UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
SCHEDULE
14C
(Rule
14c-101)
SCHEDULE
14C INFORMATION
Information
Statement Pursuant to Section 14(c) of the
Securities
Exchange Act of 1934
Check
the appropriate box:
| ☒ |
Preliminary
Information Statement |
| |
|
| ☐ |
Confidential,
for Use of the Commission Only (as permitted by Rule 14c-5(d)(2)) |
| |
|
| ☐ |
Definitive
Information Statement |
SUSTAINABLE
PROJECTS GROUP INC.
(Name
of Registrant as Specified in Its Charter)
Payment
of Filing Fee (Check the appropriate box):
| ☒ |
No
fee required |
| |
|
| ☐ |
Fee
paid previously with preliminary materials |
| |
|
| ☐ |
Fee
computed on table in exhibit required by Item 25(b) of Schedule 14A (17 CFR 240.14a-101) per Item 1 of this Schedule and Exchange
Act Rules 14c-5(g) and 0-11 |
PRELIMINARY
COPY DATED AUGUST 23, 2024, SUBJECT TO COMPLETION
SUSTAINABLE
PROJECTS GROUP INC.
Tankedraget
7
Aalborg,
Denmark DK-900
NOTICE
OF STOCKHOLDER ACTION BY WRITTEN CONSENT
DATE
FIRST MAILED TO STOCKHOLDERS: September 3, 2024
To
Our Stockholders:
This
Notice and the accompanying Information Statement are being furnished to the stockholders of Sustainable Projects Group Inc., a Nevada
corporation (the “Company”), to notify stockholders of the actions taken by the Company’s Board of Directors (the “Board”)
by written consent dated August 21, 2024 and by the holders of a majority of the issued and outstanding shares of the Company’s
common stock by written consent delivered to the Company on August 21, 2024, approving an amendment
to our Articles of Incorporation, as amended, to effect a reverse stock split of our outstanding common stock, par value $0.0001 per
share (the “Common Stock”), at a reverse stock split ratio ranging from any whole number between 1-for-10 and 1-for-100,
subject to and as determined by the Board.
As
the matters set forth in this Information Statement have been duly authorized and approved by the written consent of the holders of more
than a majority of the Company’s voting securities, your vote or consent is not requested or required to approve these matters.
The Information Statement is provided solely for your information, and also serves the purpose of informing stockholders of the matters
described herein pursuant to Section 14(c) of the Securities Exchange Act of 1934, as amended, and the rules and regulations prescribed
thereunder, including Regulation 14C. You do not need to do anything in response to this Notice and the Information Statement.
WE
ARE NOT ASKING YOU FOR A PROXY AND
YOU
ARE REQUESTED NOT TO SEND US A PROXY.
| Sincerely, |
|
| |
|
| /s/
Sune Mathiesen |
|
| Sune
Mathiesen |
|
| Chairman,
President & Chief Executive Officer |
|
TABLE
OF CONTENTS
Sustainable
Projects Group Inc.
Tankedraget
7
Aalborg,
Denmark DK-900
INFORMATION
STATEMENT
WE
ARE NOT ASKING YOU FOR A PROXY AND
YOU
ARE REQUESTED NOT TO SEND US A PROXY
ABOUT
THIS INFORMATION STATEMENT
General
Sustainable
Projects Group Inc., a Nevada corporation, and its subsidiaries is sending you this Information Statement solely for purposes of informing
the Company’s stockholders of record as of August 21, 2024 (the “Record Date”) of actions taken by the Company’s
stockholders by less than unanimous written consent in lieu of a special meeting of stockholders. No action is requested or required
on your part. When used in this Information Statement, the terms the “Company,” “we,” “us,” or “our”
refer to Sustainable Projects Group Inc., and/or its subsidiaries, depending on the context.
This
Information Statement is first being mailed on or about September 3, 2024. The Company’s principal executive offices are located
at Tankedraget 7, Aalborg, Denmark DK-900, and the Company’s telephone number is (305) 814-2915.
The
holders of a majority of our issued and outstanding shares of common stock (the “Majority Stockholders”) have approved, by
written consent delivered to the Company on August 21, 2024, an amendment to our Articles of Incorporation,
as amended (the “Articles”), to effect a reverse stock split of our outstanding common stock, par value $0.0001 per share
(the “Common Stock”), at a reverse stock split ratio ranging from any whole number between 1-for-10 and 1-for-100,
subject to and as determined by the Board (the “Reverse Stock Split”).
Important
Notice Regarding the Internet Availability of this Information Statement: a copy of this Notice and the Information Statement is
available to you free of charge at https://www.lithiumharvest.com/investors/.
The
Notice and Information Statement is first being mailed on or about September 3, 2024 to the Company’s stockholders of record as
of the Record Date.
Summary
of the Corporate Action
Approval
of Reverse Stock Split
The
Majority Stockholders have approved, by written consent delivered to the Company on August 21, 2024, an
amendment to our Articles to effect the Reverse Stock Split.
