SCHEDULE 14C INFORMATION
INFORMATION STATEMENT PURSUANT TO SECTION 14(C) OF THE SECURITIES
EXCHANGE ACT OF 1934
Filed by the Registrant [X]
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[X] Preliminary Information Statement [ ] Confidential, for Use of
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</Table>
RETURN ASSURED INCORPORATED
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(Name of Registrant as Specified In Its Charter)
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PRELIMINARY INFORMATION STATEMENT
RETURN ASSURED INCORPORATED
1901 Avenue of the Stars
Suite 1710
Los Angeles, CA 90067
PRELIMINARY INFORMATION STATEMENT
This information statement is being mailed to the stockholders of
Return Assured Incorporated (the "Company"), commencing on or about April 2,
2002, to all stockholders of record on March 29, 2002, in connection with the
prior approval by the board of directors of the Company of the corporate actions
referred to below and their subsequent adoption by a majority of the
stockholders of the Company (the "Majority Stockholders"). Accordingly, all
necessary corporate approvals in connection with the matters referred to herein
have been obtained, and this Information Statement is furnished solely for the
purpose of informing stockholders, in the manner required under the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), of these transactions
before they take effect. The total number of shares of the Common Stock
outstanding on March 20, 2002 is 35,834,012. As of March 20, 2002, the total
number of outstanding warrants for the purchase of shares of Common Stock is
685,000.
WE ARE NOT ASKING YOU FOR A PROXY AND YOU ARE REQUESTED NOT TO SEND US A PROXY.
1. REVERSE STOCK SPLIT
The Company, as authorized by the necessary approvals of the board of
directors and the Company's Majority Stockholders, have approved the adoption of
a one (1) for sixty (60) reverse stock split whereby record owners of Common
Stock as of March 29, 2002 shall own one share of Common Stock for every sixty
shares held (the "Reverse Stock Split"). There shall be no fractional shares and
each fractional share shall be rounded up to the nearest whole share. The
capital accounts of the Corporation shall remain unaffected by the aforesaid
Reverse Stock Split and that, consequently, upon such Reverse Stock Split, the
stated value of the Common Stock shall remain in the same proportion as the
Reverse Stock Split. The Reverse Stock Split will become effective on any date
(the "Effective Date") selected by the Board on or after April 22, 2002.
On the Effective Date, the Reverse Stock Split will be effective, and
each share of the Common Stock issued and outstanding immediately prior thereto
(the "Old Common Stock"), will be, automatically and without any action on the
part of the shareholders, converted into and reconstituted into 1/60 of a share
of the Company's Common Stock (the "New Common Stock");
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provided, however, that no fractional shares of New Common Stock will be issued
as a result of the Reverse Stock Splits. Each fractional share shall be rounded
up to the nearest whole share.
Shortly after the Effective Date, shareholders will be asked to
surrender certificates representing shares of Old Common Stock in accordance
with the procedures set forth in a letter of transmittal to be sent by the
Company. Upon such surrender, a certificate representing shares of New Common
Stock will be issued and forwarded to the shareholders; however, each
certificate representing shares of Old Common Stock will continue to be valid
and represent the number of shares of New Common Stock equal to the number of
shares of Old Common Stock adjusted for the Reverse Stock Split. SHAREHOLDERS
SHOULD NOT SEND THEIR STOCK CERTIFICATES UNTIL THEY RECEIVE A TRANSMITTAL
LETTER.
PURPOSE OF THE REVERSE SPLIT
The Board believes the Reverse Stock Split is desirable for several
reasons. The Reverse Stock Split should enhance the acceptability of the Common
Stock by the financial community and the investing public. The reduction in the
number of issued and outstanding shares of Common Stock caused by the Reverse
Stock Split is anticipated initially to increase proportionally the per share
market price of the Common Stock. The Board also believes that the proposed
Reverse Stock Split may result in a broader market for the Common Stock than
that which currently exists. The expected increased price level may encourage
interest and trading in the Common Stock and possibly promote greater liquidity
for the Company's shareholders, although such liquidity could be adversely
affected by the reduced number of shares of Common Stock outstanding after the
Reverse Stock Split Effective Date.
