U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C 20549
SCHEDULE 14C INFORMATION
Information Statement Pursuant to Section 14(c)
of the Securities Exchange Act of 1934
Check the appropriate box:
[X] Preliminary Information Statement
[ ] Confidential, for Use of the Commission Only (as permitted by
Rule 14c-5(d)(2))
[ ] Definitive Information Statement
INTERNET BUSINESS'S INTERNATIONAL, INC.
(Name of Registrant as Specified in 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:
(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):
(4) Proposed maximum aggregate value of transaction:
(5) Total fee paid:
[ ] 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:
(2) Form, Schedule or Registration Statement No.:
(3) Filing Party:
(4) Date Filed:
INTERNET BUSINESS'S INTERNATIONAL, INC.
4634 SOUTH MARYLAND PARKWAY, SUITE 101
LAS VEGAS, NEVADA 89119
INFORMATION STATEMENT
This Information Statement is being circulated to the
shareholders of Internet Business's International, Inc., a Nevada
corporation (the `Company") in connection with the taking of corporate action
without a meeting upon the written consent of the holders of a majority of the
outstanding shares of the Company's common stock, $0.001 par value (the "Common
Stock").
WE ARE NOT ASKING YOU FOR A PROXY AND YOU ARE REQUESTED NOT
TO SEND US A PROXY.
As more completely described below, the matter upon which
action was taken is the approval of a one-for-ten (1 for 10) reverse
stock split of the Common Stock. The date such action was approved by
written consent of the shareholders was April 15, 2002.
This Information statement is being first sent or given to
shareholders on or about April __, 2002.
By Order of the Board of Directors
/s/ Albert R. Reda
Albert R. Reda
Chief Executive Officer
Las Vegas, Nevada
April __, 2002
WE ARE NOT ASKING YOU FOR A PROXY AND
YOU ARE REQUESTED NOT TO SEND US A PROXY.
The Board of Directors of INTERNET BUSINESS'S INTERNATIONAL,
INC., a Nevada corporation (the "Company") is furnishing this
Information Statement to shareholders in connection with a Majority
Action of Shareholders of the Company taken on April 15, 2002, related
to approving a one-for-ten reverse stock split of the Company's common
stock, $0.001 par value (the "Common Stock").
This Information Statement is first being mailed to shareholders on or
about April __, 2002.
QUESTIONS AND ANSWERS
Q: What am I being asked to approve?
A: You are not being asked to approve anything. This Information
Statement is being provided to you solely for your information.
Shareholders holding a majority of the outstanding voting common stock
of the Company have already agreed to approve a one-for-ten reverse
stock split of the Company's outstanding Common Stock.
Q: Who can I call with questions?
A: Please call Albert R. Reda at (949) 833-0261.
GENERAL INFORMATION
OUTSTANDING SHARES AND VOTING RIGHTS
On April 15, 2002, the Board of Directors authorized and
approved, subject to shareholder approval, a corporate action, which
the Board of Directors deemed to be in the best interests of the
Company and its shareholders. The Board of Directors further
authorized the preparation and circulation of this Information
Statement and a shareholders' consent to the holders of a majority of
the outstanding shares of Common Stock.
There are currently 343,486,029 shares of Common Stock
outstanding, and each share of Common Stock is entitled to one vote.
The consent of shareholders holding at least fifty percent (50%) of
the outstanding shares of Common Stock is necessary to approve the
matter being considered. Except for the Common Stock, there is no
other class of voting securities outstanding at this date. The record
date for determining shareholders entitled to vote or give consent is
April 15, 2002 (the "Record Date"). As of the Record Date,
shareholders holding 176,398,906 shares (51.35%) have provided their
consent to the proposed action.
The matter upon which action is proposed to be taken is the
effectuation by the Company of a one-for-ten reverse stock split of
the Company's outstanding Common Stock (the "Reverse Stock Split").
