INFORMATION STATEMENT REGARDING ACTION TAKEN BY WRITTEN CONSENT OF THE

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 all the common stockholders of Alpine 4 Technologies Ltd. (“we,” “us,” or the “Company”), in connection with the action taken by written consent of the holders of the majority of the voting power of our outstanding voting securities in lieu of a meeting which authorized the approval of an amendment (the “Amendment”) to the Company’s Amended and Restated Certificate of Incorporation (the “Certificate of Incorporation”), to increase the number of shares of the Company’s Class A Common Stock authorized from 100,000,000 shares to 125,000,000 shares; our Class B common stock from 5,000,000 shares to 10,000,000 shares; and our Class C common stock from 10,000,000 shares to 15,000,000 shares (collectively, the “Share Increase”), and the filing of the Amendment to reflect the Share Increase. This information statement is provided to you by the Company.

On November 27, 2019, our board of directors approved the Share Increase and the filing of the Amendment, and recommended both to the shareholders of the Company for approval. In addition, on November 27, 2019, the holders of the Series B Preferred Stock, which collectively have voting rights equal to 200% of the voting power of the other equity securities of the Company, held by five individuals, which is in excess of the required majority of our outstanding voting securities necessary for an amendment to the Company’s Certificate of Incorporation, voted to approve the Amendment and the Share Increase.  A copy of the form of Amendment is attached as Appendix A to this information statement.

 

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 holders of a majority of our outstanding 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 or delivered on or about December 9, 2019, to stockholders of record, and is being delivered to inform you of the corporate action described herein before it takes 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 the Company. As of the date of this Information Statement, we had approximately 386 shareholders.  We will provide this information by mail, hand delivery, or email to all of our shareholders.

SHARE INCREASE

When effective, the Amendment will amend our Certificate of Incorporation to effect the Share Increase.

The Share Increase

On November 27, 2019, our board of directors approved, subject to stockholder approval, an amendment to our Certificate of Incorporation (the “Amendment”) that will have the effect of increasing our authorized Class A Common Stock from 100,000,000 shares to 125,000,000 shares; our Class B common stock from 5,000,000 shares to 10,000,000 shares; and our Class C common stock from 10,000,000 shares to 15,000,000 shares (the “Share Increase”). Subsequent to our board of directors’ approval of the Amendment and the Share Increase, the holders of a majority of the voting power of our voting stock approved, by written consent, the Amendment and the Share Increase on November 27, 2019. We expect that the Amendment will be effective on or about December 30, 2019, at such time as the Amendment is filed with the Secretary of State of Delaware.

Increase in Authorized Class A, Class B, and Class C Common Shares

We currently have authorized capital stock of 100,000,000 shares of our Class A Common Stock, $0.0001 par value; 5,000,000 shares of our Class B Common Stock, $0.0001 par value; and 10,000,000 shares of our Class C Common Stock, $0.0001 par value.  As of the Record Date, there were 99,870,161 shares of Class A common stock issued and outstanding; 5,000,000 shares of Class B common stock issued and outstanding; and 9,955,201 shares of Class C common stock issued and outstanding.

When the Amendment is filed and the Share Increase becomes effective, our authorized shares of Class A Common Stock will increase from 100,000,000 shares to 125,000,000 shares; our Class B common stock from 5,000,000 shares to 10,000,000 shares; and our Class C common stock from 10,000,000 shares to 15,000,000 shares

When the Share Increase becomes effective, there will be no immediate change in the number of issued and outstanding common shares. Although the Share Increase would not have any immediate dilutive effect on the proportionate voting power or other rights of our existing stockholders, any future issuance of additional authorized shares of our common stock may, among other things, dilute the earnings per share of our common stock and the equity and voting rights of those holding our common stock at the time the additional shares are issued.

Purposes of the Increase in Authorized Shares

Having an increased number of authorized but unissued shares of our Class A, Class B, and Class C Common Stock would allow us to take prompt action with respect to corporate opportunities that develop, without the delay and expense of convening a special meeting of stockholders for the purpose of approving an increase in our capitalization. The newly authorized Class A Common Stock would be available for issuance from time to time as determined by our board of directors for any proper corporate purpose. Such purposes might include, without limitation, issuance in public or private sales for cash as a means of obtaining additional capital for use in our business and operations, and issuance as part or all of the consideration required to be paid by us for acquisitions of other businesses or assets.

Accordingly, on November 27, 2019, our board of directors and the holders of a majority of the voting power of our voting stock approved the Amendment that will have the effect of increasing our authorized Class A Common Stock from 100,000,000 to 125,000,000 shares, and providing us with approximately 25,000,000 additional shares of authorized Class A Common Stock. We believe this will place us in a better position to react quickly in response to corporate opportunities that may develop. Notwithstanding the foregoing, we have no obligation to issue such additional shares and there are no plans, proposals or arrangements currently contemplated by us that would involve the issuance of the additional shares to acquire another company or its assets, or for any other corporate purpose stated.

The Class B and Class C common shares have greater voting rights, and could be used by management in connection with acquisition transactions or other similar uses.  As noted, the Class C common stock was recently issued by the Board to the holders of Class A common stock as a dividend. When the Amendment takes effect, we will have an additional 5,000,000 shares of Class B common stock and 5,000,000 shares of Class C common stock to be issued as the Board determines. As of the date of this information statement, the Company had no plans, proposals or arrangements currently contemplated by us that would involve the issuance of the additional shares to acquire another company or its assets, or for any other corporate purpose stated.

Potential Anti-Takeover Effects of the Increase in Capital Stock

Any additional issuance of Class A, Class B, or Class C Common Stock could, under certain circumstances, have the effect of delaying or preventing a change in control of our company by increasing the number of outstanding shares entitled to vote and by increasing the number of votes required to approve a change in control. Shares of common stock could be issued, or rights to purchase such shares could be issued, to render more difficult or discourage an attempt to obtain control of our company by means of a tender offer, proxy contest, merger or otherwise. The ability of our board of directors to issue such additional shares of common stock could discourage an attempt by a party to acquire control of our company by tender offer or other means. Such issuances could therefore deprive stockholders of benefits that could result from such an attempt, such as the realization of a premium over the market price that such an attempt could cause. Moreover, the issuance of such additional shares of common stock to persons whose interests are aligned with that of our board of directors could make it more difficult to remove incumbent officers and directors from office, even if such change were to be favorable to stockholders generally.

Although the increased proportion of unissued authorized shares to issued shares could, under certain circumstances, have an anti-takeover effect (for example, by permitting issuances that would dilute the stock ownership of a person seeking to effect a change in the composition of our board or contemplating a tender offer or other transaction for the combination of our company with another company), the Share Change Amendment was not proposed or adopted in response to any effort of which we are aware to accumulate shares of common stock or obtain control of us, nor is it part of a plan by management to recommend a series of similar actions having an anti-takeover effect to the board and our stockholders.

Our board believes that it is advisable and in the best interests of our company to have available additional authorized but unissued shares of Class A, Class B, and Class C Common Stock in an amount adequate to provide for our future needs. The unissued shares of common stock will be available for issuance from time to time as may be deemed advisable or required for various purposes, including the issuance of shares in connection with financing or acquisition transactions. We have no present plans or commitments for the issuance or use of the proposed shares of common stock in connection with any financing.

Interests of Certain Persons in Matters to be Acted Upon

Except as disclosed elsewhere in this Information Statement, none of the following persons has any substantial interest, direct or indirect, by security holdings or otherwise in any matter to be acted upon:

The stockholdings of our directors and officers are listed below in the section entitled “Security Ownership of Certain Beneficial Owners and Management.”