Additionally, a variety of brokerage house policies and practices tend
to discourage individual brokers within those firms from dealing with lower
priced stocks. Some of those policies and practices pertain to the payment of
broker's commissions and to time consuming procedures that function to make the
handling of lower priced stocks economically unattractive to brokers. In
addition, the structure of trading commissions also tends to have an adverse
impact upon holders of lower priced stock because the brokerage commission on a
sale of lower priced stock generally represents a higher percentage of the sales
price than the commission on a relatively higher priced issue. The proposed
Reverse Stock Split could result in a price level for the Common Stock that will
reduce, to some extent, the effect of the above-referenced policies and
practices of brokerage firms and diminish the adverse impact of trading
commissions on the market for the Common Stock. Any reduction in brokerage
commissions resulting from the Reverse Stock Split may be offset, however, in
whole or in part, by increased brokerage commissions required to be paid by
shareholders selling "odd lots" created by such Reverse Stock Split.
However, there can be no assurance that any or all of these effects
will occur; including, without limitation, that the market price per share of
New Common Stock after the Reverse Stock Split will be equal to the applicable
multiple of the market price per share of Old Common
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Stock before the Reverse Stock Split, or that such price will either exceed or
remain in excess of the current market price. Further, there is no assurance
that the market for the Common Stock will be improved. Shareholders should note
that the Board cannot predict what effect the Reverse Stock Split will have on
the market price of the Common Stock.
EFFECT OF THE REVERSE STOCK SPLIT
Consummation of the Reverse Stock Split will not alter the number of
authorized shares of Common Stock, though separate action is being taken to
increase the number of authorized shares of common stock, which is currently
50,000,000 shares (see the section entitled "Increase in the Number of
Authorized Shares of Common Stock"). As discussed above, proportionate voting
rights and other rights of the holders of Common Stock will not be altered by
the Reverse Stock Split.
Shareholders should note that certain disadvantages may result from the
adoption of this Reverse Stock Split. The number of outstanding shares of Common
Stock will be decreased as a result of a Reverse Stock Split, but the number of
authorized shares of Common Stock will not be so decreased. The Company will
therefore have the authority to issue a greater number of shares of Common Stock
following the Reverse Stock Split without the need to obtain shareholder
approval to authorize additional shares. Any such additional issuance may have
the effect of significantly reducing the interest of the existing shareholders
of the Company with respect to earnings per share, voting, liquidation value and
book and market value per share.
The par value of the Common Stock will remain at $.001 per share
following the Reverse Stock Split, and the number of shares of the Common Stock
outstanding will be reduced. As a consequence, the aggregate par value of the
outstanding Common Stock will be reduced, while the aggregate capital in excess
of par value attributable to the outstanding Common Stock for statutory and
accounting purposes will be correspondingly increased. The Reverse Stock Split
will not affect the Company's total shareholders' equity. All share and per
share information would be retroactively adjusted following the Effective Date
to reflect the Reverse Stock Split for all periods presented in future filings.
The Common Stock is currently registered under Section 12(g) of the
Securities Exchange Act of 1934 (the "Exchange Act") and, as a result, the
Company is subject to the periodic reporting and other requirements of the
Exchange Act. The Reverse Stock Split will not effect the registration of the
Common Stock under the Exchange Act. After the Effective Date, trades of the New
Common Stock will be reported on the Nasdaq electronic "Bulletin Board" under
the Company's symbol RTNA.
FEDERAL INCOME TAX CONSEQUENCES OF THE REVERSE STOCK SPLIT
The Company has not sought and will not seek an opinion of counsel or a
ruling from the Internal Revenue Service regarding the federal income tax
consequences of the Reverse Stock
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Split. The Company, however, believes that because the Reverse Stock Split is
not part of a plan to increase any shareholder's proportionate interest in the
assets or earnings and profits of the Company, the Reverse Stock Split will have
the following federal income tax effects:
1. A shareholder will not recognize gain or loss on the exchange of Old
Common Stock for New Common Stock. In the aggregate, the shareholder's basis in
shares of New Common Stock will equal his basis in shares of Old Common Stock.
