UNITED STATES
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 [ ] Confidential,
for Use of the Commission Only (as permitted by Rule 14c-5(d)(2))
[ ] Definitive Information Statement
ICEWEB, INC.
--------------------------------------------
(Name of Registrant As Specified in Charter)
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ICEWEB, INC.
620 Herndon Parkway
Suite 360
Herndon, Virginia 20170
telephone 703-964-8000
Dear Stockholders:
We are writing to advise you that IceWeb, Inc. intends to amend its
Certificate of Incorporation (the "Amendment") increasing the number of
authorized shares of common stock from 100,000,000 shares to 1,000,000,000
shares and effect a forward stock split of all of the outstanding shares of our
common stock at a ratio of 10-for-one. This action was approved on February 23,
2004 by our Board of Directors. In addition, six individuals who hold a majority
of our issued and outstanding voting securities have advised us that they will
approve this action by written consent in lieu of a special meeting in
accordance with the relevant sections of the Delaware General Corporation Law.
These actions will not be effective until after we file the Amendment with the
Delaware Secretary of State. We intend to file the Amendment on or about
________________, 2004, which is 20 days after the date this information
statement is first mailed to our stockholders.
The forward stock split and increase in the authorized common stock of
IceWeb is not intended to change the proportionate equity interest of our
stockholders in relation to the authorized common stock of IceWeb. As described
hereafter, it is hoped that these actions will result in a broader based market
and promote greater liquidity for IceWeb's stockholders. Since there is no
proportionate increase between the outstanding and authorized shares of common
stock as a result of this Amendment, this action is not designed to permit or
facilitate any transaction involving the common stock of IceWeb.
WE ARE NOT ASKING YOU FOR A PROXY, AND YOU ARE REQUESTED NOT TO SEND US
A PROXY.
No action is required by you. The accompanying information statement is
furnished only to inform our stockholders of the actions described above before
they take place in accordance with Rule 14c-2 of the Securities Exchange Act of
1934. This information statement is first mailed to you on or about March __,
2003.
Please feel free to call us at 703-964-8000 should you have any
questions on the enclosed Information Statement. We thank you for your continued
interest in IceWeb.
For the Board of Directors
of ICEWEB, INC.
By: /s/ John R. Signorello
-------------------------------------
John R. Signorello, CEO and President
ICEWEB, INC.
620 HERNDON PARKWAY
SUITE 360
HERNDON, VA 20170
INFORMATION STATEMENT REGARDING
ACTION TO BE TAKEN BY WRITTEN CONSENT OF
MAJORITY STOCKHOLDERS
IN LIEU OF A SPECIAL MEETING
WE ARE NOT ASKING YOU FOR A PROXY,
AND YOU ARE REQUESTED NOT TO SEND US A PROXY.
GENERAL
This Information Statement is being furnished to the stockholders of
IceWeb, Inc. in connection with the adoption of a Certificate of Amendment to
our Certificate of Incorporation by written consent of our Board of Directors
and the holders of a majority of our issued and outstanding voting securities in
lieu of a special meeting. On February 23, 2004 our Board of Directors approved
an amendment to our Certificate of Incorporation increasing the number of our
authorized shares of common stock from 100,000,000 shares to 1,000,000,000
shares and effecting a forward stock split of all of the outstanding shares of
our common stock at a ratio of 10 for one (the "Amendment"). These actions will
become effective upon the written consent of the holders of a majority of our
issued and outstanding common stock and the filing of the Amendment with the
Secretary of State of Delaware in accordance with the relevant sections of the
Delaware General Corporation Law. The following individuals, collectively own
approximately 58% of our outstanding voting stock which is in excess of the
required majority of our outstanding voting securities necessary for the
adoption of this action, have advised us that they will execute a written
consent approving the Amendment on or about ________________, 2004:
Shareholder No. of Shares Owned
----------- -------------------
John R. Signorello 18,179,300
John Younts 1,600,000
Tom Cerami 1,000,000
James Bond 500,000
Mari-Beth Kinney 668,750
Michael N. Cachine, Sr. 127,442
----------
22,075,492
==========
Messrs. Signorello and Cachine are executive officers of our company
and Mr. Signorello is a member of our Board of Directors. The Amendment will be
filed with the Secretary of State of Delaware as soon as possible thereafter.
The full text of the Amendment is attached to this information statement as
Exhibit A.
