SCHEDULE 14C
(Rule 14c-101)
INFORMATION REQUIRED IN INFORMATION STATEMENT
SCHEDULE 14C INFORMATION
Information Statement Pursuant to Section 14(c)
of the Securities Exchange Act of 1934
Check the appropriate box:
[ ] Confidential, for use of the Commission only
(as permitted by Rule 14c-5(d)(2))
[ ] Preliminary information statement
[X] Definitive information statement
REWARD ENTERPRISES, 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:
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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 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:
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(2) Form, Schedule or Registration Statement No.:
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(4) Date Filed:
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WE ARE NOT ASKING YOU FOR A PROXY
AND YOU ARE REQUESTED NOT TO SEND US A PROXY.
Definitive Information Statement
Dated: July 1, 2004
REWARD ENTERPRISES, INC.
2033 Main Street, Suite 500
Sarasota, Florida 34237
(941) 928-7394
INFORMATION STATEMENT
This information statement (the "Information Statement") is furnished
to the shareholders of Reward Enterprises, Inc., a Nevada corporation (the
"Company"), with respect to certain corporate actions of the Company. This
information is first being provided to shareholders on or about July 12, 2004.
The corporate action involves two (2) proposals (the "Proposals"):
1. To approve an amendment to the Company's Articles of
Incorporation to increase the authorized common stock, par
value $0.001 per share, of the Company from 200,000,000 shares
to 5,000,000,000 shares.
2. To approve an amendment to the Company's Articles of
Incorporation to authorize 10,000,000 shares of preferred
stock, par value $0.001 per share, of the Company.
ONLY THE COMPANY'S SHAREHOLDERS OF RECORD AT THE CLOSE OF BUSINESS ON JULY 1,
2004 (THE "RECORD DATE") ARE ENTITLED TO NOTICE OF THE PROPOSALS. PRINCIPAL
SHAREHOLDERS WHO, AS OF THE RECORD DATE, WILL COLLECTIVELY HOLD IN EXCESS OF 50%
OF THE COMPANY'S 44,165,000 ISSUED AND OUTSTANDING SHARES ENTITLED TO VOTE ON
THE PROPOSALS HAVE INDICATED THAT THEY WILL VOTE IN FAVOR OF THE PROPOSALS. AS A
RESULT, THE PROPOSALS SHOULD BE APPROVED WITHOUT THE AFFIRMATIVE VOTE OF ANY
OTHER SHAREHOLDERS OF THE COMPANY. THIS ACTION IS EXPECTED TO BE TAKEN NOT LESS
THAN TWENTY (20) DAYS FROM THE MAILING OF THIS INFORMATION STATEMENT, BUT AS
SOON THEREAFTER AS PRACTICABLE.
BY ORDER OF THE BOARD OF DIRECTORS
/s/ Earl Ingarfield
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Earl Ingarfield, President, Chief Executive Officer and Director
Sarasota, Florida
July 1, 2004
TABLE OF CONTENTS
Page No.
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ABOUT THE INFORMATION STATEMENT...................................................................................1
What is the purpose of the information statement?............................................................1
Who is entitled to notice?...................................................................................1
What corporate matters will the principal shareholders vote for and how will they vote?......................1
What vote is required to approve the proposals?..............................................................2
STOCK OWNERSHIP...................................................................................................3
Beneficial Owners............................................................................................3
PROPOSAL 1 - AMENDMENT TO THE ARTICLES OF INCORPORATION TO INCREASE THE COMPANY'S AUTHORIZED SHARES OF COMMON
STOCK.............................................................................................................4
Purpose of Increasing Number of Authorized Shares of Common Stock............................................4
PROPOSAL 2 - AMENDMENT TO THE ARTICLES OF INCORPORATION TO AUTHORIZE SHARES OF PREFERRED STOCK....................5
Purpose of Authorizing Shares of Preferred Stock.............................................................5
Description Of Securities....................................................................................6
General......................................................................................................6
Common Stock.................................................................................................6
Warrants.....................................................................................................6
Options......................................................................................................6
Dividends....................................................................................................6
Transfer Agent...............................................................................................6
Anti-Takeover Effects Of Provisions Of The Articles of Incorporation.........................................6
Additional Information.......................................................................................7
INTEREST OF CERTAIN PERSONS IN OR OPPOSITION TO MATTERS TO BE ACTED UPON..........................................7
PROPOSALS BY SECURITY HOLDERS.....................................................................................7
DELIVERY OF DOCUMENTS TO SECURITY HOLDERS SHARING AN ADDRESS......................................................7
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Reward Enterprises, Inc.
