SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 14C
INFORMATION
Proxy Statement Pursuant to Section 14(c) of
the Securities
Exchange Act of 1934
Filed by the Registrant [
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Filed by a Party other than
the Registrant
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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]
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Definitive Information Statement
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Definitive Additional Materials
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MCTC HOLDINGS, INC.
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(Name of Registrant as Specified in its Charter)
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WE ARE NOT ASKING YOU FOR A PROXY AND YOU ARE REQUESTED
NOT TO SEND US A PROXY.
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(Name of Person(s) Filing Information Statement, if other than the Registrant)
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Fee computed on table below per Exchange Act Rules 14c-5(g) and 0-11.
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Aggregate number of securities to which transaction applies:
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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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Proposed maximum aggregate value of transaction:
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Amount Previously Paid:
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Form, Schedule or Registration Statement No.:
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Persons who are to respond to the collection of information contained in this form are not required to respond unless the form displays a currently valid OMB control number.
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Contact Person:
Mailander Law
Office, Inc.
Tad Mailander
945 4
th
Avenue, Ste. 311
San Diego, CA
92101
(619) 239-9034
MCTC HOLDINGS,
INC.
520 S. Grand
Avenue, Suite 320
Los Angeles,
CA 90071
(310) 986-4929
__________
WE ARE NOT
ASKING YOU FOR A PROXY
AND YOU ARE
NOT REQUESTED TO SEND US A PROXY
__________
NOTICE OF
ACTION TAKEN BY UNANIMOUS WRITTEN CONSENT OF
THE
BOARD OF DIRECTORS, AND MAJORITY VOTE OF 70.7% OF THE
STOCKHOLDERS
ELIGIBLE TO VOTE ON JULY 3, 2019.
To
the Stockholders of MCTC HOLDINGS, INC.:
The enclosed
Definitive Information Statement is being distributed and published to the holders of record of common stock, par value $0.0001
per share (“Common Stock”), of MCTC Holdings, Inc., a Delaware corporation (the “Company” or “we”)
as of the close of business on July 10, 2019 (the “Mailing Record Date”) under Rule 14c-2 of the Securities Exchange
Act of 1934, as amended (the “Exchange Act”). The purpose of the enclosed Definitive Information Statement is to inform
our stockholders of action taken by written consent by the holders of a majority of our outstanding voting stock pursuant to Title
8, Chapter 1, § 242(a)(1)(3), and § 242(b)(1)(2) of the Delaware General Corporation Law, and, Article II Sections 3(d),
5, 7 and 8 of the Company’s By-laws,. The enclosed Definitive Information Statement shall be considered the notice required
under Section 228 of the Delaware General Corporation Law.
The following
actions were authorized, by written consent, by holders of a majority of our outstanding voting stock on July 3, 2019, (the “Written
Consent”):
-
an amendment to the Company’s
Certificate of Incorporation (the “Certificate of Amendment”) to: (i) approve a reverse stock split of the Company’s
outstanding Common Stock at a ratio of 1-for-15; (ii) decrease the Company’s authorized Common Stock from 290,000,000 shares,
par value $0.0001 to 19,333,333 shares, par value $0.0015; and, (iii) a corresponding amendment to the Company’s Certificate
of Incorporation, after the reverse stock split, to increase the Company’s authorized shares to 300,000,000 shares, consisting
of 290,000,000 shares of Common Stock, $0.0001 par value. The Company’s 10,000,000 shares of authorized but undesignated
Preferred Stock, $0.0001 par value, is not affected by this Certificate of Amendment.
The Written
Consent constitutes the only stockholder approval required under the Delaware General Corporation Law, our Certificate of Incorporation
and Bylaws to approve the Certificate of Amendment. No consents or proxies are being requested from stockholders, and our Board
of Directors is not soliciting your consent or your proxy in connection with these actions. Pursuant to Rule 14c-2 under the Exchange
Act, the Certificate of Amendment, as approved in the Written Consent, will not become effective until at least 20 calendar days
after the enclosed Definitive Information Statement is first mailed or otherwise published to our stockholders entitled to receive
notice thereof. The Company anticipates that the amendments discussed above will be effected on or about the close of business
on or about August 31, 2019, subject to regulatory review by FINRA and the SEC, which could affect the effective date. The Company
will advise shareholders of any amended effective date by press release and filing of Form 8-K with the SEC.
THIS IS NOT A
NOTICE OF A SPECIAL MEETING OF STOCKHOLDERS, AND NO STOCKHOLDER MEETING WILL BE HELD TO CONSIDER ANY MATTER DESCRIBED HEREIN.
Important Notice
Regarding the Availability of Information Statement Materials in Connection with this Notice of Written Consent: We will furnish
a copy of this Definitive Information Statement, without charge, to any stockholder upon written request to the following address:
520 South Grand Avenue, Ste. 320, Los Angeles, CA 90071, Attention: Chief Financial Officer.
By Order of the Board of Directors,
/s/
Arman Tabatabaei
Principal Executive Officer
Los Angeles, CA
August 15, 2019
MCTC HOLDINGS,
INC.
520 S. Grand
Avenue, Suite 320
Los Angeles,
CA 90071
(310) 986-4929
__________________________________________
DEFINITIVE
INFORMATION STATEMENT
_____________________________________
WE ARE
NOT ASKING YOU FOR A CONSENT OR PROXY AND
YOU ARE
REQUESTED NOT TO SEND US A CONSENT OR PROXY.
INFORMATION STATEMENT PURSUANT TO
SECTION 14C OF THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED
THIS IS NOT
A NOTICE OF A SPECIAL MEETING OF STOCKHOLDERS AND NO STOCKHOLDER MEETING WILL BE HELD TO CONSIDER ANY MATTER DESCRIBED HEREIN.
