UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
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
(Amendment No. __________)
Check the appropriate box:
a. [X] Preliminary Information Statement
b. [ ] Confidential, for Use of the Commission Only
(as permitted by Rule l4c-5(d) (2))
c. [ ] Definitive Information Statement
SUPERIOR GALLERIES, INC.
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(NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] 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: $_____________
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-ll(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: _____________
INFORMATION STATEMENT OF
SUPERIOR GALLERIES, INC.
9478 West Olympic Boulevard
Beverly Hills, California 90212
(310) 203-9855
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THIS INFORMATION STATEMENT IS BEING PROVIDED
TO YOU BY THE BOARD OF DIRECTORS OF
SUPERIOR GALLERIES, INC.
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WE ARE NOT ASKING YOU FOR A PROXY AND
YOU ARE REQUESTED NOT TO SEND US A PROXY.
Our Board of Directors is furnishing this information statement to all
holders of record of the issued and outstanding shares of our common stock,
$0.001 par value ("Common Stock"), and voting preferred stock, $0.001 par value
("Preferred Stock"), as of the close of business on August 15, 2005 (the "Record
Date"), in connection with the authorization of the corporate actions described
below by the written consent of the Company's Board of Directors on July 25,
2005, and the subsequent approval of such corporate action by the written
consent, dated August ___, 2005, of those stockholders of the Company entitled
to vote a majority of the shares of the Company's voting capital stock
outstanding on such date. Stockholders holding in the aggregate 6,259,070,
shares of voting stock, or 72.60% of the voting capital stock outstanding on
such date, approved the corporate actions described below. 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 the stockholders of the Company, in the manner required
under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), of
these corporate actions before they take effect.
This Information Statement is first being mailed or furnished to the
stockholders of the Company on or about August ___, 2005, and the amendments
described herein shall not become effective until at least 20 days thereafter.
ACTIONS BY BOARD OF
DIRECTORS
AND
CONSENTING STOCKHOLDERS
ACTION 1: AMENDMENT OF CERTIFICATE OF INCORPORATION TO INCREASE AUTHORIZED
COMMON STOCK
Our Board of Directors and stockholders holding a majority of the
outstanding shares of our voting stock have approved the proposed Amendment to
our Certificate of Incorporation ("COI Amendment"), a copy of which is attached
hereto as Appendix A, to effectuate an increase in the number of our authorized
shares of Common Stock by increasing our authorized capital stock from
22,500,000 total shares, of which 12,500,000 shares are designated as Common
Stock and 10,000,000 shares are designated as Preferred Stock, to 30,000,000
total shares, of which 20,000,000 shall be designated as Common Stock and
10,000,000 shall remain designated as Preferred Stock (the "Capital Stock
Increase"). The reasons for, and general effect of, the amendment to the
Company's Certificate of Incorporation is described in "AMENDMENT INCREASING THE
NUMBER OF AUTHORIZED SHARES OF THE COMPANY'S CAPITAL STOCK."
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ACTION 2: AMENDMENT OF BYLAWS TO INCREASE AUTHORIZED NUMBER OF DIRECTORS
Our Board of Directors and stockholders holding a majority of the
outstanding shares of our voting stock have approved the proposed Amendment to
our Bylaws ("Bylaw Amendment") to effectuate an increase in the authorized
number of directors from 5 to a number between 5 and 9, inclusive, with the
exact number to be set by the Board of Directors. The reasons for, and general
effect of, the amendment to the Company's Bylaws is described in "AMENDMENT OF
BYLAWS INCREASING THE NUMBER OF AUTHORIZED DIRECTORS."
VOTE REQUIRED UNDER DELAWARE GENERAL CORPORATION LAW
Section 242 of the Delaware General Corporation Law requires us to
obtain approval of the COI Amendment from the holders of a majority of our
voting capital stock. Pursuant to Section 109 of the Delaware General
Corporation Law and our Bylaws, the holders of a majority of our voting capital
stock must also approve of the Bylaw Amendment. The COI Amendment and the Bylaw
Amendment are collectively referred to herein as the "Amendments."
