SCHEDULE 14C INFORMATION
Information Statement Pursuant to Section 14(c)
of the Securities Exchange Act of 1934
Check the appropriate box:
[_] Preliminary Information Statement
[_] Confidential, for use of the Commission only (as permitted by Rule
14c-5(d)(21))
[X] Definitive Information Statement
The Jackson Rivers Company
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(Name of Registrant as Specified In Its Charter)
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[_] Fee computed on table below per Exchange Act Rules 14c-5(g) and 0-11.
1) Title of each class of securities to which transaction applies:
2) Aggregate number of securities to which transaction applies:
3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which
the filing is calculated and state how it was determined.):
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4) Proposed maximum aggregate value of transaction:
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[_] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number, or
the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
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2) Form, Schedule or Registration Statement No.:
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THE JACKSON RIVERS COMPANY
550 Greens Parkway, Suite 230
Houston, Texas 77067
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NOTICE OF SHAREHOLDER ACTION BY WRITTEN CONSENT
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December 14, 2006
A majority of the shareholders of The Jackson Rivers Company, have taken
action by written consent to approve an amendment to our Articles of
Incorporation, which amendment will (i) effectuate a reverse stock split of our
common stock by changing and reclassifying up to Five Hundred (500) shares of
our issued and outstanding common stock, par value $.00001 per share ("Common
Stock") into one (1) fully paid and non-assessable share of Common Stock; (ii)
change our corporate name to "Interact Holdings Group, Inc.", or whichever
substantially similar name is available, and (iii) increase our authorized
Common Stock to 5,000,000,000 shares.
Shareholders of record at the close of business on November 21, 2006 will
be entitled to notice of this shareholder action by written consent. Since the
actions will be approved by the holders of the required majority of the
outstanding shares of our voting stock, no proxies were or are being solicited.
We anticipate that the name change, the reverse split and the increase in
authorized shares will become effective on or after January 3, 2006.
Jeffrey W. Flannery
Chief Executive Officer
WE ARE NOT ASKING YOU FOR A PROXY AND YOU
ARE REQUESTED NOT TO SEND US A PROXY.
THE JACKSON RIVERS COMPANY
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INFORMATION STATEMENT
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INFORMATION CONCERNING THE ACTION BY WRITTEN CONSENT
Date and Purpose of Written Consent
Shareholders holding a majority of the voting power of the company took action
by written consent on November 21, 2006 for the purpose of approving an
amendment to the company's articles of incorporation (the "Charter Amendment")
to (i) effectuate a 1-for up to 500 reverse split of the company's issued and
outstanding common stock (the "Reverse Split"); (ii) change the company's
corporate name to "Interact Holdings Group, Inc.", or whichever substantially
similar name is available (the "Name Change") and (iii) increase our authorized
Common Stock to 5,000,000,000 shares.
Shareholders Entitled to Vote
Approval of the matters described herein requires the written consent of the
holders of outstanding stock of each voting group entitled to vote on such
matters. As of November 21, 2006, there were 183,658,574 shares of our common
stock outstanding, 960,000 shares of our series A preferred stock outstanding,
8,413,607 shares of our series B preferred stock outstanding and 2,200,000
shares of our series C preferred stock outstanding. Holders of our common stock
are entitled to one vote per share. Holders of our series A preferred stock are
entitled to 2,000 votes for each share of series A preferred stock held by them,
and for the actions described herein, vote together with the holders of common
stock as a single class. As such, the holders of series A preferred stock hold
1,920,000,000 votes. The holders of our series B and C preferred stock have no
voting rights except as prescribed by law and have no voting rights for the
actions described herein. Accordingly, there are 2,103,658,574 votes outstanding
voting together as a single class. Shareholders of record at the close of
business on November 21, 2006, will be entitled to receive this notice and
information statement.
Proxies
No proxies are being solicited.
Consents Required
The Charter Amendment requires the consent of the holders of a majority of the
shares of common stock and series A preferred stock voting together as a single
class.