THE ACTIONS DESCRIBED IN THIS INFORMATION STATEMENT HAVE BEEN APPROVED BY HOLDERS OF A MAJORITY OF OUR COMMON STOCK. WE ARE NOT
ASKING YOU FOR A PROXY AND YOU ARE REQUESTED NOT TO SEND US A PROXY. THERE ARE NO DISSENTERS’ RIGHTS WITH RESPECT TO THE
ACTIONS DESCRIBED IN THIS INFORMATION STATEMENT.
This Information Statement advises
stockholders of MCTC Holdings, Inc. (the “Company “) of:
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an
amendment to the Company’s Certificate of Incorporation (the “Certificate
of Amendment”) to: (i) approve a reverse stock split of the Company’s outstanding
Common Stock at a ratio of 1-for-15; (ii) decrease the Company’s authorized Common
Stock from 290,000,000 shares, par value $0.0001 to 19,333,333 shares, par value $0.0015;
and, (iii) a corresponding amendment to the Company’s Certificate of Incorporation,
after the reverse stock split, to increase the Company’s authorized shares to 300,000,000
shares, consisting of 290,000,000 shares of Common Stock, $0.0001 par value. The Company’s
10,000,000 shares of authorized but undesignated Preferred Stock, $0.0001 par value is
not affected by this Certificate of Amendment.
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Our Board of
Directors approved the Certificate of Amendment on July 3, 2019 (the Certificate of Amendment is referred to herein as the “Amendment”)
and approved close of markets on July 10, 2019 as the record date for determining shareholders eligible to vote to approve the
Amendment (the “Voting Record Date”). The Amendment was subsequently approved, by written consent, by stockholders
holding a majority of our outstanding voting Common Stock on the Voting Record Date (the “Written Consent”). Copies
of the substantive text of the Certificate of Amendment is attached to this Information Statement as Exhibit A.
The Amendment
will not become effective until 20 calendar days after the enclosed Information Statement is first mailed or otherwise delivered
to our stockholders as of the Mailing Record Date. The Certificate of Amendment will only become effective upon the filing of
the Certificate of Amendment with the Delaware Secretary of State, which filing will occur no less than 20 days after the date
of the mailing of this Information Statement to our stockholders. Copies of this Information Statement will be mailed to the holders
of record as of July 10, 2019 of the outstanding shares of the Company’s Common Stock.
AUTHORIZATION BY THE BOARD OF DIRECTORS
AND THE MAJORITY STOCKHOLDERS
Under the Delaware
General Corporation Law and the Company’s Bylaws, any action that can be taken at an annual or special meeting of stockholders
may be taken without a meeting, without prior notice and without a vote if the holders of outstanding stock having not less than
the minimum number of votes necessary to authorize or take such action at a meeting at which all shares entitled to vote thereon
were present and voted consent to such action in writing. As the holders of the Company’s Common Stock are entitled to vote
on such matters, approval of the Amendment required the approval of a majority of the Company’s outstanding voting rights.
On the Voting Record Date, the Company had 183,864,600 shares of common stock issued and outstanding with the holders thereof
being entitled to cast one vote per share. The written consent was executed by Robert L. Hymers (43,333,334 shares of common stock
– 23.35% voting rights; Edward Manolos (43,333,333 shares of common stock – 23.35%) and Dan Nguyen (43,333,333 shares
of common stock – 23.35%), who together held 70.07% of the Company’s outstanding voting stock as of the Voting Record
Date.
We have obtained
all necessary corporate approvals in connection with the Amendment. We are not seeking written consents from any other stockholder,
and the other stockholders will not be given an opportunity to vote with respect to the actions described in this Definitive Information
Statement. This Definitive Information Statement is furnished solely for the purposes of advising stockholders of the action approved
by the Written Consent and giving stockholders notice of the Amendment as required by the Delaware General Corporation Law and
the Exchange Act.
As the Amendment
was approved by the Written Consent, there will be no stockholders’ meeting, and representatives of the principal accountants
for the current year and for the most recently completed fiscal year will not have the opportunity to make a statement if they
desire to do so and will not be available to respond to appropriate questions from our stockholders.
DESCRIPTION OF
THE COMPANY’S CAPITAL STOCK
General
The Company’s
authorized capital stock currently consists of a total of 300,000,000 shares of Common Stock: 290,000,000 shares of Common Stock,
$0.0001 par value per share, and 10,000,000 shares of preferred stock, $0.0001 par value per share (the “Preferred Stock”).
As of July 10, 2019, there were: (i) 183,864,600 outstanding shares of Common Stock; and (ii) no shares of preferred stock outstanding.
No proposal or action of the Company concerns the Preferred Stock authorized by the Company’s Articles of Incorporation.
Common Stock
As of July 10,
2019, there were 183,864,600 shares of Common Stock outstanding. Holders of the Common Stock are entitled to one vote for each
share held on all matters submitted to a vote of the Company’s stockholders. Holders of Common Stock are entitled to receive
ratably any dividends that may be declared by the Board out of legally available funds, subject to any preferential dividend rights
of any outstanding Preferred Stock. Upon the Company’s liquidation, dissolution or winding up, the holders of Common Stock
are entitled to receive ratably the Company’s net assets available after the payment of all debts and other liabilities
and subject to the prior rights of any outstanding Preferred Stock. Holders of Common Stock have no preemptive, subscription,
redemption or conversion rights. The outstanding shares of Common Stock are fully paid and nonassessable. The rights, preferences
and privileges of holders of Common Stock are also subject to, and may be adversely affected by, the rights of holders of shares
of any series of Preferred Stock which the Company may designate and issue in the future without further stockholder approval.
Preferred Stock
The Board is
currently authorized, without further stockholder approval, to issue from time to time up to an aggregate of 10,000,000 shares
of Preferred Stock in one or more series and to fix or alter the designations, preferences, rights, qualifications, limitations
or restrictions of the shares of each series, including the dividend rights, dividend rates, conversion rights, voting rights,
term of redemption including sinking fund provisions, redemption price or prices, liquidation preferences and the number of shares
constituting any series or designations of such series without further vote or action by the stockholders. The issuance of Preferred
Stock may have the effect of delaying, deferring or preventing a change in control of management without further action by the
stockholders and may adversely affect the voting and other rights of the holders of Common Stock. The issuance of Preferred Stock
with voting and conversion rights may adversely affect the voting power of the holders of Common Stock, including the loss of
voting control to others.