We have two classes of capital stock outstanding, consisting of our
Common Stock and our Preferred Stock, which will vote together as one class for
purposes of approving the Amendments. Our presently outstanding Preferred Stock
consists of four series, including our Series A Redeemable 8% Convertible
Preferred Stock ("Series A Preferred Stock"), Series B $1.00 Convertible
Preferred Stock ("Series B Preferred Stock"), Series D $1.00 Convertible
Preferred Stock ("Series D Preferred Stock"), and Series E $1.00 Convertible
Preferred Stock ("Series E Preferred Stock"). All of our outstanding Preferred
Stock except the Series A Preferred Stock may vote on the Amendments. There are
no dissenters' rights of appraisal with respect to the Amendments. For purposes
hereof, the term "Voting Stock" means our common stock and all of our
outstanding Preferred Stock other than the Series A Preferred Stock.
OWNERSHIP OF VOTING STOCK AS OF RECORD DATE
Only the holders of record of our Voting Stock at the close of business
on the Record Date are entitled to approve and adopt the Amendments. As of the
Record Date, 8,622,978 shares of Voting Stock (consisting of 4,819,942 shares of
Common Stock and 3,803,036 shares of voting Preferred Stock) were issued and
outstanding and held of record by approximately 199 stockholders (197 holders of
Common Stock and 2 holders of voting Preferred Stock). Of the Voting Stock, each
share of Common Stock issued and outstanding on the Record Date is entitled to
one vote with regard to the approval and adoption of the Amendments and each
share of voting Preferred Stock issued and outstanding on the Record Date is
entitled to the number of votes that is represented by the number of shares of
Common Stock that such share of voting Preferred Stock would be convertible into
as of the Record Date. Currently, each share of our Series B Preferred Stock is
convertible into 0.506 shares of Common Stock, each share of our Series D
Preferred Stock is convertible into 0.833 shares of Common Stock, and each share
of our Series E Preferred Stock is convertible into 0.16667 shares of our Common
Stock.
VOTE OBTAINED
On July 25, 2005, our Board of Directors adopted resolutions
authorizing and approving the Amendments and the implementation of the Capital
Stock Increase and the Bylaw Amendment. The Board of Directors directed
management to submit the Amendments to our stockholders for approval and
reserved the right to abandon the Amendments at any time prior to the Effective
Time (as defined below).
Under the Delaware General Corporation Law, our stockholders may
approve the Amendments without a meeting, without prior notice and without a
vote if a written consent to the Amendments is signed by the holders of
outstanding shares of Voting Stock having not less than the minimum number of
votes that would be necessary to authorize or take such action at a meeting at
which all shares entitled to vote on the action were present and voted. The
holders of a majority of the outstanding shares of Voting Stock are Silvano
DiGenova, who is our Chief Executive Officer and Chairman of the Board, and
Stanford International Bank Limited, an affiliate of Stanford Group Company
(collectively, the "Majority Group"). The members of the Majority Group have
approved the Amendments by written consent dated effective as of August ____,
2005. Accordingly, your consent is not required and is not being solicited in
connection with the Amendments.
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GENERAL
We will pay the expenses of furnishing this information statement,
including the cost of preparing, assembling and mailing this information
statement. We anticipate that this information statement will be sent or given
on or about August ___, 2005 to the record holders of Voting Stock as of close
of business on the Record Date, and that the Amendment will be filed with the
Delaware Secretary of State and become effective no earlier than the twentieth
day after this information statement is sent or given to those holders of Voting
Stock.
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NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THE CAPITAL STOCK INCREASE, PASSED
UPON THE MERITS OR FAIRNESS OF THE CAPITAL STOCK INCREASE, OR PASSED UPON THE
ADEQUACY OR ACCURACY OF THE DISCLOSURE IN THIS INFORMATION STATEMENT. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
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SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth, as of July 25, 2005, certain
information with respect to the beneficial ownership of our stock by (i) each of
our executive officers named in the summary compensation table above, (ii) each
of our directors, (iii) each person known to us to be the beneficial owner of
more than 5% of each class of our outstanding voting securities, and (iv) all of
our directors and executive officers as a group.
