SCHEDULE 14C INFORMATION
Information Statement Pursuant to Section 14 (c)
of the Securities Exchange Act of 1934 (Amendment No.)
Check the appropriate box:
[X] Amended Preliminary Information Statement
[ ] Confidential, for Use of the Commission Only
(as permitted by Rule 14c-5 (d)(2))
[ ] Definitive Information Statement
M POWER ENTERTAINMENT, INC.
(Name of Registrant As Specified In 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 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
2) Form, Schedule or Registration Statement No:
3) Filing Party:
4) Date Filed:
THIS INFORMATION STATEMENT IS BEING PROVIDED TO
YOU BY THE BOARD OF DIRECTORS OF THE COMPANY
WE ARE NOT ASKING YOU FOR A PROXY AND YOU ARE
REQUESTED NOT TO SEND US A PROXY
M POWER ENTERTAINMENT, INC.
2602 Yorktown Place
Houston, Texas 77056
INFORMATION STATEMENT
June __, 2006
GENERAL INFORMATION
This Information Statement has been filed with the Securities and Exchange
Commission and is being furnished, pursuant to Section 14C of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), to the holders (the
"Stockholders") of the common stock, par value $0.001 per share (the "Common
Stock"), of M Power Entertainment, Inc., a Delaware Corporation (the
"Company"), to notify such Stockholders that on or about May 22, 2006, the
Company received written consents in lieu of a meeting of Stockholders from
from the shareholders holding 1,000 shares of Series D Preferred Stock issued
and outstanding. The shares of Series D Preferred Stock give the holder, Gary
Kimmons, the right to vote on all shareholder matters equal to fifty-one (51%)
percent of the total vote ("Majority Stockholder"). approving the Amended
Articles of Incorporation of the Company (the "Amendment"), pursuant to which
the maximum number of shares of stock that the Company shall be authorized to
have outstanding at any time shall be increased to one billion (1,000,000,000)
shares of common stock at par value of $0.001.
On May 22, 2006, the Board of Directors of the Company approved the Amendment,
subject to Stockholder approval. The Majority Stockholder approved the
Amendment by written consent in lieu of a meeting on May 22, 2006 in
accordance with the Delaware Business Corporation Act. Accordingly, your
consent is not required and is not being solicited in connection with the
approval of the Amendments.
WE ARE NOT ASKING YOU FOR A PROXY AND YOU ARE REQUESTED NOT TO SEND A PROXY.
The Amendment to the Company's Certificate of Incorporation amended the number
of shares of stock that the Company shall be authorized to have outstanding at
any time shall be one billion (1,000,000,000) shares of common stock at par
value of $0.001 with no preemptive rights. The form of Certificate of
Amendment that will be filed with the Delaware Secretary of State is attached
hereto as Exhibit A.
The entire cost of furnishing this Information Statement will be borne by the
Company. The Company will request brokerage houses, nominees, custodians,
fiduciaries and other like parties to forward this Information Statement to
the beneficial owners of the Common Stock held of record by them and will
reimburse such persons for their reasonable charges and expenses in connection
therewith. The Board of Directors has fixed the close of business on June 2,
2006 as the record date (the "Record Date") for the determination of
Stockholders who are entitled to receive this Information Statement.
You are being provided with this Information Statement pursuant to Section 14C
of the Exchange Act and Regulation 14C and Schedule 14C thereunder, and, in
accordance therewith, the Amendment will not be filed with the Secretary of
State of the State of Delaware or become effective until at least 20 calendar
days after the mailing of this Information Statement.
This Information Statement is being mailed on or about June 23, 2006 to all
Stockholders of record as of the Record Date.
1
ADDITIONAL INFORMATION
The Company is subject to the informational requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and in accordance
therewith files reports, proxy statements and other information including
annual and quarterly reports on Form 10-KSB and 10-QSB (the "1934 Act
Filings") with the Securities and Exchange Commission (the "Commission").
Reports and other information filed by the Company can be inspected and copied
at the public reference facilities maintained at the Commission at Room 1580,
100 F Street, NE, Washington, DC 20549. Copies of such material can be
obtained upon written request addressed to the Commission, Public Reference
Section, 100 F Street, NE, Washington, D.C. 20549, at prescribed rates. The
Commission maintains a web site on the Internet (http://www.sec.gov) that
contains reports, proxy and information statements and other information
regarding issuers that file electronically with the Commission through the
Electronic Data Gathering, Analysis and Retrieval System ("EDGAR").
The following documents as filed with the Commission by the Company are
incorporated herein by reference:
1. Quarterly Reports on Form 10-QSB for the quarters ended March 31, 2005;
June 30, 2005; September 30, 2005; and March 31, 2006
2. Annual Report on Form 10-KSB for the year ended December 31, 2005.
OUTSTANDING VOTING SECURITIES
As of the date of the Consent by the Majority Stockholder, May 22, 2006, the
Company had 59,753,458 shares of Common Stock issued and outstanding, and
there were 1,000 shares of Series D Preferred Stock issued and outstanding.