Vote Obtained
– Title 8 Section 228 of the Delaware General Corporation Law
Section 228
of the Delaware General Corporation Law provides that any action required to be taken at any annual or special meeting of stockholders
of a corporation, or any action which may be taken at any annual or special meeting of such stockholders, may be taken without
a meeting, without prior notice and without a vote, if a consent or consents in writing, setting forth the action so taken, shall
be signed by the holders of outstanding 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 thereon were present and voted.
To eliminate
the costs and management time involved in soliciting and obtaining proxies to approve the Actions and to effectuate the Actions
as early as possible to accomplish the purposes of the Company as hereafter described, the Board of Directors of the Company voted
to utilize, and did in fact obtain, the written consent of the holders of a majority of the voting power of the Company. The consenting
shareholders, all of which are officers and directors of the Company, and their respective approximate ownership percentage of
the voting stock of the Company as of the Voting Record Date, which total in the aggregate 70.07% of the outstanding voting stock,
are as follows: Robert L. Hymers (43,333,334 shares of common stock – 23.35% voting rights; Edward Manolos (43,333,333 shares
of common stock – 23.35%) and Dan Nguyen (43,333,333 shares of common stock – 23.35%).
Pursuant to
Section 228(e) of the Delaware General Corporation Law, the Company is required to provide prompt notice of the taking of the
corporate action without a meeting by less than unanimous written consent to those stockholders who have not consented in writing
and who, if the action had been taken at a meeting, would have been entitled to notice of the meeting. This Definitive Information
Statement is intended to provide such notice. This Definitive Information Statement is being distributed pursuant to the requirements
of Section 14(c) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) to the Company’s stockholders
on the Record Date. The corporate action described herein will be effective approximately 20 days (the “20-day Period”)
after the mailing or publication of this Definitive Information Statement. The 20-day Period is expected to conclude on or about
August 31, 2019.
The entire cost
of furnishing this Definitive Information Statement will be borne by the Company.
ACTION ONE
AMENDMENT
TO OUR CERTIFICATE OF INCORPORATION
Reverse Stock
Split
General
On July 3, 2019,
the Board of Directors of the Company approved, declared it advisable and in the Company’s best interest, and directed that
there be submitted to the holders of a majority of the Company’s common stock for approval, the prospective amendment to
the Company’s Articles of Incorporation to effect a 1-for-15 reverse split of the Company’s Common Stock (the “Reverse
Stock Split”). On July 3, 2019, stockholders of the Company owning a majority of the Company’s outstanding voting
stock (the “Majority Stockholders”) approved the Reverse Stock Split by written consent, in lieu of a special meeting
of the stockholders.
Effects of
Reverse Split
The corporate
action provides for the combination of our presently issued and outstanding shares of Common Stock into a smaller number of shares
of identical Common Stock. This is known as a “reverse stock split.” Under the proposal, each fifteen (15) shares
of our presently issued and outstanding Common Stock as of the close of business on the effective date of the approved director’s
resolution will be converted automatically into one (1) share of our post-reverse stock split Common Stock. Each fractional share
shall be rounded up to the nearest whole share and that the holders of lots that are less than 100 shares be rounded up to round
lots of 100 shares.
Each stockholder
will hold the same percentage of our outstanding Common Stock immediately following the reverse stock split as he or she did immediately
prior to the reverse stock split, except for adjustments required due to the treatment of fractional shares. The Reverse Split
does not change the number of authorized shares of Preferred Stock.
Common
Stock
Pre-Split Outstanding
Shares
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Post-Split Outstanding
Shares
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183,864,600
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12,457,640
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Reasons for the Reverse Stock
Split
The primary purposes of the reverse
stock split are to:
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Increase
the per share price of our Common Stock;
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Provide
the Company with the flexibility to issue additional shares to facilitate future acquisitions
and financings.
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The reduction
in the number of issued and outstanding shares of Common Stock to result from the reverse stock split is expected to increase
the market price of the Common Stock to a level above the current market trading price. While the Board believes that the shares
of Common Stock will trade at higher prices than those which have prevailed in the recent past, there can be no assurance that
such increase in the trading price will occur or, if it does occur, that it will equal or exceed the direct arithmetical result
of the reverse stock split because there are numerous factors and contingencies which could affect our market price.
The Company’s
Common Stock is currently quoted on the OTC Market Groups, Inc. “Current Information Pink Tier” under the symbol “MCTC.”
A higher per share price for the Common Stock may enable the Company to meet minimum bid price criteria for initial listing of
the Common Stock on a national securities exchange at such time as we implement our future business plans. Because trading of
our Common Stock is conducted in the over-the-counter market, an investor could find it more difficult to dispose of, or to obtain
accurate quotations as to the market value of, the Common Stock. In addition, because the Common Stock is not listed on a national
securities exchange and presently trades at less than $5.00 per share, trading in our Common Stock is subject to the requirements
of certain rules promulgated under the Exchange Act, which require additional disclosure by brokers or dealers in connection with
any trades involving a stock defined as a “penny stock.” Because our Common Stock is presently classified as a “penny
stock,” prior to effectuating any transaction in our Common Stock, a broker or dealer is required to make a suitability
determination as to the proposed purchaser of our Common Stock and to receive a written agreement, meeting certain requirements.
The additional burdens imposed upon brokers or dealers by such requirements could discourage brokers or dealers from effecting
transactions in our Common Stock, which could limit the market liquidity of our Common Stock and the ability of investors to trade
our Common Stock.