On November 21, 2006, Jeffrey W. Flannery and James E. Nelson, holders of
1,920,000,000 voting rights with respect to their 960,000 shares of our series A
preferred stock delivered written consents to us adopting the proposals set
forth herein. Messrs. Flannery and Nelson collectively hold approximately 91% of
the outstanding voting rights. For a detailed breakdown of Messrs. Flannery and
Nelson's holdings, please see "COMMON STOCK OUTSTANDING AND CERTAIN BENEFICIAL
OWNERS AND MANAGEMENT."
Information Statement Costs
The cost of delivering this information statement, including the preparation,
assembly and mailing of the information statement, as well as the cost of
forwarding this material to the beneficial owners of our capital stock will be
borne by us. We may reimburse brokerage firms and others for expenses in
forwarding information statement materials to the beneficial owners of our
capital stock.
1
COMMON STOCK OWNERSHIP OF CERTAIN
BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth certain information regarding the beneficial
ownership of our common stock as of November 21, 2006 by the following persons:
o each person who is known to be the beneficial owner of more than
five percent (5%) of our issued and outstanding shares of common
stock;
o each of our directors and executive officers; and
o all of our directors and executive officers as a group.
Except as set forth in the footnotes to the table, the persons named in
the table have sole voting and investment power with respect to all shares of
common stock shown as beneficially owned by them, subject to community property
laws where applicable. A person is considered the beneficial owner of any
securities as of a given date that can be acquired within 60 days of such date
through the exercise of any option, warrant or right. Shares of common stock
subject to options, warrants or rights which are currently exercisable or
exercisable within 60 days are considered outstanding for computing the
ownership percentage of the person holding such options, warrants or rights, but
are not considered outstanding for computing the ownership percentage of any
other person.
Number of Shares
Number Of Shares Beneficially Owned Percentage Owned
Name And Address (1) Beneficially Owned Percentage Owned (2) Post Reverse Split Post Reverse Split (4)
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Jeffrey W. Flannery 480,000 (3) * 480,000 57%
James E. Nelson 480,000 (3) * 480,000 57%
All directors and officers as a 960,000 (3) * 960,000 72%
group (2 persons)
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* Less than 1% of the outstanding shares of common stock.
(1) Unless otherwise noted, the address for each person is 550 Greens Parkway,
Suite 230, Houston, Texas 77067.
(2) Based on 183,658,574 common shares issued and outstanding.
(3) Consists of 480,000 shares of series A preferred stock, each share of
which is (i) convertible into 1 share of our common stock and (ii)
entitled to 2,000 votes on any matter presented to holders of our common
stock.
(4) Based on 367,317 shares of common stock outstanding after the 1-for-500
reverse split.
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PROPOSAL 1
AMENDMENT TO OUR ARTICLES OF
INCORPORATION TO EFFECTUATE A 1-FOR-UP TO 500 REVERSE STOCK SPLIT
Introduction
On November 21, 2006, our board of directors unanimously adopted a
resolution declaring it advisable to amend our articles of incorporation to
effectuate a 1-for-up to 500 reverse stock split. Our board of directors further
directed that this amendment to our articles of incorporation be submitted for
consideration by our stockholders. On November 21, 2006, the holders of our
voting stock approved the 1-for-up to 500 reverse stock split. A copy of the
amendment to our articles of incorporation is attached to this information
statements as Appendix A.
Effective Time of the Reverse Split
We intend to file, as soon as practicable on or after the twentieth (20th)
day after this information statement is sent to our shareholders, an amendment
to our articles of incorporation effectuating the reverse stock split with the
Secretary of State of Florida. This amendment to our articles of incorporation
will become effective at the close of business on the date the amendment to the
articles of incorporation is accepted for filing by the Secretary of State of
Florida. It is presently contemplated that such filing will be made on or after
January 3, 2006. A copy of the amendment to our articles of incorporation is
attached to this information statement as Appendix A.
