SCHEDULE 14C INFORMATION STATEMENT
Information 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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Definitive Information Statement
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Confidential, for use of the Commission Only (as permitted
by Rule 14a-5(d)(2)
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TARGET
GROUP INC.
(Name of Registrant as Specified In Its
Charter)
Payment of Filing Fee (Check the appropriate box):
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Fee computed on table below per Exchange Act Rules 14c-5(g)
and 0-11.
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1) Title of each class of securities to which transaction
applies:
__________________________________________________________________
2) Aggregate number of securities to which transaction
applies:
__________________________________________________________________
3) Per unit price or other underlying value of transaction
computed pursuant to Exchange Act Rule 0-11
(Set forth the amount on which the filing fee is calculated
and state how it was determined):
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4) Proposed maximum aggregate value of transaction:
__________________________________________________________________
5) Total fee paid:
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Fee paid previously with preliminary materials.
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box if any part of the fee is offset as provided by Exchange Act Rule 240.0-11and 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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3) Filing Party:
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4) Date Filed:
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TARGET GROUP INC.
55 Administration Road, Unit 8
Vaughn, Ontario, Canada L4K 4G9
Telephone: (416) 444-4644
Notice of Proposed Action by Written Consent
of the Holders of the
Majority of the Voting Stock to be taken
on or about September 24, 2018.
To the Stockholders of Target Group Inc.
The enclosed Information Statement is to
inform you that upon written consent by the holders of a majority of the voting stock of the Company, the Company intends to take
certain action as more particularly described in this Information Statement. The action will be effected 20 days from the date
this Information Statement is mailed to stockholders which mailing is expected to be on or about September 4, 2018. The enclosed
Information Statement will be considered the notice required under Section 228 of the Delaware General Corporation Law.
Only stockholders of record at the close of business on August
1, 2018
(“Record Date”)
will be given Notice of the Action by Written Consent. The Company is not soliciting
proxies.
WE ARE NOT ASKING YOU FOR A PROXY AND
YOU ARE REQUESTED NOT TO SEND US A PROXY.
VOTING SECURITIES AND PRINCIPAL HOLDERS
THEREOF
At the Record Date, the Company had outstanding
33,261,853 shares of Common Stock, par value $0.0001 per share and 1,000,000 shares of Series A Preferred Stock, par value $0.0001
per share. The Majority Shareholders have signed consent to the taking of the corporate action described. This consent will be
sufficient, without any further action, to provide the necessary stockholder approval of the Amendment.
CORPORATE ACTION TO BE TAKEN
ADOPTION OF AN AMENDMENT TO THE ARTICLES
OF INCORPORATION
The Board of Directors is recommending that
the Company’s current Articles of Incorporation be amended to decrease the authorized Common Stock to 850,000,000 shares.
On August 20, 2018, the Board of Directors of the Company approved and declared it in the best interests of the Company and its
shareholders that the Amendment be submitted to the holders of a majority of the Company’s voting stock for approval of the
Amendment. On August 20, 2018, the Majority Stockholders approved the Amendment to decrease the authorized Common Stock by written
consent in lieu of a special meeting of stockholders.
Currently, the Company
is authorized to issue up to 20,000,000,000 shares of Common Stock. As of the Record Date, there were 33,261,853 shares of Common
Stok issued and outstanding. As a general matter, the Board of Directors and the Majority Shareholders believe the available number
of unissued shares of Common Stock is too many shares to be potentially issued at the discretion of the Board of Directors without
going back to the Company’s stock holders for approval prior to issuance.
The Company is considering
and will continue to consider various funding options, including the issuance of either Common stock or securities convertible
into Common Stock from time to time to raised additional working capital necessary to support future growth of the Company. The
Board of Directors believes that potential investors will be more likely to invest in the Company’s securities if the Board
of Directors can only issue up to 850,000,000 shares of Common Stock as opposed to 20,000,000,000 shares of Common Stock
The decrease in the
authorized Common Stock was not approved as a means of preventing or dissuading a change in control or takeover of the Company.
However, reducing the number of shares that can be issued could decrease the opportunity for future change of control or takeover
of the Company. The Board of Directors of the Company has no knowledge of any current effort to obtain control of the Company.
However, the Majority Shareholders who hold the Company’s Series A Preferred Stock will continue to exercise the majority
voting power of the Company as a result of the super voting rights granted to the Series A Preferred Stock.
A copy of the Amendment
is included in this Information Statement.
