SCHEDULE 14C INFORMATION
Information Statement Pursuant to Section 14(c)
of the Securities Exchange Act of 1934
[ ] Preliminary Information Statement
[ ] Confidential, For Use of the Commission Only
(as permitted by Rule 14c-5(d)(2))
[X] Definitive Information Statement
IMSCO Technologies, Inc.
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IMSCO TECHNOLOGIES, INC.
5092 S. Jones Boulevard
Las Vegas, Nevada 89119
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August 6, 2001
Dear Shareholder,
If you have been following our press releases, you know that there have
been some changes at IMSCO, including our acquisitions of Global Sports &
Entertainment, Inc. and TurfClub.com, Inc. In connection with these
developments, we are holding a special meeting of the shareholders of IMSCO
Technologies, Inc. at 10:00 a.m. on August 27, 2001 at 5092 S. Jones Boulevard,
Las Vegas, Nevada 89119. All of our shareholders as of August 3, 2001 are
invited to attend.
Enclosed is a copy of the Notice of Special Meeting of Shareholders and
an Information Statement which contains information about the company and the
actions that we will be taking at the meeting. We are not soliciting proxies,
but we encourage you to read the enclosed information and hope that you will
attend the meeting.
On behalf of the Board of Directors, thank you for your cooperation and
continued support.
By Order of the Board of Directors,
Wayne Allyn Root, Chairman of the Board
IMSCO TECHNOLOGIES, INC.
5092 S. Jones Boulevard
Las Vegas, Nevada 89119
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
AUGUST 27, 2001
10:00 A.M.
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Notice is hereby given that a special meeting of the shareholders of
IMSCO Technologies, Inc. will be held at 5092 S. Jones Boulevard, Las Vegas,
Nevada 89119 at 10:00 a.m. on August 27, 2001 to consider and vote upon the
following proposals:
1. The approval and adoption of an amendment to our Certificate
of Incorporation to:
(a) reverse split the outstanding shares of our common
stock on a 1 for 4 basis;
(b) increase our authorized common stock and preferred
stock to 50 million and 5 million shares,
respectively;
(c) change our name to Global Sports & Entertainment,
Inc.; and
2. Such other business as may properly come before the meeting
other than the matters listed above.
The Board of Directors has fixed the close of business on August 3,
2001 as the record date for determining the shareholders who will be entitled to
notice of, and to vote, at the meeting. Shareholders are cordially invited to
attend the meeting in person, but we are not asking for a proxy and you are
requested not to send us a proxy.
By Order of the Board of Directors,
Wayne Allyn Root, Chairman of the Board
Dated: August 6, 2001
IMSCO TECHNOLOGIES, INC.
5092 S. Jones Boulevard
Las Vegas, Nevada 89119
INFORMATION STATEMENT
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INTRODUCTION
We are furnishing this information statement in connection with a
special meeting of the shareholders of IMSCO Technologies, Inc. The meeting will
be held at 10:00 am on August 27, 2001 5092 S. Jones Boulevard, Las Vegas,
Nevada 89119.
We are sending this information to our shareholders on or about August
6, 2001. Our board of directors has fixed the close of business on August 3,
2001 as the record date for the determination of IMSCO shareholders entitled to
notice of and to vote at the meeting.
WE ARE NOT ASKING YOU FOR A PROXY AND YOU
ARE REQUESTED NOT TO SEND US A PROXY.
MATTERS TO BE CONSIDERED AT THE MEETING
At the meeting, and at any adjournment or postponement of the meeting,
we will ask our shareholders:
1. To authorize an amendment to our Certificate of Incorporation
to:
(a) reverse split the outstanding shares of our common
stock on a 1 for 4 basis;
(b) increase our authorized common stock and preferred
stock to 50 million and 5 million shares,
respectively;
(c) change our name to Global Sports & Entertainment,
Inc.; and
2. To transact any other business that may properly come before
the meeting.
VOTES REQUIRED AND QUORUM
Approval of the matters brought before the meeting requires the
affirmative vote of the holders of a majority of the shares entitled to vote on
such matters. As of August 3, 2001, there were 15,000,000 shares of our common
stock outstanding, 674,264 shares of our Series B Preferred Stock outstanding
and 64,000 shares of our Series C Preferred Stock outstanding. Holders of our
common stock are entitled to one vote per share. Holders of our Series B and
Series C Preferred Stock are entitled to 125 votes per share. Accordingly, there
are the equivalent of 107,283,000 votes outstanding, so the proposals will pass
if holders of at least 53,641,501 such votes cast their vote in favor.
