split by 500 and then rounding up to the nearest whole share. The reverse stock split would affect the Company's Common Stock uniformly and would not affect any common stock shareholder's percentage ownership interests in the Company or proportionate voting power, except to the extent that whole shares will be exchanged in lieu of fractional shares.
If the Company implements the reverse stock split, the number of shares of Series A Preferred Shares held by Ben-Tsur Joseph, the Companys Chief Executive Officer and Chief Financial Officer, and, consequently, the voting power attributable to his Series A Preferred Shares, will remain unchanged and thus his proportionate voting power will thus be increased.
Effect on Options, Warrants and Other Securities
All outstanding shares of options, warrants, notes, debentures and other securities entitling their holders to purchase shares of the Company's Common Stock would be adjusted as a result of the reverse stock split, as required by the terms of these securities. In particular, the conversion ratio for each instrument would be reduced, and the exercise price, if applicable, would be increased, in accordance with the terms of each instrument and based on the of 1 for 500 ratio. Also, the number of shares reserved for issuance under the Company's existing stock option plans would be reduced proportionally based on such ratio.
Other Effects on Outstanding Shares
If a reverse stock split were implemented, the rights of the outstanding shares of Common Stock would remain the same after the reverse stock split.
The reverse stock 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 higher than the costs of transactions in round-lots of even multiples of 100 shares.
The Common Stock is currently registered under Section 12(g) of the Securities Exchange Act of 1934, as amended. As a result, the Company is subject to the periodic reporting and other requirements of the Securities Exchange Act. The proposed reverse stock split would not affect the registration of the Common Stock under the Securities Exchange Act.
Authorized Shares of Common Stock
The reverse stock split, if implemented, would not change the number of authorized shares of the Company's Common Stock as designated by the Company's Articles of Incorporation, as amended. Therefore, because the number of issued and outstanding shares of Common Stock would decrease, the number of shares remaining available for issuance of the Company's Common Stock would increase.
Procedure for Effecting the Reverse Stock Split and Exchange of Stock Certificates
If the Company's shareholders approve the proposed amendment to the Company's Articles of Incorporation to affect the reverse stock split, the Board may elect whether or not to declare a reverse stock split at any time prior to 12 months after the date of shareholder approval. The reverse stock split would be implemented by filing the appropriate amendment to the Company's Articles of Incorporation with the Secretary of State of the State of Nevada, and the reverse stock split would become effective on the date of the filing.
As of the effective date of the reverse stock split, each certificate representing shares of the Company's Common Stock before the reverse stock split would be deemed, for all corporate purposes, to evidence ownership of the reduced number of shares of Common Stock resulting from the reverse stock split. All options, warrants, convertible debt instruments and other securities would also be automatically adjusted on the effective date.
The Company anticipates that its transfer agent will act as the exchange agent for purposes of implementing the exchange of stock certificates. As soon as practicable after the effective date, shareholders and holders of securities convertible into the Company's Common Stock would be notified of the effectiveness of the reverse split. Shareholders of record would receive a letter of transmittal requesting them to surrender their stock certificates for stock certificates reflecting the adjusted number of shares as a result of the reverse stock split. Persons who hold their shares in brokerage accounts or street name would not be required
to take any further actions to effect the exchange of their certificates. Instead, the holder of the certificate will be contacted.
No new certificates would be issued to a shareholder until the shareholder has surrendered the shareholder's outstanding certificate(s) together with the properly completed and executed letter of transmittal to the exchange agent. Until surrender, each certificate representing shares before the reverse stock split would continue to be valid and would represent the adjusted number of shares based on the exchange ratio of the reverse stock split, rounded up to the nearest whole share. Shareholders should not destroy any stock certificate and should not submit any certificates until they receive a letter of transmittal.
Fractional Shares
The Company will not issue fractional shares in connection with any reverse stock split. Instead, any fractional share resulting from the reverse stock split would be rounded up to the nearest whole share.
Accounting Consequences
The par value of the Company's Common Stock would remain unchanged at $0.0001 per share after the reverse stock split. Also, the capital account of the Company would remain unchanged, and the Company does not anticipate that any other accounting consequences would arise as a result of the reverse stock split.
Federal Income Tax Consequences
The following is a summary of material federal income tax consequences of the reverse stock split and does not purport to be complete. It does not discuss any state, local, foreign or minimum income or other tax consequences. Also, it does not address the tax consequences to holders that are subject to special tax rules, including banks, insurance companies, regulated investment companies, personal holding companies, foreign entities, nonresident alien individuals, broker-dealers and tax-exempt entities. The discussion is based on the provisions of the United States federal income tax law as of the date hereof, which is subject to change
retroactively as well prospectively. This summary also assumes that the shares are held as a capital asset, as defined in the Internal Revenue Code of 1986, as amended (generally, property held for investment). The tax treatment of a shareholder may vary depending upon the particular facts and circumstances of the shareholder. Each shareholder is urged to consult with the shareholder's own tax advisor with respect to the consequences of the reverse stock split.