The Board believes
that the Reverse Stock Split also could result in a broader market for our Common Stock than the current market. Many institutional
investors are unwilling or unable due to investment restrictions to invest in companies whose stock trades at less than $5.00
per share. Many investment advisors are subject to internal restrictions on their ability to recommend stocks trading at less
than $5.00 per share because of a general presumption that such stocks may be highly speculative. In addition, stocks trading
at less than $5.00 per share may not be marginable under the internal policies of some investment firms. The reverse stock split
is anticipated to result in a price increase for our Common Stock relieving, to some extent, the effect of such limitations on
the market for our Common Stock. Additionally, brokerage commissions on the sale of lower priced stocks often represent a higher
percentage of the sales price than commissions on relatively higher priced stocks. The expected increase in trading price may
also encourage interest and trading in our Common Stock and possibly promote greater liquidity for our stockholders. We also believe
that the current per share price of our Common Stock has or may have a negative effect on our ability to use our Common Stock
in connection with possible future transactions such as financings, strategic alliances, acquisitions and other uses not presently
determinable. However, there can be no assurances that the reverse stock split will have the desired consequences.
Effects of the Reverse Stock Split
The reverse
stock split will be effected and will be effective upon a date on or after the expiration of the 20-day Period after the mailing
or publication of this Definitive Information Statement. The 20-day Period is expected to conclude on or about August 31, 2019,
subject to regulatory approval by FINRA and the SEC, which could delay the effective date of the corporate action.
Adoption of
the reverse stock split will reduce the shares of Common Stock outstanding on the record date. The effect of the reverse split
upon holders of Common Stock will be that the total number of shares of our Common Stock held by each stockholder will be automatically
converted into the number of whole shares of Common Stock equal to the number of shares of Common Stock owned immediately prior
to the reverse stock split divided by fifteen (15), adjusted for any fractional shares. Each of our stockholders will continue
to own shares of Common Stock and will continue to share in the assets and future growth of the Company as a stockholder. Each
fractional share shall be rounded up to the nearest whole share and that the holders of lots that are less than 100 shares be
rounded up to round lots of 100 shares. Each stockholder’s percentage ownership interest in the Company and proportional
voting power will change due to adjustments for fractional shares.
Post-Split
Increase in Authorized Shares
Concurrent with
the effectiveness of the reverse stock split, the Company’s Majority Stockholders approved a Certificate of Amendment to
increase the number of to increase the authorized shares of the Company to 300,000,000 shares, consisting of 290,000,000 shares
of Common Stock, $0.0001 par value, and 10,000,000 shares of authorized but undesignated Preferred Stock, $0.0001 par value.
Reasons for
the Post-Effective Increase in Authorized Shares
The resulting
reduction in the number of issued and outstanding shares of common stock, and the corresponding increase in the number of authorized
shares after effectiveness of the reverse stock split, will provide the Company with additional authorized but unissued Common
Stock which could be utilized for future asset acquisitions or to otherwise raise funds to help build the Company's business objectives.
Anti-Take
Over Effects of the Reverse Stock Split
The effective
decrease and post-effective increase in our authorized shares, could potentially be used by management to thwart a take-over attempt,
or allow management to remain intact, since after the closing of the reverse stock split, Messrs. Hymers, Manolos and Nguyen will
constitute a majority of the Company’s board of directors and its major stockholders controlling approximately 70.7% of
the total number of issued and outstanding shares of the Company. The foregoing, when considered with the over-all effects of
the completion of reverse stock split by the Company, might render it more difficult or discourage a merger, tender offer or proxy
contest, or the removal of incumbent management. The proposal could make the accomplishment of a merger or similar transaction
more difficult, even if it may appear beneficial to some shareholders.
Neither the
Company’s articles nor its by-laws presently contain any provisions having anti-takeover effects and this proposal is not
a plan by management to adopt a series of amendments to the Company’s charter or by-laws to institute an anti-takeover provision.
The Company does not have any plans or proposals to adopt other provisions or enter into other arrangements that may have material
anti-takeover consequences.
The advantage
of the reverse stock split and post-effective increase in our authorized shares, includes permitting the Company to pursue financing
from investors, acquire assets, and issue shares of common stock in exchange for possible financing. The main disadvantage to
the reverse stock split is that it may have an anti-takeover effect and discourage any potential mergers or tender offers.
No Dissenters Rights
In connection
with the approval of the Reverse Split, shareholders of the Company will not have a right to dissent and obtain payment for their
shares under the Delaware General Corporation Law, the Articles of Incorporation or Bylaws.
Accounting Matters
The Reverse
Split will not affect the par value of the Company’s Common Stock. As a result, on the effective date of the Reverse Split
approved by the Company’s Board of Directors, the stated capital on the Company’s balance sheet attributable to Common
Stock would be increased from then current amount by a factor that equals the Reverse Split ratio, and the additional paid-in
capital account would be debited with the amount by which the stated capital is increased. The per share net income or loss and
net book value per share will be increased because there will be less shares issued and outstanding.
Tax Consequences to Common Stockholders
The following
discussion sets forth the material United States federal income tax consequences that the Company’s management believes
will apply with respect to the Company and the shareholders of the Company who are United States holders at the effective time
of the Reverse Split. This discussion does not address the tax consequences of transactions effectuated prior to or after the
Reverse Split, including, without limitation, the tax consequences of the exercise of options, warrants or similar rights to purchase
stock. For this purpose, a United States holder is a shareholder that is: (i) a citizen or resident of the United States, (ii)
a domestic corporation, (iii) an estate whose income is subject to United States federal income tax regardless of its source,
or (iv) a trust if a United States court can exercise primary supervision over the trust’s administration and one or more
United States persons are authorized to control all substantial decisions of the trust. This discussion does not describe all
of the tax consequences that may be relevant to a holder in light of his particular circumstances or to holders subject to special
rules (such as dealers in securities, financial institutions, insurance companies, tax-exempt organizations, foreign individuals
and entities and persons who acquired their Common Stock as compensation). In addition, this summary is limited to shareholders
who hold their Common Stock as capital assets. This discussion also does not address any tax consequences arising under the laws
of any state, local, or foreign jurisdiction. Accordingly, each shareholder is strongly urged to consult with a tax adviser to
determine the particular federal, state, local or foreign income or other tax consequences to such shareholder related to any
Reverse Split.
