Only stockholders of record of the Common Stock, $.001 par value, and
the Series A Preferred Stock, $.001 par value, of the Company at the close of
business on April 4, 2001 are entitled to receive notice of and to attend the
Meeting. If you do not expect to be present, you are requested to fill in, date
and sign the enclosed Proxy, which is solicited by the Board of Directors of the
Company, and to mail it promptly in the enclosed envelope. In the event you
decide to attend the Meeting in person, you may, if you desire, revoke your
Proxy and vote your shares in person.
Dated: April 12, 2001
By Order of the Board of Directors
GEORGE WEISZ
Secretary
IMPORTANT
---------
THE RETURN OF YOUR SIGNED PROXY AS PROMPTLY AS POSSIBLE WILL GREATLY
FACILITATE ARRANGEMENTS FOR THE MEETING. NO POSTAGE IS REQUIRED IF THE PROXY IS
RETURNED IN THE ENVELOPE ENCLOSED FOR YOUR CONVENIENCE AND MAILED IN THE UNITED
STATES.
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AMERICAN JEWELRY CORP.
131 WEST 35TH STREET
NEW YORK, NEW YORK 10001
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PROXY STATEMENT
SPECIAL MEETING OF STOCKHOLDERS
APRIL 30, 2001
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This Proxy Statement is furnished in connection with the solicitation
of proxies by the Board of Directors of AMERICAN JEWELRY CORP., a Delaware
corporation (the "Company"), to be voted at the Annual Meeting of Stockholders
of the Company (the "Meeting") which will be held at the offices of Jenkens &
Gilchrist Parker Chapin LLP, The Chrysler Building, 405 Lexington Avenue, 9th
Floor, New York, New York 10174 on Tuesday, April 30, 2001 at 10:00 A.M., local
time, and any adjournment or adjournments thereof, for the purposes set forth in
the accompanying Notice of Special Meeting of Stockholders and in this Proxy
Statement.
The principal executive offices of the Company are located at 131 West
35th Street, New York, New York 10001. The approximate date on which this Proxy
Statement and accompanying Proxy will first be sent or given to stockholders is
April 12, 2001.
A Proxy, in the accompanying form, which is properly executed, duly
returned to the Company and not revoked will be voted in accordance with the
instructions contained therein and, in the absence of specific instructions,
will be voted in favor of the proposal and in accordance with the judgment of
the person or persons voting the proxies on any other matter that may be brought
before the Meeting. Each such Proxy granted may be revoked at any time
thereafter by writing to the Secretary of the Company prior to the Meeting, by
execution and delivery of a subsequent proxy or by attendance and voting in
person at the Meeting, except as to any matter or matters upon which, prior to
such revocation, a vote shall have been cast pursuant to the authority conferred
by such Proxy. The cost of soliciting proxies will be borne by the Company.
Following the mailing of the proxy materials, solicitation of proxies may be
made by officers and employees of the Company, or anyone acting on their behalf,
by mail, telephone, telegram or personal interview.
VOTING SECURITIES
Stockholders of record as of the close of business on April 4, 2001
(the "Record Date") will be entitled to notice of, and to vote at, the Meeting
or any adjournments thereof. On the Record Date, there were 337,564,057
outstanding shares of Common Stock, $.001 par value ("Common Stock"), and
200,000 outstanding shares of Series A Preferred Stock, $.001 par value
("Preferred Stock"). Each holder of Common Stock is entitled to one vote for
each share held by such holder and each holder of Preferred Stock are entitled
to an aggregate of 396,270,850 votes, representing 54% of the aggregate shares
entitled to vote. By virtue of their holdings of Preferred Stock, officers and
directors of the Company will be able to pass the proposal being submitted at
the Meeting. The presence, in person or by proxy, of the holders
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of a majority of the shares issued and outstanding and entitled to vote, is
necessary to constitute a quorum at the Meeting.
