SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 14A
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934 (Amendment No. )
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Check the appropriate box:
[_] Preliminary Proxy Statement [_] Confidential, For Use of the
[X] Definitive Proxy Statement Commission Only (as permitted
[_] Definitive Additional Materials by Rule 14a-6(e)(2))
[_] Soliciting Material Pursuant to
Rule 14a-11(c) or Rule 14a-12
IVG Corp.
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(Name of Registrant as Specified In Its Charter)
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(Name of Person(s) Filing Proxy Statement, if Other Than the Registrant)
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to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is
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YOUR VOTE IS IMPORTANT
IVG CORP.
PROXY STATEMENT
SPECIAL MEETING OF SHAREHOLDERS
ELORIAN LANDERS
CHAIRMAN AND
CHIEF EXECUTIVE OFFICER
November 14, 2001
Dear Shareholder:
I am pleased to invite you to a Special Meeting of Shareholders of IVG
Corp. The meeting will be held at 8:00 a.m. on December 3, 2001 at the offices
of IVG Corp., 13135 S. Dairy Ashford, Suite 525, Sugar Land, Texas.
At the meeting, you and the other shareholders will be asked to: (1)
approve an amendment to Article IV of our Certificate of Incorporation and
effect a one-for-twenty reverse stock split and a decrease in our authorized
Common Stock from 300,000,000 to 150,000,000 shares; (2) approve a further
amendment to Article IV of our Certificate of Incorporation to authorize
10,000,000 shares of preferred stock and to permit such shares of preferred
stock to be designated and issued from time to time, and the rights of such
preferred stock to be fixed from time to time, by the Board of Directors without
shareholder approval; and (3) approve an amendment to Article I of our
Certificate of Incorporation to effect a change in our name from IVG Corp. to
Group Management Corp.
We hope you can join us on December 3, 2001. Whether or not you can
attend, please read the enclosed Proxy Statement. When you have done so, please
MARK your votes on the enclosed proxy, SIGN AND DATE THE PROXY, and RETURN it to
us in the enclosed envelope. Your vote is important, so please return your proxy
promptly.
Very truly yours,
Elorian Landers
IVG CORP.
13135 S. DAIRY ASHFORD
SUGAR LAND, TEXAS 77478
281-295-8400
November 14, 2001
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
TO BE HELD DECEMBER 3, 2001
IVG Corp. will hold a Special Meeting of Shareholders at the offices of
IVG Corp., 13135 S. Dairy Ashford, Suite 525, in Sugar Land, Texas on Monday,
December 3, 2001 at 8:00 a.m.
We are holding this meeting:
o To approve an amendment to Article IV of our Certificate of
Incorporation and effect a one-for-twenty reverse stock split and a
decrease in our authorized Common Stock from 300,000,000 to 150,000,000
shares;
o To approve a further amendment to Article IV of our Certificate of
Incorporation to authorize 10,000,000 shares of preferred stock and to
permit such shares of preferred stock to be designated and issued from
time to time, and the rights of such preferred stock to be fixed from
time to time, by the Board of Directors without shareholder approval;
o To approve an amendment to Article I of our Certificate of
Incorporation to effect a change in our name from IVG Corp. to Group
Management Corp.
Your board of directors recommends that you vote FOR each of the
proposals outlined in this proxy statement.
Your board of directors has selected November 13, 2001 as the record
date for determining shareholders entitled to vote at the meeting. A list of
shareholders on that date will be available for inspection at our corporate
headquarters, 13135 S. Dairy Ashford, Suite 525, Sugar Land, Texas, for at least
ten days before the meeting. The list also will be available for inspection at
the meeting.
This notice of special meeting, proxy statement and proxy are being
distributed on or about November 14, 2001.
By Order of the Board of Directors,
Clay C. Border
Secretary
TABLE OF CONTENTS
QUESTIONS AND ANSWERS...............................................................................1
STOCK OWNERSHIP.....................................................................................3
BENEFICIAL OWNERSHIP OF CERTAIN SHAREHOLDERS, DIRECTORS AND EXECUTIVE OFFICERS...................3
ITEM 1. APPROVAL OF AMENDMENTS TO ARTICLE IV OF OUR CERTIFICATE OF INCORPORATION
TO EFFECT REVERSE STOCK SPLIT AND DECREASE AUTHORIZED COMMON STOCK..................................5
ITEM 2. APPROVAL OF AMENDMENTS TO ARTICLE IV OF OUR CERTIFICATE OF INCORPORATION
TO AUTHORIZE 10,000,000 SHARES OF PREFERRED STOCK...................................................9
ITEM 3. APPROVAL OF AMENDMENT TO ARTICLE I OF OUR CERTIFICATE OF INCORPORATION
TO CHANGE OUR NAME FROM IVG CORP. TO GROUP MANAGEMENT CORP.........................................11
ANNUAL MEETING ADVANCE NOTICE REQUIREMENTS.........................................................11
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YOUR VOTE IS IMPORTANT.
PLEASE REMEMBER TO PROMPTLY RETURN YOUR PROXY.
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QUESTIONS AND ANSWERS
Q1: WHO IS SOLICITING MY PROXY?