Percentage of
Name and Address Amount and Nature of Stock
of Beneficial Owner(1) Title of Class Beneficial Ownership(2) Outstanding(1)
- -------------------------------------------- ---------------------------- ----------------------- --------------
Silvano DiGenova Common(3) 2,050,764 39.71%
Series B Preferred Stock 400,000 11.76%
Paul Biberkraut Common(4) 28,750 *
Lee Ittner Common(5) 20,000 *
David Rector Common(4) 10,000 *
Anthony Friscia -- 0 *
Larry Abbott -- 0 *
Stanford International Bank Limited Common(6)(7) 4,950,806 58.79%
c/o Stanford Venture Capital Holdings, Inc. Series B Preferred Stock 3,000,000 88.24%
6075 Poplar Avenue Series D Preferred Stock 2,000,000 100.00%
Memphis, TN 38119 Series E Preferred Stock 2,500,000 100.00%
All Executive Officers and Directors Common(3)8) 2,109,514 40.46%
as a Group (6 persons) Series B Preferred Stock 400,000 11.76%
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*Less than one percent.
(1) The address for each of Messrs. DiGenova, Biberkraut, Ittner, Rector,
Gollihugh and Friscia is 9478 West Olympic Blvd., Beverly Hills, California
90212. Messrs. DiGenova, Biberkraut, Ittner, Rector and Friscia are our
current directors. Messrs. DiGenova, Biberkraut and Abbott are officers of
the Company.
(2) Based upon information furnished to us by the directors and executive
officers or obtained from our stock transfer books showing 4,819,942 shares
of common stock outstanding as of July 25, 2005. We are informed that these
persons hold the sole voting and dispositive power with respect to the
common stock except as noted herein. For purposes of computing "beneficial
ownership" and the percentage of outstanding common stock held by each
person or group of persons named above as of July 25, 2005, any security
which such person or group of persons has the right to acquire within 60
days after such date is deemed to be outstanding for the purpose of
computing beneficial ownership and the percentage ownership of such person
or persons, but is not deemed to be outstanding for the purpose of
computing the percentage ownership of any other person.
(3) Includes 142,500 shares of common stock issuable upon the exercise of
options and warrants, 202,230 shares of common stock issuable upon the
conversion of Series B Preferred Stock, all of which were convertible
within 60 days of the date of this table, and 1,000 shares held by Mr.
DiGenova's minor children, over which Mr. DiGenova exercises voting
control.
(4) These shares of common stock are issuable upon the exercise of options that
are exercisable within 60 days. (5) These shares of common stock include
10,000 shares issuable upon the exercise of options that are exercisable
within 60
days.
(6) Voting and investment control of Stanford International Bank Limited
("SIBL") is held by R. Allen Stanford. SIBL is affiliated with Stanford
Group Company, a broker-dealer. Stanford Financial Group Company, also an
affiliate of SIBL, has provided us with a line of credit. SIBL and its
predecessor in interest with respect to portions of these securities,
Stanford Venture Capital Holdings, Inc., have represented to us that at the
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time that they acquired securities from us, they purchased these securities
for investment and not with a view to the distribution thereof, and did not
have any agreements or understandings, directly or indirectly, with any
person to distribute these securities. We pay Stanford Group Company a
management fee of $5,000 per month, provide auction services, and from time
to time sell coins, to its affiliate, Stanford Coins & Bullion, Inc.
(7) Includes 1,517,472 shares of common stock issuable upon the conversion of
Series B Preferred Stock, 1,666,667 shares of common stock issuable upon
the conversion of Series D Preferred Stock, and 416,667 shares of common
stock issuable upon the conversion of Series E Preferred Stock, all of
which are currently convertible within the next 60 days. Also includes
600,000 shares of common stock owned by four employees of Stanford Venture
Capital Holdings, Inc., Daniel Bogar, William Fusselmann, Osvaldo Pi and
Ronald Stein, in equal amounts.