Each share of outstanding Common Stock is entitled to one vote on matters
submitted for Stockholder approval. The shares of Series D Preferred Stock
give the holder, Gary Kimmons, the right to vote on all shareholder matters
equal to fifty-one (51%) percent of the total vote.
On May 22, 2006, the holder the 1,000 shares of Series D Preferred Stock
executed and delivered to the Company a written consent approving the
Amendment. Since the Amendment has been approved by the Majority Stockholder,
no proxies are being solicited with this Information Statement.
The DGCL 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 stock having not less than the minimum number of votes that would
be necessary to take such action at a meeting at which all shares entitled to
vote thereon were present.
SECURITY OWNERSHIP OF
CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth certain information regarding the Company's
common stock owned on May 22, 2006 by each person who is known by the Company
to own beneficially more than 5% of its outstanding Common Stock:
Name and Address Amount and Nature of Percent of
Title Of Class of Beneficial Owner Beneficial Ownership(1) Class (2)
- --------------- -------------------- ---------------------- -------------
Common Gary F. Kimmons (3) 13,115,742 21.94%
Common Kathryn Kimmons (4) 13,115,742 21.94%
Common Dick Meador (5) 306,260 Less than 1%
Officers and Directors
as a Group (3 persons) 13,422,002 22.46%
2
(1) All amounts shown in this column include shares obtainable upon exercise
of stock options or warrants currently exercisable or exercisable within
60 days of the date of this table.
(2) Based on 59,753,458 shares issued and outstanding as of May 22, 2006.
(3) Mr. Kimmons is a general partner of the Kimmons Family Partnership, Ltd.,
and as such has the sole voting, investment and disposition power over the
33,633 shares of our common stock owned by the partnership. Mr. Kimmons is
deemed to own 13,115,742 shares as follows: (a)13,064,106 shares owned of
record by Mr. Kimmons, (b) 33,636 of these shares owned of record by the
Kimmons Family Partnership, Ltd., by virtue of Mr. Kimmons being the
General Partner of the Kimmons Family Partnership, Ltd., (c) 3,000 of
these shares by virtue of warrants to purchase these shares, and (d)
15,000 of these shares by virtue of options to purchase these shares
(options to purchase 15,000 of these shares have already vested.)
(4) Mrs. Kimmons is deemed to have indirect beneficial ownership of these
shares, as the spouse of Gary F. Kimmons.
(5) Mr. Meador is deemed to own 304,500 of these shares by virtue of a warrant
to purchase these shares.
The address of all persons listed above is 2602 Yorktown Place, Houston, Texas
77056.
Preferred Shareholder Table
Name and Address Amount and Nature of Percent of
Title Of Class of Beneficial Owner Beneficial Ownership(1) Class (2)
- -------------- -------------------- ----------------------- ---------
Series D
Preferred Gary F. Kimmons 1,000 100%
The address of all persons listed above is 2602 Yorktown Place, Houston, Texas
77056.
DISSENTER'S RIGHTS OF APPRAISAL
The Stockholders have no right under the DGCL, the Company's articles of
incorporation consistent with above or By-Laws to dissent from any of the
provisions adopted in the Amendments.
AMENDMENT TO CERTIFICATE OF INCORPORATION
TO INCREASE THE NUMBER OF AUTHORIZED SHARES
OF COMMON STOCK FROM 250,000,000 TO 1,000,000,000
The Company's Articles of Incorporation, as amended (the "Articles of
Incorporation") authorizes the maximum number of shares outstanding at any
time shall be two hundred fifty (250,000,000) shares of Common Stock. On May
22, 2006, the Board of Directors approved an amendment to the Articles of
Incorporation to authorize one billion (1,000,000,000) shares of Common Stock.
The Board of Directors is authorized to fix the number of shares of and to
determine or alter the rights, preferences, privileges and restrictions
granted to or imposed upon the Common Stock. On May 22, 2006, the holders of a
majority of the outstanding shares of Common Stock approved the amendment by
written consent.