1
The forward stock split and increase in the authorized common stock of
IceWeb is not intended to change the proportionate equity interest of our
stockholders in relation to the authorized common stock of our company. As
described hereafter, it is hoped that these actions will result in a broader
based market and promote greater liquidity for IceWeb's stockholders. Since
there is no proportionate increase between the outstanding and authorized shares
of common stock as a result of this Amendment, this action is not designed to
permit or facilitate any transaction involving the common stock of IceWeb.
The elimination of the need for a meeting of stockholders to approve
this action is made possible by Section 228 of the Delaware General Corporation
Law which provides that the written consent of the holders of outstanding shares
of voting capital stock, having not less than the minimum number of votes which
would be necessary to authorize or take such action at a meeting at which all
shares entitled to vote thereon were present and voted, may be substituted for
such a meeting. In order to eliminate the costs involved in holding a special
meeting, our Board of Directors voted to utilize the written consent of the
holder of a majority in interest of our voting securities.
Pursuant to Section 228 of the Delaware General Corporation Law, we are
required to provide prompt notice of the taking of the corporate action without
a meeting of stockholders to all stockholders who did not consent in writing to
such action. This Information Statement serves as this notice. This Information
Statement is first being mailed on or about March __, 2004 to stockholders of
record, and is being delivered to inform you of the corporate actions described
herein before they take effect in accordance with Rule 14c-2 of the Securities
Exchange Act of 1934. No dissenter's rights are afforded to our stockholders
under Delaware law as a result of the adoption of the Amendment.
The entire cost of furnishing this Information Statement will be borne
by us. We will request brokerage houses, nominees, custodians, fiduciaries and
other like parties to forward this Information Statement to the beneficial
owners of our voting securities held of record by them and we will reimburse
such persons for out-of-pocket expenses incurred in forwarding such material.
OUR PRINCIPAL STOCKHOLDERS
Our voting securities are comprised of our common stock. The holders of
our shares of common stock are entitled to one vote for each outstanding share
on all matters submitted to our stockholders. The following table contains
information regarding record ownership of our common stock as of February 23,
2004 held by:
* persons who own beneficially more than 5% of our outstanding voting
securities,
* our directors,
* named executive officers, and
* all of our directors and officers as a group.
2
A person is deemed to be the beneficial owner of securities that can be
acquired by such a person within 60 days from February 23, 2004, upon exercise
of options, warrants or convertible securities. Each beneficial owner's
percentage ownership is determined by assuming that options, warrants and
convertible securities that are held by such a person (but not those held by any
other person) and are exercisable within 60 days from that date have been
exercised. Unless otherwise indicated, the address of each of the listed
beneficial owners identified is 620 Herndon Parkway, Suite 360, Herndon,
Virginia 20170.
Name of Amount and Nature of Percentage
Beneficial Owner Beneficial Ownership of Class
---------------- -------------------- ----------
John R. Signorello 18,179,300 shares 47.5%
Michael N. Cachine, Sr.(1) 261,866 shares *
All officers and
directors as a group
(two persons)(1) 18,441,166 shares 48%
_________
* represents less than 1%
(1) Shares beneficially owned by Mr. Cachine include options to purchase 134,424
shares of our common stock at an exercise price of $0.37 per share.
PROPOSAL 1
AMENDMENT TO OUR CERTIFICATE OF INCORPORATION
TO INCREASE THE NUMBER OF OUR AUTHORIZED
SHARES OF COMMON STOCK AND
TO EFFECT A FORWARD STOCK SPLIT OF OUR
OUTSTANDING COMMON STOCK
We currently have authorized 100,000,000 shares of common stock and at
February 1, 2004 we had 38,281,924 shares issued and outstanding. Pursuant to
the Amendment,
* we will increase the number of authorized shares to 1,000,000,000
shares, and
* the number of outstanding shares of our common stock on the date of
the Amendment (the "Old Shares") will be automatically increased on
the ratio of 10 for one (the "New Shares").
This means that all stockholders of record on the record date of the
forward split will receive and own 10 New Shares for every one Old Share owned,
with all fractional shares rounded up to the nearest whole. As a result,
following the forward stock split, the stockholders as of the record date will
own a total of 382,819,420 shares of stock, an increase of 344,537,496 shares.
3
PURPOSE AND EFFECT OF AMENDMENT.