We
may effect the Reverse Stock Split on or after September 23,
2024, the 20th calendar day after we mail the Notice and this Information Statement to stockholders
of record as of the Record Date, and prior to March 31, 2025.
Voting
and Vote Required
The
Company is not seeking consent, authorizations or proxies from you. Under Chapter 78 of the Nevada Revised Statutes (the “NRS”),
the Articles, and the Company’s by-laws (the “By-Laws”), the Reverse Split may be approved, without a meeting of stockholders,
by a resolution of our Board of Directors (the “Board”) and the written consent of the Majority Stockholders. As of the Record
Date, the Company had 296,037,813 shares of Common Stock outstanding and entitled to vote. Each share of our Common Stock is entitled
to one vote. The written consent was executed by the Majority Stockholders, holding 184,967,174 shares of common stock, representing
a majority of the voting power of our Common Stock as of the Record Date. Accordingly, the written consent was executed by stockholders
holding sufficient voting power to approve the actions contemplated by the written consent and no further stockholder action is required.
The Majority Stockholders are Sune Mathiesen Holding ApS and FENO Holding ApS. Sune Mathiesen, our Chief Executive Officer, President
and Chairman of the Board, is the Managing Director of Sune Mathiesen Holding ApS, and Paw Juul, our Chief Technology Officer, is the
Managing Director of FENO Holding ApS.
Dissenters’
Rights of Appraisal
The
NRS does not provide dissenters’ rights of appraisal to the Company’s stockholders in connection with the matters approved
by the written consent.
FORWARD-LOOKING
STATEMENTS
This
Information Statement contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform
Act of 1995 that involve risks and uncertainties, many of which are beyond our control. Our actual results could differ materially and
adversely from those anticipated in such forward-looking statements as a result of certain factors, including those set forth in this
Information Statement.
All
statements, other than statements of historical facts, included in this Information Statement regarding our Reverse Stock Split, strategy,
future operations and plans and objectives of management are forward-looking statements. When used in this Information Statement, the
words “will,” “may,” “believe,” “anticipate,” “intend,” “estimate,”
“expect,” “project,” “plan,” and similar expressions are intended to identify forward-looking statements,
although not all forward-looking statements contain such identifying words. All forward-looking statements speak only as of the date
of this Information Statement. We undertake no obligation to update any forward-looking statements or other information contained herein.
Stockholders and potential investors should not place undue reliance on these forward-looking statements. Although we believe that our
plans, intentions, and expectations reflected in or suggested by the forward-looking statements in this Information Statement are reasonable,
we cannot assure stockholders and potential investors that these plans, intentions, or expectations will be achieved. We disclose important
factors that could cause our actual results to differ materially from our expectations under Part I, Item 1A. “Risk Factors”
in our Annual Report on Form 10-K for the year ended December 31, 2023, filed with the U.S. Securities and Exchange Commission (the “SEC”)
on April 4, 2024, and in Part II, Item 1A. “Risk Factors” in any Quarterly Reports on Form 10-Q filed subsequently
thereto. These cautionary statements qualify all forward-looking statements attributable to us or persons acting on our behalf.
APPROVAL
TO EFFECT A REVERSE STOCK SPLIT
Our
Board and the Majority Stockholders have adopted resolutions to authorize the Board, in its sole discretion, to amend our Articles to
effect the Reverse Stock Split at any time prior to March 31, 2025 (the “Split Authorization”). The amendment to our Articles
would be accomplished by adding to the end of the third paragraph thereof referring to the number of shares with par value the following
text:
“Upon
the filing and effectiveness (the “Reverse Stock Split Effective Time”) pursuant to the General Corporation Law of Nevada
of the Certificate of Amendment to these Articles of Incorporation of the Corporation, each [●] shares of Common Stock issued and
outstanding immediately prior to the Reverse Stock Split Effective Time shall, automatically and without any further action on the part
of the Corporation or any of the respective holders thereof, be reclassified, combined and converted into one (1) fully paid and nonassessable
share of Common Stock (the “Reverse Stock Split”), subject to the treatment of fractional share interests as described below.
The reclassification of the Common Stock will be deemed to occur at the Reverse Stock Split Effective Time. From and after the Reverse
Stock Split Effective Time, certificates representing Common Stock prior to such reclassification shall represent the number of shares
of Common Stock into which such Common Stock prior to such reclassification shall have been reclassified pursuant to the Certificate
of Amendment. No fractional shares shall be issued in connection with the Reverse Stock Split and, in lieu thereof, any stockholder who
would otherwise be entitled to receive a fractional share of Common Stock shall instead be entitled to receive a cash payment equal to
the product obtained by multiplying (a) the closing price per share of the Common Stock on the OTC Pink on the date of the Reverse Stock
Split Effective Time, after giving effect to the Reverse Stock Split, by (b) the fraction of the share owned by the stockholder, without
interest.”