2. A shareholder's holding period for tax purposes for shares of New
Common Stock will be the same as the holding period for tax purposes of the
shares of Old Common Stock exchanged therefor.
3. The Reverse Stock Split will constitute a reorganization within the
meaning of Section 368(a)(1)(E) of the Internal Revenue Code or will otherwise
qualify for general nonrecognition treatment, and the Company will not recognize
any gain or loss as a result of the Reverse Stock Split.
SHAREHOLDERS ARE URGED TO CONSULT THEIR TAX ADVISERS AS TO THE
PARTICULAR TAX CONSEQUENCES TO THEM OF THE REVERSE STOCK SPLIT, INCLUDING THE
FEDERAL, STATE, LOCAL, FOREIGN AND OTHER TAX CONSEQUENCES TO THEM OF THE REVERSE
STOCK SPLIT AND OF POTENTIAL CHANGES IN APPLICABLE TAX LAWS.
2. INCREASE IN NUMBER OF AUTHORIZED SHARES OF COMMON STOCK
The Company, as authorized by the necessary approvals of the board of
directors and the Company's Majority Stockholders, have approved an amendment to
the Company's Certificate of Incorporation to increase the number of authorized
shares of Common Stock, par value $ .001 per share ("Common Stock ), from
51,000,000 shares to 105,000,000 shares consisting of 100,000,000 shares of
Common Stock, par value $.001 per share and 5,000,000 shares of Preferred Stock,
$.0001 per share. Stockholders representing a majority of the issued and
outstanding shares have approved this proposed amendment. As of March 20, 2002,
35,834,012 shares of Common Stock were issued and outstanding. As of March 20,
2002, the total number of outstanding warrants for the purchase of shares of
Common Stock is 685,000.
The Board believes that the proposed increase is desirable so that, as
the need may arise, the Company will have more flexibility to issue shares of
Common Stock without the expense and delay of a special stockholders' meeting in
connection with possible future stock dividends or stock splits, equity
financings, future opportunities for expanding the business through investments
or acquisitions, management incentive and employee benefit plans and for other
general corporate purposes.
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Authorized but unissued shares of the Company's Common Stock may be
issued at such times, for such purposes and for such consideration as the Board
of Directors may determine to be appropriate without further authority from the
Company's stockholders, except as otherwise required by applicable law or stock
exchange policies.
The increase in authorized Common Stock will not have any immediate
effect on the rights of existing stockholders. However, the Board will have the
authority to issue authorized Common Stock without requiring future stockholder
approval of such issuances, except as may be required by applicable law or
exchange regulations. To the extent that additional authorized shares are issued
in the future, they will decrease the existing stockholders' percentage equity
ownership and, depending upon the price at which they are issued, could be
dillutive to the existing stockholders. The holders of Common Stock have no
preemptive rights.
The increase in the authorized number of shares of Common Stock and the
subsequent issuance of such shares could have the effect of delaying or
preventing a change in control of the Company without further action by the
stockholders. Shares of authorized and unissued Common Stock could be issued
(within the limits imposed by applicable law) in one or more transactions. Any
such issuance of additional stock could have the effect of diluting the earnings
per share and book value per share of outstanding shares of common Stock, and
such additional shares could be used to dilute the stock ownership or voting
rights of a person seeking to obtain control of the Company. The company has
previously adopted certain measures that may have the effect of helping to
resist an unsolicited takeover attempt.