(8) Includes 10,000 shares of common stock held by Lee Ittner, 28,750 shares of
common stock issuable upon the exercise of options held by Paul Biberkraut
and 10,000 shares of common stock issuable upon the exercise of options
held by each of Lee Ittner and David Rector, all of which were exercisable
within 60 days of the date of this table.
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NOTICE TO STOCKHOLDERS OF ACTION
APPROVED BY CONSENTING STOCKHOLDERS
The following actions have been approved by the written consent of the
stockholders holding a majority of the issued and outstanding shares of the
Company's Voting Stock:
AMENDMENT INCREASING THE NUMBER OF AUTHORIZED
SHARES OF THE COMPANY'S CAPITAL STOCK
PURPOSE AND EFFECT OF THE CAPITAL STOCK INCREASE
The Company's Board of Directors has determined that it is in the
Company's best interest to increase the number of authorized shares of Common
Stock. The Board of Directors believes that the Amendment will provide the
Company with greater flexibility by increasing the Company's authorized capital
to allow it to issue additional shares of Common Stock as the Board of Directors
deems necessary or advisable. Because of the number of shares that have been
reserved for issuance upon the potential conversion of our Preferred Stock, if
we do not increase the number of authorized shares of Common Stock we will be
unable to pursue certain future transactions for the purpose of raising equity
capital. Consequently, the Board of Directors has recommended that the Company
increase the number of authorized shares of capital stock to 30,000,000 shares,
of which 20,000,000 shares shall be designated as Common Stock and 10,000,000
shares shall remain designated as Preferred Stock which may be issued in one or
more series or classes as designated by the Board of Directors, from time to
time, without the approval of stockholders.
The Capital Stock Increase will not have any immediate effect on the
rights of existing stockholders. However, the Board of Directors will have the
authority to issue authorized Common Stock or other securities convertible into
or exercisable or exchangeable for Common Stock without requiring future
stockholder approval of such issuances, except as may be required by the
Company's Certificate of Incorporation or applicable law. To the extent that
additional authorized shares are issued in the future, they may decrease the
existing stockholders' percentage equity ownership and, depending on the price
at which they are issued, could be dilutive to the existing stockholders.
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 its
stockholders. Shares of authorized and unissued Common Stock could, within the
limits imposed by applicable law, be issued in one or more transactions which
would make a change in control of the Company more difficult, and therefore less
likely. 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 Board of Directors is not currently aware of any attempt to take
over or acquire the Company. While it may be deemed to have potential
anti-takeover effects, the Amendment is not prompted by any specific effort or
takeover threat currently perceived by management.
DESCRIPTION OF COMMON STOCK
The holders of outstanding shares of our common stock are entitled to
receive dividends out of assets legally available at times and in amounts as the
board of directors may from time to time determine, subordinate to any
preferences that may be granted to the holders of preferred stock. Holders of
common stock are entitled to one vote per share on all matters on which the
holders of common stock are entitled to vote.
The common stock is not entitled to preemptive rights and may not be
redeemed or converted. Upon our liquidation, dissolution or winding up, after
payment of all of our debts and liabilities and fulfillment of the rights of any
outstanding class or series of preferred stock that has priority to distributed
assets, the assets legally available for distribution to our shareholders are
divided among the holders of the common stock, Series B Preferred Stock, Series
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D Preferred Stock and Series E Preferred Stock in proportion to the number of
shares of common stock held by them, with the Series B Preferred Stock, Series D
Preferred Stock and Series E Preferred Stock being treated as though it had
converted into common stock in accordance with its terms. The rights of holders
of common stock are subordinate to those of holders of any series of preferred
stock.