The
Split Authorization permits, but does not require, our Board to effect a reverse stock split of our issued and outstanding Common
Stock at any time prior to March 31, 2025 at a reverse stock split ratio ranging from any whole
number between 1-for-10 and 1-for-100, subject to and as determined by the Board. Our Board reserves the right to elect to abandon
the Reverse Stock Split, if it determines, in its sole discretion, that the Reverse Stock Split is no longer in the best interests of
the Company and its stockholders.
We
do not intend to issue fractional shares in connection with the Reverse Stock Split. Instead, any stockholders who would have been entitled
to receive fractional shares as a result of the Reverse Stock Split will instead receive cash payments in lieu of such fractional shares.
Each holder of our Common Stock will hold the same percentage of our outstanding Common Stock immediately following the Reverse Stock
Split as that stockholder did immediately prior to the Reverse Stock Split, except to the extent that the Reverse Stock Split results
in stockholders receiving cash in lieu of fractional shares. The par value of our Common Stock will continue to be $0.0001 per share.
Background
and Reasons for the Reverse Stock Split; Potential Consequences of the Reverse Stock Split
Our
Board and Majority Stockholders approved the Split Authorization with the primary intent of (1) increasing the market price of our Common
Stock, enabling a future uplisting of our Common Stock onto The Nasdaq Capital Market, and (2) making our Common Stock more attractive
to a broader range of institutional and other investors.
We
are seeking to increase the market price of our Common Stock to satisfy one of the initial listing requirements for uplisting onto The
Nasdaq Capital Market, although we are under no obligation to uplist and there can be no assurance that the trading price of our Common
Stock would be maintained at such level or that we will be able to maintain any such listing of our Common Stock on The Nasdaq Capital
Market if we are able to uplist in the future. The Nasdaq Capital Market requires, among other items, an initial bid price of at least
$4.00 per share, and following initial listing, maintenance of a continued bid price of at least $1.00 per share.
We
also believe that the Reverse Stock Split, if implemented, will make our Common Stock more attractive to a broader range of institutional
and other investors, as we believe that the current market price of our Common Stock may affect its acceptability to certain institutional
investors, professional investors and other members of the investing public. Many brokerage houses and institutional investors have internal
policies and practices that either prohibit them from investing in low-priced stocks or tend to discourage individual brokers from recommending
low-priced stocks to their customers. In addition, some of those policies and practices may function to make the processing of trades
in low-priced stocks economically unattractive to brokers. Moreover, because brokers’ commissions on low-priced stocks generally
represent a higher percentage of the stock price than commissions on higher-priced stocks, the current average price per share of Common
Stock can result in individual stockholders paying transaction costs representing a higher percentage of their total share value than
would be the case if the share price were substantially higher. We believe that, if implemented by our Board, the Reverse Stock Split
will make our Common Stock a more attractive and cost-effective investment for many investors.
Reducing
the number of outstanding shares of our Common Stock through the Reverse Stock Split is intended, absent other factors, to increase the
per share market price of our Common Stock. However, other factors, such as our financial results, market conditions and the market perception
of our business, may adversely affect the market price of our Common Stock. As a result, there can be no assurance that the Reverse
Stock Split, if completed, will result in the intended benefits described above, that the market price of our Common Stock will increase
following the Reverse Stock Split or that the market price of our Common Stock will not decrease in the future. Additionally, we cannot
assure you that the market price per share of our Common Stock after a Reverse Stock Split will increase in proportion to the reduction
in the number of shares of our Common Stock outstanding before the Reverse Stock Split. Accordingly, the total market capitalization
of our Common Stock after the Reverse Stock Split may be lower than the total market capitalization before the Reverse Stock Split.
Criteria
the Board of Directors May Use to Determine Whether to Implement the Reverse Stock Split
When
determining whether to implement the Reverse Stock Split, and which Reverse Stock Split ratio to implement, if any, the Board may consider
various factors, including:
| | ● | the
historical trading price and trading volume of our Common Stock; |
| | | |
| | ● | the
then-prevailing trading price and trading volume of our Common Stock and the expected impact
of the Reverse Stock Split on the trading market for our Common Stock in the short- and long-term; |
| | | |
| | ● | the
number of shares of our Common Stock outstanding; |
| | | |
| | ● | the
anticipated impact of a particular ratio on the Company’s ability to reduce administrative
and transactional costs; and |
| | | |
| | ● | prevailing
general market, legal and economic conditions. |
Procedure
for Implementing the Reverse Stock Split
The
Reverse Stock Split, if approved by our stockholders, would become effective on the date and time set forth in the Certificate of Amendment
to our Articles that is filed with the Nevada Secretary of State, which we expect would be shortly after such filing is made with the
Nevada Secretary of State (the “Effective Time”). The exact timing of the filing of the Certificate of Amendment that will
effect the Reverse Stock Split will be determined by our Board based on its evaluation as to when such action will be the most advantageous
to the Company and our stockholders. In addition, our Board reserves the right, without further action by the stockholders, to elect
not to proceed with the Reverse Stock Split if, at any time prior to filing the amendment to our Articles, our Board, in its sole discretion,
determines that it is no longer in our best interest and the best interests of our stockholders to proceed with the Reverse Stock Split.