A: We, the board of directors of IVG Corp., are sending you this proxy
statement in connection with our solicitation of proxies for use at a
Special Meeting of Shareholders. Certain directors, officers and
employees of IVG Corp. also may solicit proxies on our behalf by mail,
phone, fax or in person.
Q2: WHO IS PAYING FOR THIS SOLICITATION?
A: IVG Corp. will pay for the solicitation of proxies. IVG Corp. also will
reimburse banks, brokers, custodians, nominees and fiduciaries for
their reasonable charges and expenses in forwarding our proxy materials
to the beneficial owners of IVG Corp. common stock.
Q3: WHAT AM I VOTING ON?
A: Three items: (1) to approve an amendment to Article IV of our
Certificate of Incorporation and effect a one-for-twenty reverse stock
split and a decrease in our authorized Common Stock from 300,000,000 to
150,000,000 shares; (2) to approve a further amendment to Article IV of
our Certificate of Incorporation to authorize 10,000,000 shares of
preferred stock and to permit such shares of preferred stock to be
designated and issued from time to time, and the rights of such
preferred stock to be fixed from time to time, by the Board of
Directors without shareholder approval; and (3) to approve an amendment
to Article I of our Certificate of Incorporation to effect a change in
our name from IVG Corp. to Group Management Corp.
Q4: WHO CAN VOTE?
A: Only those who owned common stock at the close of business on November
13, 2001, the record date for the Special Meeting, can vote. If you
owned common stock on the record date, you have one vote per share for
each matter presented at the Special Meeting.
Q5: HOW DO I VOTE?
A: You may vote your shares either in person or by proxy. To vote by
proxy, you should mark, date, sign and mail the enclosed proxy in the
enclosed prepaid envelope. Giving a proxy will not affect your right to
vote your shares if you attend the Special Meeting and want to vote in
person by voting you automatically revoke your proxy. You also may
revoke your proxy at any time before the voting by giving the Secretary
of IVG Corp. written notice of your revocation or by submitting a
later-dated proxy. If you execute, date and return your proxy but do
not mark your voting preference, the individuals named as proxies will
vote your shares FOR each of the proposals.
1
Q6: WHAT CONSTITUTES A QUORUM?
A: Voting can take place at the Special Meeting only if shareholders
owning a majority of the voting power of the common stock (a majority
of the total number of votes entitled to be cast) are present in person
or represented by effective proxies. On the record date, we had
64,220,639 shares of common stock outstanding. Both abstentions and
broker non-votes are counted as present for purposes of establishing
the quorum necessary for the meeting to proceed. A broker non-vote
results from a situation in which a broker holding your shares in
"street" or "nominee" name indicates to us on a proxy that you have not
voted and it lacks discretionary authority to vote your shares.
Q7: WHAT VOTE OF THE SHAREHOLDERS WILL RESULT IN THE MATTERS BEING PASSED?
To approve each item, shareholders holding a majority of the total
voting power of the outstanding common stock must affirmatively vote to
approve the matter. Abstentions and broker non-votes have the same
effect as votes "against" the proposal.
Q8: HOW DOES THE BOARD RECOMMEND THAT I VOTE ON THE MATTERS PROPOSED?
A: The board of directors of IVG Corp. unanimously recommends that
shareholders vote FOR each of the proposals submitted at the Special
Meeting.
Q9: WILL THERE BE OTHER MATTERS PROPOSED AT THE SPECIAL MEETING?
A: No other matters will be proposed at the Special Meeting.
Q10: WHEN ARE 2002 SHAREHOLDER PROPOSALS DUE IF THEY ARE TO BE INCLUDED IN
THE COMPANY'S PROXY MATERIALS?
A: To be considered for presentation at IVG Corp.'s 2002 Annual Meeting of
Shareholders and included in our proxy statement, a shareholder
proposal must be received at IVG Corp.'s offices no later than March
29, 2002. To curtail controversy as to the date on which a proposal was
received by the company, we suggest that proponents submit their
proposals by certified mail, return receipt requested.
2
STOCK OWNERSHIP
BENEFICIAL OWNERSHIP OF CERTAIN SHAREHOLDERS, DIRECTORS AND EXECUTIVE OFFICERS
The following table sets forth information with respect to the
beneficial ownership of our common stock at October 26, 2001 by:
o each of our named executive officers and directors;
o all of our executive officers and directors as a group; and
o each person, or group of affiliated persons, known to us to own
beneficially more than 5% of our common stock.
In accordance with the rules of the SEC, the table gives effect to the
shares of common stock that could be issued upon the exercise of outstanding
options and common stock purchase warrants within 60 days of October 26, 2001.
Unless otherwise noted in the footnotes to the table and subject to community
property laws where applicable, the following individuals have sole voting and
investment control with respect to the shares beneficially owned by them. Unless
otherwise stated below, the address of each executive officer and director is
c/o IVG Corp., 13135 S. Dairy Ashford , Suite 525, Sugar Land, Texas 77478.