2033 Main Street, Suite 500
Sarasota, Florida 34237
(941) 928-7394
_____________________
INFORMATION STATEMENT
July 1, 2004
_____________________
This information statement contains information related to certain
corporate actions of Reward Enterprises, Inc., a Nevada corporation (the
"Company"), and is expected to be mailed to shareholders on or about July 12,
2004.
ABOUT THE INFORMATION STATEMENT
What is the purpose of the information statement?
This information statement is being provided pursuant to Section 14 of
the Securities Exchange Act of 1934 to notify the Company's shareholders as of
the close of business on the Record Date of corporate action expected to be
taken pursuant to the consents or authorizations of principle shareholders.
Shareholders holding a majority of the Company's outstanding common stock are
expected to act upon certain corporate matters outlined in this information
statement, which action is expected to take place August 6, 2004, consisting of
the approval of an amendment to the Company's Articles of Incorporation to
increase the authorized common stock to 5,000,000,000 shares and the
authorization of 10,000,000 shares of preferred stock.
Who is entitled to notice?
Each holder of an outstanding share of common stock of record on the
close of business on the Record Date, July 1, 2004, will be entitled to notice
of each matter to be voted upon pursuant to consents or authorizations.
Shareholders as of the close of business on the Record Date that hold in excess
of fifty percent (50%) of the Company's 44,165,000 issued and outstanding shares
of common stock have indicated that they will vote in favor of the Proposals.
Under Nevada corporate law, all the activities requiring shareholder approval
may be taken by obtaining the written consent and approval of more than 50% of
the holders of voting stock in lieu of a meeting of the shareholders. No action
by the minority shareholders in connection with the Proposals is required.
What corporate matters will the principal shareholders vote for and how will
they vote?
Shareholders holding a majority of the outstanding stock have indicated
that they will vote for the following matters:
o For the approval of an amendment to the Company's Articles of
Incorporation to increase the authorized shares of the
Company's common stock from 200,000,000 to 5,000,000,000
shares. (see page 4).
o For the approval of an amendment to the Company's Articles of
Incorporation to authorize 10,000,000 shares of the Company's
preferred stock. (see page 6).
1
What vote is required to approve the proposals?
Increase Authorized Shares of Common Stock. For the approval of an
amendment to the Company's Articles of Incorporation to increase the authorized
shares of the Company's common stock from 200,000,000 to 5,000,000,000, the
affirmative vote of a majority of the shares of common stock outstanding on the
Record Date, or 22,082,501, will be required for approval. Shareholders holding
in excess of 22,082,501 shares have indicated that they will vote for the
approval of the amendment.
Authorize shares of preferred stock. For the approval of an amendment
to the Company's Articles of Incorporation to authorize 10,000,000 shares of the
Company's preferred stock, the affirmative vote of a majority of the shares of
common stock outstanding on the Record Date, or 22,082,501, will be required for
approval. Shareholders holding in excess of 22,082,501 shares have indicated
that they will vote for the approval of the amendment.
