SCHEDULE 14C
(Rule 14c-101)
INFORMATION REQUIRED IN INFORMATION STATEMENT
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
[x] Definitive Information Statement Commission only
GREENSHIFT CORPORATION.
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(Name of Registrant as Specified In Its Charter)
Payment of Filing Fee (Check the appropriate box):
[x] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14c-5(g) and 0-11.
1) Title of each class of securities to which transaction applies:
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2) Aggregate number of securities to which transaction applies:
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3) Price per unit or other underlying value of transaction 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:
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5) Total fee paid:
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[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
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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GREENSHIFT CORPORATION
ONE PENN PLAZA, SUITE 1612
NEW YORK, NY 10119
INFORMATION STATEMENT
To the Holders of the Voting Stock:
The purpose of this Information Statement is to notify you that the holder of
shares representing a majority of the voting power of GreenShift Corporation
(the "Company") has given its written consent to a resolution adopted by the
Board of Directors of the Company to amend the articles of incorporation so as
(1) to change the name of the company to "Carbonics Capital Corporation", (2) to
effect a reverse split of the Company's common stock in a ratio of 1-for-20, and
(3) to increase the Company's authorized common stock to 500,000,000 shares. We
anticipate that this Information Statement will be mailed on January 11, 2008 to
shareholders of record. On or after January 31, 2008, the amendment of the
articles of incorporation will be filed with the Delaware Secretary of State and
will become effective.
Delaware corporation law permits holders of a majority of the voting power to
take shareholder action by written consent. Accordingly, the Company will not
hold a meeting of its shareholders to consider or vote upon the amendment of the
Company's certificate of incorporation.
WE ARE NOT ASKING YOU FOR A PROXY.
YOU ARE REQUESTED NOT TO SEND US A PROXY.
January 11, 2008 Kevin Kreisler
Chairman and Chief Executive Officer
VOTING SECURITIES AND PRINCIPAL SHAREHOLDERS
We determined the shareholders of record for purposes of this shareholder action
at the close of business on December 28, 2007 (the "Record Date"). On the Record
Date, the authorized voting stock consisted of:
(1) 200,000,000 shares of common stock, par value $0.001, each of which is
entitled to one vote. On the Record Date, there were 200,000,000
shares of common stock issued, outstanding and entitled to vote.
(2) 1,000,000 shares of Series C Preferred Stock, par value $0.001. On the
Record Date, there were 973,054 shares of Series C preferred stock
issued, outstanding and entitled to vote. As a result the voting power
of the outstanding shares of Series C preferred stock is equal to that
of 1,459,429,905 common shares.
The following table sets forth the number of shares of voting stock beneficially
owned by each person who, as of the Record Date, owned beneficially more than 5%
of either class of the Company's voting stock, as well as the ownership of such
shares by each member of the Company's Board of Directors and the shares
beneficially owned by its officers and directors as a group.
Name and Address Amount and Nature of Percent of Class Percent of
of Beneficial Owner(1) Beneficial Ownership Common Preferred Voting Power
- -------------------------------------------------------------------------------------------------------------------
Kevin Kreisler (2) 973,054 Series C Preferred -- 100% 77.84%
Kurt Gordon -- -- -- --%
David Winsness -- -- -- --%
Current officers and directors973,054 Series C Preferred -- 100% 77.84%
as a group (4 persons)
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<FN>
(1) The address of all shareholders, unless otherwise noted, is c/o
GreenShift Corporation, One Penn Plaza, Suite 1612, New York, NY
10119.
(2) Represents shares owned by Viridis Capital, LLC, which company is
majority owned by Mr. Kreisler, the Company's chairman and chief
executive officer.
</FN>
AMENDMENT OF THE ARTICLES OF INCORPORATION
TO CHANGE THE NAME OF THE CORPORATION
Until December 2007 GreenShift Corporation owned a group of affiliated
corporations. The name of each corporation was in the form "GS (name)."
Recently, however, GreenShift divested itself of the GS group of corporations,
and management intends to pursue new business activities. For that reason, the
Board of Directors of GreenShift Corporation has adopted a resolution to change
the name of the corporation from GreenShift Corporation to "Carbonics Capital
Corporation." The holder of shares representing a majority of the voting power
of the Company's outstanding voting stock has given his written consent to the
resolution. Under Delaware corporation law, the consent of the holders of a
majority of the voting power is effective as shareholders' approval. We will
file an Amendment with the Secretary of State of Delaware effective the name
change, which will become effective on or after January 31, 2008 (the "Effective
Date").