Reasons for the Reverse Stock Split
Our board of directors seeks to adopt the one for up to five hundred
reverse stock split in order to improve our capitalization. The number of total
shares outstanding on November 21, 2006 was 183,658,574. Our board of directors
believes that this number of outstanding shares, along with the low per share
market price of our common stock, impairs its marketability to and acceptance by
institutional investors and other members of the investing public and creates a
negative impression of our company.
Theoretically, decreasing the number of shares of common stock outstanding
should not, by itself, affect the marketability of the shares, the type of
investor who would be interested in acquiring them, or our reputation in the
financial community. In practice, however, many investors and market makers
consider low-priced stocks as unduly speculative in nature and, as a matter of
policy, avoid investment and trading in such stocks. The presence of these
negative perceptions may be adversely affecting, and may continue to adversely
affect, not only the pricing of our common stock but also its trading liquidity.
In addition, these perceptions may affect our commercial business and our
ability to raise additional capital through the sale of stock or the cost of
debt we may incur.
We hope that the decrease in the number of shares of our outstanding
common stock resulting from the reverse split, and the anticipated increase in
the price per share, will encourage greater interest in our common stock among
members of the financial community and the investing public and possibly create
a more liquid market for our stockholders with respect to those shares presently
held by them. However, the possibility exists that stockholder liquidity may be
adversely affected by the reduced number of shares which would be outstanding if
the reverse split is effected, particularly if the price per share of our common
stock begins a declining trend after the reverse split is effected. Companies
which effectuate reverse stock splits often experience such a declining trend.
It is possible that the reverse split will not achieve any of the desired
results. There also can be no assurance that the price per share of our common
stock immediately after the reverse split will increase proportionately with the
reverse split, or that any increase will be sustained for any period of time.
We are not aware of any present efforts by anyone to accumulate our common
stock, and the proposed reverse split is not intended to be an anti-takeover
device.
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Possible Disadvantages
The liquidity of our common stock may be adversely affected by the reduced
number of freely-tradeable shares outstanding after the reverse stock-split. The
reverse stock-split will cause the number of "odd-lot" holders to go up and
cause the number of "round-lot" holders of the common stock to go down. An
odd-lot is fewer than 100 shares. The number of round-lot holders is a common
measure of a stock's distribution, and a lower number may reflect more
negatively on our shares. In addition, the new odd-lot holders may become
reluctant to trade their shares because of any stigma or higher commissions
associated with odd-lot trading. Stockholders who hold odd-lots may experience
an increase in the cost of selling their shares and may have greater difficulty
in making sales. This may negatively impact the average trading volume and
thereby diminish interest in the common stock by some investors and advisors.
Notwithstanding these potential disadvantages, the board of directors
believes that the reverse stock-split is in our best interest for the reasons
set forth above.
Effects of Reverse Stock-Split
The reverse stock-split will increase our authorized but unissued common
stock, which may be used by our board of directors in order to thwart
anti-takeover efforts by outsiders. The board nominees are not aware of any such
current takeover efforts, and the reverse split is not being proposed as an
anti-takeover measure.
Following the reverse split, our capital structure will be as follows:
(i) 367,317 shares of common stock outstanding;
(ii) 990,000,000 shares of common stock authorized, with 989,632,683
shares reserved for issuance
While management is currently seeking attractive equity or debt financing
arrangements, there are currently no proposals or arrangements, written or
otherwise, to issue additional shares of our common stock at this time. However,
should we issue additional shares of stock in the future, this could have the
effect of diluting the earnings per share and book value per share of existing
shares of common stock.
Our charter currently provides that preferred stock may be issued in one
or more series. Our board of directors is authorized to fix the number of shares
of any series of preferred stock, to determine the designation of any such
series and to determine the rights, preferences, privileges, qualifications and
limitations of such preferred stock. Depending upon the nature and terms of any
such designated and issued preferred stock, such issuance could make a takeover
of our company more difficult and therefore, less likely. An issuance of any
shares of preferred stock could have the effect of diluting the earnings per
share and book value per share of existing shares of common stock. The board of
directors has no present plans, understandings, or agreements to issue any
additional shares of preferred stock. Other than our preferred stock as
discussed above, there are no provisions of our articles, bylaws, employment
agreements or credit agreements that have material antitakeover consequences.