2
STOCK OWNERSHIP
Beneficial Owners
As of July 1, 2004 the Record Date, other than the persons identified
below, no person owned beneficially more than five percent (5%) of the Company's
common stock. Unless otherwise indicated, beneficial ownership is direct and the
person indicated has sole voting and investment power. There are no other
classes or series of capital stock outstanding. As of July 1, 2004, the Company
had 44,165,000 shares of common stock outstanding.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
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AMOUNT AND NATURE
NAME AND OF BENEFICIAL PERCENTAGE OF
TITLE OF CLASS ADDRESS OF BENEFICIAL OWNER OWNERSHIP CLASS (1)
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Common Bell Investments, LLC(2) 23,000,000 52.1%
2033 Main Street - Suite 500
Sarasota, FL 34237
SECURITY OWNERSHIP OF MANAGEMENT
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AMOUNT AND NATURE
NAME AND OF BENEFICIAL PERCENTAGE OF
TITLE OF CLASS ADDRESS OF BENEFICIAL OWNER OWNERSHIP CLASS (1)
------------------------------------ --------------------------------------- ---------------------- ----------------
Common Earl Ingarfield(2) 23,000,000 52.1%
2033 Main Street - Suite 500
Sarasota, FL 34237
ALL OFFICERS AND DIRECTORS
AS A GROUP (1) PERSON 23,000,000 52.1%
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* Less than 1%.
(1) Applicable percentage of ownership is based on 44,165,000 shares of
common stock outstanding as of July 1, 2004 for each stockholder.
Beneficial ownership is determined in accordance within the rules of
the Commission and generally includes voting of investment power with
respect to securities. Shares of common stock subject to securities
exercisable or convertible into shares of common stock that are
currently exercisable or exercisable within 60 days of July 1, 2004 are
deemed to be beneficially owned by the person holding such options for
the purpose of computing the percentage of ownership of such persons,
but are not treated as outstanding for the purpose of computing the
percentage ownership of any other person.
(2) Earl Ingarfield is the Manager of Bell Investments, LLC, and has the
voting power and control over the 23,000,000 shares held by Bell
Investments, LLC. Mr. Ingarfield is the President, Chief Executive
Officer and sole Director of Reward Enterprises.
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PROPOSAL 1 - AMENDMENT TO THE ARTICLES OF INCORPORATION
TO INCREASE THE COMPANY'S AUTHORIZED SHARES OF COMMON STOCK
The Company's sole director proposes an amendment to the Company's
Articles of Incorporation to increase the number of authorized shares of common
stock, par value $0.001 per share, from 200,000,000 to 5,000,000,000 shares.
Purpose of Increasing Number of Authorized Shares of Common Stock
The Company's sole director believes that it is desirable to have
additional authorized shares of common stock available for possible future
financings, possible future acquisition transactions and other general corporate
purposes. The Company's sole director believes that having such additional
authorized shares of common stock available for issuance in the future should
give the Company greater flexibility and may allow such shares to be issued
without the expense and delay of a special shareholders' meeting. Although such
issuance of additional shares with respect to future financings and acquisitions
would dilute existing shareholders, the Company's sole director believes that
such transactions would increase the value of the Company to its shareholders.
The Company currently is not a party to any agreements or non-terminated letters
of intent, nor is the Company currently contemplating the issuance of any shares
of common stock for any future financing, any future acquisitions transactions
or other general corporate purposes.
The non-binding letter of intent entered into by the Company to acquire
all of the outstanding shares of common stock of Magna Yachts, Inc., a Canadian
corporation, in exchange for the issuance of 1,100,000,000 shares of the
Company's common stock to the current shareholders of Magna Yachts, Inc. was
terminated by the parties on April 28, 2004.
The amendment to the Company's Articles of Incorporation provides for
the authorization of 4,800,000,000 additional shares of the Company's common
stock. As of July 1, 2004, 44,165,000 shares of the Company's common stock were
issued and outstanding.
The amendment to the Company's Articles of Incorporation relating to
the increase in authorized shares of common stock shall be filed with the Nevada
Secretary of State so that Article VI of the Articles of Incorporation shall be,
in part, as follows:
ARTICLE SIX- AUTHORIZED SHARES
The Corporation shall have the authority to issue Five Billion
(5,000,000,000) shares of Common Stock, $.001 par value per
share....