We have calculated the percentages of shares beneficially owned based
on 61,620,639 shares of common stock outstanding at October 26, 2001. On October
24, 2001 we entered into an Asset and Stock Purchase Agreement with GMS
Acquisition LLC, Group Management Services, Inc., E. Michael Kahoe, and James
Kahoe. Assuming certain conditions are satisfied and the Closing occurs under
the Asset and Stock Purchase Agreement, we will issue (i) 5,100,000 shares of
Common Stock and options for the purchase of 637,500 shares of Common Stock to
E. Michael Kahoe and (ii) 4,900,000 shares of Common Stock and options for the
purchase of 612,500 shares of Common Stock to James Kahoe. Following such
issuances of Common Stock, we will have approximately 71,620,639 shares
outstanding and Mr. E. Michael Kahoe will beneficially own 5,737,500 shares of
Common Stock and Mr. James Kahoe will beneficially own 5,512,500 shares of
Common Stock. Mr. E. Michael Kahoe's approximate percentage beneficial ownership
will be 8.0% and Mr. James Kahoe's approximate percentage beneficial ownership
will be 7.7%. Messrs. E. Michael and James Kahoe's address is c/o Group
Management Services, Inc., 5811 Canal Road, Suite 230, Valley View, Ohio 44127.
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NAME OF BENEFICIAL OWNER SHARES OF COMMON STOCK BENEFICIALLY
OWNED
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NUMBER(1) PERCENT(2)
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Elorian Landers(3) 12,436,221 20.2%
Eden Kim(4) 9,205,641 14.9%
Clay Border 1,517,000 2.5%
Thomas L. McCrimmon(5) 5,314,780 8.6%
Executive officers and directors as a group(6) (3 persons) 19,268,001 31.3%
Alpha Capital Aktiengesellschaft 5,342,777(7) 7.9%
AMRO International, S.A. 4,452,315(8) 6.7%
Markham Holdings Ltd. 6,233,241(9) 9.2%
Stonestreet Limited Partnership 3,561,850(10) 5.5%
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(1) Pursuant to Rule 13d-3 under the Exchange Act of 1934, as amended, a person
has beneficial ownership of any securities as to which such person,
directly or indirectly, through any contract, arrangement, undertaking,
relationship or otherwise, has or shares voting power and/or investment
power as to which such person has the right to acquire such voting and/or
investment power within 60 days. Percentage of beneficial ownership as to
any person as of a particular date is calculated by dividing the number of
shares beneficially owned by such person by the sum of the number of shares
outstanding as of such date and the number of unissued shares as to which
such person has the right to acquire voting and/or investment control
within 60 days. The number of shares shown includes outstanding shares
owned as of October 26, 2001, by the person indicated and shares underlying
warrants and/or options owned by such person on October 26, 2001, that were
exercisable within 60 days of that date.
(2) Based on 61,620,639 shares of common stock issued and outstanding as of the
close of business on October 26, 2001.
(3) Includes 750,000 shares subject to options exercisable within 60 days of
October 26, 2001.
(4) Includes 1,500,000 shares subject to options exercisable within 60 days of
October 26, 2001. Mr. Kim's address is 10715 Orline Court, Cupertino,
California 94015.
(5) Includes 1,800,000 shares subject to options exercisable within 60 days of
October 26, 2001. Mr. McCrimmon's address is 3816 West Linebaugh Avenue,
Suite 200, Tampa, Florida 33624.
(6) Includes 2,292,500 shares subject to options exercisable within 60 days of
October 26, 2001.
(7) Includes 5,267,777 shares of common stock issuable on conversion of
convertible notes at an assumed conversion price of $0.05695 per share, and
75,000 shares of common stock issuable on the exercise of immediately
exercisable warrants. Alpha Capital Aktiengesellschaft's address is
Pradafant 7, 9490 Furstentums, Vaduz, Lichtenstein.
(8) Includes 4,389,815 shares of common stock issuable on conversion of
convertible notes at an assumed conversion price of $0.05695 per share, and
62,500 shares of common stock issuable on the exercise of immediately
exercisable warrants. Amro International's address is care of Ultra Finanz,
Grossmuensterplatz 6, Zurich, Switzerland CH8022.
(9) Includes 6,145,741 shares of common stock issuable on conversion of
convertible notes at an assumed conversion price of $0.05695 per share, and
87,500 shares of common stock issuable on the exercise of immediately
exercisable warrants. Markham Holdings Ltd.'s address is care of Mr. David
Hassan, 50 Town Range, P.O. Box 472, Gibraltar.
(10) Includes 3,511,850 shares of common stock issuable on conversion of
convertible notes at an assumed conversion price of $0.05695 per share, and
50,000 shares of common stock issuable on the exercise of immediately
exercisable warrants. Stonestreet Limited Partnership's address is care of
Carol Harrop/Michael Finkelstein, 260 Town Center Blvd., Suite 201,
Markham, ON, L3R 8H8.
4
ITEM 1.