MATERIAL INCORPORATED BY REFERENCE
The audited balance sheets of the Company as of August 31, 2001 and
August 31, 2000 and the related statements of operations, shareholders' equity
and cash flows for the years ended August 31, 2001 and August 31, 2000 are
incorporated herein by reference to the Company's Annual Reports on Form
10-KSB/A, as amended, for the fiscal years ended August 31, 2001 and August 31,
2000 (the "Annual Reports"). The Company's unaudited balance sheet as of
November 30, 2001 and the related statements of operations and cash flows for
the three month period ended November 30, 2001 are incorporated herein by
reference to the Company's Quarterly Report on Form 10-QSB for that period.
Information required pursuant to Item 13(a) of Schedule 14A and
specified in Item 303 of Regulation S-B is hereby incorporated by reference to
the Annual Reports and the Quarterly Report listed above.
Information required pursuant to Item 13(a) of Schedule 14A and
specified in Item 304 of Regulation S-B is hereby incorporated by reference to
the Current Report listed above.
.
By Order of the Board of Directors
Matthew J. Sebal
President, Chairman & Director
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EXHIBIT LIST
EXHIBIT A Amendment to Certificate of Incorporation
EXHIBIT B Awareness Letter of Goldstein Golub Kessler
EXHIBIT C Consent of Goldstein Golub Kessler
EXHIBIT D Consent of Goldstein Golub Kessler
EXHIBIT E Consent of Pannell Kerr Forster
EXHIBIT A
CERTIFICATE OF AMENDMENT
OF THE CERTIFICATE OF INCORPORATION
OF
RETURN ASSURED INCORPORATED
Under Section 242
of the
Delaware General Corporation Law
I, the President and Chairman of Return Assured Incorporated, a
corporation existing under the laws of the state of Delaware, do hereby certify
as follows:
First: That the name of the corporation is Return Assured Incorporated.
Second: That the certificate of incorporation of the corporation was
filed with the Delaware Secretary of State on June 18, 1996.
Third: That at a meeting of the board of directors of the corporation,
resolutions were adopted setting forth proposed amendments to the certificate of
incorporation of said corporation, declaring said amendments to the certificate
of incorporation to be advisable and requesting the consent of the stockholders
of said corporation for consideration thereof. The resolutions setting forth the
proposed amendments are as follows:
AUTHORIZED SHARES
RESOLVED, that the Certificate of Incorporation of the corporation be
amended by adding to Article IV, the following:
All issued and outstanding shares of Common Stock, par value $.001
per share, ("Old Common Stock"), outstanding as of the close of
business on the date this Certificate of Amendment to the
Certificate of Incorporation is filed with the Secretary of State
of the State of Delaware (the "Effective Date") shall
automatically without any action on the part of the holder of the
Old Common Stock be converted into one sixtieth (1/60) the number
of shares of Common Stock , par value $.001 per share ("New Common
Stock"). Each holder of a certificate or certificates which
immediately prior to the Effective Date represented outstanding
shares of Old Common Stock (the "Old Certificates") shall, from
and after the Effective Date, be entitled to receive a certificate
or certificates (the "New Certificates") representing the shares
of New Common Stock into which the shares of Old Common Stock
formerly represented by such Old Certificates are reclassified
under the terms hereof. Prior to the Effective Date, there are
35,834,012 shares of issued and
outstanding shares of Old Common Stock and 14,165,988 shares of
authorized but unissued shares of Old Common Stock. On the
Effective Date, there will be approximately 597,234 issued and
outstanding shares of New Common Stock and 99,402,766 shares of
authorized but unissued shares of New Common Stock. The 35,834,012
shares of Old Common Stock are hereby changed into approximately
597,234 shares of New Common Stock at the rate of 1-for-60.
The total number of shares of stock which the corporation shall have
authority to issue is 105,000,000 of which 100,000,000 shall be common
stock, par value $.001 per share, and 5,000,000 shall be preferred
stock, par value $.0001 per share. No holder of any of the shares of
the stock of the corporation, whether now or hereafter authorized and
issued, shall be entitled as of right to purchase or subscribe for (1)
any unissued stock of any class, or (2) any additional shares of any
class to be issued by reason of any increase of the authorized capital
stock of the corporation of any class, or (3) bonds, certificates of
indebtedness, debentures or other securities convertible into stock of
the corporation, or carrying any right to purchase stock of any class,
but any such unissued stock or such additional authorized issue of any
stock or of other securities convertible into stock, or carrying any
right to purchase stock, may be issued and disposed of pursuant to
resolution of the Board of Directors to such persons, firms,
corporations or associations and upon such terms as may be deemed
advisable by the Board of Directors in the exercise of its discretion.