There are certain advantages and disadvantages of voting for an
increase in the Company's authorized common stock. The advantages include:
o The ability to raise capital by issuing capital stock through
possible financing transactions, if any.
o To have shares of common stock available to pursue business
expansion opportunities, if any.
The disadvantages include:
o Dilution to the existing shareholders, including a decrease in
our net income per share in future periods. This could cause
the market price of our stock to decline.
4
PROPOSAL 2 - AMENDMENT TO THE ARTICLES OF INCORPORATION
TO AUTHORIZE SHARES OF PREFERRED STOCK
The Company's sole director proposes an amendment to the Company's
Articles of Incorporation to authorize 10,000,000 shares of preferred stock. The
power to determine the voting powers, designations, preferences, limitations,
restrictions and relative rights of each class or series of preferred stock
shall be vested with the board of directors under the proposed amendment.
Purpose of Authorizing Shares of Preferred Stock
The Company's sole director believes that it is also desirable to have
authorized shares of preferred stock available for possible future financings,
possible future acquisition transactions and other general corporate purposes.
The Company's sole director believes that having authorized shares of preferred
stock available for issuance in the future should give the Company greater
flexibility, as the voting powers, designations, preferences and rights of the
shares of preferred stock, as well as the issuance of such shares of preferred
stock may be established without the expense and delay of a special
shareholders' meeting. Although such issuance of preferred shares with respect
to future financings and acquisitions would dilute existing shareholders if the
shares are convertible into shares of common shares, the sole director believes
that such transactions would increase the value of the Company to its
shareholders. The Company currently is not a party to any agreements or
non-terminated letters of intent, nor is the Company currently contemplating the
issuance of any shares of preferred stock for any future financing, any future
acquisitions transactions or other general corporate purposes.
The amendment to the Company's Articles of Incorporation shall be filed
with the Nevada Secretary of State so that Article VI of the Certificate of
Incorporation shall be as follows:
ARTICLE SIX- AUTHORIZED SHARES
The Corporation shall have the authority to issue Five Billion
(5,000,000,000) shares of Common Stock, $.001 par value per
share and Ten Million (10,000,000) shares of Preferred Stock,
$.001 par value per share. The Board of Directors is expressly
vested the authority to determine and establish, from time to
time by duly adopted resolution, the voting powers,
designations, preferences, limitations, restrictions and
relative rights of each class or series of preferred stock.
There are certain advantages and disadvantages of voting for the
authorization of shares of preferred stock. The advantages include:
o The ability to raise capital by issuing preferred stock under
possible financing transactions, if any.
o To have shares of preferred stock available to pursue business
expansion opportunities, if any.
The disadvantages include:
o Dilution to the existing shareholders, which could cause the
market price of our stock to decline.
o The issuance of authorized but unissued preferred stock could
be used to deter a potential takeover of the Company that may
otherwise be beneficial to shareholders by diluting the shares
held by a potential suitor or issuing shares to a shareholder
that will vote in accordance with the desires of the Company's
Board of Directors, at that time. A takeover may be beneficial
to independent shareholders because, among other reasons, a
potential suitor may offer such shareholders a premium for
their shares of stock compared to the then-existing market
price. The Company does not have any plans or proposals to
adopt provisions or enter into agreements that may have
material anti-takeover consequences.
5
Description Of Securities
General
The Company's authorized capital consists of 200,000,000 shares of
common stock, par value $0.001 per share. At July 1, 2004, there were 44,165,000
outstanding shares of common stock and no authorized shares of preferred stock.
Set forth below is a description of certain provisions relating to the Company's
capital stock. For additional information, please refer to the Company's
Articles of Incorporation and By-Laws and the Nevada General Corporate Laws.
Common Stock
Each outstanding share of common stock has one vote on all matters
requiring a vote of the stockholders. There is no right to cumulative voting;
thus, the holder of fifty percent or more of the shares outstanding can, if they
choose to do so, elect all of the directors. In the event of a voluntary of
involuntary liquidation, all stockholders are entitled to a pro rata
distribution after payment of liabilities and after provision has been made for
each class of stock, if any, having preference over the common stock. The
holders of the common stock have no preemptive rights with respect to future
offerings of shares of common stock. Holders of common stock are entitled to
dividends if, as and when declared by the Board of Directors out of the funds
legally available therefore at that time. It is the Company's present intention
to retain earnings, if any, for use in its business. The payment of dividends on
the common stock are, therefore, unlikely in the foreseeable future.