APPROVAL OF AMENDMENTS TO ARTICLE IV OF
OUR CERTIFICATE OF INCORPORATION TO EFFECT REVERSE STOCK SPLIT
AND DECREASE AUTHORIZED COMMON STOCK
GENERAL
Our Board has unanimously approved, and recommends that the
shareholders adopt, a proposal to amend Article IV of our Certificate of
Incorporation (the "Certificate") to effect a one-for-twenty reverse stock split
of the Company's outstanding common stock, decrease the number of authorized
shares of our common stock, par value $0.0001, from 300,000,000 to 150,000,000
shares and provide additional information concerning the rights and preferences
of our common stock. The text required to effect these changes is set forth in
clause (a) of the first sentence of paragraph A of the proposed amended Article
IV and in paragraphs B.(1) and C of the proposed amended Article IV as set forth
in the proposed Certificate of Amendment to the Certificate of Incorporation of
IVG Corp. attached to this Proxy Statement as Appendix A (the "Certificate of
Amendment").
Paragraph C of the proposed amended Article IV provides for the
combination of our presently issued and outstanding shares of common stock into
a smaller number of shares of identical common stock. This is known as a
"reverse stock split." Under the proposal, each twenty shares of our presently
issued and outstanding common stock, as of the close of business on the
effective date of the Certificate of Amendment, will be converted automatically
into one share of our post-reverse stock split common stock. Fractional shares
will not be issued. Instead, we will issue one full share of our post-reverse
stock split common stock to any shareholder who would have been entitled to
receive a fractional share as a result of the reverse stock split. Each
shareholder will hold the same percentage of our outstanding common stock
immediately following the reverse stock split as he did immediately prior to the
reverse stock split, except for minor adjustments required due to the treatment
of fractional shares.
In conjunction with the reverse stock split, the first sentence of
paragraph A of the proposed amended Article IV provides for a decrease in the
number of authorized shares of our common stock from 300,000,000 to 150,000,000.
If the reverse stock split is approved and effected, the number of shares of
common stock outstanding will decrease to approximately 3.21 million shares
(based upon the shares outstanding as of the record date). As our business
consists in large part of making acquisitions of portfolio companies, and may
require us to issue our common stock from time to time in connection with these
acquisitions, the Board believes that the Company may require a reasonable
amount of excess authorized common stock to implement the Company's business
plan. We believe, however, that the present number of shares of our authorized
common stock will be higher than needed by us to effect our future financing
plans and that IVG Corp. will be subject to unnecessarily high franchise taxes
in respect of these shares. Assuming the reverse stock split is effected, the
Board believes that reducing the number of these authorized shares is in the
best interest of IVG Corp. and its shareholders, and that the proposed number of
150,000,000 authorized shares of common stock will adequately provide for the
company's future needs.
5
REASONS FOR THE REVERSE STOCK SPLIT
The primary purposes of the reverse stock split are to:
o increase the per share price of our common stock;
o reduce the number of outstanding shares to a level more consistent
with other public companies with a similar market capitalization;
and
o maintain the company's flexibility to issue additional shares to
facilitate future stock acquisitions and financings.
The reduction in the number of issued and outstanding shares of common
stock to result from the reverse stock split is expected to increase the market
price of the common stock to a level above the current market trading price.
While the board believes that the shares of common stock will trade at higher
prices than those which have prevailed in the recent past, there can be no
assurance that such increase in the trading price will occur or, if it does
occur, that it will equal or exceed the direct arithmetical result of the
reverse stock split, which would raise the current per share price to
approximately $2.80.
Our common stock is currently quoted on the OTC Bulletin Board of the
National Association of Securities Dealers, Inc. A higher per share price for
the Common Stock may ultimately enable the Company to meet the $4.00 minimum bid
price requirement for initial listing on the Nasdaq SmallCap Market. This would
expand the market liquidity of our common stock and the ability of investors to
trade our common stock. Because trading of our common stock is currently
conducted in the over-the-counter market, investors may find it difficult to
dispose of, or to obtain accurate quotations as to the market value of, the
common stock.
The board believes that the reverse stock split also could result in a
broader market for our common stock than the current market. Many institutional
investors are unwilling or unable due to investment restrictions to invest in
companies whose stock trades at less than $1.00 per share because of a general
presumption that such stocks may be highly speculative. The reverse stock split
is anticipated to result in a price increase for our common stock relieving, to
some extent, the effect of such limitations on the market for our common stock.
Additionally, brokerage commissions on the sale of lower priced stocks often
represent a higher percentage of the sales price than commissions on relatively
higher priced stocks. The expected increase in trading price may also encourage
interest and trading in our common stock and possibly promote greater liquidity
for our shareholders. We also believe that the current per share price of our
common stock has or may have a negative effect on our ability to use our common
stock in connection with possible future transactions such as financings,
strategic alliances, acquisitions and other uses not presently determinable.
6
In addition, a number of other public companies have market
capitalization similar to that of IVG Corp., but generally have less than 5
million shares outstanding, compared to the over 60 million shares that we have
outstanding. The board believes that the reverse stock split would more closely
align our capital structure with companies of comparable market capitalization,
which the board believes is a more appropriate capital structure than our
current structure.
For the above reasons, we believe that the reverse stock split is in
the best interests of IVG Corp. and its shareholders. However, there can be no
assurances that the reverse stock split will have the desired effects.