If a Certificate of Amendment effecting the Reverse Stock Split has not been filed with the Nevada Secretary of State by the close of
business on March 31, 2025, our Board will abandon the Reverse Stock Split.
Fractional
Shares
Stockholders
will not receive fractional shares of Common Stock in connection with the Reverse Stock Split. Instead, any holder of Common Stock who
would otherwise be entitled to a fractional share of Common Stock as a result of the Reverse Stock Split will instead be entitled to
receive a cash payment equal to the product obtained by multiplying (a) the closing price per share of the Common Stock on the OTC Pink
on the date of the Effective Time, after giving effect to the Reverse Stock Split, by (b) the fraction of the share owned by the stockholder,
without interest.
Stockholders
will not be entitled to receive interest for the period of time between the Effective Time and the date payment is made for their fractional
share interest. You should also be aware that, under the escheat laws of certain jurisdictions, sums due for fractional interests that
are not timely claimed after the funds are made available may be required to be paid to the designated agent for each such jurisdiction.
Thereafter, stockholders otherwise entitled to receive such funds may have to obtain the funds directly from the state to which they
were paid.
If
you believe that you may not hold sufficient shares of our Common Stock at the Effective Time to receive at least one share in the Reverse
Stock Split and you want to continue to hold our Common Stock after the Reverse Stock Split, you may do so by either:
| | ● | purchasing
a sufficient number of shares of our Common Stock; or |
| | | |
| | ● | if
you have shares of our Common Stock in more than one account, consolidating your accounts; |
in
each case, so that you hold a number of shares of our Common Stock in your account before the Reverse Stock Split that will entitle you
to receive at least one share of Common Stock in the Reverse Stock Split. Shares of our Common Stock held in registered form and shares
of our Common Stock held in “street name” (that is, through a broker, bank or other holder of record) for the same stockholder
will be considered held in separate accounts and will not be aggregated when effecting the Reverse Stock Split.
Effect
of the Reverse Stock Split on Holders of Outstanding Common Stock
General
After
the Effective Time of the Reverse Stock Split, should the Board elect to implement it, each stockholder will own a reduced number of
shares of Common Stock. However, the Reverse Stock Split would affect all of our stockholders uniformly and would not affect any stockholder’s
percentage ownership interests in the Company, except to the extent that the Reverse Stock Split results in any of our stockholders owning
a fractional share as described above. Voting rights and other rights and preferences of the holders of our Common Stock would not be
affected by the Reverse Stock Split (other than as a result of the payment of cash in lieu of fractional shares). For example, a holder
of 2% of the voting power of the outstanding shares of our Common Stock immediately prior to the Reverse Stock Split would continue to
hold 2% (assuming there is no impact as a result of the payment of cash in lieu of fractional shares) of the voting power of the outstanding
shares of our Common Stock immediately after the Reverse Stock Split. The number of stockholders of record also would not be affected
by the Reverse Stock Split (assuming there is no impact as a result of the payment of cash in lieu of fractional shares).
The
principal effects of the Reverse Stock Split would be that:
| | ● | each
10 to 100 shares of our Common Stock owned by a stockholder (depending on the Reverse Stock
Split ratio selected by the Board), would be combined into one new share of our Common Stock; |
| | | |
| | ● | no
fractional shares of Common Stock would be issued in connection with the Reverse Stock Split;
instead, any stockholders who would have been entitled to receive fractional shares as a
result of the Reverse Stock Split will instead receive cash payments in lieu of such fractional
shares; |
| | | |
| | ● | by
reducing the number of shares of Common Stock outstanding without reducing the number of
shares of available but unissued Common Stock, the Reverse Stock Split will effectively increase
the relative number of authorized but unissued shares, which the Board may use in connection
with future financings or other issuances; |
| | ● | based
upon the Reverse Stock Split ratio selected by the Board of Directors, proportionate adjustments
would be made to the per share exercise price and the number of shares issuable upon the
exercise or vesting of all then outstanding equity awards with respect to the number of shares
of Common Stock subject to such award and the exercise price thereof, to the extent applicable,
subject to the terms of such awards; |
| | | |
| | ● | the
number of shares of Common Stock authorized under the Company’s 2023 Equity Incentive
Plan (the “Plan”), will be proportionately adjusted for the Reverse Stock Split
ratio selected by the Board; and |
| | | |
| | ● | the
number of stockholders owning “odd lots” of less than 100 shares of our Common
Stock may potentially increase; odd lot shares may be more difficult to sell and brokerage
commissions and other costs of transactions in odd lots generally are proportionately higher
than the costs of transactions in “round lots” of even multiples of 100 shares. |
However,
we believe that any potential negative effects are outweighed by the benefits of the Reverse Stock Split.