The Reverse
Split is intended to be a tax-free recapitalization to the Company and its stockholders, except for those stockholders who receive
shares of Common Stock in lieu of a fractional share. Stockholders will not recognize any gain or loss for federal income tax
purposes as a result of the Reverse Split, except for those stockholders receiving shares of Common Stock in lieu of a fractional
share (as described herein). The holding period for shares of Common Stock after the Reverse Split will include the holding period
of shares of Common Stock before the Reverse Split, provided that such shares of Common Stock are held as a capital asset at the
effective time of the Amendment. The adjusted basis of the shares of Common Stock after the Reverse Split will be the same as
the adjusted basis of the shares of Common Stock before the Reverse Split, excluding the basis of fractional shares. A stockholder
who receives shares of Common Stock in lieu of a fractional share generally may recognize gain in an amount not to exceed the
excess of the fair market value of such shares over the fair market value of the fractional share to which the stockholder was
otherwise entitled.
THIS SUMMARY
IS NOT INTENDED AS TAX ADVICE TO ANY PARTICULAR PERSON. IN PARTICULAR, AND WITHOUT LIMITING THE FOREGOING, THIS SUMMARY ASSUMES
THAT THE SHARES OF COMMON STOCK ARE HELD AS “CAPITAL ASSETS” AS DEFINED IN THE CODE, AND DOES NOT CONSIDER THE FEDERAL
INCOME TAX CONSEQUENCES TO THE COMPANY’S STOCKHOLDERS IN LIGHT OF THEIR INDIVIDUAL INVESTMENT CIRCUMSTANCES OR TO HOLDERS
WHO MAY BE SUBJECT TO SPECIAL TREATMENT UNDER THE FEDERAL INCOME TAX LAWS (SUCH AS DEALERS IN SECURITIES, INSURANCE COMPANIES,
FOREIGN INDIVIDUALS AND ENTITIES, FINANCIAL INSTITUTIONS AND TAX EXEMPT ENTITIES). IN ADDITION, THIS SUMMARY DOES NOT ADDRESS
ANY CONSEQUENCES OF ANY REVERSE SPLIT UNDER ANY STATE, LOCAL OR FOREIGN TAX LAWS. THE STATE AND LOCAL TAX CONSEQUENCES OF ANY
REVERSE SPLIT MAY VARY AS TO EACH STOCKHOLDER DEPENDING ON THE STATE IN WHICH SUCH STOCKHOLDER RESIDES.
AS A RESULT,
IT IS THE RESPONSIBILITY OF EACH STOCKHOLDER TO OBTAIN AND RELY ON ADVICE FROM HIS, HER OR ITS TAX ADVISOR AS TO, BUT NOT LIMITED
TO, THE FOLLOWING: (A) THE EFFECT ON HIS, HER OR ITS TAX SITUATION OF ANY FORWARD SPLIT, INCLUDING, BUT NOT LIMITED TO, THE APPLICATION
AND EFFECT OF STATE, LOCAL AND FOREIGN INCOME AND OTHER TAX LAWS; (B) THE EFFECT OF POSSIBLE FUTURE LEGISLATION OR REGULATIONS;
AND (C) THE REPORTING OF INFORMATION REQUIRED IN CONNECTION WITH ANY REVERSE SPLIT ON HIS, HER OR ITS OWN TAX RETURNS. IT WILL
BE THE RESPONSIBILITY OF EACH STOCKHOLDER TO PREPARE AND FILE ALL APPROPRIATE FEDERAL, STATE, LOCAL, AND, IF APPLICABLE, FOREIGN
TAX RETURNS.
Tax Consequences for the Company
The Company should not recognize
any gain or loss as a result of the Reverse Split.
Fractional Shares
We will not
issue fractional certificates for post-reverse split shares in connection with the reverse split. To the extent any holders of
pre-reverse split shares are entitled to fractional shares as a result of the reverse stock split, each fractional share shall
be rounded up to the nearest whole share and that the holders of lots that are less than 100 shares be rounded up to round lots
of 100 shares.
Share Certificate Transfer Instructions
The Company
anticipates that the reverse split will become effective on [Date], or as soon thereafter as is practicable, which we will refer
to as the "effective date." Beginning on the effective date, each certificate representing pre-reverse split shares
will be deemed for all corporate purposes to evidence ownership of post-reverse split shares.
Our transfer
agent, Pacific Stock Transfer Company 6725 Via Austi Pkwy, Suite 300, Las Vegas NV 89119, will act as exchange agent for purposes
of implementing the exchange of stock certificates. Holders of pre-reverse split shares may choose to surrender to the exchange
agent certificates representing pre-reverse split shares in exchange for certificates representing post-reverse split shares.
Until a stockholder forwards a completed letter of transmittal, together with certificates representing such stockholder’s
shares of pre-Reverse Split Common Stock to the transfer agent and receives in return a certificate representing shares of post-Reverse
Split Common Stock, such stockholder’s pre-Reverse Split Common Stock shall be deemed equal to the number of whole shares
of post-Reverse Split Common Stock to which such stockholder is entitled as a result of the Reverse Split.
DISTRIBUTION
AND COSTS
We will pay
the cost of preparing and publishing this Definitive Information Statement. Only one Information Statement will be published to
multiple stockholders sharing an address, unless contrary instructions are received from one or more of such stockholders. Upon
receipt of a written request at the address noted above, we will deliver a single copy of this Definitive Information Statement
and future stockholder communication documents to any stockholders sharing an address to which multiple copies are now published.
SECURITY
OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following
table sets forth, as of July 10, 2019, certain information with respect to our equity securities owned of record or beneficially
by (i) each of our Officers and Directors; (ii) each person who owns beneficially more than 5% of each class of our outstanding
equity securities; and (iii) all Directors and Executive Officers as a group.