EFFECTS OF THE REVERSE STOCK SPLIT
Subject to shareholder approval, the reverse stock split will be
effected by filing the Certificate of Amendment and will be effective upon the
close of business on the date of filing. Although we expect to file the
Certificate of Amendment with the Delaware Secretary of State's office promptly
following approval at the Special Meeting, the actual timing of the filing will
be determined by our management based upon their evaluation as to when the
filing will be most advantageous to IVG Corp. and its shareholders. We reserve
the right to forego or postpone filing the Certificate of Amendment if we
determine that action to be in the best interests of IVG Corp. and its
shareholders.
We are currently authorized to issue 300 million shares of common stock
of which 64,220,639 shares were issued and outstanding at the close of business
on the record date. Adoption of the reverse stock split will reduce the shares
of common stock outstanding on the record date to approximately 3,211,032. The
number of authorized shares is proposed to be set at 150,000,000. The reverse
stock split will have no effect on the par value of the common stock.
The effect of the reverse split upon holders of common stock will be
that the total number of shares of our common stock held by each shareholder
will be automatically converted into the number of whole shares of common stock
equal to the number of shares of common stock owned immediately prior to the
reverse stock split divided by twenty, adjusted for any fractional shares. Each
of our shareholders will continue to own one or more shares of common stock and
will continue to share in the assets and future growth of the company as a
shareholder.
Assuming the reverse stock split is approved by the shareholders at the
Special Meeting and implemented, each shareholder's percentage ownership
interest in the company and proportional voting power will remain unchanged,
except for minor differences resulting from adjustments for fractional shares.
The rights and privileges of the holders of shares of common stock will be
substantially unaffected by the reverse stock split. All issued and outstanding
options, warrants, and convertible securities would be appropriately adjusted
for the reverse stock split automatically on the effective date of the reverse
stock split. All shares, options, warrants or convertible securities that IVG
Corp. has agreed to issue (or agrees to issue prior to the effective date of the
reverse stock split) in any merger or acquisition agreement also will be
appropriately adjusted for the reverse stock split.
7
The reverse stock split also may result in some shareholders owning
"odd lots" of less than 100 shares of common stock received as a result of the
reverse stock split. Brokerage commissions and other costs of transactions in
odd lots may be higher, particularly on a per-share basis, than the cost of
transactions in even multiples of 100 shares.
It is not necessary to forward to us your certificates representing
shares of pre-reverse stock split common stock for surrender in exchange for
certificates representing post reverse stock split common stock. We will reflect
on our books your ownership of the number of whole shares of post-reverse stock
split common stock into which the shares of pre-reverse stock split common stock
have been converted as a result of the reverse stock split.
CERTAIN FEDERAL INCOME TAX CONSIDERATIONS
The following discussion describes certain material federal income tax
considerations relating to the reverse stock split. This discussion is based
upon the Internal Revenue Code, existing and proposed regulations thereunder,
legislative history, judicial decisions, and current administrative rulings and
practices, all as amended and in effect on the date hereof. Any of these
authorities could be repealed, overruled, or modified at any time. Any such
change could be retroactive and, accordingly, could cause the tax consequences
to vary substantially from the consequences described herein. No ruling from the
Internal Revenue Service (the "IRS") with respect to the matters discussed
herein has been requested, and there is no assurance that the IRS would agree
with the conclusions set forth in this discussion.
This discussion may not address certain federal income tax consequences
that may be relevant to particular shareholders in light of their personal
circumstances or to shareholders who may be subject to special treatment under
the federal income tax laws. This discussion also does not address any tax
consequences under state, local or foreign laws.
SHAREHOLDERS ARE URGED TO CONSULT THEIR TAX ADVISORS AS TO THE
PARTICULAR TAX CONSEQUENCES OF THE REVERSE STOCK SPLIT FOR THEM, INCLUDING THE
APPLICABILITY OF ANY STATE, LOCAL OR FOREIGN TAX LAWS, CHANGES IN APPLICABLE TAX
LAWS AND ANY PENDING OR PROPOSED LEGISLATION.
The reverse stock split is intended to be a tax-free recapitalization
to the Company and its shareholders, except for those shareholders who receive a
whole share of common stock in lieu of a fractional share. Shareholders will not
recognize any gain or loss for federal income tax purposes as a result of the
reverse stock split, except for those shareholders receiving a whole share of
common stock in lieu of a fractional share (as described below). The holding
period for shares of common stock after the reverse stock split will include the
holding period of shares of common stock before the reverse stock split,
provided that such shares of common stock are held as a capital asset at the
effective time of the Certificate of Amendment. The adjusted basis of the shares
of common stock after the reverse stock split will be the same as the adjusted
basis of the shares of common stock before the reverse stock split excluding the
basis of fractional shares.
8
A shareholder who receives a whole share of common stock in lieu of a
fractional share generally may recognize gain in an amount not to exceed the
excess of the fair market value of such whole share over the fair market value
of the fractional share to which the shareholder was otherwise entitled.
We recommend a vote FOR the approval of the amendments to Article IV
necessary to effect the reverse stock split and increase the authorized Common
Stock.
ITEM 2.