Effect
on Shares of Common Stock
For
the purposes of providing examples of the effect of the Reverse Stock Split on our Common Stock, the following table contains approximate
information, based on share information as of the Record Date, of the effect of a Reverse Stock Split at certain ratios within the range
of the proposed Reverse Stock Split ratios on the number of shares of our Common Stock authorized, outstanding, reserved for future issuance
and not outstanding or reserved:
| Status | |
Number of Shares of Common
Stock Authorized | | |
Number of
Shares of Common
Stock Issued and Outstanding | | |
Number of
Shares of Common Stock Underlying Outstanding
Equity Awards | | |
Number of
Shares of Common Stock
Authorized but Not
Outstanding or Reserved | |
| Pre-Reverse Stock Split | |
| 500,000,000 | | |
| 296,037,813 | | |
| — | | |
| 203,962,187 | |
| Post-Reverse Stock Split 1:10 | |
| 500,000,000 | | |
| 29,603,781 | | |
| — | | |
| 470,396,219 | |
| Post-Reverse Stock Split 1:20 | |
| 500,000,000 | | |
| 14,801,890 | | |
| — | | |
| 485,198,110 | |
| Post-Reverse Stock Split 1:30 | |
| 500,000,000 | | |
| 9,867,927 | | |
| — | | |
| 490,132,073 | |
| Post-Reverse Stock Split 1:40 | |
| 500,000,000 | | |
| 7,400,945 | | |
| — | | |
| 492,599,055 | |
| Post-Reverse Stock Split 1:50 | |
| 500,000,000 | | |
| 5,920,756 | | |
| — | | |
| 494,079,244 | |
| Post-Reverse Stock Split 1:60 | |
| 500,000,000 | | |
| 4,933,963 | | |
| — | | |
| 495,066,037 | |
| Post-Reverse Stock Split 1:70 | |
| 500,000,000 | | |
| 4,229,111 | | |
| — | | |
| 495,770,889 | |
| Post-Reverse Stock Split 1:80 | |
| 500,000,000 | | |
| 3,700,472 | | |
| — | | |
| 496,299,528 | |
| Post-Reverse Stock Split 1:90 | |
| 500,000,000 | | |
| 3,289,309 | | |
| — | | |
| 496,710,691 | |
| Post-Reverse Stock Split 1:100 | |
| 500,000,000 | | |
| 2,960,378 | | |
| — | | |
| 497,039,622 | |
After
the Effective Time of the Reverse Stock Split that our Board elects to implement, our Common Stock would have a new CUSIP number.
Effect
on our Authorized Preferred Stock
The
Reverse Stock Split, if implemented, would not affect the total authorized number of shares of our preferred stock or the par value of
our preferred stock.
Effect
on Outstanding Equity Awards and Equity Plans
If
our Board decides to implement the Reverse Stock Split, as of the Effective Time, based on the Reverse Stock Split ratio selected by
the Board, proportionate adjustments will be made to all then-outstanding equity awards with respect to the number of shares of Common
Stock subject to such award and the exercise price thereof, to the extent applicable. In addition, the number of shares of Common Stock
available for issuance under the Plan will be proportionately adjusted for the Reverse Stock Split ratio selected by the Board, such
that fewer shares will be subject to the Plan.
Reduction
in Stated Capital
Pursuant
to the Reverse Stock Split, the par value of our Common Stock would remain $0.0001 per share. As a result of the Reverse Stock Split,
at the Effective Time, the stated capital on our balance sheet attributable to our Common Stock would be reduced in proportion to the
size of the Reverse Stock Split, subject to a minor adjustment in respect of the treatment of fractional shares, and the additional paid-in
capital account would be credited with the amount by which the stated capital is reduced. Our stockholders’ equity, in the aggregate,
would remain unchanged.
Beneficial
Holders of Common Stock (i.e., stockholders who hold in street name)
Upon
the implementation of the Reverse Stock Split, we intend to treat shares held by stockholders through a bank, broker, custodian or other
nominee in the same manner as registered stockholders whose shares are registered in their names. Banks, brokers, custodians or other
nominees will be instructed to effect the Reverse Stock Split for their beneficial holders holding our Common Stock in street name. However,
these banks, brokers, custodians or other nominees may have different procedures than registered stockholders for processing the Reverse
Stock Split. Stockholders who hold shares of our Common Stock with a bank, broker, custodian or other nominee and who have any questions
in this regard are encouraged to contact their banks, brokers, custodians or other nominees.
Registered
“Book-Entry” Holders of Common Stock (i.e., stockholders that are registered on the transfer agent’s books and
records but do not hold stock certificates)
Certain
of our registered holders of Common Stock may hold some or all of their shares electronically in book-entry form with the transfer agent.
These stockholders do not have stock certificates evidencing their ownership of the Common Stock. They are, however, provided with a
statement reflecting the number of shares registered in their accounts.
Stockholders
who hold shares electronically in book-entry form with the transfer agent will not need to take action (the exchange will be automatic)
to receive whole shares of post-Reverse Stock Split Common Stock, subject to adjustment for the treatment of fractional shares.
