Unassociated Document
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:
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Preliminary
information statement
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Confidential,
for use of the Commission only
(as
permitted by Rule 14c-5(d)(2))
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x |
Definitive
information statement
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BRIGHTON
OIL & GAS, INC.
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(Name
of Registrant as Specified in Its Charter)
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Payment
of Filing Fee (Check the appropriate box):
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x
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No
fee required.
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o
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Fee
computed on table below per Exchange Act Rules 14c-5(g) and
0-11.
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(1)
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Title
of each class of securities to which transaction applies:
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(2)
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Aggregate
number of securities to which transaction applies:
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(3)
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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)
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Proposed
maximum aggregate value of transaction:
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(5)
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Total
fee paid:
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o
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Fee
paid previously with preliminary materials.
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o
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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.
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(1)
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Amount
Previously Paid:
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(2)
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Form,
Schedule or Registration Statement No.:
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(3)
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Filing
Party:
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(4)
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Date
Filed:
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INFORMATION
STATEMENT
BRIGHTON
OIL & GAS, INC.
15851
Dallas Parkway Suite 1990
Addison,
Texas 75001
(972)
450-5995
INFORMATION
STATEMENT
WE
ARE NOT ASKING FOR A PROXY AND YOU ARE REQUESTED NOT TO SEND US A
PROXY
This
information statement (the “Information Statement”) is furnished to the
shareholders of BRIGHTON OIL & GAS, INC., a Nevada corporation (the
“Company”), with respect to certain corporate actions of the Company. This
Information statement is first being provided to shareholders on or about
November 5, 2007.
The
corporate action involves the following proposals (the “Proposal”):
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1.
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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 100,000,000 shares to 300,000,000
shares.
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2.
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To
ratify the implantation of a ten-for-one reverse split of the Company's
common stock.
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ONLY
THE
COMPANY’S SHAREHOLDERS OF RECORD AT THE CLOSE OF BUSINESS ON OCTOBER 23, 2007
(THE “RECORD DATE”) ARE ENTITLED TO NOTICE OF THE PROPOSAL. PRINCIPAL
SHAREHOLDERS WHO, AS OF THE RECORD DATE, WILL COLLECTIVELY HOLD IN EXCESS OF
50%
OF THE COMPANY’S 92,019,000 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/
Charles L. Stidham
Charles
L. Stidham
Chief
Executive Officer
Dallas,
Texas
October
24, 2007
BRIGHTON
OIL & GAS, INC.
15851
Dallas Parkway Suite 1990
Addison,
Texas 75001
(972)
450-5995
INFORMATION
STATEMENT
November
5, 2007
This
information statement contains information related to certain corporate actions
of Brighton Oil & Gas, Inc., a Nevada corporation (the “Company”), and is
expected to be mailed to shareholders on or about November 5, 2007.
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 principal 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 November 26, 2007, consisting of the approval of
an
amendment to the Company’s Articles of Incorporation to increase the authorized
common stock to 300,000,000 and to ratify the implementation of a ten-for-one
reverse split of the Company's common 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, October 23, 2007, 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 92,019,000 issued and outstanding shares
of common stock have indicated that they will vote in favor of the Proposal.
Under Nevada Corporate Law, all of 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 matter:
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 100,000,000 to
300,000,000 shares.
FOR
the
ratification and approval of a ten-for-one reverse stock split of the Company's
common stock.
What
vote is required to approve the proposals?
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 10,000,000 to
30,000,000 and to ratify the reverse stock split, the affirmative vote of a
majority of the shares of common stock outstanding on the record date, or
46,009,501 will be required for approval. Shareholders holding in excess of
50,000,000 shares have indicated that they will vote for the approval of the
Proposals.
SECURITY
OWNERSHIP OF CERTAIN
BENEFICIAL
OWNERS AND MANAGEMENT
The
table
below sets forth certain information with respect to beneficial ownership of
our
stock as of October 23, 2007 by:
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persons
known by us to be the beneficial owners of more than five percent
of our
issued and outstanding Common or Preferred
Stock;
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each
of our executive officers and directors;
and
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all
of our officers and directors as a
group.