DESCRIPTION OF CAPITAL STOCK AND VOTING
RIGHTS
The Company’s
authorized capital consists currently of 20,000,000,000 shares of Common Stock, par value $0.0001 per share and 20,000,000 shares
of Preferred Stock, par value $0.0001. As of the Record Date, there were 33,261,853 shares of Common Stock outstanding and 1,000,000
shares of Series A Preferred Stock issued and outstanding. The holders of Common Stock and the Preferred Stock are entitled to
vote together as a single class on all matters to come before a vote of the stockholders of the Company.
VOTE REQUIRED FOR APPROVAL
Section 242 of the
Delaware General Business Corporation Act provides an outline of the scope of the amendments of the Articles of Incorporation allowed
a Delaware Corporation. This includes the amendment discussed in this Information Statement. The procedure and requirements to
effect an amendment to the Articles of Incorporation of a Delaware corporation are set forth in Section 242 provides that proposed
amendments must first be adopted by the Board of Directors and then submitted to stockholders for their consideration at an annual
or special meeting and must be approved by shareholders holding at least the majority voting power of the Company.
Section 228 of the
Delaware General Business Corporation Act provides that any action required to be taken at a special or annual meeting of the stockholders
of a Delaware corporation may be taken by written consent, in lieu of a meeting, if the consent is signed by stockholders holding
at least the minimum number of votes that would be necessary to authorize or take the action at a meeting at which all shareholders
entitled to vote were present and voted.
The persons holding
at least the majority voting power of the Company have adopted, ratified and approved the amendment to the articles of incorporation
increasing the authorized capital stock as described in this Information Statement. No further votes are required or necessary
to effect the proposed amendment or the other corporate actions to be taken.
The securities that
would have been entitled to vote if a meeting was required to be held to amend the Company’s Articles of Incorporation consist
of 33,261,853 shares of the Company’s Common Stock and 1,000,000 shares of Series A Preferred Stock issued and outstanding
as of the Record Date.
SECURITY OWNERSHIP OF EXECUTIVE OFFICERS,
DIRECTORS
AND FIVE PERCENT STOCKHOLDERS
The following table
sets forth certain information concerning the ownership of the Company’s Common Stock as of August 1, 2018, with respect
to: (i) each person known to the Company to be the beneficial owner of more than five percent of the Company’s Common Stock;
(ii) all directors; and (iii) directors and executive officers of the Company as a group. To the knowledge of the Company, each
shareholder listed below possesses sole voting and investment power with respect to the shares indicated.
Title of Class
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Name and Address
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Amount of
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of Beneficial Owner
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Ownership
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Percent of Class
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Common Stock
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Rubin Schindermann
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8,238,706
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24.8%
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55 Administration Road, Unit 8
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Vaughn, ON, Canada L4K 4G9
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Common Stock
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Alexander (“Sasha”) Starr
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8,238,706
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24.8%
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55 Administration Road, Unit 8
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Vaughn, ON, Canada L4K 4G9
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Common Stock
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Chess Supersite Inc.(a)
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2,000,000
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6.0%
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1409-7440 Bathurst Street
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Thornhill, Ontario
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Canada L4J 7K8
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Common Stock
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All executive officers and
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directors as a group (2 persons)
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49.6%
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______________________________
(a) Nava Starr is the sole officer and director of Chess Supersite
Inc. (Canada). Nava Starr is the wife of Alexander (Sasha) Starr. Mr. Starr disclaims any beneficial ownership of these shares.
INTEREST OF CERTAIN PERSONS IN
OR OPPOSITION TO MATTERS TO BE ACTED
UPON
No person who has been a director or officer
of the Company at any time since the beginning of the last fiscal year, associates of the foregoing persons has any substantial
interest, direct or indirect, in proposed amendment to the Company’s Articles of Incorporation which differs from that of
other stockholders of the Company. No director of the Company opposes the proposed amendment of the Company’s Articles of
Incorporation.
ADDITIONAL INFORMATION
Additional information concerning the Company,
including its annual and quarterly reports for the previous twelve months which have been filed with the Securities and Exchange
Commission may be accessed through the Securities and Exchange Commission EDGAR archives at www.sec.gov. Upon written request of
any stockholder to the Company’s CEO, Rubin Schindermann, at 55 Administration Road, Unit 8, Vaughn, Ontario, Canada L4K 4G9,
a copy of the Company’s Annual Report on Form 10-K for the year ended December 31, 2017 will be provided without charge and
as well as the Company’s Quarterly Report on Form 10-Q for the period ended June 30, 2018.
Index of Exhibits
Exhibit 3(i) Certificate of Amendment
to Certificate of Incorporation.