AMENDMENT OF THE CERTIFICATE OF INCORPORATION
TO EFFECT A REVERSE STOCK SPLIT OF THE COMMON STOCK
AND TO INCREASE THE AUTHORIZED COMMON STOCK TO 500 MILLION SHARES
The Board of Directors of the Company has unanimously adopted a resolution to
amend the Certificate of Incorporation to effect a reverse split of the
Company's outstanding common stock at a ratio of 1:20 (the "Reverse Split") and
to increase the authorized common stock to 500 million shares (identified,
together with the Reverse Split, as the "Recapitalization"). The holder of
shares representing a majority of the voting power of the Company's outstanding
voting stock has given its written consent to the resolution. Under Delaware
corporation law, the consent of the holder of a majority of the voting power is
effective as shareholders' approval. We will file an Amendment with the
Secretary of State of Delaware effecting the Recapitalization, which will become
effective on or after January 31, 2008 (the "Effective Date").
The Amendment to the Certificate of Incorporation will provide that each twenty
shares of common stock outstanding on the Effective Date will be exchanged for
one post-Reverse Split share of Company common stock ("New Common Stock"). No
fractional shares or scrip will be issued; rather, shareholders who would
otherwise be entitled to a fractional share as a result of the Reverse Split
will be issued one whole share of New Common Stock in lieu of the fraction.
Reasons for Approving the Recapitalization
There are three primary reasons why the Board of Directors approved the
Recapitalization. The first reason is the exhaustion of our authorized stock.
Our articles of incorporation authorize the Board of Directors to issue
200,000,000 common shares. At present, 200,000,000 common shares have been
issued and remain outstanding. There are no authorized but unissued shares of
common stock available for the various purposes for which the Board of Directors
might wish to use such shares, such as effecting acquisitions, business
expansion, obtaining financing, and recruiting management personnel, all of
which will be necessary if the Company is to take advantage of new business
opportunities.
The second reason for the Recapitalization is to make shares of authorized
common stock available for issuance upon the conversion or exercise of
derivative securities that are currently outstanding. Viridis Capital, LLC
(which is owned by Kevin Kreisler, our Chairman) currently holds 973,054 shares
of Series C Preferred Stock that are convertible into Company common stock equal
to 77.84% of the fully diluted capital stock of the Company. One effect of the
Recapitalization will be to make available authorized shares for issuance upon
conversion of the preferred shares.
In addition, there are outstanding debentures issued by GreenShift that are
convertible, at the instance of the debt-holders, into GreenShift common stock.
There are also warrants and options issued by GreenShift that are exercisable
for common stock. The following table shows the derivative securities currently
outstanding that may result in the issuance of more than 1,000,000 common
shares:
Principal Shares
Derivative Security Issue Date Amount Issuable
- -------------------------------------------- ------------------ ------------------ ------------------
Secured Convertible Debenture (1) 10/2005 $ 395,267 16,891,752
Secured Convertible Debenture (1) 2/7/2006 $ 1,150,369 49,161,068
Secured Convertible Debenture (1) 6/2007 $ 570,000 24,358,974
Warrants (2) 2/2006 $ -- 45,000,000
<FN>
(1) The principal amount and accrued interest on these Secured Convertible
Debentures are convertible by the holder into common stock at a
conversion rate equal to the lesser of $0.10 per share or 80% of the
average of the closing market prices for the common stock during the
five days preceding conversion. At $0.023 (80% of the average of the
closing market prices for the common stock for the 5 days prior to
December 19, 2007), the Secured Convertible Debentures could be
converted into 90,411,795 common shares.
(2) There are three five-year Warrants that were issued in connection with
the sale of the Secured Convertible Debentures on February 7, 2006.
One permits the purchase of 15,000,000 shares at $0.15 per share. One
permits the purchase of 15,000,000 shares at $0.20 per share. One
permits the purchase of 15,000,000 shares at $0.25 per share. The
Warrants expire on February 7, 2011.
</FN>
All of the foregoing derivative securities are currently exercisable, and the
notes and debentures will remain exercisable until satisfied. In the event that
any of the foregoing derivative securities were converted or exercised,
GreenShift would not be able to issue the requisite common stock, and would be
in default, unless the number of available common shares is increased.
Conversion of those debentures would improve GreenShift's balance sheet by
reducing its debt to equity ratio, and increase its ability to obtain future
financing. However, conversion would also dilute the interest of current
shareholders in the equity in GreenShift. The additional authorized common stock
is necessary to accommodate those conversions, should they occur.
At the present time, the Board of Directors has not made any specific plan,
commitment, arrangement, understanding or agreement with respect to the
additional authorized shares that will be available for issuance after the
Recapitalization, other than shares needed for issuance upon conversion of the
derivative securities discussed above.