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NAME
AND ADDRESS
OF
BENEFICIAL OWNER
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NUMBER
OF SHARES
OWNED
(1)
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PERCENT
OF
OWNERSHIP*
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K
& D Equity Investments, Inc.
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50,000,000
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54.34
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15851
Dallas Parkway Ste. 1990
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Addison
TX 75001
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Charles
Stidham (2)
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0
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0.00
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15851
Dallas Parkway Ste. 1990
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Addison,
TX 75001
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Robert
Barbee (2)
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0
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0.00
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15851
Dallas Parkway Ste. 1990
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Addison
TX 75001
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Michele
A. Sheriff (2)
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0
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0.00
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15851
Dallas Parkway Ste. 1990
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Addison
TX 75001
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R.
Wayne Duke (2)
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0
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0.00
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15851
Dallas Parkway Ste. 1990
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Addison
TX 75001
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All
officers and directors as a group
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0
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0.00
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(4
persons)
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(1)
Pre-split
(2)
Officer and/or director
*
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Applicable
percentage of ownership is based on 92,019,000 shares of common stock
outstanding as of October 23, 2007 for each stockholder. Beneficial
ownership is determined in accordance with the rules of the SEC 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 October 23, 2007 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.
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PROPOSAL
ONE - AMENDMENT TO THE ARTICLES OF INCORPORATION
The
Company’s directors propose 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 100,000,000 to 300,000,000 shares.
Purpose
of Increasing the Company’s Authorized Shares of Common
Stock
General
Corporate Purposes
The
Company’s directors believe that it is desirable to have additional authorized
shares of common stock available for other possible future financings, possible
future acquisition transactions, stock dividends, stock splits and other general
corporate purposes. The Company’s directors believe 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, management believes that such transactions
would increase the value of the Company to its shareholders.
Amendment
of Articles of Incorporation
The
amendment to the Company’s Articles of Incorporation provides for the
authorization of 100,000,000 additional shares of the Company’s common stock. As
of October 23, 2007, 92,019,000 shares of the Company’s common stock were issued
and outstanding.
The
amendment to the Company’s Articles of Incorporation shall be filed with the
Nevada Secretary of State so that Article IV of the Articles of
Incorporation shall be changed as follows:
“4.1
Authorized Capital. The aggregate number of shares of all classes which the
corporation shall have authority to issue is 310,000,000 shares of which
300,000,000 shall be Common Shares, $.001 par value per share and 10,000,000
shall be Preferred Shares, $.01 par value per share, and the designations,
preferences, limitations and relative rights of the shares of each class are
as
follows:”
Advantages
and Disadvantages of Increasing Authorized Shares
There
are
certain advantages and disadvantages of voting for an increase in the Company’s
authorized common stock. The advantages include:
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The
ability to raise capital by issuing capital stock under the transaction
described above, or other financing
transactions.
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To
have shares of common stock available to pursue business expansion
opportunities, if any.
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The
disadvantages include:
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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.
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The
issuance of authorized but unissued 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.
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Description
Of Securities
General
The
Company’s authorized capital consists of 100,000,000 shares of common stock, par
value $0.001 per share and 10,000,000 shares of preferred stock, par value
$.01.
On October 23, 2007, there were 92,019,000 outstanding shares of common stock
and no shares of preferred stock outstanding. 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 Revised Statutes.
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.
The
Company has 10,000,000 authorized shares of preferred stock with a par value
of
$0.01 per share, issuable in such series, bearing such voting, dividend,
conversino, liquidation and other rights and preferences as the Board of
Directors may determine. No shares of preferred stock are currently issued
or
outstanding.