Fourth: That thereafter, pursuant to resolutions of the board of
directors, stockholders holding not less than the necessary number of shares as
required by statute consented in writing to the amendments in accordance with
Section 228 of the General Corporation Law.
Fifth: That said amendments to the certificate of incorporation were
duly adopted in accordance with Section 242 of the General Corporation Law of
the state of Delaware by written consent of the holders of a majority of all
outstanding shares that would have been entitled to vote if such action was
taken at a meeting of stockholders.
Sixth: That the capital of the corporation shall not be reduced under
or by reason of said amendments.
IN WITNESS WHEREOF, the undersigned affirms, under penalty of perjury,
that the foregoing instrument is the act and deed of the corporation and that
the facts stated therein are true.
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Matthew J. Sebal
President and Chairman
EXHIBIT B
ACCOUNTANT'S AWARENESS LETTER
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549
We are aware that our report dated January 14, 2002, on our review of the
interim financial statements of Return Assured Incorporated and Subsidiaries as
of November 30, 2001 and for the three month period ended November 30, 2001
included in the Form 10-QSB for the quarter ended November 30, 2001 is being
incorporated by reference in the Company's Preliminary Information Statement on
Schedule 14C. Pursuant to Rule 436(c) under the Securities Act of 1933, this
report should not be considered as part of the Information Statement prepared
or certified by us within the meaning of Sections 7 and 11 of that Act.
GOLDSTEIN GOLUB KESSLER LLP
New York, New York
March 20, 2002
EXHIBIT C
CONSENT OF INDEPENDENT AUDITORS
INDEPENDENT AUDITOR'S CONSENT
To the Board of Directors
Return Assured Incorporated
We hereby consent to the incorporation by reference in this Preliminary
Information Statement on Schedule 14C of our report dated November 30, 2001 on
the consolidated financial statements of Return Assured Incorporated and
Subsidiaries appearing in the Annual Report on Form 10- KSB of Return Assured
Incorporated, for the year ended August 31, 2001.
Goldstein Golub Kessler LLP
New York, New York
March 20, 2002
EXHIBIT D
CONSENT OF INDEPENDENT AUDITORS
To the Board of Directors
Return Assured Incorporated
We hereby consent to the incorporation by reference in this Preliminary
Information Statement on Schedule 14C of Return Assured Incorporated, formerly
known as Hertz Technology Group, Inc., of our report dated October 26, 2000 on
the consolidated financial statements of Hertz Technology Group, Inc and
Subsidiaries appearing in the Annual Report on Form 10-KSB, as amended, of
Return Assured Incorporated for the year ended August 31, 2000.
Goldstein Golub Kessler LLP
New York, New York
March 20, 2002
EXHIBIT E
CONSENT OF INDEPENDENT AUDITORS
March 20, 2002
Board of Directors
Return Assured Incorporated
2240-885 West Georgia Street
Vancouver, BC V6C 3E8
Dear Sirs:
We consent to the incorporation by reference in this Preliminary Information
Statement on Schedule 14C of Return Assured Incorporated, formerly known as
Hertz Technology, Inc., of our report dated September 27, 2000 and October 17,
2000 relating to the audited financial statements for the period ending August
31, 2000 of Return Assured Incorporated (formerly A Sure eCommerce, Inc.)
appearing in the Annual Report on Form 10-KSB, as amended, of Return Assured
Incorporated, formerly known as Hertz Technology Group, Inc., for the year ended
August 31, 2000.
"Pannell Kerr Forster"
CHARTERED ACCOUNTANTS
Vancouver, Canada