Holders
of Certificated Shares of Common Stock
If
you hold any of your shares of our Common Stock in certificated form, you will receive a transmittal letter from our transfer agent after
the Effective Time. The transmittal letter will be accompanied by instructions specifying how you can exchange your certificate representing
the pre-Reverse Stock Split shares of our Common Stock for either: (1) a certificate representing the post-Reverse Stock Split shares
of our Common Stock, or (2) post-Reverse Stock Split shares of our Common Stock in a book-entry form, evidenced by a transaction statement
that will be sent to your address of record indicating the number of shares of our Common Stock you hold, together with any payment of
cash in lieu of fractional shares to which you are entitled. Beginning at the Effective Time of the Reverse Stock Split, each certificate
representing pre-Reverse Stock Split shares of our Common Stock will be deemed for all corporate purposes to evidence ownership of post-Reverse
Stock Split shares. If you are entitled to a payment of cash in lieu of fractional shares, payment will be made as described above under
“Fractional Shares.”
WE
MAY ISSUE THE ADDITIONAL SHARES OF AUTHORIZED COMMON STOCK THAT WILL BECOME AVAILABLE AS A RESULT OF THE REVERSE STOCK SPLIT WITHOUT
THE ADDITIONAL APPROVAL OF OUR STOCKHOLDERS.
Not
a Going Private Transaction
Notwithstanding
the decrease in the number of outstanding shares following the implementation of the Reverse Stock Split, the Board does not intend for
this transaction to be the first step in a “going private transaction” within the meaning of Rule 13e-3 of the Securities
Exchange Act of 1934, as amended (the “Exchange Act”), and the implementation of the proposed Reverse Stock Split will not
cause the Company to go private.
No
Appraisal Rights
Under
the NRS, our stockholders are not entitled to appraisal rights with respect to the Reverse Stock Split, and we will not independently
provide our stockholders with any such rights.
Material
U.S. Federal Income Tax Consequences of the Reverse Stock Split
The
following discussion is a summary of material U.S. federal income tax consequences of an implemented Reverse Stock Split to U.S. Holders
(as defined below) that hold shares of our Common Stock as “capital assets” (generally, property held for investment) within
the meaning of Section 1221 of the U.S. Internal Revenue Code of 1986, as amended (the “Code”). This summary is based upon
the Code, Treasury regulations promulgated thereunder, published rulings and administrative pronouncements of the Internal Revenue Service
(the “IRS”), and judicial decisions, in each case in existence on the date hereof, all of which are subject to change and
to differing interpretations. Any such change could apply retroactively and could adversely affect the tax consequences described below.
No assurance can be given that the IRS will agree with the consequences described in this summary, or that a court will not sustain any
challenge by the IRS in the event of litigation. No advance tax ruling has been or will be sought or obtained from the IRS regarding
the tax consequences of the transactions described herein.
For
purposes of this summary, a “U.S. Holder” is a beneficial owner of shares of our Common Stock that is (a) an individual who
is a citizen or resident of the United States for U.S. federal income tax purposes, (b) an entity that is classified for U.S. federal
income tax purposes as a corporation and that is organized under the laws of the United States, any state thereof, or the District of
Columbia, or is otherwise treated for U.S. federal income tax purposes as a domestic corporation, (c) an estate the income of which is
subject to U.S. federal income taxation regardless of its source, or (d) a trust (i) whose administration is subject to the primary supervision
of a court within the United States and all substantial decisions of which are subject to the control of one or more United States persons
as described in Section 7701(a)(30) of the Code (“United States persons”), or (ii) that has a valid election in effect under
applicable Treasury regulations to be treated as a United States person.
This
summary does not discuss all U.S. federal income tax considerations that may be relevant to U.S. Holders in light of their particular
circumstances or that may be relevant to certain beneficial owners that may be subject to special treatment under U.S. federal income
tax law (for example, tax-exempt or governmental organizations, S corporations, partnership and other pass through entities (and investors
therein)), mutual funds, insurance companies, banks, thrifts and other financial institutions, dealers in securities, brokers or traders
in securities, commodities or currencies that elect to use a mark-to-market method of accounting, real estate investment trusts, regulated
investment companies, individual retirement accounts, qualified pension plans or other tax deferred accounts, persons who hold shares
of our Common Stock as part of a straddle, hedging, constructive sale, wash sale, synthetic security, conversion, or other integrated
transaction, persons required for U.S. federal income tax purposes to confirm the timing of income accruals to their financial statements
under Section 451 of the Code, U.S. Holders that have a functional currency other than the U.S. dollar, persons that own 5% or more (by
vote or value) of our Common Stock, and persons who acquired shares of our Common Stock as a result of the exercise of employee stock
options or otherwise as compensation or through a tax-qualified retirement plan). Furthermore, this summary does not discuss any alternative
minimum tax consequences or the Medicare contribution tax on net investment income and does not address any aspects of U.S. federal estate
or gift tax laws or of U.S. state or local or non-U.S. taxation.