Upon the effective date of the Reverse Stock Split, each
certificate representing shares of Common Stock outstanding
immediately prior to the Reverse Stock Split (the "Old Common Stock")
will be deemed automatically without any action on the part of the
shareholders to represent one-tenth the number of shares of Common
Stock after the Reverse Stock Split (the "New Common Stock");
provided, however, that no fractional shares of New Common Stock will
be issued as a result of the Reverse Stock Split. All fractional
shares will be rounded to the next highest whole number. After the
Reverse Stock Split becomes effective, shareholders will be asked to
surrender certificates representing shares of Old Common Stock in
accordance with the procedures set forth in a letter of transmittal to
be sent by the Company. Upon such surrender, a certificate
representing shares of New Common Stock will be issued and forwarded
to the shareholders.
The Reverse Stock Split alone will reduce the number of
outstanding shares of Common Stock to approximately 34,348,600 shares.
The number of shares of capital stock authorized by the Articles of
Incorporation will not change as a result of the Reverse Stock Split.
The Common Stock issued pursuant to the Reverse Stock Split will be
fully paid and non-assessable. The Reverse Stock Split will not alter
the voting and other rights that presently characterize the Common
Stock. The Common Stock is currently quoted on the OTC Bulletin Board
under the trading symbol "IBUI."
EXPENSES OF INFORMATION STATEMENT
The expenses of mailing this Information Statement will be
borne by the Company, including expenses in connection with the
preparation and mailing of this Information Statement and all
documents that now accompany or may hereafter supplement it. It is
contemplated that brokerage houses, custodians, nominees, and
fiduciaries will be requested to forward the Information Statement to
the beneficial owners of the Common Stock held of record by such
persons and that the Company will reimburse them for their reasonable
expenses incurred in connection therewith.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth information regarding the
beneficial ownership of shares of the Company's common stock as of
April 15, 2002 by (i) all stockholders known to the Company to be
beneficial owners of more than 5% of the outstanding Common Stock;
(ii) each director; and (iii) all directors and executive officers of
the Company individually and as a group. Unless otherwise indicated,
each person has sole voting power and sole dispositive power as to all
of the shares shown as beneficially owned by them:
Name and Address Amount and Nature of Percent of
of Beneficial Owner Beneficial Ownership Class
Reda Family Trust (1) 29,600,000 8.61%
3338 Punta Alta, #1E
Laguna Hills, CA 92653
Cherry Family Trust (2) 15,916,086 4.63%
29245 Pompano Way
Laguna Niguel, CA 92677
Romis Corp. (3) 17,750,000 5.16%
P.O. Box 4321
Mission Viejo, CA 92690
Albert Reda Corp. (4) 17,750,000 5.16%
3900 Birch Street, Suite 103
Newport Beach, CA 92660
Wade Whitely 6,570,000 1.91%
3900 Birch Street, Suite 103
Newport Beach, CA 92660
Albert R. Reda 1,566,086 0.45%
3900 Birch Street, Suite 103
Newport Beach, CA 92660
Louis Cherry 17,750,000(3)(5) 5.16%
3900 Birch Street, Suite 103
Newport Beach, CA 92660
All executive officers and 89,152,172 25.92%
directors as a group (3 persons)
(1) Reda Family Trust is a trust created by Albert Reda for shares
obtained upon the change in control of the Company in November 1998.
(2) Cherry Family Trust is a trust created by Louis Cherry for
shares obtained upon the change in control of the Company in November 1998.
(3) Romis Corp. is a corporation controlled by Louis Cherry, which
holds shares issued as compensation for services performed by Mr.
Cherry for the Company.
(4) Albert Reda Corp. is a corporation controlled by Albert Reda, which
holds shares issued as compensation for services performed by Mr. Reda for
the Company.
(5) Consists of shares held by Romis Corp.
REVERSE STOCK SPLIT
On April 15, 2002, the Board of Directors and holders of a
majority of the outstanding Common Stock of the Company authorized and
approved by written consent a Reverse Stock Split of one-for-ten of
the Company's outstanding Common Stock. The intent of the Reverse
Stock Split is to increase the marketability and liquidity of the
Common Stock. However, shareholders are cautioned that there can be no
assurance that this will come to pass.
As of the date of this Information Statement, it is
anticipated that the Reverse Stock Split will become effective on or
about May __, 2002 (the "Effective Date"). The procedures for
consummation of the Reverse Stock Split are attached hereto as Exhibit A.