VOTING PROCEDURES
The approval of the reverse stock split requires the affirmative vote
of a majority of the shares entitled to vote at the Meeting, provided a quorum
exists. A quorum is established if, as of the Record Date, at least a majority
of the outstanding shares are present in person or represented by proxy at the
Meeting. Votes will be counted and certified by one or more Inspectors of
Election. In accordance with Delaware law, abstentions and "broker non-votes"
(i.e. proxies from brokers or nominees indicating that such persons have not
received instructions from the beneficial owner or other persons entitled to
vote shares as to a matter with respect to which the brokers or nominees do not
have discretionary power to vote) will be treated as present for purposes of
determining the presence of a quorum. For purposes of determining approval of a
matter presented at the meeting, abstentions will be deemed present and entitled
to vote and will, therefore, have the same legal effect as a vote "against" a
matter presented at the meeting. Broker non-votes will be deemed not entitled to
vote on the subject matter as to which the non-vote is indicated and will,
therefore, have no legal effect on the vote on that particular matter.
The enclosed proxies will be voted in accordance with the instructions
thereon. Unless otherwise stated, all shares represented by such proxy will be
voted as instructed. Proxies may be revoked as noted above.
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SECURITY OWNERSHIP OF CERTAIN BENEFICIAL
OWNERS AND MANAGEMENT
The following table sets forth, as of March 27, 2001, certain
information as to the stock ownership of each person known by the Company to own
beneficially 5% or more of the Company's outstanding Common Stock, by each
director of the Company who owns any shares, and by all officers and directors
as a group. This table includes the shares of Series A Preferred Stock, which
have the right in the aggregate to cast 54% of the total votes which may be cast
by the holders of all the outstanding (i) shares of Common Stock and (ii) Series
A Preferred Stock.
Name and Address
of Beneficial Number of shares of Number of shares Percentage of
Owner Common Stock Owned (1) of Series A Preferred Owned Voting Rights
- ----------------- ---------------------- --------------------------- -------------
Isaac Nussen 5,000,000 100,000 27.7%
131 West 35th Street
New York, NY 10001
George Weisz 5,000,000 100,000 27.7%
131 West 35th Street
New York, NY 10001
Eric Rothschild -0- -0- *
131 West 35th Street
New York, NY 10001
All officers and
directors as a
group (4 persons) 10,000,000 200,000 55.4%
* Represents less than 1%.
(1) Except as otherwise indicated, all shares are beneficially owned and
sole voting and investment power is held by the persons named.
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PROPOSAL 1
AMENDMENT TO CERTIFICATE
OF INCORPORATION TO AUTHORIZE
A REVERSE STOCK SPLIT
OF THE COMPANY'S COMMON STOCK
General
- -------
The Company's Board of Directors has unanimously adopted resolutions
proposing, declaring advisable and recommending that the stockholders of the
Company authorize an amendment to the Company's Certificate of Incorporation
(the "Amendment") to effect a reverse stock split (the "Reverse Split") and to
provide for the issuance of one whole share in lieu of fractional shares
otherwise issuable in connection with the Reverse Split. There will be no change
in the number of the Company's authorized shares of Common Stock and no change
in the par value of the Common Stock.
If the Reverse Split is approved, the Board of Directors will have the
authority, without further stockholder approval, to effect the Reverse Split,
pursuant to which each of the Company's presently outstanding shares (the "Old
Shares") of Common Stock would be exchanged for new shares (the "New Shares") of
Common Stock in an exchange ratio to be approved by the Board of Directors,
ranging from one (1) New Share for each two hundred and fifty (250) Old Shares
to one (1) New Share for each three hundred (300) Old Shares. The number of Old
Shares for which each New Share is to be exchanged is referred to as the
"Exchange Number". The Reverse Split will be effected simultaneously for all
Common Stock and the Exchange Number will be the same for all Common Stock..
In addition, the Board of Directors will also have the authority to
determine the exact timing of the Reverse Split, which may be at any time on or
prior to June 30, 2001, without further stockholder approval. The timing and the
Exchange Number will be determined in the judgment of the Board of Directors,
with the intention of maximizing the Company's ability to meet the listing
requirements for inclusion on the Nasdaq Small Cap Stock Market ("Nasdaq") or
the American Stock Exchange ("AMEX") and other intended benefits of the Reverse
Split to stockholders and the Company. See the information below under the
caption "Purpose of the Reverse Split." The text of the proposed Amendment is
set forth on Exhibit A to this Proxy Statement.