If
an entity or arrangement classified for U.S. federal income tax purposes as a partnership owns shares of our Common Stock, the tax treatment
of a member of the entity or party to such arrangement will depend on the status of the member and the activities of the entity and such
member. The tax treatment of such an entity or arrangement, and the tax treatment of any member of such an entity or party to such an
arrangement, are not addressed in this summary. Any entity or arrangement that is classified for U.S. federal income tax purposes as
a partnership and that owns shares of our Common Stock, and any members of such an entity and parties to such an arrangement, are encouraged
to consult their tax advisors.
THIS
DISCUSSION IS FOR INFORMATIONAL PURPOSES ONLY AND IS NOT TAX ADVICE. BENEFICIAL OWNERS OF SHARES OF OUR COMMON STOCK ARE ENCOURAGED TO
SEEK ADVICE FROM THEIR OWN TAX ADVISORS REGARDING THE INCOME TAX CONSEQUENCES OF THE REVERSE STOCK SPLIT, TAKING INTO ACCOUNT THEIR PARTICULAR
SITUATIONS AS WELL AS ANY TAX CONSEQUENCES OF THE REVERSE STOCK SPLIT ARISING UNDER THE U.S. FEDERAL INCOME, ESTATE OR GIFT TAX LAWS
OR UNDER THE LAWS OF ANY STATE, LOCAL OR NON-U.S. TAXING JURISDICTION OR UNDER ANY APPLICABLE INCOME TAX TREATY.
We
intend to take the position that the Reverse Stock Split constitutes a recapitalization for U.S. federal income tax purposes pursuant
to Section 368(a)(1)(E) of the Code. Assuming the Reverse Stock Split qualifies as a recapitalization:
| | ● | a
U.S. Holder will not recognize gain or loss on the Reverse Stock Split, except with respect
to any cash received in lieu of a fractional share of our Common Stock; |
| | | |
| | ● | the
aggregate tax basis of the shares of our Common Stock received by a U.S. Holder in the Reverse
Stock Split will be equal to the aggregate tax basis of the shares exchanged therefor, excluding
any portion of such basis allocable to a fractional share of our Common Stock; |
| | | |
| | ● | the
holding period of the shares of our Common Stock received by a U.S. Holder in the Reverse
Stock Split will include the holding period of the shares exchanged therefor; and |
| | | |
| | ● | such
capital gain or loss will be short term if the shares owned immediately prior to the Reverse
Stock Split were held for one year or less at the Effective Time of the Reverse Stock Split
and long term if held for more than one year. |
In
general, a U.S. Holder who receives a cash payment in lieu of a fractional share of our Common Stock should be treated as if the fractional
share were issued and then redeemed. Whether such redemption qualifies for sale or exchange treatment depends on whether the reduction
in such U.S. Holder’s stock ownership is considered to be “not essentially equivalent to a dividend” for purposes of
Section 302(b)(l) of the Code or otherwise eligible for sale or exchange treatment. Whether such redemption is “not essentially
equivalent to a dividend” with respect to a U.S. Holder will depend upon such U.S. Holder’s particular circumstances. At
a minimum, however, for the redemption to be “not essentially equivalent to a dividend,” it must result in a “meaningful
reduction” in the U.S. Holder’s percentage stock ownership of the Company. The redemption of fractional shares from a minority
shareholder of a publicly traded corporation in a recapitalization is generally considered to be a meaningful reduction in interest or
otherwise eligible for sale or exchange treatment. Therefore, minority U.S. Holders that do not exercise control over the Company’s
corporate affairs are generally expected to recognize capital gain or loss equal to the difference between the amount of cash received
in lieu of the fractional share of our Common Stock and the portion of the U.S. Holder’s tax basis of the shares of our Common
Stock owned by such U.S. Holder immediately prior to the Reverse Stock Split that is allocable to the fractional share. Such gain or
loss generally will be long-term capital gain or loss if the U.S. Holder’s holding period in the shares of our Common Stock that
it owns immediately prior to the Reverse Stock Split is more than one year as of the date on which the Reverse Stock Split occurs. The
deductibility of capital losses is subject to limitations.
U.S.
Treasury regulations provide detailed rules for allocating the tax basis and holding period among shares of Common Stock which were acquired
by a stockholder on different dates and at different prices. U.S. Holders that acquired shares of our Common Stock on different dates
or at different prices should consult their tax advisors regarding the allocation of the tax basis and holding period among such shares.
Payments
of cash made in lieu of a fractional share of our Common Stock may, under certain circumstances, be subject to information reporting
and backup withholding. To avoid backup withholding, each U.S. Holder of our Common Stock that does not otherwise establish an exemption
from backup withholding should furnish on applicable IRS forms its taxpayer identification number and comply with the applicable certification
procedures.
Backup
withholding is not an additional tax and amounts withheld will be allowed as a credit against the U.S. Holder’s U.S. federal income
tax liability and may entitle such U.S. Holder to a refund, provided the required information is timely furnished to the IRS. U.S. Holders
of our Common Stock should consult their own tax advisors regarding the application of the information reporting and backup withholding
rules to them.