PURPOSES AND EFFECTS OF THE REVERSE STOCK SPLIT
The Common Stock is listed for trading on the OTC Bulletin
Board under the symbol IBUI. On the Record Date, the reported closing
price of the Common Stock on the OTC Bulletin Board was $.0064 per share.
The Board believes that the current per-share price of the
Common Stock has limited the effective marketability of the Common
Stock because of the reluctance of many brokerage firms and
institutional investors to recommend lower-priced stocks to their
clients or to hold them in their own portfolios. Certain policies and
practices of the securities industry may tend to discourage individual
brokers within those firms from dealing in lower-priced stocks. Some
of those policies and practices involve time-consuming procedures that
make handling of lower-priced stock economically unattractive. The
brokerage commission on lower-priced stock may also represent a higher
percentage of the sale price than the brokerage commission on a higher
priced issue. Any reduction in brokerage commissions resulting from
the Reverse Stock Split may be offset, however, in whole or in part,
by increased brokerage commissions required to be paid by stockholders
selling "odd lots" created by such Reverse Stock Split.
On the Record Date the number of beneficial holders of the
Common Stock was approximately 1,000. The Company does not anticipate
that the Reverse Stock Split will result in a significant reduction in
the number of such holders, and does not currently intend to effect
any Reverse Stock Split that would result in a reduction in the number
of holders large enough to eliminate the Company's being subject to
the periodic reporting requirements of the Securities and Exchange Commission.
The Reverse Stock Split would have the following effects upon
the number of shares of Common Stock outstanding (343,486,029 shares
as of the Record Date) assuming that no additional shares of Common
Stock are issued by the Company after the Record Date and that the
Reverse Stock Split is effected and without taking into account any
increase in the number of outstanding shares resulting from the
exercise of outstanding options. The Common Stock will continue to
have a par value of $0.001 per share following the Reverse Stock
Split, and the number of shares Common Stock outstanding will be
reduced to approximately 34,348,600 shares.
At the Effective Date, each share of Common Stock issued and
outstanding immediately prior thereto (the "Old Shares") will be
reclassified as and changed into the appropriate fraction of a share
of the Common Stock (the "New Common Stock"), subject to the treatment
of fractional share interests as described below. Shortly after the
Effective Date, the Company will send transmittal forms to the holders
of the Old Common Stock to be used in forwarding their certificates
formerly representing Old Common Stock for surrender and exchange for
certificates representing New Common Stock. No certificates or scrip
representing fractional share interests in the New Common Stock will
be issued, and no such fractional share interest will entitle the
holder thereof to vote, or to any rights of a shareholder of the
Company. In lieu of any such fractional share interest, each holder of
Old Common Stock who would otherwise be entitled to receive a
fractional share interest of New Common Stock will in lieu receive one
full share upon surrender of certificates formerly representing Old
Common Stock held by such holder.
FEDERAL INCOME TAX CONSEQUENCES OF THE REVERSE STOCK SPLIT
The following is a summary of the material federal income tax
consequences of the proposed Reverse Stock Split. This summary does
not purport to be complete and does not address the tax consequences
to holders that are subject to special tax rules, such as banks,
insurance companies, regulated investment companies, personal holding
companies, foreign entities, non-resident alien individuals, broker-
dealers and tax-exempt entities. This summary is based on the Internal
Revenue Code of 1986, as amended (the "Code"), Treasury regulations
and proposed regulations, court decisions and current administrative
rulings and pronouncements of the Internal Revenue Service (the
"IRS"), all of which are subject to change, possibly with retroactive
effect, and assumes that the New Common Stock will be held as a
"capital asset" (generally, property held for investment) as defined
in the Code. Holders of Old Common Stock are advised to consult their
own tax advisers regarding the federal income tax consequences of the
Reverse Stock Split in light of their personal circumstances and the
consequences under state, local and foreign tax laws.
1. The Reverse Stock Split will qualify as a recapitalization
described in Section 368(a)(1)(E) of the Code.
2. No gain or loss will be recognized by the Company in connection with the
Reverse Stock Split.