The Board of Directors also reserves the right, notwithstanding
stockholder approval and without further action by stockholders, to not proceed
with the Reverse Split, if, at any time prior to filing the Amendment with the
Secretary of State of the State of Delaware, the Board of Directors, in its sole
discretion, determines that the Reverse Split is no longer in the best interests
of the Company and its stockholders. The Board of Directors may consider a
variety of factors in determining whether or not to implement the Reverse Split
and in determining the Exchange Number, including, but not limited to, overall
trends in the stock market, recent changes and anticipated trends in the per
share market price of the Company's Common Stock, business and transactional
developments and the Company's actual and projected financial performance.
Except for changes due to the issuance of one whole additional share in
lieu of fractional shares, the Reverse Split will not change the proportionate
equity interests of the Company's stockholders, nor will the respective voting
rights and other rights of stockholders be altered. The Common Stock issued
pursuant to the Reverse Split will remain fully paid and non-assessable. The
Company will continue to be subject to the periodic reporting requirements of
the Securities Exchange Act of 1934, as amended.
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Purposes of the Reverse Split
- -----------------------------
The Company's Common Stock is quoted on NASD Over The Counter Bulletin
Board (the "OTCBB"). The Company desires to be listed on Nasdaq or AMEX. In
order for Common Stock to initially be listed on Nasdaq or AMEX, the Company and
the Common Stock are required to meet certain eligibility requirements
established by both the Nasdaq and AMEX stock exchanges.
Under Nasdaq's initial listing requirements, among other things, the
Company is required to meet a minimum bid price of at least $4.00 per share, to
have public float in the amount of 1,000,000 shares and must satisfy any of the
following: net tangible assets totaling at least $4,000,000, market
capitalization totaling $50,000,000 or net income in the latest fiscal year or
two of the last three fiscal year totaling $750,000. Once listed on Nasdaq, the
Company will be required to satisfy Nasdaq's listing maintenance standards.
Under the AMEX listing guidelines for U.S. Companies the Company can
meet the AMEX listing by satisfying requirements under either the Regular
Financial Guidelines or Alternate Financial Guidelines and Distribution
Guidelines as provided by AMEX. Under the Regular Financial Guidelines, among
other things, the Company must have pre-tax income of at least $750,000 in the
latest fiscal year or two of the most recent three fiscal years, it must meet
the minimum bid price of $3.00 per share and the market value of its public
float must be at least $3,000,000. Under the Alternate Financial Guidelines,
among other things, the Company does not have to meet a minimum pre-tax income,
it must have a minimum bid price of $3.00 per share, the market value of its
public float must be at least $15,000,000 and it must have an operating history
of at least three years.
The principal purpose of the Reverse Split Proposal is to increase the
market price of the Company's Common Stock to approach the Nasdaq or AMEX
minimum bid requirement. While there can be no assurance that after effectuating
the Reverse Split, the Company's stock price will increase to meet the minimum
bid price or other requirements of Nasdaq or AMEX for inclusion for trading on
either of their stock exchanges or maintain such price, the Company intends to
be in compliance with those requirements.
Giving the Board authority to implement the Reverse Split will avoid the
need to call a special meeting of, or seek consents from, stockholders under
time constraints to authorize a reverse split should it become necessary in
order to seek to meet Nasdaq's or AMEX's initial listing criteria. The Company
also believes that establishing its Common Stock on Nasdaq or AMEX may provide
the Company with a broader market for its Common Stock and facilitate the use of
the Common Stock in financing and other transactions in which the Company may
engage.
Certain Effects of the Reverse Split
- ------------------------------------
The following table illustrates the principal effects of the Reverse
Split on the Company's Common Stock:
Prior to the Subsequent to
Number of Shares Reverse Split 250-for-1 Split
- ---------------- ------------- ---------------
Authorized 350,000,000 350,000,000
Outstanding(1) 340,447,387 1,361,790
Available for Future Issuance 9,552,613 348,638,210
- -----------------
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(1) Gives effect to the Reverse Split as if it occurred on the Record Date,
subject to adjustment resulting from the issuance of whole shares in lieu of
fractional shares.