The third reason, specifically for the Reverse Split, relates to the current low
market price of our common stock. The Company may require financing to fund its
business development, be it the costs of acquisitions or the capital needed to
fund the growth of the acquired companies. The Board of Directors has come to
the conclusion that an increase in the market price of the common stock may
enhance the marketability of the common stock and so improve the Company's
prospects for obtaining financing. It is hoped that the Reverse Split will
increase the per share market price of the common stock. There is, however, no
assurance that the market price will increase, or that it will not return to its
current levels after the Reverse Split.
Recently, the market price for Company common stock has been only pennies per
share. Many brokerage firms are reluctant to recommend lower-priced stocks to
their clients. The policies and practices of some brokerage houses tend to
discourage individual brokers within those firms from dealing in lower priced
stocks. Additionally, the brokerage commission on the purchase or sale of stock
with a relatively low per share price generally tends to represent a higher
percentage of the sales price than the brokerage commission charged on a stock
with a relatively high per share price.
The Board of Directors believes that these issues are best addressed by an
increase in the inherent value per share of common stock that will occur as a
result of the Reverse Split. The Board believes that, absent the Reverse Split,
the Company is not likely to obtain additional financing on favorable terms.
Accordingly, the Board believes that the proposed Reverse Split is essential to
the Company's growth.
General Effect of the Increase in Authorized Common
Stock and the Reverse Stock Split on Our Capital Stock
The New Common Stock will not be different from the common stock held by the
Company's stockholders prior to the Reverse Split. The stockholders will have
the same relative rights following the Effective Date as they had prior to the
Effective Date, except to the extent the proportion of shares that they own is
affected by the rounding up of fractional shares. The table below shows the
cumulative effect on the Company's voting stock of the "Recapitalization" that
will occur on the Effective Date, namely: (a) the increase in authorized common
stock and (b) the reverse split of the outstanding common stock. The column
labeled "After Recapitalization" does not reflect any adjustments that may
result from the rounding-up of fractional shares because we cannot calculate at
this time the number of fractional shares that will result from the Reverse
Split.
Prior to After
Shares of Common Stock Recapitalization Recapitalization
- ------------------------------------------------------------------ ----------------- ------------------
Authorized common stock 200,000,000 500,000,000
Authorized preferred stock 1,000,000 1,000,000
Issued and outstanding common stock 200,000,000 10,000,000
Issued and outstanding preferred stock 973,054 973,054
Issuable upon conversion of Series C Preferred Stock 1,459,429,905 72,971,496
Outstanding if all preferred stock is converted 1,874,909,950 82,971,496
Available for issuance if all preferred stock is converted -- 417,028,504
As a result of the Recapitalization, there will be 417,028,504 shares available
for issuance after the conversion of the preferred shares. The Board of
Directors will be authorized to issue the additional common shares without
having to obtain the approval of the Company's shareholders. Delaware law
requires that the Board use its reasonable business judgment to assure that the
Company obtains "fair value" when it issues shares. Nevertheless, the issuance
of the additional shares would dilute the proportionate interest of current
shareholders in the Company. The issuance of the additional shares could also
result in the dilution of the value of shares now outstanding, if the terms on
which the shares were issued were less favorable than the contemporaneous market
value of the Company's common stock.
The Recapitalization, with the resulting increase in the number of shares
available for issuance, is not being done for the purpose of impeding any
takeover attempt. Nevertheless, the power of the Board of Directors to provide
for the issuance of shares of common stock without shareholder approval has
potential utility as a device to discourage or impede a takeover of the Company.
In the event that a non-negotiated takeover were attempted, the private
placement of stock into "friendly" hands, for example, could make the Company
unattractive to the party seeking control of the Company. This would have a
detrimental effect on the interests of any stockholder who wanted to tender his
or her shares to the party seeking control or who would favor a change in
control.
Exchange of Stock Certificate and Liquidation of Fractional Shares
On the Effective Date, the outstanding certificates representing shares of the
Company's common stock will be automatically converted into certificates
representing shares of New Common Stock. It is not necessary for a shareholder
to obtain a replacement certificate in order to be registered in the record
books of the corporation as the owner of the appropriate number of share of New
Common Stock. Every shareholder who wishes to receive a replacement certificate,
however, may do so by surrendering to the Transfer Agent his certificate
representing shares of pre-Reverse Split and paying the Transfer Agent's
standard fee. In exchange, he will receive a replacement certificate
representing the appropriate number of share of New Common Stock. The name and
address of the Transfer Agent are:
Olde Monmouth Stock Transfer Co.
200 Memorial Parkway
Atlantic Highlands, NJ 07716
732-872-2727
No Dissenters Rights
Under Delaware law, shareholders are not entitled to dissenters' rights with
respect to any of the transactions described in this Information Statement.
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