A quorum of the shareholders is necessary to take action at the
meeting. A quorum is present if shareholders holding shares which represent a
majority of the outstanding votes are present at the meeting. Accordingly, as
described above, shareholders entitled to a total of at least 53,641,501 votes
will need to be present in order to hold a valid meeting.
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BOARD RECOMMENDATIONS - INSIDERS' INTENT TO VOTE IN FAVOR
Our board of directors has determined that approval of the reverse
split, increase in authorized capital and name change are in the best interests
of the company and our shareholders. Accordingly, the board has unanimously
approved the proposals and recommends that the shareholders who choose to attend
the meeting vote in favor of these matters as well.
Certain officers, directors and affiliates of the company who
beneficially own an aggregate of approximately 35.4% of the outstanding votes
have indicated that they intend to vote in favor of each of the proposals
discussed herein.
THE REVERSE SPLIT
(Proposal 1(a))
INTRODUCTION
On July 12, 2001, our board of directors approved a proposal to effect
a reverse split of our common stock, subject to the approval of our
shareholders. The reverse split, if approved, would combine our outstanding
common stock on 1 for 4 basis. In other words, once the reverse split takes
place, every 4 shares of common stock that you hold will be combined into 1
share. Your percentage ownership in the company and relative voting power will
remain essentially unchanged.
The reverse split will not affect the number of shares of preferred
stock outstanding, but the terms of our Series B and Series C Preferred Stock
provide for a reduction in the conversion ratio in proportion to the reverse
split ratio. Accordingly, shares of Series B and Series C Preferred Stock which
are currently convertible into 125 shares of common stock each, will be
convertible into approximately 31.25 shares of common stock following the
reverse split. Each Series B and Series C Preferred Stock holder's conversion
rights and proportional voting power will remain effectively unchanged.
REASONS FOR THE REVERSE SPLIT
We expect that we will have to raise additional equity capital in the
near future in order to finance the development and growth of our business. We
cannot promise that any offering of our securities will take place or will be
successful, but we believe that reducing the number of outstanding shares and
increasing the number of authorized and unissued shares will make our capital
structure more attractive to potential investors and provide us with greater
flexibility in structuring financings and pursuing other corporate development
opportunities.
Further, we believe that our current low stock price negatively affects
the marketability of our existing shares and our ability to raise additional
capital. Although we cannot guarantee it, we assume that the reverse split will
increase the market price of our stock in a direct inverse proportion to the
reverse split ratio. Finally, we are hopeful that the reverse split and the
resulting anticipated increased price level will encourage interest in our
common stock and possibly promote greater liquidity for our shareholders. Again,
however, we cannot guarantee that this will be the case or, indeed, that any of
the foregoing hoped-for effects will result from the reverse split.
CERTAIN EFFECTS OF THE REVERSE SPLIT
The relative voting and other rights of holders of the common stock
will not be altered by the reverse split, and each share of common stock will
continue to entitle its owner to one vote. As a result of the reverse split, the
number of shares of common stock presently outstanding will be consolidated. No
fractional shares will be issued in connection with the reverse split. Instead,
fractional shares will be rounded up and one whole share will be issued. We
expect that most shareholders will receive one additional share of common stock,
but we do not anticipate that this will materially affect any shareholder's
proportional interest. We do not anticipate that the reverse split will result
in any material reduction in the number of holders of common stock.
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The reverse split may result in some shareholders owning "odd-lots" of
less than 100 shares of common stock. Brokerage commissions and other costs of
transactions in odd-lots are generally somewhat higher than the costs of
transactions in round lots of even multiples of 100 shares.
The reverse split will not affect the company's stockholders' equity as
reflected on our financial statements, except to change the number of issued and
outstanding shares of common stock.
CERTAIN FEDERAL INCOME TAX CONSEQUENCES
Following is a summary of the material anticipated federal income tax
consequences of the proposed reverse split. This summary is based upon existing
law which is subject to change by legislation, administrative action and
judicial decision, and is necessarily general. In addition, this summary does
not address any consequence of the reverse split under any state, local or
foreign tax laws. Accordingly, this summary is not intended as tax advice to any
person or entity, and we advise you to consult with your own tax advisor for
more detailed information relating to your individual tax circumstances.