3. No gain or loss will be recognized by a shareholder who exchanges all of
his or her Old Common Stock solely for New Common Stock.
4. The aggregate basis of the New Common Stock to be received in
the Reverse Stock Split (including any whole shares received
in lieu of fractional shares) will be the same as the
aggregate basis of the Old Common Stock surrendered in
exchange therefore.
5. The holding period of the New Common Stock to be received in
the Reverse Stock Split (including any whole shares received
in lieu of fractional shares) will include the holding period
of the Old Common Stock surrendered in exchange therefore.
THE FOREGOING SUMMARY IS INCLUDED FOR GENERAL INFORMATION ONLY.
ACCORDINGLY, EACH HOLDER OF COMMON STOCK OF THE COMPANY IS URGED TO
CONSULT WITH HIS OR HER OWN TAX ADVISER WITH RESPECT TO THE TAX
CONSEQUENCES OF THE PROPOSED REVERSE STOCK SPLIT, INCLUDING THE
APPLICATION AND EFFECT OF THE LAWS OF ANY STATE, MUNICIPAL, FOREIGN OR
OTHER TAXING AUTHORITY.
EXHIBIT A
THE REVERSE STOCK SPLIT
RESOLVED, that the Board of Directors be, and it hereby is,
authorized to effect a Reverse Stock Split in accordance with the
following resolutions.
FURTHER RESOLVED, that such Reverse Stock Split shall be
effected as follows:
Simultaneously with the effective date of the
Reverse Stock Split (the "Effective Date"), which shall
be 20 calendar days after the mailing to all shareholders
of record as of April 15, 2002 of an Information
Statement pursuant to Rule 14C-2 under the Securities
Exchange Act of 1934, if a business day, or the next
business day after such 20th day, each share of the
Company's common stock, $0.001 par value, issued and
outstanding immediately prior to the Effective Date (the
"Old Common Stock") shall automatically and without any
action on the part of the holder thereof be reclassified
as and changed, pursuant to a reverse stock split, into
any fraction thereof, into one-tenth of a share of
the Company's outstanding common stock, $0.001 par value
(the "New Common Stock"), subject to the treatment of
fractional share interests as described below. Each
holder of a certificate or certificates which immediately
prior to the Effective Date represented outstanding
shares of Old Common Stock (the "Old Certificates,"
whether one or more) shall be entitled to receive
upon surrender of such Old Certificates to the Company's
transfer agent for cancellation, a certificate or
certificates (the "New Certificates," whether one or
more) representing the number of whole shares of the New
Common Stock into which and for which the shares of the
Old Common Stock formerly represented by such Old
Certificates so surrendered, are reclassified under the
terms hereof.
From and after the Effective Date, Old
Certificates shall represent only the right to receive
New Certificates pursuant to the provisions hereof. No
certificates or scrip representing fractional share
interests in New Common Stock will be issued, and no such
fractional share interest will entitle the holder thereof
to vote, or to any rights of a shareholder of the
Company. Any fraction of a share of New Common Stock to
which the holder would otherwise be entitled will be
adjusted upward to the nearest whole share. If more than
one Old Certificate shall be surrendered at one time for
the account of the same shareholder, the number of full
shares of New Common Stock for which New Certificates
shall be issued shall be computed on the basis of the
aggregate number of shares represented by the Old
Certificates so surrendered. In the event that the
Company's transfer agent determines that a holder of Old
certificates has not tendered all his or her certificates
for exchange, the transfer agent shall carry forward any
fractional share until all certificates of that holder
have been presented for exchange such that payment for
fractional shares to any one person shall not exceed the
value of one share. If any New Certificate is to be
issued in a name other than that in which the Old
Certificates surrendered for exchange are issued, the Old
Certificates so surrendered shall be properly endorsed
and otherwise in proper form for transfer. From and after
the Effective Date the amount of capital represented by
the shares of the New Common Stock into which and for
which the shares of the Old Common Stock are reclassified
under the terms hereof shall be the same as the amount of
capital represented by the shares of Old Common Stock so
reclassified, until thereafter reduced or increased in
accordance with applicable law.
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