Our common stock is currently quoted on the OTC Bulletin Board. At the
present time, there are approximately 1,700,000 shares of our common stock that
are freely tradable. We believe that the absence of a substantial market for our
shares is a disincentive for investors to acquire our common shares. We believe
that the 10-for-one (10:1) forward stock split will substantially increase the
number of our common shares that trade in the over-the-counter market and will
provide substantially greater liquidity for our shares which, hopefully, will
provide greater incentive for investors to acquire our common shares.
As a result of the increase in the number of authorized shares of our
common stock, we will have additional shares of unissued common stock available
in the event the Board of Directors determines that it is necessary or
appropriate to permit future stock dividends, including the forward split which
will occur contemporaneously as herein described, to raise additional capital
through the sale of equity securities, to acquire another company or its assets,
to establish strategic relationships with corporate partners and to provide
equity incentives to employees and officers or for other valid corporate
purposes. Our Board of Directors believe that increasing the number of
authorized shares of common stock available for issuance or reservation will
provide us with the flexibility to issue shares of common stock without the
expense and delay of a special stockholders' meeting. Our business model
provides that in the future we may issue shares of our common stock in
acquisitions, for capital raising purposes, in connection with equity
compensation plans or for other valid corporate purposes. However, we currently
have no plans or existing or proposed agreements or understandings to issue, or
reserve for future issuance, any shares of our common stock, including as part
of a capital raising transaction or otherwise.
The increase in authorized common stock will not have any immediate
effect on the rights of existing stockholders. However, the Board will have the
authority to issue authorized common stock without requiring future stockholder
approval of such issuances, except as may be required by our Certificate of
Incorporation or applicable law. To the extent that additional authorized shares
are issued in the future, they may decrease the existing stockholders'
percentage equity ownership and, depending on the price at which they are
issued, could be dilutive to the existing stockholders. In addition, the
issuance of additional shares of common stock could have the effect of making it
more difficult for a third party to acquire a majority of our outstanding voting
stock and any such issuance of additional stock could have the effect of
diluting the earnings per share and book value per share of outstanding shares
of common stock.
While the Amendment may have anti-takeover ramifications, rendering it
more difficult or discouraging an attempt to obtain control of our company by
means of tender offer, proxy contest, merger or otherwise, the Board of
Directors believes that the financial flexibility offered by the proposed
amendment outweighs any disadvantages. To the extent that the Amendment may have
anti-takeover effects, it may encourage persons seeking to acquire IceWeb to
negotiate directly with our Board of Directors enabling the Board of Directors
to consider the proposed transaction in a manner that best serves the
stockholders' interest. The Board of Directors is not currently aware of any
attempt to take over or acquire IceWeb. While it may be deemed to have potential
anti-takeover effects, the increase in the authorized common stock is not
prompted by any specific effort or takeover threat currently perceived by
management.
4
The forward stock split will have the following effects upon the number
of shares of our common stock outstanding and the number of authorized and
unissued shares of our common stock:
* The number of shares owned by each holder of common stock will be
increased tenfold;
* The number of shares of our common stock which will be issued and
outstanding after the forward stock split will be approximately
382,819,420 ;
* The per share loss and net book value of our common stock will be
decreased because there will be a greater number of shares of our
common stock outstanding;
* The par value of the common stock will remain $0.001 per share;
* The stated capital on our balance sheet attributable to the common
stock will be increased 10 times its present amount and the
additional paid-in capital account will be debited with the amount
by which the stated capital is increased; and
* All outstanding options, warrants, and convertible securities
entitling the holders thereof to purchase shares of common stock
will enable such holders to purchase, upon exercise thereof, 10
times of the number of shares of common stock which such holders
would have been able to purchase upon exercise thereof immediately
preceding the forward stock split, at the same aggregate price
required to be paid therefore upon exercise thereof immediately
preceding the forward stock split.
MANNER OF EFFECTING THE AMENDMENT.
The increase in the number of authorized shares of our common stock and
the forward stock split will be effected by the filing of the Amendment with the
Secretary of State of the State of Delaware. The Amendment will become effective
upon the filing. We anticipate that the Amendment will be filed on or about
________________, 2004, which is 20 days after this Information Statement was
first mailed to our stockholders. The record date for the forward split will be
the effective date of the Amendment, and the effective date of the forward stock
split will be 10 days after the record date. As soon as practicable after the
effective date of the forward stock split, stockholders of record on the record
date will receive certificates representing the additional shares of common
stock issued to the stockholder as a result of the forward stock split. No scrip
or fractional shares will be issued. Fractional shares will be rounded up to the
nearest whole share. We will bear the costs of the issuance of the additional
stock certificates.