APPROVAL OF AMENDMENTS TO ARTICLE IV OF
OUR CERTIFICATE OF INCORPORATION TO
AUTHORIZE 10,000,000 SHARES OF PREFERRED STOCK.
GENERAL
Our Board has unanimously approved, and recommends that the
shareholders adopt, a proposal to amend Article IV of our Certificate to
authorize 10,000,000 shares of preferred stock. This class of preferred stock,
if authorized, would be issuable from time to time by the Board of Directors
without shareholder approval. Such preferred stock is frequently referred to as
"blank check preferred stock." The text required to authorize and create this
blank check preferred stock is set forth in clause (b) of the first sentence of
paragraph A of the proposed amended Article IV and in paragraph B.(2) of the
proposed amended Article IV as set forth in the proposed Certificate of
Amendment.
Paragraph B.(2) of the proposed amended Article IV provides
that the preferred stock, par value $0.0001 (the "Preferred Stock"), may be
issued from time to time in one or more series. The Board of Directors is
authorized to fix the number of shares of any series of Preferred Stock and to
determine the designation of any such shares. The Board of Directors also is
authorized to determine or alter the rights, preferences, privileges and
restrictions granted to or imposed upon any unissued series of Preferred Stock
and, within the limits and restrictions stated in any resolutions of the Board
of Directors originally fixing the number of shares constituting any series, to
increase or decrease the number of shares of a series (but not below the number
of shares of such series then outstanding) subsequent to the issuance of shares
of such series.
REASONS FOR PREFERRED STOCK
The Board believes this proposed amendment to be in the best
interest of the Company as it will enhance our ability to seek financing, in
particular from investors seeking to purchase Preferred Stock. The Board
believes that its ability to pursue financing opportunities in the future will
be essential to the growth of the Company, and the ability to issue Preferred
Stock will give it needed flexibility.
9
EFFECTS OF PREFERRED STOCK
The Board of Directors does not presently intend to issue any Preferred
Stock. Although it is not possible to state the actual effects of any issuance
of Preferred Stock upon the rights of holders of other Company securities, such
effects might include: (i) restrictions on Common Stock dividends if Preferred
Stock dividends have not been paid; (ii) dilution of the voting power and equity
interest of holders of Common Stock to the extent that any Preferred Stock
series has voting rights or that any Preferred Stock series is convertible into
Common Stock; or (iii) inability of holders of Common Stock to share in the
Company's assets on liquidation until satisfaction of any liquidation
preferences granted to the holders of Preferred Stock. In addition, the issuance
of Preferred Stock under certain circumstances may have the effect of
discouraging an attempt to change control of the Company by, for example,
creating voting impediments to the approval of mergers and other similar
transactions involving the Company.
RIGHTS OF COMMON STOCK
Subject to such preferential rights as may be determined by the Board
of Directors of the Company in connection with the future issuance, if any, of
shares of Preferred Stock, holders of shares of our Common Stock are entitled to
one vote per share on all matters submitted to a vote of shareholders, to
receive such dividends as may be declared by the Board of Directors of the
Company out of funds of the Company legally available therefor, and, in the
event of the liquidation, dissolution or winding-up of the affairs of the
Company, to share prorata according to their respective interests in the
Company's assets after payment of or provision for the payment of all debts and
other liabilities of the Company. Holders of our Common Stock do not have
cumulative voting rights, preemptive rights or other rights to purchase
additional securities of the Company or any rights of conversion or redemption.
CERTIFICATE OF INCORPORATION; BYLAWS
Our Certificate of Incorporation and Bylaws do not contain any specific
provisions the effect of which might be to discourage, delay or impede a change
of control of the Company.
We recommend a vote FOR the amendments to Article IV necessary to
authorize and create the Preferred Stock.
10
ITEM 3.
APPROVAL OF AMENDMENT TO ARTICLE I OF
OUR CERTIFICATE OF INCORPORATION TO CHANGE OUR NAME
FROM IVG CORP. TO GROUP MANAGEMENT CORP.
GENERAL
Our Board has unanimously approved, and recommends that the
shareholders adopt, a proposal to amend Article I of our Certificate to change
the name of the company from IVG Corp. to Group Management Corp. The text
required to effect these changes is contained in the proposed amended Article I
as set forth in the proposed Certificate of Amendment.
REASONS FOR THE NAME CHANGE
The Board of Directors believes that it is in the best interest of the
Company to change its name in order to reflect its current and future business
activities and strategic direction.
Previously, our acquisition and investment strategy consisted of
targeting portfolio companies that provided products or services on the Internet
or technology for Internet application. Recently, we have refocused our business
plan to pursue acquisitions of professional employer organizations and of
companies producing products for the creative products market. In accordance
with this plan, we intend to acquire Group Management Services, Inc. and to
focus the greater part of our financial and other resources on obtaining
revenues in the professional employer organization or staff leasing industry and
in the creative products industry.
While we intend to continue fostering growth in our existing portfolio
companies, our primary focus will be on our business service companies and
companies in the creative products industry and, consequently, we believe that
the name change will better reflect our intent.
For the above reasons, we believe that the name change is in the best
interests of IVG Corp. and its shareholders.
We recommend a vote FOR the amendment to Article I to effect the name
change to Group Management Corp.