EXHIBIT 3(i)
CERTIFICATE
OF AMENDMENT
TO
CERTIFICATE OF INCORPORATION
OF
TARGET GROUP INC.
RESOLVED,
that
the Certificate of Incorporation of the Corporation be amended by changing Article Four to decrease the authorized shares of Common
Stock to 850,000,000.
ARTICLE FOUR
The total number of
shares of stock which the Corporation shall have authority to issue is 870,000,000 shares consisting of 850,000,000 shares of Common
Stock having a par value of $0.0001 per share and 20,000,000 shares of Preferred Stock having a par value of $0.0001 per share.
The voting powers,
designations, preferences and relative, participating, optional or other special qualifications, limitations or restrictions of
the designated series of Preferred Stock are as set forth herein.
Designation of
Series A Preferred Stock
1,000,000 shares of Preferred Stock having a par value of $0.0001 per share shall be designated
as Series A Preferred Stock
(“Series A Stock”)
. Dividends shall be declared and set aside for any shares of
Series A Stock in the same manner and amount as for the Common Stock. Series A Stock, as a class, shall have voting rights equal
to a multiple of 2X the number of shares of Common Stock issued and outstanding that are entitled to vote on any matter requiring
shareholder approval
(“Voting Multiple”).
Each share of Series A Stock shall be entitled to such number of votes
based on the Voting Multiple and as held at the record date for the determination of stockholders entitled to vote on such matter
or, if no such record date is established, at the date on which notice of the meeting of shareholders at which the vote is to be
taken is marked or the date any written consent of shareholders is solicited if the vote is not to be taken at a meeting. The Series
A Stock shall not vote as a separate class, but shall vote together with the Common Stock on all matters, including any amendment
to increase or decrease the authorized capital stock. Upon the voluntary or involuntary dissolution, liquidation or winding up
of the corporation, the assets of the Corporation available for distribution to its shareholders shall be distributed to the holders
of Common Stock and the holders of the Series A Stock ratably without any preference to the holders of the Series A Stock.
Subject to and in compliance
with the provisions of this Certificate of Amendment, shares of Series A Stock may, at the option of the holder, be converted at
any time into fully-paid and nonassessable shares of Common Stock at the rate of One Hundred (100) shares of Common Stock for each
One (1) share of Series A Stock
(“Conversion Rate”)
.
Mechanics of
Conversion
. Each holder of Series A Stock who desires to convert the same into shares of Common Stock shall surrender
the certificate or certificates therefor, duly endorsed, at the office of the Corporation or any transfer agent for the Series
A Stock, and shall give written notice to the Corporation at such office that such holder elects to convert the same. Such notice
shall state the number of shares of Series A Stock being converted. Thereupon, the Corporation shall promptly issue and deliver
at such office to such holder a certificate or certificates for the number of shares of Common Stock to which such holder is entitled
and shall promptly pay in cash or, to the extent sufficient funds are not then legally available therefor, in Common Stock (at
the Common Stock's fair market value determined by the Board of Directors as of the date of such conversion), any declared and
unpaid dividends on the shares of Series A Stock being converted. Such conversion shall be deemed to have been made at the close
of business on the date of such surrender of the certificates representing the shares of Series A Stock to be converted, and the
person entitled to receive the shares of Common Stock issuable upon such conversion shall be treated for all purposes as the record
holder of such shares of Common Stock on such date. Notwithstanding anything to the contrary in the foregoing, no conversion shall
occur until after the 60
th
day following the date that the first share of Series A Stock is issued
("Original
Issue Date")
.
Adjustment for
Stock Splits and Combinations
. If the Corporation shall at any time or from time to time after the Original Issue Date
effect a subdivision of the outstanding Common Stock without a corresponding subdivision of the Preferred Stock, the Conversion
Rate in effect immediately before that subdivision shall be proportionately decreased. Conversely, if the Corporation shall at
any time or from time to time after the Original Issue Date combine the outstanding shares of Common Stock into a smaller number
of shares without a corresponding combination of the Preferred Stock, the Conversion Rate in effect immediately before the combination
shall be proportionately increased. Any adjustment hereunder shall become effective at the close of business on the date the subdivision
or combination becomes effective.