Stockholders should recognize that if the Reverse Split is effectuated
they will own a fewer number of shares than they presently own (a number equal
to the number of shares owned immediately prior to the filing of the Amendment
divided by the Exchange Number, after adjustment for fractional shares, as
described below). While the Company expects that the Reverse Split will result
in an increase in the market price of the Common Stock, there can be no
assurance that the Reverse Split will increase the market price of the Common
Stock by a multiple equal to the Exchange Number or result in the permanent
increase in the market price (which is dependent upon many factors, including,
but not limited to, the Company's performance and prospects). Also, should the
market price of the Common Stock decline, the percentage decline may be greater
than would pertain in the absence of a Reverse Split. Furthermore, the
possibility exists that liquidity in the market price of the Common Stock could
be adversely affected by the reduced number of shares that would be outstanding
after the Reverse Split. In addition, the Reverse Split will increase the number
of stockholders of the Company who own odd-lots (less than 100 shares).
Stockholders who hold odd-lots typically will experience an increase in the cost
of selling their shares, as well as greater difficulty in effecting such sales.
There can be no assurance that the Reverse Split will achieve the desired
results that have been outlined above.
Procedure for Effecting Reverse Split and Exchange of Stock Certificates
- ------------------------------------------------------------------------
If the Amendment is approved by the Company's stockholders, and if the
Board of Directors still believes that the Reverse Split is in the best
interests of the Company and its stockholders, the Company will file the
Amendment with the Secretary of State of the State of Delaware at such time as
the Board has determined the appropriate Exchange Number and the appropriate
effective time for the Reverse Split. The Board may delay effecting the Reverse
Split until June 30, 2001 without resoliciting such stockholder approval. The
Reverse Split will become effective on the date of filing the Amendment (the
"Effective Date"). Beginning on the Effective Date, each certificate
representing Old Shares will be deemed for all corporate purposes to evidence
ownership of New Shares.
Promptly after the Effective Date, stockholders will be notified that
the Reverse Split has been effected and of the exact Exchange Number. The
Company's transfer agent, Florida Atlantic Stock Transfer and Trust, will act as
exchange agent (the "Exchange Agent") for purposes of implementing the exchange
of stock certificates. Holders of Old Shares will be asked to surrender to the
Exchange Agent certificates representing Old Shares in exchange for certificates
representing New Shares in accordance with the procedures to be set forth in a
letter of transmittal to be sent by the Company. No new certificates will be
issued to a stockholder until such stockholder has surrendered such
stockholder's outstanding certificate(s) together with the properly completed
and executed letter of transmittal to the Exchange Agent. STOCKHOLDERS SHOULD
NOT DESTROY ANY STOCK CERTIFICATE AND SHOULD NOT SUBMIT ANY CERTIFICATES UNTIL
REQUESTED TO DO SO.
Fractional Shares
- -----------------
No scrip or fractional certificates will be issued in connection with
the Reverse Split. Stockholders who otherwise would be entitled to receive
fractional shares because they hold a number of Old Shares not evenly divisible
by the Exchange Number, will be entitled, upon surrender to the Exchange Agent
of certificates representing such shares, to the issuance of one whole
additional share for the fractional share the stockholder would have otherwise
received.
No Dissenter's Rights
- ---------------------
Under Delaware law, stockholders are not entitled to dissenter's rights
with respect to the proposed Amendment.
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Federal Income Tax Consequences of the Reverse Split
- ----------------------------------------------------
The following is a summary of certain material federal income tax
consequences of the Reverse Split, and does not purport to be complete. It does
not discuss any state, local, foreign or minimum income or other U.S. federal
tax consequences. Also, it does not address the tax consequences to holders that
are subject to special tax rules, such as banks, insurance companies, regulated
investment companies, personal holding companies, foreign entities, nonresident
alien individuals, broker-dealers and tax-exempt entities. The discussion is
based on the provisions of the United States federal income tax law as of the
date hereof, which is subject to change retroactively as well as prospectively.
This summary also assumes that the Old Shares were, and the New Shares will be,
held as a "capital asset," as defined in the Internal Revenue Code of 1986, as
amended (generally, property held for investment). The tax treatment of a
stockholder may vary depending upon the particular facts and circumstances of
such stockholder. EACH STOCKHOLDER SHOULD CONSULT WITH SUCH STOCKHOLDER'S OWN
-------------------------------------------------------------
TAX ADVISOR WITH RESPECT TO THE CONSEQUENCES OF THE REVERSE SPLIT.