AMENDMENT OF BYLAWS INCREASING THE
NUMBER OF AUTHORIZED DIRECTORS
PURPOSE AND EFFECT OF THE BYLAW AMENDMENT
The Board of Directors believes that it is in the Company's best
interest to increase the size of the Board of Directors from five (5) members to
a range consisting of not less than five (5) nor more than nine (9) members,
with the exact number of directors to be authorized by resolution of the Board
of Directors. The Board of Directors has therefore proposed that the text of
Article III, Section 3.3(i) of the Bylaws of the Company be amended and restated
in its entirety to read:
"The authorized number of Directors shall be, until changed by a duly
adopted amendment to the Certificate of Incorporation or by an amendment to this
Section 3.3 of these Bylaws adopted by the vote or written consent of
shareholders entitled to exercise majority voting power as provided in the DGCL,
such number as may from time to time be authorized by resolution of the Board,
provided that such number shall not be less than five (5) nor more than nine
(9)."
The proposed Bylaw Amendment will allow the Company to appoint
additional qualified directors. The Board of Directors also believes that the
availability of additional director positions will provide it with the
flexibility to identify and recruit key individuals whose industry knowledge and
expertise will benefit the Company by contributing to discussions as to whether
the Company should establish strategic relationships with other companies or
take any other proper corporate action. Furthermore, the proposed range of
authorized persons serving as directors offers the Board of Directors greater
flexibility in determining the size of the Board without further stockholder
approval, within the range set by the stockholders.
The Board of Directors believes that the proposed increase in the
number of directors will allow the Company to increase the number of outside
independent directors, which may serve to further legitimize the actions of the
Board of Directors and ensure that proposed corporate transactions are at
arm's-length. However, the proposed amendment to increase the size of the Board
of Directors could, under certain circumstances, have an anti-takeover effect,
although this is not the intention of this proposal. For example, in the event
of a hostile attempt to take over control of the Company, it may be easier for
the Company to impede the attempt with a larger Board since it would require
more directors to vote in favor of the take-over attempt. The Bylaw Amendment,
therefore, may have the effect of discouraging unsolicited takeover attempts. By
potentially discouraging initiation of any such unsolicited takeover attempt,
the proposed Amendment may limit the opportunity for the Company's stockholders
to dispose of their shares at the higher price generally available in takeover
attempts or that may be available under a merger proposal. The Board of
Directors is not, however, aware of any attempt to take control of the Company
and the Board of Directors has not presented this proposal with the intent that
it be utilized as a type of anti-takeover device.
INFORMATION RELATED TO BOTH ACTIONS
INTEREST OF CERTAIN PERSONS IN MATTERS TO BE ACTED UPON
None of our officers or directors, nor any of their associates, has a
substantial interest, direct or indirect, by security holdings or otherwise, in
either the Capital Stock Increase or the Bylaw Amendment.
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APPROVAL OF BOARD OF DIRECTORS
On July 25, 2005, our Board of Directors adopted resolutions
authorizing and approving the Amendments. The Board of Directors directed
management to submit the Amendments to our stockholders for approval and
reserved the right to abandon the Amendments at any time prior to the Effective
Time.
APPROVAL OF STOCKHOLDERS AND INFORMATION ABOUT THE MAJORITY GROUP
Under the Delaware General Corporation Law and our Bylaws, our
stockholders may approve the Amendments without a meeting, without prior notice
and without a vote if a written consent to the Amendments is signed by the
holders of outstanding shares having not less than the minimum number of votes
that would be necessary to authorize or take such action at a meeting at which
all shares entitled to vote on the action were present and voted (here, a
majority of the outstanding shares of Voting Stock).
On the Record Date we had approximately 199 stockholders of record (197
holders of Common Stock and 2 holders of voting Preferred Stock) holding an
aggregate of 8,622,978 (consisting of 4,819,942 shares of Common Stock and
3,803,036 shares of voting Preferred Stock) shares of Voting Stock. Of those
shares, approximately 72.56%, or 6,259,070 shares, were controlled by the
Majority Group. Of the Voting Stock, each holder of Common Stock is entitled to
one vote per share and each holder of voting Preferred Stock is entitled to the
number of votes that is represented by the number of shares of Common Stock that
such share of voting Preferred Stock would be convertible into as of the Record
Date. The proposed actions to implement the Amendments require the affirmative
vote or written consent of the holders of a majority of the outstanding shares
of our Voting Stock as of the Record Date. The Majority Group, which holds a
majority of our Voting Stock, approved the Amendments by written consent
effective as of August ___, 2005. Accordingly, no other stockholder approval is
required and is not being solicited in connection with the Amendments.