Common Stock
|
|
|
|
|
Title of Class
|
|
Name and
Address of
Beneficial Owner
(3)
|
|
Amount and
Nature
of
Beneficial Ownership
(4)
|
|
|
Percent
of
Class
(1)
|
|
|
|
|
|
|
|
|
|
|
Common Stock
|
|
Robert L. Hymers
(1,2)
|
|
|
43,333,334
|
|
|
23.35%
|
|
|
|
|
|
|
|
|
|
|
|
Common Stock
|
|
Edward Manolos
(1,2)
|
|
|
43,333,333
|
|
|
23.35%
|
|
|
|
|
|
|
|
|
|
|
|
Common Stock
|
|
Dan Nguyen
(1,2)
|
|
|
43,333,333
|
|
|
23.35
|
|
Common Stock
|
|
All Directors and Officers
|
|
|
139,000,000
|
|
|
70.07%
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
Unless otherwise indicated, based
on 183,864,600 shares of common stock issued and outstanding as of July 10, 2019. Shares of common stock subject to options
or warrants currently exercisable, or exercisable within 60 days, are deemed outstanding for purposes of computing the percentage
of the person holding such options or warrants, but are not deemed outstanding for the purposes of computing the percentage
of any other person.
|
(2)
|
Indicates one of our officers or
directors.
|
(3)
|
Unless
indicated otherwise, the address of the shareholder is 520 S. Grand Avenue, Ste. 320, Los Angeles, CA 90071.
|
(4)
|
For purposes of this Definitive Information Statement, “beneficial
ownership” of securities is defined in accordance with Rule 13d-3 of the Securities and Exchange Commission. A beneficial
owner is generally defined as: Any person who directly or indirectly, through any contract, arrangement, understanding, relationship,
or otherwise, has or shares voting power which includes the power to vote, or to direct the voting of such security; and/or
investment power which includes the power to dispose, or to direct the disposition of, such security; and, Any person who,
directly or indirectly, creates or uses a trust, proxy, power of attorney, pooling arrangement or any other contract, arrangement,
or device with the purpose of effect of divesting such person of beneficial ownership of a security or preventing the vesting
of such beneficial ownership as part of a plan or scheme to evade the reporting requirements of section 13(d) or (g) of the
Act.
|
We are not aware
of any person who owns of record, or is known to own beneficially, five percent or more of the outstanding securities of any class
of the issuer, other than as set forth above. We are not aware of any person who controls the issuer as specified in Section 2(a)(1)
of the 1940 Act. There are no classes of stock other than common stock issued or outstanding. We do not have an investment advisor.
There are no
current arrangements which will result in a change in control.
DELIVERY
OF DOCUMENTS TO SECURITY HOLDERS SHARING AN ADDRESS
We will only
deliver one Definitive Information Statement to multiple stockholders sharing an address, unless we have received contrary instructions
from one or more of the stockholders. Also, we will promptly deliver a separate copy of this Definitive information statement
and future stockholder communication documents to any stockholder at a shared address to which a single copy of this Definitive
Information Statement was published, or deliver a single copy of this Definitive Information Statement and future stockholder
communication documents to any stockholder or stockholders sharing an address to which multiple copies are now published, upon
written request to us at our address noted above. Stockholders may also address future requests regarding delivery of information
statements and/or annual reports by contacting us at the address noted above.
WHERE YOU
CAN FIND MORE INFORMATION
We file annual,
quarterly and special reports, proxy statements and other information with the SEC. The periodic reports and other information
we have filed with the SEC, may be inspected and copied at the SEC’s Public Reference Room at 100 F Street, N.E., Washington
DC 20549. You may obtain information as to the operation of the Public Reference Room by calling the SEC at 1-800-SEC-0330. The
SEC also maintains a Web site that contains reports, proxy statements and other information about issuers, like the Company, who
file electronically with the SEC. The address of that site is www.sec.gov. Copies of these documents may also be obtained by writing
our secretary at the address specified above.
Dated: August
15, 2019 MCTC HOLDINGS, INC.
By:
/s/
Arman Tabatabaei
Arman
Tabatabaei
Principal
Executive Officer
Exhibit
A
MINUTES OF ACTION AND CONSENT IN LIEU OF A SPECIAL
MEETING OF
THE SHAREHOLDERS OF MCTC HOLDINGS, INC
The undersigned, being shareholders of MCTC
Holdings, Inc., a Delaware corporation (the "Corporation"), in lieu of a special meeting of the Shareholders of the Corporation,
do hereby adopt the following resolutions to be effective as of the 24
th
day of July, 2019:
Revocation of Name Change Authorization
The shareholders of the Corporation revoke their
previous consent dated July 3, 2019 authorizing the change of the Corporation’s name to Cannabis Global, Inc. and the application
for a new trading symbol. The shareholder affirm the remainder of its July 3, consent, including authorization of a 1 for 15 reverse
stock split of the Corporation’s common stock, as follows:
Approval of Reverse Stock Split
BE IT RESOLVED, That the undersigned shareholders
of the Corporation hereby approve and authorize the effectuation of a 1 for 15 reverse stock split of the Corporation's common
stock for all shareholders of record as of July 10, 2019.
FURTHER RESOLVED, That in order to give effect
to the aforementioned stock split, a Certificate of Amendment be filed with the Delaware Secretary of State providing: (a) that
the authorized shares of common stock be 290,000,000, $0.0001 par value prior to the reverse split; (b) that authorized shares
of common stock be 19,333,333, $0.0015 par value after the reverse split; (c) that the number of shares affected will be one (1)
share of common stock for each fifteen (15) shares of common stock issued and outstanding and any rights to acquire the same; (d)
each fractional share shall be rounded up to the nearest whole share and that the holders of lots that are less than 100 shares
be rounded up to round lots of 100 shares; (collectively, the "Reverse stock Split').