No gain or loss should be recognized by a shareholder upon the shareholder's exchange of shares pursuant to the reverse stock split. The aggregate tax basis of the shares received in the reverse stock split would be the same as the shareholder's aggregate tax basis in the shares exchanged. The shareholder's holding period for the shares would include the period during which the shareholder held the pre-split shares surrendered in the reverse stock split.
The Company's beliefs regarding the tax consequence of the reverse 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. The state and local tax consequences of the reverse stock split may vary significantly as to each shareholder, depending upon the state in which he or she resides.
Vote Required; Manner of Approval; Appraisal Rights
Approval to amend the Articles of Incorporation to effect a reverse stock split requires the affirmative vote of the holders of a majority of the voting power of the outstanding shares of the Company.
APPROVAL OF AMENDMENT TO ARTICLES OF INCORPORATION TO AMEND THE ARTICLES OF INCORPORATION TO INCREASE OF AUTHORIZED SHARES AND EFFECT A 1 FOR 500 REVERSE SPLIT.
On *, 2008, shareholders holding a majority of the voting power of the outstanding stock of the Company approved an amendment to the Companys Articles of Incorporation (the Amendment), as amended, to replace Article 4 of the Articles of Incorporation (the Articles), in its entirety, which will result in an increase to the number of authorized shares of Common Stock and effect a reverse split of the Companys issued and outstanding Common Stock on a one for five hundred basis. The approval of this Amendment will increase the Companys authorized shares of Common Stock to 1,000,000,000. The Company currently has
authorized (i) Common Stock of 380,000,000 shares and approximately 380,000,000 shares of Common Stock are issued and outstanding as of the Record Date and (ii) authorized Preferred Stock of 20,000,000, 1,000
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shares of which are designated as Series A Preferred Stock, all of which are issued and outstanding. Upon the effectiveness of the reverse split, the Companys issued and outstanding Common Stock will decrease to 760,000 shares.
Upon filing the Amendment to increase the Companys authorized shares of Common Stock from 380,000,000 to 1,000,000,000 and to effect a reverse split on the Companys issued and outstanding Common Stock on a one for five hundred basis, Article 4 will be amended by replacing Article 4 of the Articles, in their entirety, as follows:
The total number of shares which the Company shall have the authority to issue is 1,020,000,000 shares of two classes of capital stock to be designated respectively preferred stock (Preferred Stock) Common Stock (Common Stock). The total number of Common Stock the Corporation shall have authority to issue is 1,000,000,000 shares, par value $0.0001 per share. The total number of shares of Preferred Stock the Corporation shall have authority to issue is 20,000,000 shares, par value $0.0001 per share. The Preferred Stock authorized by this Certificate of Incorporation may be issued in series. The Board of Directors is authorized
to establish series of Preferred Stock and to fix, in the manner and to the full extent provided and permitted by law, the rights, preferences and limitations of each series of the Preferred Stock and the relative rights, preferences and limitations between or among such series including, but not limited to:
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(1)
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the designation of each series and the number of shares that shall constitute the series;
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(2)
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the rate of dividends, if any, payable on the shares of each series, the time and manner of payment and whether or not such dividends shall be cumulative;
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(3)
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whether shares of each series may be redeemed and, if so, the redemption price and the terms and conditions of redemption;
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(4)
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sinking fund provisions, if any, for the redemption or purchase of shares of each series which is redeemable;
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(5)
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the amount, if any, payable upon shares of each series in the event of the voluntary or involuntary liquidation, dissolution or winding up of the corporation, and the manner and preference of such payment; and
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(6)
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the voting rights, if any, in the shares of each series and any conditions upon the exercising of such rights.
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The outstanding shares of Common Stock shall be reverse split on a one-for-five hundred basis, effective as of the effective date of this Certificate of Amendment. The number of authorized, but unissued shares shall not be affected by the reverse stock split.
Forward-Looking Statements and Information
This Information Statement includes forward-looking statements within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act. You can identify our forward-looking statements by the words expects, projects, believes, anticipates, intends, plans, predicts, estimates and similar expressions.
The forward-looking statements are based on managements current expectations, estimates and projections about us. The Company cautions you that these statements are not guarantees of future performance and involve risks, uncertainties and assumptions that we cannot predict. In addition, the Company has based many of these forward-looking statements on assumptions about future events that may prove to be inaccurate. Accordingly, actual outcomes and results may differ materially from what the Company has expressed or forecast in the forward-looking statements.