ANNUAL MEETING ADVANCE NOTICE REQUIREMENTS
SHAREHOLDER PROPOSALS. Our bylaws provide that shareholder proposals
and director nominations by shareholders may be made in compliance with certain
advance notice, informational and other applicable requirements. With respect to
shareholder proposals (concerning matters other than the nomination of
directors), the individual submitting the proposal must file a WRITTEN NOTICE
with the Secretary of IVG Corp., at 13135 S. Dairy Ashford, Suite 525, Sugar
Land, Texas 77478 setting forth certain information, including the following:
11
o a brief description of the business desired to be bought before
the meeting and the reasons for conducting that business at the
meeting;
o the name and address of the proposing shareholder;
o the number of shares of common stock beneficially owned by the
proposing shareholder; and
o any material interest of the proposing shareholder in such
business.
The notice must be delivered to the Secretary (1) at least 30 days
before any scheduled meeting or (2) if less than 40 days notice or prior public
disclosure of the meeting is given, by the close of business on the 10th day
following the giving of notice or the date public disclosure was made, whichever
is earlier.
GENERALLY. Our annual meetings are held each year at a time and place
designated by our board of directors in the notice of the meeting. Our 2002
annual meeting of shareholders is currently scheduled for June 28, 2002. Copies
of our bylaws are available upon written request made to the Secretary of IVG
Corp. at the above address. The requirements described above do not supersede
the requirements or conditions established by the SEC for shareholder proposals
to be included in our proxy materials for a meeting of shareholders. The
chairman of the meeting may refuse to bring before a meeting any business not
brought in compliance with applicable law and our bylaws.
---------------------------------------------------------------
PLEASE TAKE A MOMENT NOW TO VOTE. PLEASE
SIGN AND RETURN YOUR PROXY.
THANK YOU.
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12
APPENDIX A
CERTIFICATE OF AMENDMENT
TO THE CERTIFICATE OF INCORPORATION
OF
IVG CORP.
Pursuant to the provisions of Section 242 of the Delaware General
Corporation Law, IVG CORP., a Delaware corporation (the "Corporation") hereby
certifies that:
1. The name of the corporation is IVG CORP.
2. The following amendments to the Certificate of Incorporation of the
Corporation were adopted and approved by at least a majority of the
voting power of the Corporation at a Special Meeting of the
Shareholders held on December 3, 2001 (the "Special Meeting"). At the
Special Meeting, ____ shares of the Corporation's common stock, par
value $.0001 (the "Common Stock"), were voted in favor of the amendment
to Article I, ____shares of Common Stock were voted against the
amendment to Article I and ______ shares of Common Stock abstained from
voting on the amendment to Article I. At the Special Meeting,
__________ shares of Common Stock were voted in favor of the amendments
to Article IV set forth at clause (a) of paragraph A, at paragraph B.1
and at paragraph C., ______ shares of Common Stock were voted against
such amendments and __________ shares of Common Stock abstained from
voting on such amendments. At the Special Meeting, __________ shares of
Common Stock were voted in favor of the amendments to Article IV set
forth at clause (b) of paragraph A and at paragraph B.2., ______ shares
of Common Stock were voted against such amendments and __________
shares of Common Stock abstained from voting on such amendments. The
shares of capital stock of the Corporation outstanding and entitled to
vote at the Special Meeting consisted of shares of Common Stock.
3. Article I of the Certificate of Incorporation of the Corporation is
hereby amended to read in its entirety as follows:
ARTICLE I
The name of the corporation is Group Management Corp.
4. Article IV of the Certificate of Incorporation of the Corporation is
hereby amended to read in its entirety as follows:
A-1
ARTICLE IV
AUTHORIZED SHARES
A. The Corporation shall have authority to issue an aggregate
of 160,000,000 shares of capital stock, consisting of (a) 150,000,000
shares of Common Stock, par value $0.0001 per share (the "Common
Stock"), and (b) 10,000,000 shares of Preferred Stock, par value
$0.0001 per share (the "Preferred Stock").
B. The designations, powers, preferences and relative,
participating, optional and other special rights, and the
qualifications, limitations and restrictions thereof with respect to
the Common Stock and the Preferred Stock are as follows:
(1) COMMON STOCK. Each holder of the Common Stock of
the Corporation shall be entitled to one vote for every share
of Common Stock outstanding in his name on the books of the
Corporation. Except for and subject to those rights expressly
granted to the holders of the Preferred Stock or except as may
be provided by the laws of the State of Delaware, the holders
of Common Stock shall have exclusively all other rights of
shareholders including, without limitation, (i) the right to
receive dividends, when and as declared by the Board of
Directors out of assets legally available therefor, and (ii)
in the event of any distribution of assets upon liquidation,
dissolution or winding up of the Corporation or otherwise, the
right to receive ratably and equally with all holders of all
Common Stock all the assets and funds of the Corporation
remaining after the payment to the holders of the Preferred
Stock of the specific amounts that they are entitled to
receive upon such liquidation, dissolution or winding up of
the Corporation, if any.