Approval of Amendment to Certificate of Incorporation
FURTHER RESOLVED, That, immediately following
the Reverse Split, the undersigned shareholders of the Corporation hereby approve and authorize the filing of a Certificate of
Amendment with the Delaware Secretary of State providing for the amendment of the Corporation's Certificate of Incorporation amending
and replacing the first and fourth articles with the following:
"FOURTH"
(a) Authorization of Capital Stock. The aggregate
number of shares of stock which the Corporation shall have the authority to issue is Three Hundred Million (300,000,000) shares,
consisting of Two Hundred Ninety Million (290,000,000) shares of common stock, $0.0001 par value (the "Common Stock''), and
Ten Million (10,000,000) shares of authorized but undesignated preferred stock, $0.0001 par value (the "Preferred Stock"),
The Board of Directors is authorized to establish, from the authorized but undesignated shares of Preferred Stock, one or more
classes or series of shares, to designate each such class and series, and fix the rights and preferences of each such class of
Preferred Stock; which class or series shall have such voting powers (full or limited or no voting powers), such preferences, relative,
participating, optional or other special rights, and such qualifications, limitations or restrictions as shall be stated and expressed
in the resolution or resolutions providing for the issue of such class or series of Preferred Stock as may be adopted from time
to time by the Board of Directors prior to the issuance of any shares thereof. Except as provided in the resolution or resolutions
of the Board of Directors creating any series of Preferred Stock, the shares of Common Stock shall have the exclusive right to
vote for the election and removal of directors and for all other purposes. Each holder of Common Stock shall be entitled to one
vote for each share held.
FURTHER RESOLVED, at such time as that Corporation
has submitted the requisite documents and other information to the Financial Information Regulatory Authority. ("FINRA")
to process the Corporate Actions, that the proper officers of the Corporation be and hereby are authorized and directed to execute
on the Corporation's behalf the Certificate of Amendment in the form required by the Secretary of State of Delaware with such effective
date as the President of the Corporation deems appropriate, and be it
FURTHER RESOLVED, that in conjunction with the
Reverse Split, the Corporation is authorized to obtain a new CUSIP number for the Corporation's common stock; and be it
FURTHER RESOLVED, that the Board of Directors
shall direct and empower the officers of the Corporation, and each acting alone is, hereby authorized to do and perform any and
all such acts, including execution of any and all documents and certificates, as such officers shall deem necessary or advisable,
to carry out the purposes and intent of the foregoing resolutions, including but not limited to making the necessary filing of
the Amendment to the Corporation's Certificate of Incorporation with the Delaware Secretary of State, the filing of Form 8-K and
14C with the U.S. Securities & Exchange Commission, and the Corporate Action Notification with the Financial Industry Regulatory
Authority.
IN WITNESS WHEREOF, the undersigned, being shareholders
of the Corporation have executed this written action, setting forth the number of shares of the Corporation held, the entirety
of which shall be deemed to have been voted in favor of the foregoing resolutions as though they were present and voted at a meeting
of the shareholders. Before executing and delivering these Minutes of Action, the undersigned hereby acknowledges that he/she has
been given an opportunity to and has asked any questions he/she may have of the Corporation's management and has received answers
that are satisfactory to the undersigned.
SHAREHOLDERS Common Stock
/s/ Robert Leslie Hymers, III
43,333,334 common shares
Dated: July 24, 2019
/s/ Edward Manolos
43,333,333 common shares
Dated: July 24, 2019
/s/ Dan Van Nguyen
43,333,333 common shares
Dated: July 24, 2019
WRITTEN ACTION
OF THE
BOARD OF DIRECTORS
OF
MCTC HOLDINGS, INC.
The undersigned, constituting the all of the
members of the Board of Directors of MCTC Holdings, Inc., a Delaware corporation (the “Corporation”), do hereby take
the following action and, pursuant to Delaware General Corporation Law (“DGCL”) Section 242, adopt the following resolutions
by written consent in lieu of a meeting effective as of the 24
th
day of July, 2019. It is the undersigned’s intent
that this unanimous written consent be filed by the Secretary of the Corporation with the minutes of the meetings of the Board
of Directors.
1:15 Reverse Stock Split
WHEREAS, after careful review of the
Corporation’s options with regard to its capitalization, consideration of the information provided, full disclosure by
the Corporation's CEO, discussions with certain shareholders and after lengthy discussions, including without limitation, the
benefits of effecting a reverse stock split, reduction of risks to the Corporation and the effects on liquidity, the Board of
Directors of the Corporation has determined that it is in the best interest of the Corporation and its shareholders to effect
a 1 for 15 reverse split of its common stock.
NOW, THEREFORE, BE IT RESOLVED, That the Board
of Directors of the Corporation hereby approves, ratifies and recommends that the shareholders authorize the effectuation of a
1 for 15 reverse stock split of the Corporation’s common stock for all shareholders of record as of July 10, 2019; and be
it,
FURTHER RESOLVED, That in order to give effect to the
aforementioned stock split, a recommendation be made to the shareholders, that a Certificate of Amendment be filed with the
Delaware Secretary of State providing:
(a) that the authorized shares of common stock
be 290,000,000, $0.0001 par value prior to the reverse split; (b) that authorized shares of common stock be 19,333,333, $0.0015
par value immediately after the reverse split; (c) that the number of shares affected will be one (1) share of common stock for
each fifteen (15) shares of common stock issued and outstanding and any rights to acquire the same; (d) each fractional share
shall be rounded up to the nearest whole share and that the holders of lots that are less than 100 shares after the reverse split
be rounded up to round lots of 100 shares; (e) the Corporation’s authorized but unissued shares of undesignated preferred
stock shall remain at tem (10) million shares, $0.0001 par value. (the “Reverse Stock Split)
Amendment to Certificate of Incorporation Immediately Following Reverse
Stock Split Increasing Authorized Common Stock and Decreasing Par Value
WHEREAS, after careful review of the Corporation’s
options with regard to its
capitalization, consideration of the information
provided, full disclosure by the Corporation's CEO, discussions with certain shareholders and after lengthy discussions, including
without limitation, the benefits of effecting an amendment to the Corporation’s Certificate of Incorporation following the
Reverse Stock Split, including but not limited the Corporations future need to raise additional capital, acquire complementary
products and technologies, the need to provide for equity based compensation and the limited shares otherwise available for future
issuance, the Board of Directors of the Corporation has determined that it is in the best interest of the Corporation and its shareholders
to increase the authorized number of common shares available for issuance back to 290,000,000 as well as decreasing the par value
of its common stock back to $0.0001.