We understand that the reverse split will be a "recapitalization" under
applicable federal tax laws and regulations. As a result of such tax treatment,
no gain or loss should be recognized by the company or our shareholders as a
result of the reverse split or the exchange of pre-reverse split shares for
post-reverse split shares. A shareholder's aggregate tax basis in his or her
post-reverse split shares should be the same as his or her aggregate tax basis
in the pre-reverse split shares. In addition, the holding period of the
post-reverse split shares received by such shareholder should include the period
during which the pre-reverse split shares were held, provided that all such
shares were held as capital assets in the hands of the shareholder at the time
of the exchange.
EFFECTIVE DATE OF THE REVERSE SPLIT
If the proposal is approved by the shareholders, the reverse split will
become effective after we file an amendment to our Certificate of Incorporation
with the Secretary of State of Delaware. We anticipate that this will take place
on or about August 27, 2001. Upon filing the amendment, all of our outstanding
common stock will be converted into new common stock in accordance with the
reverse split ratio described above. After the reverse split is effective,
certificates representing shares of pre-reverse split common stock will be
deemed to represent only the right to receive the appropriate number of shares
of post-reverse split common stock.
EXCHANGE OF CERTIFICATES
You are not being asked to exchange your certificates at this time,
however you are entitled to do so after the reverse split takes place if you
wish by contacting our transfer agent. Otherwise, certificates representing
pre-reverse split shares will be exchanged for certificates reflecting
post-reverse split shares at the first time they are presented to the transfer
agent for transfer.
RIGHT TO ABANDON REVERSE SPLIT
Although we do not anticipate doing so, we may abandon the proposed
reverse split at any time prior to its effectiveness if our board of directors
deems it advisable to do so. Any decision as to the appropriateness of the
reverse split will be made by solely our board of directors and will depend upon
numerous factors including the future trading price of our stock, the growth and
development of our business and our financial condition and results of
operations.
VOTE REQUIRED
We are required to obtain the affirmative vote of at least a majority
of the voting shares that are present or represented at the meeting in order to
effect the reverse split. Certain officers, directors and affiliates of the
company who beneficially own an aggregate of approximately 35.4% of the
outstanding votes have indicated that they intend to vote their shares in favor
of the reverse split.
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INCREASE IN AUTHORIZED CAPITAL STOCK
(Proposal 1(b))
On July 12, 2001, our board of directors approved a proposal to
increase our authorized capital stock to 50 million shares of common stock and 5
million shares of preferred stock. As of July 19, 2001, we had 15 million shares
of authorized common stock, all of which was issued and outstanding. As of the
same date, we had 1 million shares of authorized preferred stock, of which
674,264 shares of Series B Preferred Stock was issued and outstanding and 64,000
shares of Series C Preferred Stock was issued and outstanding.
Our board of directors believes that it is advisable and in the best
interests of the company to have available additional authorized but unissued
shares of common stock in an amount adequate to provide for our future needs.
The additional shares will be available for issuance from time to time by us in
the discretion of the board of directors, normally without further stockholder
action (except as may be required for a particular transaction by applicable
law, requirements of regulatory agencies or by stock exchange rules), for any
proper corporate purpose including, among other things, future acquisitions of
property or securities of other corporations, stock dividends, stock splits,
convertible debt and equity financing.
Except for the outstanding convertible preferred stock, stock options
and warrants, we have no present commitments for the issuance or use of the
proposed additional shares of common stock or preferred stock. However, our
board of directors believes that if an increase in the authorized number of
shares of common stock were to be postponed until a specific need arose, the
delay and expense incident to obtaining the approval of our stockholders at that
time could significantly impair our ability to meet financing requirements or
other objectives.
NAME CHANGE TO GLOBAL SPORTS & ENTERTAINMENT, INC.
(Proposal 1(c))
On July 12, 2001, our board of directors approved a proposal to change
our corporate name to "Global Sports & Entertainment, Inc.," subject to the
approval of the shareholders.