Warrants
The Company has no outstanding warrants.
Options
The Company has no outstanding options.
Dividends
The Company has not declared or paid cash dividends on its common stock
since its inception and does not anticipate paying such dividends in the
foreseeable future. The payment of dividends may be made at the discretion of
the Board of Directors at that time and will depend upon, among other factors,
on the Company's operations, its capital requirements, and its overall financial
condition.
Transfer Agent
Transfer Agent and Registrar. The Company's transfer agent is Pacific
Stock Transfer Company, 500 East Warm Springs Road, Suite 240, Las Vegas, Nevada
89119. Its telephone number is (702) 361-3033.
Anti-Takeover Effects Of Provisions Of The Articles of Incorporation
Authorized And Unissued Stock. Authorized but unissued shares of common
stock and preferred stock would be available for future issuance without our
shareholders' approval. These additional shares may be utilized for a variety of
corporate purposes including but not limited to future public or direct
offerings to raise additional capital, corporate acquisitions and employee
incentive plans. The issuance of such shares may also be used to deter a
potential takeover of the Company that may otherwise be beneficial to
shareholders by diluting the shares held by a potential suitor or issuing shares
to a shareholder that will vote in accordance with the Company's Board of
Directors' desires at that time. A takeover may be beneficial to shareholders
because, among other reasons, a potential suitor may offer shareholders a
premium for their shares of stock compared to the then-existing market price.
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The existence of authorized but unissued and unreserved shares of
preferred stock may enable the Board of Directors at that time to issue shares
to persons friendly to current management, which would render more difficult or
discourage an attempt to obtain control of the Company by means of a proxy
contest, tender offer, merger or otherwise, and thereby protect the continuity
of the Company's management.
Additional Information
Incorporation by Reference. Certain financial and other information
required pursuant to Item 13 of the Proxy Rules is incorporated by reference to
the Company's Annual Report on Form 10-KSB for the year ended June 30, 2003, and
the Company's Quarterly Report on Form 10-QSB for the three months ended March
31, 2004, which are being delivered to the shareholders with this information
statement. In order to facilitate compliance with Rule 2-02(a) of Regulation
S-X, one copy of the definitive information statement will include a manually
signed copy of the accountant's report.
INTEREST OF CERTAIN PERSONS IN OR OPPOSITION TO MATTERS TO BE ACTED UPON
(a) No officer or director of the Company has any substantial interest
in the matters to be acted upon, other than his role as an officer or director
of the Company.
(b) As the Company currently has one director, no director of the
Company has informed the Company that he intends to oppose the proposed actions
to be taken by the Company set forth in this information statement.
PROPOSALS BY SECURITY HOLDERS
No security holder has requested the Company to included any proposals
in this information statement.
DELIVERY OF DOCUMENTS TO SECURITY HOLDERS SHARING AN ADDRESS
Only one information statement is being delivered to multiple security
holders sharing an address unless the Company has received contrary instructions
from one or more of the security holders. The Company shall deliver promptly
upon written or oral request a separate copy of the information statement to a
security holder at a shared address to which a single copy of the documents was
delivered. A security holder can notify the Company that the security holder
wishes to receive a separate copy of the information statement by sending a
written request to the Company at 2033 Main Street, Suite 500, Sarasota, Florida
34237; or by calling the Company at (941) 373-0171 and requesting a copy of the
Information Statement. A security holder may utilize the same address and
telephone number to request either separate copies or a single copy for a single
address for all future information statements and annual reports.
By Order of the Board of Directors
/s/ Earl Ingarfield
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Earl Ingarfield
President, Chief Executive Officer and Director
Sarasota, Florida
July 1, 2004
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