Stock Certificates and Fractional Shares
Stockholders will be required to exchange their stock certificates for new
certificates representing the shares of common stock after giving effect to the
reverse stock-split with our transfer agent. Stockholders will not be required
to pay a transfer or other fee in connection with the exchange of certificates.
We will not issue any certificates representing fractional shares of our
common stock in the transaction, while retaining the current par value of
$0.00001. We will not be paying any cash to stockholders for any fractional
shares resulting from the reverse split; rather, any resulting fractional shares
shall be rounded up to the nearest whole number.
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Our transfer agent is Transfer Online, Inc., 367 S.W. Alder St., 2nd
floor, Portland, OR 97204.
Procedure for Implementing the Reverse Stock-Split
In connection with the reverse stock-split, up to five hundred (500)
shares of our pre-split outstanding common stock will be exchanged for one share
of common stock. Post-split shares of our common stock may be obtained by
surrendering certificates representing shares of pre-split common stock to our
transfer agent. To determine the number of shares of our common stock issuable
to any record holder, the total number of shares represented by all of the
certificates issued in the name of that record holder held in each account as
set forth on the records of the transfer agent on the date upon which the split
becomes effective will be divided by 500 or less.
We will not issue any certificates representing fractional shares of our
common stock in the transaction, while retaining the current par value of
$0.00001. Any resulting fractional shares shall be rounded up to the nearest
whole number. Upon surrender to the transfer agent of the share certificate(s)
representing shares of pre-split common stock, the holder will receive a share
certificate representing the appropriate number of shares of our common stock.
Federal Income Tax Consequences
The following discussion generally describes certain federal income tax
consequences of the reverse stock-split to our stockholders. The following does
not address any foreign, state, local tax or alternative minimum income, or
other federal tax consequences of the proposed reverse stock-split. The actual
consequences for each stockholder will be governed by the specific facts and
circumstances pertaining to such stockholder's acquisition and ownership of the
common stock. Each stockholder should consult his or her accountants for more
information in this regard.
We believe that the reverse stock-split will qualify as a
"recapitalization" under Section 368(a)(1)(E) of the Code or as a
stock-for-stock exchange under Section 1036(a) of the Code. As a result, no gain
or loss should be recognized by us or our stockholders in connection with the
reverse stock-split. A stockholder's aggregate tax basis in his or her shares of
post- reverse stock-split common stock received from us will be the same as his
or her aggregate tax basis in the pre- reverse stock-split common stock
exchanged therefor. The holding period of the post- reverse stock-split common
stock surrendered in exchange therefor will include the period for which the
shares of pre-reverse stock-split common stock were held, provided all such
common stock was held as a capital asset on the date of the exchange.
This summary is provided for general information only and does not purport
to address all aspects of the possible federal income tax consequences of the
reverse stock-split and is not intended as tax advice to any person. In
particular, and without limiting the foregoing, this summary does not consider
the federal income tax consequences to our stockholders in light of their
individual investment circumstances or to holders subject to special treatment
under the federal income tax laws (such as life insurance companies, regulated
investment companies and foreign taxpayers).
No ruling from the Internal Revenue Service or opinion of counsel has been
or will be obtained regarding the federal income tax consequences to our
stockholders as a result of the reverse stock-split. Accordingly, each
stockholder is encouraged to consult his or her tax advisor regarding the
specific tax consequences of the proposed transaction to such stockholder,
including the application and effect of state, local and foreign income and
other tax laws.
No Appraisal Rights
Under Florida law, the company's shareholders are not entitled to
appraisal rights with respect to the reverse stock split and the company will
not independently provide shareholders with any such right.