VOTE REQUIRED
We are required to obtain the affirmative vote of at least a majority
of the voting shares that are present or represented at the meeting in order to
change our name. Certain officers, directors and affiliates of the company who
own an aggregate of approximately 35.4% of the outstanding votes have indicated
that they intend to vote their shares in favor of the proposed name change.
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SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The table below sets forth certain information with respect to
beneficial ownership of our stock as of July 20, 2001 by:
o persons known by us to be the beneficial owners of more than
five percent of our issued and outstanding common or preferred
stock;
o each of our executive officers and directors; and
o all of our officers and directors as a group.
The information provided reflects projected ownership of common stock
assuming that all outstanding shares of Series B and Series C Preferred Stock
have been converted into common stock and the proposed 1 for 4 reverse split has
been effected. Accordingly, percentages are computed using a denominator of
26,820,750 shares of common stock outstanding.
PERCENT OF
NAME AND ADDRESS OF BENEFICIAL OWNER NUMBER OF SHARES (1) CLASS
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Wayne Allyn Root 4,126,200 15.4%
5092 S. Jones Boulevard
Las Vegas, Nevada 89119
Douglas R. Miller 3,625,408(2) 13.5%
5092 S. Jones Boulevard
Las Vegas, Nevada 89119
Thomas G. Muehlbauer 1,739,003 6.5%
5092 S. Jones Boulevard
Las Vegas, Nevada 89119
Kerlee Inter Vivos Trust 3,625,408(2) 13.5%
5092 S. Jones Boulevard
Las Vegas, Nevada 89119
Hadfield Jackson Trust 3,130,206 11.7%
5092 S. Jones Boulevard
Las Vegas, Nevada 89119
Trilium Holdings Ltd. 4,000,000(3) 13.9%
Charlotte House
Charlotte Street
Nassau, Bahamas
All officers and directors as a group 9,490,611 35.4%
(3 persons)
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(1) Figures are approximate due to rounding.
(2) Represents shares held in the record name of the Kerlee Inter Vivos
Trust. Douglas R. Miller is a beneficiary of the Kerlee Inter Vivos
Trust.
(3) Includes 2,000,000 common shares underlying presently exercisable
warrants.
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RECENT CHANGES
CHANGE IN CONTROL
On July 11, 2001, Global Sports & Entertainment, Inc., a Delaware
corporation ("Global Sports"), and TurfClub.com, Inc., a California corporation
("TurfClub"), completed a reverse acquisition of IMSCO pursuant to which IMSCO
acquired all of the outstanding shares of Global Sports and TurfClub stock in
exchange for a controlling interest in IMSCO (the "Reorganization"). Pursuant to
an Agreement of Plan of Reorganization dated July 6, 2001, we issued to the
shareholders of Global and TurfClub a total of 669,464 shares of our Series B
Preferred Stock. Concurrent with the closing of the Reorganization, we closed
the private placement sale of 64,000 units, each unit consisting of one share of
our Series C Preferred Stock and one warrant to purchase an additional Series C
Preferred share, for $1,500,000. In connection with the Reorganization, we
issued 4,800 shares of its Series B Preferred Stock to an unaffiliated party in
payment of a broker's commission.
Each share of the our Series B and Series C Preferred Stock is
convertible into 125 shares of our common stock. We intend to seek shareholder
approval of (i) an increase in our authorized common stock to 50 million shares
and preferred stock to 5 million shares, (ii) a 1 for 4 reverse split of our
outstanding common shares, and (iii) a change in our corporate name to "Global
Sports & Entertainment, Inc." Upon the effectiveness of the increase in our
authorized common stock and reverse split, the shares of Series B Preferred
Stock issued to the former shareholders of Global Sports and TurfClub shall
automatically convert into a total of 20,920,750 shares (as adjusted for the
split) of our common stock, and the outstanding Series C Preferred Stock shall
be convertible, at the holder's option, into a total of 2,000,000 shares (as
adjusted for the split) of our common stock.
In connection with the Reorganization, all of our pre-Reorganization
officers and directors resigned and Wayne Allyn Root, Douglas R. Miller and
Thomas G. Muehlbauer were appointed as directors of the company. Mr. Root was
also appointed to serve as our Chairman of the Board and Chief Executive
Officer, Mr. Miller was appointed to serve as our President and Chief Operating
Officer. Mr. Muehlbauer was appointed to serve as our Chief Financial Officer
and Executive Vice President.
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