5
CERTAIN FEDERAL INCOME TAX CONSEQUENCES.
The forward stock split should not result in any recognition of gain or
loss. The holding period of the New Shares will include the stockholder's
holding period for the corresponding Old Shares owned prior to the forward stock
split. The adjusted basis of the New Shares (including the original shares) will
be equal to the adjusted basis of a stockholder's original shares.
Notwithstanding the foregoing, the federal income tax consequences of the
receipt of an additional share in lieu of a fractional interest is not clear but
may result in tax liabilities which should not be material in amount in view of
the low value of the fractional interest. Our beliefs regarding the tax
consequence of the forward stock split are not binding upon the Internal
Revenue Service or the courts, and there can be no assurance that the Internal
Revenue Service or the courts will accept the positions expressed above. 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, nonresident foreign individuals, broker-dealers and tax exempt
entities. The state and local tax consequences of the forward stock split may
vary significantly as to each stockholder, depending upon the state in which he
or she resides.
The foregoing summary is included for general information only.
Accordingly, stockholders are urged to consult their own tax advisors with
respect to the Federal, State and local tax consequences of the forward stock
split.
NO DISSENTER'S RIGHTS.
Under Delaware law stockholders are not entitled to dissenter's rights
of appraisal with respect to the Amendment.
WHERE YOU CAN OBTAIN ADDITIONAL INFORMATION
We are required to file annual, quarterly and special reports, proxy
statements and other information with the SEC. You may read and copy any
document we file at the SEC's public reference rooms at 450 Fifth Street, N.W.,
Washington, D.C., and at its offices in New York, New York and Chicago,
Illinois. Please call the SEC at 1-800-SEC-0330 for more information on the
operation of the public reference rooms. Copies of our SEC filings are also
available to the public from the SEC's web site at www.sec.gov.
ICEWEB, INC.
By: /s/ John R. Signorello
----------------------
John R. Signorello, CEO and President
6
EXHIBIT A
CERTIFICATE OF AMENDMENT
TO THE CERTIFICATE OF INCORPORATION
OF
ICEWEB, INC.
(A DELAWARE CORPORATION)
Pursuant to Section 242 of the Delaware General Corporations Law, the
undersigned, being the President of IceWeb, Inc., a corporation organized and
existing under the laws of the State of Delaware (the "Corporation"), does
hereby certify that the following resolutions were adopted by the Corporation's
Board of Directors and its stockholders as hereinafter described:
RESOLVED: The Certificate of Incorporation of this Corporation is
hereby amended by deleting Paragraph 4 in its entirety and replacing it with the
following:
(a) The total number of shares of all classes of capital stock which
the Corporation shall have the authority to issue is One Billion Ten Million
(1,010,000,000) shares of which One Billion (1,000,000,000) shares shall be
Common Stock, par value $0.00l per share and Ten Million (10,000,000) shares
shall be Preferred Stock, par value $.001 per share. Series of the Preferred
Stock may be created and issued from time to time, with such designations,
preferences, conversion rights, cumulative, relative, participating, optional or
other rights, including voting rights, qualifications, limitations or
restrictions thereof as shall be stated and expressed in the resolution or
resolutions providing for the creation and issuance of such series of Preferred
Stock as adopted by the Board of Directors pursuant to the authority in this
paragraph given.
(b) At the effective time of this amendment, each share of common stock
of the Corporation issued and outstanding as of the record date set by the
Corporation's Board of Directors shall be subject to a ten (10) for one (1)
forward split with all fractional shares rounded to the nearest whole.
The foregoing resolutions and this Certificate of Amendment were
adopted by the Board of Directors of the Corporation pursuant to a written
consent of the sole director of the Corporation dated February 23, 2004 in
accordance with Section 141 of the Delaware General Corporation Law, and by the
written consent dated ________________, 2004 of the holders of shares of the
Corporation's voting stock having not less than the minimum number of votes that
would be necessary to authorize or take such action at a meeting at which all
shares entitled to vote thereon were present and voted in accordance with
Section 228 of the Delaware General Corporation Law.
IN WITNESS WHEREOF, the undersigned, being the President of this
Corporation, has executed this Certificate of Amendment to the Corporation's
Certificate of Incorporation as of ________________, 2004.
ICEWEB, INC.
By:
-----------------------------
John R. Signorello, President