Specifically, the increase in authorized shares is necessary based upon the
recent financing completed by the Company. The Company will be filing a Form
SB-2 registration statement with the SEC to register a total of 655,000,000
shares of common stock in accordance with a Securities Purchase Agreement
dated April 18, 2006 between the Company and AJW Partners, LLC, AJW Offshore,
Ltd., AJW Qualified Partners, LLC and New Millenium Capital Partners II, LLC,
respectively. Secured convertible promissory notes (the "Notes") and warrants
to purchase 30,000,000 shares of our common stock (the "Warrants") were issued
pursuant to the Securities Purchase Agreement. In accordance with the
Securities Purchase Agreement, the Company is required to register (i) 225% of
the estimated amount of shares of common stock issuable in connection with the
conversion of the Notes; and (ii) the shares underlying issuable in connection
with exercise of the warrants. The amount of common shares to register
(655,000,000 shares of common stock) was calculated as follows:
3
The aggregate principal amount of the Notes is two million dollars
($2,000,000). The estimated conversion price of the Notes is $.0072 based on
the following: $.012 was the closing stock price prior to the closing date of
the transaction, less a 40% discount. Thus, at a price-per-share of $.0072,
277,777,777 shares of the Company's common stock would be issuable upon
conversion of $2,000,000 into common shares of the Company ("Conversion
Shares"). The Securities Purchase Agreement requires us to register 225% of
the Conversion Shares, which equals approximately 625,000,000 shares of common
stock. In addition, the Company is also required to register 30,000,000
shares of the Company's common stock underlying the Warrants. Thus, a total
of 655,000,000 of our common stock would be issuable upon conversion of the
Notes and Warrants ("Total Issuable Shares").
After the additional shares are used for the specific financing purpose set
forth above, the general purpose and effect of the amendment to the Company's
Articles of Incorporation in authorizing 750,000,000 additional shares of
Common Stock will be to use such additional shares of common stock for general
corporate purposes, including equity financings, stock dividends,
stock splits or other recapitalizations, and grants of stock options. When the
Board of Directors deem it to be in the best interests of the Company and the
Stockholders to issue additional shares of Common Stock in the future from
authorized shares, the Board of Directors generally will not seek further
authorization by vote of the Stockholders, unless such authorization is
otherwise required by law or regulations.
The additional authorized shares of Common Stock could have an anti-takeover
effect. If the Company's Board of Directors desires to issue additional shares
in the future, such issuance could dilute the voting power of a person seeking
control of the Company, thereby deterring or rendering more difficult a
merger, tender offer, proxy contest or an extraordinary corporate transaction
opposed by the Company.
EFFECTIVE DATE OF AMENDMENT
Pursuant to Rule 14c-2 under the Exchange Act, the filing of the Amendment to
the Certificate of Incorporation with the Delaware Secretary of State or the
effective date of such filing, shall not occur until a date at least twenty
(20) days after the date on which this Information Statement has been mailed
to the Stockholders. The Company anticipates that the actions contemplated
hereby will be effected on or about the close of business on June 22, 2006.
By Order of the Board of Directors
/s/ Gary F. Kimmons
Gary F. Kimmons
President, Chief Executive Officer & Director
/s/ Dick Meador
Dick Meador
Director
/s/ Kathryn Kimmons
Director
4
Exhibit A
STATE OF DELAWARE
CERTIFICATION OF AMENDMENT
OF CERTIFICATE OF INCORPORATION
OF
M POWER ENTERTAINMENT, INC.
A corporation organized and existing under and by virtue of the General
Corporation Law of the State of Delaware.
DOES HEREBY CERTIFY:
FIRST: That at a meeting of the Board of Directors of M Power
Entertainment, Inc. resolutions were duly adopted setting forth a proposed
amendment of the Certificate of Incorporation of said corporation, declaring
said amendment to be advisable and calling a meeting of the stockholders of
said corporation for consideration thereof. The resolution setting forth the
proposed amendment is as follows:
RESOLVED, that the Certificate if Incorporation of this corporation
be amended by changing the Article thereof numbered "Fourth" so
that, as amended, said Article shall be and read as follows:
The total number of shares of stock which the corporation shall have
authority to issue is one billion (1,000,000,000) shares. The par
value of each of such shares is one one-tenth of one cent ($0.001)
dollars. The board of Directors is expressly vested with the
authority to fix the voting powers, full or limited, or no voting
powers, and such designations, preferences and relative,
participating, optional or other special rights, and qualifications,
limitations or restrictions on any shares issued by the corporation.
SECOND: That thereafter, pursuant to resolution of its Board of
Directors, a special meeting of the stockholders of said corporation was duly
called and held upon notice in accordance with Section 222 of the General
Corporation Law of the State of Delaware at which meeting the necessary number
of shares as required by statute were voted in favor of the amendment.
THIRD: That said amendment was duly adopted in accordance with the
provisions of Section 242 of the General Corporation Law of the State of
Delaware.
FOURTH: That the capital of said corporation shall not be reduced under
or by reason of said amendment.
IN WITNESS WHEREOF, said M Power Entertainment, Inc. has caused this
certificate to be signed by Gary F. Kimmons, an Authorized Officer, this
day of June, 2006.
By: /s/ Gary F. Kimmons
Authorized Officer
Title: President
Name: Gary F. Kimmons
Print or type