Information about the Majority Group that consented to the Amendments
and the number of shares of Voting Stock owned as of the Record Date and
included in the written consent approving the Amendments is as follows:
Number of Shares of
Name of Stockholder Voting Stock
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Silvano DiGenova
9478 West Olympic Blvd., Beverly Hills, California 1,908,264
90212
Stanford International Bank Limited
c/o Stanford Venture Capital Holdings, Inc. 4,350,806
6075 Poplar Avenue
Memphis, TN 38119
TOTAL: 6,259,070
ESTIMATED EFFECTIVE TIME
We anticipate that the COI Amendment will be filed with the Delaware
Secretary of State and the Capital Stock Increase will become effective on or
about August ___, 2005 ("Effective Time"). The Bylaw Amendment will also become
effective at the Effective Time. However, in no event will either Capital Stock
Increase or the Bylaw Amendment be consummated earlier than that twentieth day
after this information statement is sent or given to those persons or entities
that held Voting Stock as of the Record Date.
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DISSENTERS' RIGHTS OF APPRAISAL
The Delaware General Corporation Law does not provide for appraisal
rights in connection with either the increase of authorized shares of the
Company's capital stock or the increase in the number of the Company's
authorized directors.
WHERE YOU CAN FIND ADDITIONAL INFORMATION ABOUT THE COMPANY
The Company is subject to the information requirements of the Exchange
Act, and in accordance therewith files reports, proxy statements and other
information including annual and quarterly reports on Form 10-K and Form 10-Q
with the Securities and Exchange Commission ("SEC"). Reports and other
information filed by the Company can be inspected and copied at the public
reference facilities maintained at the SEC at 450 Fifth Street, N.W.,
Washington, DC 20549. Copies of such material can be obtained upon written
request addressed to the SEC, Public Reference Section, 450 Fifth Street, N.W.,
Washington, DC 20549, at prescribed rates. You may obtain information on the
operation of the SEC's Public Reference Room by calling the SEC at (800)
SEC-0330. The SEC also maintains a web site on the Internet (http://www.sec.gov)
where reports, proxy and information statements and other information regarding
issuers that file electronically with the SEC may be obtained free of charge.
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APPENDIX A
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CERTIFICATE OF AMENDMENT
OF
CERTIFICATE OF INCORPORATION
OF
SUPERIOR GALLERIES, INC.
SUPERIOR GALLERIES, INC. (hereinafter called the "Corporation"), a
corporation organized and existing under and by virtue of the General
Corporation Law of the State of Delaware, does hereby certify:
1. The name of the Corporation is SUPERIOR GALLERIES, INC.
2. The Certificate of Incorporation of the Corporation is hereby
amended by striking out Subparagraph A of Article VI thereof and by substituting
in lieu of said Subparagraph A of Article VI the following new Subparagraph A of
Article VI:
The Corporation is authorized to issue two classes of stock to be
designated, respectively, "Common Stock" and "Preferred Stock." The
total number of shares of capital stock the Corporation is authorized
to issue is Thirty Million (30,000,000) shares. Twenty Million
(20,000,000) shares shall be Common Stock, $0.001 par value per share,
and Ten Million (10,000,000) shares shall be Preferred Stock, $0.001
par value per share.
3. The amendment of the Certificate of Incorporation herein certified
has been duly adopted in accordance with the provisions of Section 228 and 242
of the General Corporation Law of the State of Delaware. Prompt written notice
of the adoption of the amendment herein certified has been given to those
stockholders who have not consented in writing thereto, as provided in Section
228 of the General Corporation Law of the State of Delaware.
Executed on this ___ day of August 2005.
/s/ Silvano DiGenova
---------------------------
Silvano DiGenova, President
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