- ------------------------------------------------------------------
No gain or loss should be recognized by a stockholder of the Company
upon such stockholder's exchange of Old Shares for New Shares pursuant to the
Reverse Split. The aggregate tax basis of the New Shares received in the Reverse
Split (including any fraction of a New Share deemed to have been received) will
be the same as the stockholder's aggregate tax basis in the Old Shares exchanged
therefor. The stockholder's holding period for the New Shares will include the
period during which the stockholder held the Old Shares surrendered in the
Reverse Split.
Required Vote
- -------------
The affirmative vote of a majority of the outstanding shares of Common
Stock entitled to vote on the Amendment will be required to approve the
Amendment. The Board of Directors unanimously recommends that stockholders vote
FOR this proposal.
MISCELLANEOUS
STOCKHOLDER PROPOSALS
Rule 14a-4 of the SEC proxy rules allows the Company to use
discretionary voting authority to vote on matters coming before an annual
meeting of stockholders if the Company does not have notice of the matter at
least 45 days before the date corresponding to the date on which the Company
first mailed its proxy materials for the prior year's annual meeting of
stockholders or the date specified by an overriding advance notice provision in
the Company's By-Laws. The Company's By-Laws do not contain such an advance
notice provision. For the Company's 2001 Annual Meeting of Stockholders,
stockholders must submit such written notice to the Secretary of the Company on
or before July 24, 2001.
Stockholders of the Company wishing to include proposals in the proxy
material for the 2001 Annual Meeting of the Stockholders must submit the same in
writing so as to be received by the Secretary of the Company on or before May
10, 2001. Such proposals must also meet the other requirements of the rules of
the SEC relating to stockholder proposals.
OTHER MATTERS
The Board of Directors does not intend to bring before the Special
Meeting for action any matters other than those specifically referred to above
and is not aware of any other matters which are proposed to be presented by
others. If any other matters or motions should properly come before the Special
Meeting, the persons named in the proxy intend to vote thereon in accordance
with their judgment on such matters or motions dealing with the conduct of the
Special Meeting.
By Order of the Board of Directors
GEORGE WEISZ
Secretary
Dated: April 12, 2001
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PROXY
-----
THIS PROXY IS SOLICITED
ON BEHALF OF THE BOARD OF DIRECTORS
AMERICAN JEWELRY CORP.
131 WEST 35TH STREET
NEW YORK, NEW YORK 10001
The undersigned hereby appoints Isaac Nussen and George Weisz as
Proxies, each with the power to appoint his substitute, and hereby authorizes
them to represent and to vote, as designated below, all the shares of American
Jewelry Corp. held of record by the undersigned on April 4, 2001 at the Special
Meeting of Stockholders to be held on April 30, 2001 or any adjournment thereof.
Management recommends a vote FOR the following:
1. Proposal to amend the Company's Certificate of Incorporation to
authorize a reverse stock split of the Company's Common Stock.
FOR |_| AGAINST |_| ABSTAIN |_|
The shares represented by this proxy will be voted in the manner directed. In
the absence of any direction, the shares will be voted FOR Proposal 1 in
accordance with their discretion on such other matters as may properly come
before the meeting.
Dated ______________________, 2001
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----------------------------------
Signature(s)
(Signature(s) should conform to names as registered. For jointly owned shares,
each owner should sign. When signing as attorney, executor, administrator,
trustee, guardian or officer of a corporation, please give full title. If a
partnership, please sign in partnership name by authorized person.)
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EXHIBIT A
PROPOSED TEXT OF AMENDMENT OF RESTATED
CERTIFICATE OF INCORPORATION
The restated certificate of incorporation of the Corporation, as amended to
date, is to be further amended by adding the following paragraph immediately
after the present first paragraph of ARTICLE FOURTH thereof:
"Effective upon the filing of this Certificate of Amendment
of the Restated Certificate of Incorporation of the
Corporation, each ____ shares of Common Stock, $.001 par
value per share, of the Corporation then issued and
outstanding or held in the treasury of the Corporation
automatically shall be combined into _____ share(s) of Common
Stock of the Corporation. There shall be no fractional shares
issued. Each holder of shares of Common Stock who otherwise
would be entitled to receive a fractional share shall be
entitled to receive one whole additional share for the
fractional share the stockholder would have otherwise
received."
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