You should rely only on the information the Company has provided in this Information Statement. The Company has not authorized any person to provide information other than that provided herein. The Company has not authorized anyone to provide you with different information. You should not assume that the information in this Information Statement is accurate as of any date other than the date on the front of the document.
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ADDITIONAL INFORMATION
The Company will provide upon request and without charge to each shareholder receiving this Information Statement a copy of the Company's annual report on Form 10-KSB for the fiscal year ended December 31, 2007 and quarterly report on Form 10-Q for the quarter ended March 31, 2008, including the financial statements and financial statement schedule information included therein, as filed with the SEC. Reports and other information filed by us can be inspected and copied at the public reference facilities maintained at the SEC at 100 F Street, N.E., Washington, DC 20549. Copies of such material can be obtained upon written request addressed to the
Commission, Public Reference Section, 100 F Street, N.E., Washington, D.C. 20549, at prescribed rates. The SEC maintains a web site on the Internet (http://www.sec.gov) that contains reports, proxy and information statements and other information regarding issuers that file electronically with the SEC through the Electronic Data Gathering, Analysis and Retrieval System.
EXHIBIT INDEX
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Exhibit A
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Certificate of Amendment to the Articles of Incorporation
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RECOMMENDATION OF THE BOARD OF DIRECTORS
The Board of Directors recommended approval of the Amendment to the shareholders holding majority of the voting power.
By order of the Board of Directors
*, 2008
/s/ Ben Tsur Joseph
Ben-Tsur Joseph
Chief Executive Officer
and Chief Financial Officer
Las Vegas, Nevada
*, 2008
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EXHIBIT A
CERTIFICATE OF AMENDMENT
TO
ARTICLES OF INCORPORATION
OF
INROB TECH LTD.
The undersigned, being the President and Chief Executive Officer of INROB TECH LTD., a corporation existing under the laws of the State of Nevada, does hereby certify under the seal of the said corporation as follows:
1. The name of the Corporation (hereinafter referred to as the Corporation) is Inrob Tech Ltd
2. The Articles of Incorporation of the Corporation is hereby amended by replacing Article 4, in its entirety, with the following:
The total number of shares which the Company shall have the authority to issue is 1,020,000,000 shares of two classes of capital stock to be designated respectively preferred stock (Preferred Stock) Common Stock (Common Stock). The total number of Common Stock the Corporation shall have authority to issue is 1,000,000,000 shares, par value $0.0001 per share. The total number of shares of Preferred Stock the Corporation shall have authority to issue is 20,000,000 shares, par value $0.0001 per share. The Preferred Stock authorized by this Certificate of Incorporation may be issued in series. The Board of Directors is authorized
to establish series of Preferred Stock and to fix, in the manner and to the full extent provided and permitted by law, the rights, preferences and limitations of each series of the Preferred Stock and the relative rights, preferences and limitations between or among such series including, but not limited to:
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(1)
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the designation of each series and the number of shares that shall constitute the series;
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(2)
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the rate of dividends, if any, payable on the shares of each series, the time and manner of payment and whether or not such dividends shall be cumulative;
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(3)
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whether shares of each series may be redeemed and, if so, the redemption price and the terms and conditions of redemption;
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(4)
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sinking fund provisions, if any, for the redemption or purchase of shares of each series which is redeemable;
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(5)
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the amount, if any, payable upon shares of each series in the event of the voluntary or involuntary liquidation, dissolution or winding up of the corporation, and the manner and preference of such payment; and
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(6)
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the voting rights, if any, in the shares of each series and any conditions upon the exercising of such rights.
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The outstanding shares of Common Stock shall be reverse split on a one-for-five hundred basis, effective as of the effective date of this Certificate of Amendment. The number of authorized, but unissued shares shall not be affected by the reverse stock split.
3. The amendment of the articles of incorporation herein certified has been duly adopted by the unanimous written consent of the Corporations Board of Directors and shareholders holding a majority of the voting power of the outstanding shares of Stock of the Corporation in accordance with the provisions of Sections 78.320 of the General Corporation Law of the State of Nevada.
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IN WITNESS WHEREOF, the Corporation has caused its corporate seal to be hereunto affixed and this Certificate of Amendment of the Corporation's Articles of Incorporation, as amended, to be signed by Ben-Tsur Joseph, its Chief Executive Officer and Chief Financial Officer, on *, 2008.
INROB TECH LTD.
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By:
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/s/ Ben-Tsur Joseph
Ben-Tsur Joseph,
Chief Executive Officer
and Chief Financial Officer
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