Adjustment for
Common Stock Dividends and Distributions
. If the Corporation at any time or from time to time after the Original Issue
Date makes, or fixes a record date for the determination of holders of Common Stock entitled to receive, a dividend or other distribution
payable in additional shares of Common Stock, in each such event the Conversion Rate that is then in effect shall be decreased
as of the time of such issuance or, in the event such record date is fixed, as of the close of business on such record date, by
multiplying the Conversion Rate then in effect by a fraction (i) the numerator of which is the total number of shares of Common
Stock issued and outstanding immediately prior to the time of such issuance or the close of business on such record date, and (ii)
the denominator of which is the total number of shares of Common Stock issued and outstanding immediately prior to the time of
such issuance or the close of business on such record date plus the number of shares of Common Stock issuable in payment of such
dividend or distribution; provided, however, that if such record date is fixed and such dividend is not fully paid or if such distribution
is not fully made on the date fixed therefor, the Conversion Rate shall be recomputed accordingly as of the close of business on
such record date and thereafter the Conversion Rate shall be adjusted pursuant to reflect the actual payment of such dividend or
distribution.
Adjustment for
Reclassification, Exchange and Substitution
.
If at any time or from time to time after the Original Issue Date,
the Common Stock issuable upon the conversion of the Series A Stock is changed into the same or a different number of shares of
any class or classes of stock, whether by recapitalization, reclassification or otherwise (other than a subdivision or combination
of shares or stock dividend or a reorganization, merger, consolidation or sale of assets provided for elsewhere herein, in any
such event each holder of Series A Stock shall have the right thereafter to convert such stock into the kind and amount of stock
and other securities and property receivable upon such recapitalization, reclassification or other change by holders of the maximum
number of shares of Common Stock into which such shares of Series A Stock could have been converted immediately prior to such recapitalization,
reclassification or change, all subject to further adjustment as provided herein or with respect to such other securities or property
by the terms thereof.
Reorganizations,
Mergers, Consolidations or Sales of Assets
.
If at any time or from time to time after the Original Issue Date, there
is a capital reorganization of the Common Stock (other than a recapitalization, subdivision, combination, reclassification, exchange
or substitution of shares provided for elsewhere herein, as a part of such capital reorganization, provision shall be made so that
the holders of the Series A Stock shall thereafter be entitled to receive upon conversion of the Series A Stock the number of shares
of stock or other securities or property of the Corporation to which a holder of the number of shares of Common Stock deliverable
upon conversion would have been entitled on such capital reorganization, subject to adjustment in respect of such stock or securities
by the terms thereof. In any such case, appropriate adjustment shall be made in the application of the provisions of Certificate
of Amendment with respect to the rights of the holders of Series A Stock after the capital reorganization to the end that the provisions
of this Certificate of Amendment (including adjustment of the Conversion Rate then in effect and the number of shares issuable
upon conversion of the Series A Stock) shall be applicable after that event and be as nearly equivalent as practicable.
Automatic Conversion
.
(
i
)
Each
share of Series A Stock shall automatically be converted into shares of Common Stock, based on the then-effective Conversion Rate,
(a) at any time upon the affirmative vote of all of the holders of the outstanding shares of the Series A Stock, or (b) immediately
upon the closing of a firmly underwritten public offering pursuant to an effective registration statement under the Securities
Act of 1933, as amended, covering the offer and sale of Common Stock for the account of the Corporation in which the gross cash
proceeds to the Corporation (before underwriting discounts, commissions and fees) are at least $10,000,000. Upon such automatic
conversion, any declared and unpaid dividends shall be paid in accordance with the provisions of this Certificate of Amendment.
(
ii
)
Upon the occurrence of the event specified in paragraph (i) above, the outstanding shares of Series A Stock shall be converted
automatically without any further action by the holders of such shares and whether or not the certificates representing such shares
are surrendered to the Corporation or its transfer agent; provided, however, that the Corporation shall not be obligated to issue
certificates evidencing the shares of Common Stock issuable upon such conversion unless the certificates evidencing such shares
of Series A Stock are either delivered to the Corporation or its transfer agent as provided below, or the holder notifies the Corporation
or its transfer agent that such certificates have been lost, stolen or destroyed and executes an agreement satisfactory to the
Corporation to indemnify the Corporation from any loss incurred by it in connection with such certificates. Upon the occurrence
of such automatic conversion of the Series A Stock, the holders of Series A Stock shall surrender the certificates representing
such shares at the office of the Corporation or any transfer agent for the Series A Stock. Thereupon, there shall be issued and
delivered to such holder promptly at such office and in its name as shown on such surrendered certificate or certificates, a certificate
or certificates for the number of shares of Common Stock into which the shares of Series A Stock surrendered were convertible on
the date on which such automatic conversion occurred, and any declared and unpaid dividends shall be paid in accordance with the
provisions of this Certificate of Amendment.