Dividends
There
are
no restrictions on the common stock or otherwise that limit the ability of
us to
pay cash dividends if declared by the Board of Directors. The holders of common
stock are entitled to receive dividends if and when declared by the Board of
Directors, out of funds legally available therefore and to share pro-rata in
any
distribution to the shareholders. Generally, we are not able to pay dividends
if
after payment of the dividends, we would be unable to pay our liabilities as
they become due or if the value of our assets, after payment of the liabilities,
is less than the aggregate of our liabilities and stated capital of all classes.
We do not anticipate declaring or paying any cash dividends in the foreseeable
future.
Transfer
Agent
The
Company’s transfer agent is Empire Stock Transfer, Inc. Its address is 2470 St.
Rose Parkway, Suite 304, Henderson, Nevada 89074; its telephone number is (702)
818-5898.
Anti-Takeover
Effects Of Provisions Of The Articles of Incorporation
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.
Additional
Information
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 December 31, 2006, and the Company’s Quarterly Report on Form
10-QSB for the six months ended June 30, 2007, 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.
PROPOSAL
TWO - THE REVERSE SPLIT
INTRODUCTION
On
October 8, 2007, our Board of Directors approved a proposal to effect a reverse
split of our Common Stock, subject to the approval of our shareholders. The
reverse split, as approved, would combine our outstanding Common Stock on 1
for
10 basis. In other words, once the reverse split takes place, every 10 shares
of
Common Stock that you hold will be combined into one (1) share. Your percentage
ownership in the Company and relative voting power will remain essentially
unchanged.
REASONS
FOR THE REVERSE SPLIT
We
expect
that we will have to raise additional equity capital in the near future in
order
to finance the development and growth of our business. We cannot promise that
any offering of our securities will take place or will be successful, but we
believe that reducing the number of outstanding shares and increasing the number
of authorized and unissued shares will make our capital structure more
attractive to potential investors and provide us with greater flexibility in
structuring financings and pursuing other corporate development
opportunities.
Further,
we believe that our current low stock price negatively affects the marketability
of our existing shares and our ability to raise additional capital. Although
we
cannot guarantee it, we assume that the reverse split will increase the market
price of our stock in a direct inverse proportion to the reverse split ratio.
In
other words, with a reverse split ratio of 1 to 10, the assumption is that
the
market price of our stock should increase by 10 times following the reverse
split. Based upon our stock’s closing bid price of $.115 on October 23, 2007,
then, if every 10 shares of Common Stock were combined into one share, the
initial adjusted market value would be expected to increase to approximately
$1.15 per share.
Finally,
we are hopeful that the reverse split and the resulting anticipated increased
price level will encourage interest in our Common Stock and possibly promote
greater liquidity for our shareholders. Again, however, we cannot guarantee
that
this will be the case or, indeed, that any of the foregoing hoped-for effects
will result from the reverse split.
CERTAIN
EFFECTS OF THE REVERSE SPLIT
The
following table illustrates the principal effects of the reverse split on our
Common Stock based on the number of shares authorized, issued and outstanding
as
of October 23, 2007.
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Prior
to the
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After
the
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After
Approval
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Number
of Shares
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Reverse
Split
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Reverse
Split
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of
Add’t Stock
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Authorized
Common Stock
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100,000,000
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100,000,000*
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300,000,000
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Issued
and Outstanding
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Common
Stock
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92,019,000
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9,201,900
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9,201,900
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Common
Stock Available
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for
Issuance
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7,981,000
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90,798,100
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290,978,100
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*
Before
giving effect to the proposed increase in authorized capital from 100,0000
shares to 300,000,000 shares.
Shares
of
Common Stock issued pursuant to the reverse split will be fully paid and
nonassessable. The relative voting and other rights of holders of the Common
Stock will not be altered by the reverse split, and each share of Common Stock
will continue to entitle its owner to one vote.
As
a
result of the reverse split, the number of shares of Common Stock presently
outstanding will be consolidated. Accordingly, we will have the ability to
issue
more shares of Common Stock than is presently the case and without additional
shareholder approval. Doing so may have a dilutive effect on the equity and
voting power of our existing shareholders.