SECURITY
OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The
following table sets forth information regarding the beneficial ownership of our Common Stock on the Record Date by (a) each person who
is known by us to beneficially own 5% or more of our Common Stock, (b) each of our directors and executive officers, and (c) all of our
directors and executive officers as a group. Beneficial ownership is determined according to the rules of the SEC, which generally provide
that a person has beneficial ownership of a security if he, she or it possesses sole or shared voting or investment power over that security,
which includes the power to dispose of or to direct the disposition of the security or the right to acquire such powers within 60 days.
In computing the number of shares of our Common Stock beneficially owned by a person or entity and the percentage ownership, the Company
deemed outstanding shares of its Common Stock subject to options held by that person or entity that are currently exercisable or exercisable
within 60 days of the Record Date. We did not deem these shares outstanding, however, for the purpose of computing the percentage ownership
of any other person or entity. Unless otherwise noted, the address of each beneficial owner is c/o Tankedraget 7, Aalborg, Denmark DK-9000.
The
beneficial ownership of our Common Stock is based on 296,037,813 shares of our Common Stock issued and outstanding as of the Record Date.
| Name | |
Number of Shares Beneficially Owned | | |
Percentage of Shares Beneficially Owned(2) | |
| | |
| | |
| |
| Greater than 5% Stockholders | |
| | | |
| | |
| | |
| | | |
| | |
| Kestrel Flight Fund LLC(1) | |
| 71,797,703 | | |
| 24.3 | % |
| | |
| | | |
| | |
| AØNP14 ApS(2) | |
| 21,700,059 | | |
| 7.3 | % |
| | |
| | | |
| | |
| Directors and Executive Officers | |
| | | |
| | |
| | |
| | | |
| | |
| Sune Mathiesen | |
| 92,483,587 | (3) | |
| 31.2 | % |
| | |
| | | |
| | |
| Stefan Muehlbauer | |
| 1,000,000 | | |
| 0.3 | % |
| | |
| | | |
| | |
| Paw Juul | |
| 92,483,587 | (4) | |
| 31.2 | % |
| | |
| | | |
| | |
| All directors and executive officers as a group (3 persons) | |
| 185,967,174 | | |
| 62.2 | % |
| |
(1) |
Albert
Hanser is the Managing Partner of Kestrel Flight Fund LLC. The address of Kestrel Flight Fund LLC is 149 Meadowbrook Road, Weston,
Massachusetts 02493. |
| |
|
|
| |
(2) |
Aldo
Petersen is the managing director of AØNP14 ApS. The address of AØNP14 ApS is Amaliegade 6, DK-1256 København
K. |
| |
|
|
| |
(3) |
Consists
of 92,483,587 shares owned directly by Sune Mathiesen Holding ApS. Mr. Mathiesen is the managing director of Sune Mathiesen Holding
ApS. |
| |
|
|
| |
(4) |
Consists
of 92,483,587 shares owned by FENO Holding ApS. Mr. Juul is the managing director of FENO Holding ApS. |
WHERE
YOU CAN FIND ADDITIONAL INFORMATION
We
are subject to the reporting and information requirements of the Exchange Act, and as a result file reports, information statements and
other information with the SEC. The SEC maintains a website at www.sec.gov that contains reports, proxy and information statements
and other information regarding registrants, such as the Company, that file electronically with the SEC. We also maintain a website at
https://www.lithiumharvest.com/investors/, at which you may access these materials free of charge as soon as reasonably practicable after
they are electronically filed with, or furnished to, the SEC. The information contained in, or that can be accessed through, our website
is not part of this Information Statement.
OTHER
MATTERS
Other
Business
The
Board knows of no other matters other than those described in this Information Statement that have been approved or considered by the
Majority Stockholders.
Stockholders
Sharing an Address
The
Company will deliver only one copy of this Information Statement to multiple stockholders sharing an address unless the Company has received
contrary instructions from one or more of the stockholders. Furthermore, the Company undertakes to deliver promptly, upon written or
oral request, a separate copy of this Information Statement to a stockholder at a shared address to which a single copy of this Information
Statement is delivered. A stockholder can notify the Company that the stockholder wishes to receive a separate copy of this Information
Statement by contacting the Company at: Sustainable Projects Group Inc., 2800 Post Oak Blvd., Suite 1910, Houston, Texas 77056,
or by calling (346) 998-1533. Conversely, if multiple stockholders sharing an address receive multiple Information Statements and wish
to receive only one, such stockholders can notify the Company at the address or phone number set forth above.
*
* * * * * * * * * * * * * *
Pursuant
to the requirements of the Exchange Act, the registrant has duly caused this Information Statement to be signed on its behalf by the
undersigned hereunto authorized.
| By
Order of the Board of Directors |
|
| |
|
| /s/
Sune Mathiesen |
|
| Sune
Mathiesen |
|
| Chairman,
President & Chief Executive Officer |
|
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