NOW THEREFORE BE IT FURTHER RESOLVED, That the
Board of Directors approves and recommends that the shareholders of the Corporation, immediately following the Reverse Stock Split,
approve and adopt an amendment to Article 4 of the Corporation’s Certificate of Incorporation and that a Certificate of Amendment
be filed with the Delaware Secretary of State providing for the amendment of the Corporation’s Certificate of Incorporation
amending and replacing the fourth article thereof as follows:
“FOURTH”
(a) Authorization of Capital Stock. The
aggregate number of shares of stock which the Corporation shall have the authority to issue is Three Hundred Million
(300,000,000) shares, consisting of Two Hundred Ninety Million (290,000,000) shares of common stock, $0.0001 par value (the
“Common Stock”), and ten million (10,000,000) shares of authorized but undesignated preferred stock, $0.0001 par
value (the “Preferred Stock’’), The Board of Directors is authorized to establish, from the authorized but
undesignated shares of Preferred Stock, one or more classes or series of shares, to designate each such class and series, and
fix the rights and preferences of each such class of Preferred Stock; which class or series shall have such voting powers
(full or limited or no voting powers), such preferences, relative, participating, optional or other special rights, and such
qualifications, limitations or restrictions as shall be stated and expressed in the resolution or resolutions providing for
the issue of such class or series of Preferred Stock as may be adopted from time to time by the Board of Directors prior to
the issuance of any shares thereof. Except as provided in the resolution or resolutions of the Board of Directors creating
any series of Preferred Stock, the shares of Common Stock shall have the exclusive right to vote for the election and removal
of directors and for all other purposes. Each holder of Common Stock shall be entitled to one vote for each share held.
FURTHER RESOLVED, at such time as that Corporation
has submitted the requisite documents and other information to the Financial Information Regulatory Authority. (“FINRA”)
to process the Reverse Stock Split, that the proper officers of the Corporation be and hereby are authorized and directed to execute
on the Corporation’s behalf the Certificate of Amendment in the form required by the Secretary of State of Delaware with
such effective date as the President of the Corporation deems appropriate; and be it,
FURTHER RESOLVED, that the Officers of the Corporation
are directed to prepare and file with the U.S. Securities & Exchange Commission (the “Commission”), the required
Schedule PRE 14C Shareholder Information Statement, to respond to any comments from the Commission and to prepare and
file the DEF 14C when approved by the Commission.
In addition, the Officers of the Corporation are directed to prepare and file the required Current Report on Form 8- K with the
Commission within the required time period; and be it,
FURTHER RESOLVED, that in conjunction with the
Reverse Split, the Corporation is authorized to obtain a new CUSIP number for the Corporation’s common stock which trades;
and be it
FURTHER RESOLVED, that the proper officers of
the Corporation be, and each of them hereby is, in accordance with the foregoing resolutions, authorized, empowered and directed,
in the name and on behalf of the Corporation, to prepare, execute and deliver, or cause to be prepared, executed and delivered,
any and all agreements, amendments, certificates, reports, applications, notices, instruments, schedules, statements, consents,
letters or other documents and information and to do or cause to be done any and all such other acts and things as, in the opinion
of any such officer, may be necessary, appropriate or desirable in order to enable the Corporation fully and promptly to carry
out the purposes and intent of the foregoing resolutions, to make any filings pursuant to federal, state and foreign laws, and
to take all other actions that he or she deems necessary, appropriate or advisable in order to comply with the applicable laws
and regulations of any jurisdiction (domestic or foreign), or otherwise to effectuate and carry out the purpose and intent of the
foregoing resolutions and to permit the actions contemplated thereby to be lawfully effectuated, and any such agreements, amendments,
certificates, reports, applications, notices, instruments, schedules, statements, consents, letters or other documents and information
executed and delivered by them or any of them in connection with any such action shall be conclusive evidence of their or his authority
to take, execute and deliver the same; and be it.
FURTHER RESOLVED, that each of the proper
officers of the Corporation is authorized and directed, in the name and on behalf of the Corporation, to take or cause to be
taken any and all such further actions and to prepare, execute and deliver or cause to be prepared, executed and delivered
all such further agreements, documents, certificates and undertakings, and to incur all such fees and expenses, as in his or
her judgment shall be necessary, appropriate or advisable to carry out and effectuate the purpose and intent of any and all
of the foregoing resolutions; and be it
FURTHER RESOLVED, that all actions previously
taken by any officer, director, representative or agent of the Corporation, in the name or on behalf of the Corporation or any
of its affiliates in connection with the actions contemplated by the foregoing resolutions be, and each of the same hereby is,
adopted, ratified, confirmed and approved in all respects as the act and deed of the Corporation; and be it
FURTHER RESOLVED, that the Board hereby
adopts, as if expressly set forth herein, the form of any and all resolutions required by any authority to be filed in
connection with any applications, reports, filings, consents to service of process, powers of attorney, covenants and other
papers, instruments and documents relating to the matters contemplated by the foregoing resolutions if (i) in the opinion of
a proper officer of the Corporation executing the same, the adoption of such resolutions is necessary or advisable, and (ii)
the secretary or an assistant secretary of the Corporation evidences such adoption by inserting the same with these minutes
of action, which will thereupon be deemed to be adopted by the Board with the same force and effect as if originally set
forth herein
IN WITNESS WHEREOF, the undersigned have executed
this Written Action of the Board of Directors as of the date first written above.
DIRECTORS:
/s/ Robert L. Hymers, III
/s/ Edward Manolos
/s/ Arman Tabatabaei
/s/ Dan Van Nguyen