5
PROPOSAL 2
AMENDMENT TO OUR ARTICLES OF
INCORPORATION TO CHANGE OUR NAME TO
INTERACT HOLDINGS GROUP, INC.
Introduction
On November 21, 2006, our board of directors unanimously adopted a
resolution declaring it advisable to amend our articles of incorporation to
change our name to "Interact Holdings Group, Inc." or whichever substantially
similar name is available. Our board of directors further directed that this
amendment to our articles of incorporation be submitted for consideration by our
stockholders. On November 21, 2006, the holders of our voting stock approved the
amendment of our articles of incorporation to change our name to "Interact
Holdings Group, Inc." or whichever substantially similar name is available. A
copy of the amendment to our articles of incorporation is attached to this
information statement as Appendix A.
Effective Time of the Name Change
We intend to file, as soon as practicable on or after the twentieth (20th)
day after this information statement is sent to our shareholders, an amendment
to our articles of incorporation effectuating the name change with the Secretary
of State of Florida. This amendment to our articles of incorporation will become
effective at the close of business on the date the amendment to the articles of
incorporation is accepted for filing by the Secretary of State of Florida. It is
presently contemplated that such filing will be made on or after January 3,
2006.
Reasons for the Name Change
Our board of directors feels that this name change is in our best
interest. In light of our December 2005 acquisition of Diverse Networks, Inc.
and our May 2006 acquisition of UTSI International Corporation, the name "The
Jackson Rivers Company" no longer accurately reflects the company's operations
and interests.
You are not required to exchange your certificate(s) of The Jackson Rivers
Company for new stock certificates reflecting our new name of Interact Holdings
Group, Inc., or whichever substantially similar name is available, although you
may do so if you wish.
6
PROPOSAL 3
AMENDMENT TO OUR CERTIFICATE OF
INCORPORATION TO INCREASE OUR AUTHORIZED
COMMON STOCK TO 5,000,000,000 SHARES
Introduction
On November 21, 2006, our board of directors unanimously adopted a
resolution declaring it advisable to amend our articles of incorporation to
increase our authorized common stock from 990,000,000 shares to 5,000,000,000
shares. Our board of directors further directed that this amendment to our
articles of incorporation be submitted for consideration by our stockholders. On
November 21, 2006, the holders of our voting stock approved the increase of our
authorized common stock to 5,000,000,000 shares.
Effective Time of the Charter Amendment Increasing our Authorized Common Stock
We intend to file, as soon as practicable on or after the twentieth (20th)
day after this information statement is sent to our shareholders, an amendment
to our articles of incorporation effectuating the increase of our authorized
common stock with the Secretary of State of Florida. This amendment to our
articles of incorporation will become effective at the close of business on the
date the amendment to the articles of incorporation is accepted for filing by
the Secretary of State of Florida. It is presently contemplated that such filing
will be made on or after January 3, 2006. A copy of the amendment to our
articles of incorporation is attached to this information statement as Appendix
A.
Principal Reasons for Increase in Authorized Common Stock
Currently, our articles of incorporation, as amended, authorize 990,000,000
shares of common stock. Authorizing an additional 4,010,000,000 shares of common
stock would give our board of directors the express authority without further
action of the stockholders to issue common stock from time to time as the board
deems necessary. The board of directors believes it is necessary to have the
ability to issue such additional shares of common stock for general corporate
purposes. Potential uses of the additional authorized shares may include equity
financings, issuance of options, acquisition transactions, stock dividends or
distributions, without further action of the stockholders, unless such action
were specifically required by applicable state law or by rules of any stock
exchange or similar system on which our securities may then be listed. The board
of directors chose such a large number of shares of authorized common stock
because it wants maximum flexibility to issue common stock in the future without
having to seek stockholder approval in the future.