(2) PREFERRED STOCK. Preferred Stock may be issued
from time to time in one or more series, each of such series
to have such terms as stated in the resolution or resolutions
providing for the establishment of such series adopted by the
Board of Directors of the Corporation as hereinafter provided.
Except as otherwise expressly stated in the resolution or
resolutions providing for the establishment of a series of
Preferred Stock, any shares of Preferred Stock that may be
redeemed, purchased or acquired by the Corporation may be
reissued except as otherwise expressly provided by law.
Different series of Preferred Stock shall not be construed to
constitute different classes of stock for the purpose of
voting by classes unless expressly provided in the resolution
or resolutions providing for the establishment thereof. The
A-2
Board of Directors of the Corporation is hereby expressly
authorized to issue, from time to time, shares of Preferred
Stock in one or more series, and, in connection with the
establishment of any such series by resolution or resolutions,
to determine and fix the number of shares constituting that
series and the distinctive designation of that series and to
determine and fix such voting powers, full or limited, or no
voting powers, and such other powers, designations,
preferences and relative, participating, optional and other
rights, and the qualifications, limitations and restrictions
thereof, including, without limitation, dividend rights,
conversion rights, redemption privileges and liquidation
preferences, as shall be stated in such resolution or
resolutions, all to the fullest extent permitted by the
Delaware General Corporation Law. Without limiting the
generality of the foregoing, the resolution or resolutions
providing for the establishment of any series of Preferred
Stock may, to the extent permitted by law, provide that such
series shall be superior to, rank equally with or be junior to
the Preferred Stock of any other series. Except as otherwise
expressly provided in the resolution or resolutions providing
for the establishment of any series of Preferred Stock, no
vote of the holders of shares of Preferred Stock or Common
Stock shall be a prerequisite to the issuance of any shares of
any series of the Preferred Stock authorized by and complying
with the conditions of this Certificate of Incorporation.
C. On the date that this Certificate of Amendment is filed
with the Secretary of State of the State of Delaware (the "Effective
Date"), every twenty (20) shares of Common Stock of the Corporation
issued and outstanding at the close of business on the Effective Date
(the "Old Common Stock") will automatically be converted into one share
of common stock, par value $.0001 per share (the "New Common Stock") of
the Corporation. No fractional shares will be issued and, in lieu
thereof, each holder of Common Stock whose aggregate shares of Old
Common Stock held in one name or account immediately prior to the
Effective Date are fewer than twenty (20) shares or not evenly
divisible by twenty (20) shall receive one full share of New Common
Stock in exchange for such fractional share.
A-3
5. Except as amended by this Certificate of Amendment, the Certificate
of Incorporation of the Corporation shall remain in full force and
effect.
IN WITNESS WHEREOF, the undersigned Chief Executive Officer and
Secretary of IVG Corp. have executed this Certificate of Amendment on _______,
2001 at Sugar Land, Texas.
IVG CORP.
By:
----------------------------------------
Elorian Landers, Chief Executive Officer
By:
----------------------------------------
Clay C. Border, Secretary
A-4
================================================================================
IVG Corp.
Special Meeting of Shareholders
to be held December 3, 2001
PROXY
PROXY SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby (a) acknowledges receipt of the Notice of Special Meeting
of Shareholders of IVG Corp.(the "Company"), to be held on December 3, 2001 and
the proxy statement in connection therewith, each dated November 14, 2001, (b)
appoints Elorian Landers and Clay C. Border, III, or either of them, as Proxies,
each with the power to appoint a substitute, (c) authorizes the Proxies to
represent and vote, as designated below, all the shares of Common Stock of the
Company held of record by the undersigned on November 13, 2001, at such Special
Meeting and at any adjournment(s) thereof, and (d) revokes any proxies
heretofore given.
1. Approval of the proposal to amend Article IV of the Certificate of
Incorporation to effect a one for twenty reverse stock split and a
decrease in authorized Common Stock from 300,000,000 to 150,000,000.
|_| FOR |_| AGAINST |_| ABSTAIN
2. Approval of the proposal to amend Article IV of the Certificate of
Incorporation to authorize 10,000,000 shares of preferred stock.
|_| FOR |_| AGAINST |_| ABSTAIN
3. Approval of the proposal to amend Article I of the Certificate of
Incorporation to change the name of the company from IVG Corp. to Group
Management Corp.
|_| FOR |_| AGAINST |_| ABSTAIN
THIS PROXY WILL BE VOTED AS SPECIFIED. IF NO SPECIFICATION IS INDICATED, THIS
PROXY WILL BE VOTED FOR THE ADOPTION AND APPROVAL OF PROPOSALS 1, 2 AND 3, IN
THE DISCRETION OF THE PROXIES.
IMPORTANT: Please date this proxy and sign exactly as your name or names appear
thereon. If stock is held jointly, signature should include both names.
Executors, administrators, trustees, guardians and others signing in the
representative capacity, please so indicate when signing.
DATED:______________, 2001 _____________________________Signature
-----------------------------------------
PLEASE SIGN, DATE AND RETURN THIS PROXY
PROMPTLY IN THE ACCOMPANYING ENVELOPE. _______________________________________
----------------------------------------- Signature if held jointly