No
fractional shares will be issued in connection with the reverse split. Instead,
fractional shares will be rounded up and one whole share will be issued. We
expect that most shareholders will receive one additional share of Common Stock,
but we do not anticipate that this will materially affect any shareholder’s
proportional interest. We do not anticipate that the reverse split will result
in any material reduction in the number of holders of Common Stock.
The
reverse split may result in some shareholders owning “odd-lots” of less than 100
shares of Common Stock. Brokerage commissions and other costs of transactions
in
odd-lots are generally somewhat higher than the costs of transactions in round
lots of even multiples of 100 shares.
The
reverse split will not affect the Company’s stockholders’ equity as reflected on
our financial statements, except to change the number of issued and outstanding
shares of Common Stock.
CERTAIN
FEDERAL INCOME TAX CONSEQUENCES
Following
is a summary of the material anticipated federal income tax consequences of
the
proposed reverse split. This summary is based upon existing law which is subject
to change by legislation, administrative action and judicial decision, and
is
necessarily general. In addition, this summary does not address any consequence
of the reverse split under any state, local or foreign tax laws. Accordingly,
this summary is not intended as tax advice to any person or entity, and we
advise you to consult with your own tax advisor for more detailed information
relating to your individual tax circumstances.
We
understand that the reverse split will be a “recapitalization” under applicable
federal tax laws and regulations. As a result of such tax treatment, no gain
or
loss should be recognized by the Company or our shareholders as a result of
the
reverse split or the exchange of pre-reverse split shares for post-reverse
split
shares. A shareholder’s aggregate tax basis in his or her post-reverse split
shares should be the same as his or her aggregate tax basis in the pre-reverse
split shares. In addition, the holding period of the post-reverse split shares
received by such shareholder should include the period during which the
pre-reverse split shares were held, provided that all such shares were held
as
capital assets in the hands of the shareholder at the time of the
exchange.
EFFECTIVE
DATE OF THE REVERSE SPLIT
If
the
proposal is approved by the shareholders, the reverse split will become
effective immediately, pending proper notification to the regulators and the
securities markets. Upon proper regulatory notification, all of our outstanding
Common Stock will be converted into new Common Stock in accordance with the
reverse split ratio described above. After the reverse split is effective,
certificates representing shares of pre-reverse split Common Stock will be
deemed to represent only the right to receive the appropriate number of shares
of post-reverse split Common Stock.
EXCHANGE
OF CERTIFICATES
You
are
not being asked to exchange your certificates at this time, however, you are
entitled to do so after the reverse split takes place if you wish by contacting
our transfer agent. Otherwise, certificates representing pre-reverse split
shares will changed for certificates reflecting post-split shares at the first
time they are presented to the transfer agent for transfer.
RIGHT
TO ABANDON REVERSE SPLIT
Although
we do not anticipate doing so, we may abandon the proposed reverse split at
any
time prior to its effectiveness if our Board of Directors deems it advisable
to
do so. Any decision as to the appropriateness of the reverse split will be
made
by solely our Board of Directors and will depend upon numerous factors including
the future trading price of our stock, the growth and development of our
business and our financial condition and results of operations.
VOTE
REQUIRED
We
are
required to obtain the affirmative vote of at least a majority of the shares
that are present or represented at the meeting in order to effect the reverse
split. Certain officers, directors and affiliates of the Company who
beneficially own an aggregate of approximately 56% of the outstanding common
votes have already voted their shares in favor of the reverse
split.
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) No
director of the Company has informed the Company that he intends to oppose
the
proposed action to be taken by the Company set forth in this information
statement.
PROPOSALS
BY SECURITY HOLDERS
No
security holder has requested the Company to include 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 13355 Noel Road, Dallas, Texas 75240 or by calling the Company at
(972) 386-4644 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.
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By
Order of the Board of Directors
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/s/
Charles L. Stidham
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Charles
L. Stidham
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Chief
Executive Officer
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Dallas,
Texas
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October
24, 2007
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