Within the limits imposed by applicable law, described below, shares of common
stock could be issued in one or more transactions. Depending upon the nature and
terms thereof, such a transaction or transactions could make a takeover of
Jackson Rivers more difficult and, therefore, less likely. An issuance of
additional shares of common stock could have the effect of diluting the earnings
per share and book value per share of existing shares of common stock and
diluting the stock ownership of persons seeking to obtain control of Jackson
Rivers. The board of directors has no present plans, understandings, or
agreements to issue the additional shares to be authorized.
Our charter currently provides that preferred stock may be issued in one or more
series. Our board of directors is authorized to fix the number of shares of any
series of preferred stock, to determine the designation of any such series and
to determine the rights, preferences, privileges, qualifications and limitations
of such preferred stock. Depending upon the nature and terms of any such
designated and issued preferred stock, such issuance could make a takeover of
our company more difficult and therefore, less likely. An issuance of any shares
of preferred stock could have the effect of diluting the earnings per share and
book value per share of existing shares of common stock. The board of directors
has no present plans, understandings, or agreements to issue any additional
shares of preferred stock. Other than our preferred stock as discussed above,
there are no provisions of our articles, bylaws, employment agreements or credit
agreements that have material antitakeover consequences.
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The board of directors does not currently intend to propose any amendments to
Jackson Rivers' articles of incorporation which might be deemed to have the
effect of discouraging takeover attempts, although such amendments or other
programs may be considered by the board in the future if it believes the
interests of the stockholders would be protected thereby. Management might be
able to use the additional shares to resist or frustrate a third-party
transaction providing an above-market premium that is favored by a majority of
the independent shareholders. However, it should be noted that management
currently controls over 90% of voting rights with respect to the outstanding
common stock and considers a hostile takeover attempt very unlikely.
All shares of common stock which are not issued and outstanding, including the
additional shares of common stock that will be authorized when the Charter
Amendment becomes effective, would be issuable at any time or from time to time
by action of the board of directors without further authorization from
stockholders, except to the extent that such further authorization is required
by the terms of any agreements into which Jackson Rivers may hereafter enter, by
the terms of any securities that Jackson Rivers may hereafter issue, or
applicable law.
The additional shares of common stock which would be authorized would have the
same rights and privileges as and otherwise be identical to the shares of common
stock currently authorized and outstanding.
By Order of the Board of Directors
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Jeffrey W. Flannery
Chief Executive Officer
December 14, 2006
Houston, Texas
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APPENDIX A
ARTICLES OF AMENDMENT
TO THE
ARTICLES OF INCORPORATION
OF THE JACKSON RIVERS COMPANY
Pursuant to the provisions of Section 607.1003 of the Florida Statutes, The
Jackson Rivers Company, a Florida profit corporation adopts the following
Articles of Amendment to its Articles of Incorporation:
FIRST: Article I shall be amended to read as follows:
"The name of the corporation is INTERACT HOLDINGS GROUP, INC."
SECOND: Article V, as previously amended, is hereby further amended as follows:
"On ____, 2006 (the "Effective Date"), the issued shares of the Company's Common
Stock, par value $0.00001 per share (the "Old Common Stock"), outstanding or
held as treasury shares as of the open of business on the Effective Date, shall
automatically and without any action on the part of the holders of the Old
Common Stock be reverse split (the "Split") on a one-for-500 basis so that 500
shares of the Old Common Stock shall be converted into and reconstituted as one
share of Common Stock, par value $0.00001 per share (the "New Common Stock").
Any fractional shares resulting from the Split shall be rounded up to the
nearest share of the New Common Stock."
THIRD: Article V, as previously amended, is hereby further amended as follows:
"Capital Stock. The Company shall be authorized to issue 6,000,000,000 shares,
of which 5,000,000,000 shares shall be common stock, par value $0.00001 per
share, and 1,000,000,000 shares shall be preferred stock, par value $0.0001 per
share."
FOURTH: The amendments were approved by the shareholders. The number of votes
cast for the amendments by the shareholders were sufficient for approval.
Dated: January ____, 2006
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Jeffrey W. Flannery
Chief Executive Officer
A-1