UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
DEFINITIVE
SCHEDULE 14C INFORMATION STATEMENT
Information Statement Pursuant to Section 14(c)
Of the Securities Exchange Act of 1934
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[ ] Preliminary Information Statement
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[X] Definitive Information Statement
Trading Solutions.com, Inc.
(Name of Registrant as Specified In Charter)
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TRADING SOLUTIONS.COM, INC.
2469 E. 7000 S., #214, Salt Lake City, Utah 84121
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NOTICE OF STOCKHOLDER ACTION BY WRITTEN CONSENT
April 7, 2004
A majority of the stockholders of Trading Solutions.com, Inc., or TSLU, have taken action by written consent to amend TSLU’s articles of incorporation to do the following:
1. Increase the number of shares of common stock that TSLU is authorized to issue from 20,000,000 to 50,000,000;
2. Authorize 10,000,000 shares of undesignated preferred stock, par value $0.01 per share; and
3. Change the name of the company to "Chembio Diagnostics, Inc."
Stockholders of record at the close of business on March 17, 2004 will be entitled to notice of this stockholder action by written consent. Since the actions have been 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 amendment will become effective on or after April 28, 2004.
Mark L. Baum
President and Chief Executive Officer
INFORMATION STATEMENT
PURSUANT TO SECTION 14
OF THE SECURITIES EXCHANGE ACT OF 1934
AND REGULATION 14C AND SCHEDULE 14C THEREUNDER
This information statement is circulated to advise the stockholders of action taken without a meeting upon the written consent of the holders of a majority of the outstanding shares of the common stock of the Company.
WE ARE NOT ASKING YOU FOR A PROXY AND YOU
ARE REQUESTED NOT TO SEND US A PROXY.
INFORMATION CONCERNING THE ACTION BY WRITTEN CONSENT
DATE AND PURPOSE OF WRITTEN CONSENT
Stockholders holding a majority of the voting power of the company have taken action by written consent for the purpose of amending TSLU’s articles of incorporation to do the following:
1. Increase the number of shares of common stock that TSLU is authorized to issue from 20,000,000 to 50,000,000;
2. Authorize 10,000,000 shares of undesignated preferred stock, par value $0.01 per share; and
3. Change the name of the company to "Chembio Diagnostics, Inc."
OUTSTANDING SHARES AND VOTING RIGHTS
Currently, our only class of securities entitled to vote on the matters to be acted upon is common stock, of which the total amount presently outstanding following a 1 for 17 reverse stock split effective March 12, 2004 is 1,063,147 shares, each share being entitled to one vote.
The record date for determination of the security holders entitled to vote or give consent is March 17, 2004.
The consent of the holders of a majority of the shares entitled to vote upon the matter is required for approval of the actions. The company’s board of directors and the stockholder holding 882,352 shares of common stock, or 82.9% of the issued and outstanding voting securities of TSLU, have adopted, ratified and approved resolutions to effect the actions listed above. No other votes are required or necessary. We anticipate effecting the amendment to the articles of incorporation twenty days following the delivery of the definitive information statement to our shareholders of record.
APPROXIMATE DATE OF MAILING: April 10, 2004.
INTERESTS OF CERTAIN PERSONS IN THE ACTIONS
Other than elections to office, none of the persons who have been directors or officers of the Company at any time since the beginning of the last fiscal year, nor any associate of any such persons, has any interest in the matters to be acted upon. None of our directors has informed us in writing that he intends to oppose any action to be taken by us. No proposals have been received from any of our stockholders.
DISSENTER'S RIGHTS OF APPRAISAL
Nevada Revised Statutes do not provide for dissenter's rights of appraisal in connection with the actions being taken by us.
SECURITY OWNERSHIP OF MANAGEMENT AND PRINCIPAL STOCKHOLDERS
The following table presents information about the beneficial ownership of our common stock as of March 17, 2004 by:
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each person or entity who is known by us to own beneficially more than 5% of the outstanding shares of our common stock;
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each of our directors;
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each of our named executive officers;
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each of the persons who served as our chief executive officer during our fiscal year ended December 31, 2003; and
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all directors and executive officers as a group.
Beneficial ownership is determined in accordance with the rules of the Securities and Exchange Commission and generally includes voting or investment power with respect to securities, subject to community property laws, where applicable. Shares of our common stock subject to options or other convertible securities that are presently exercisable or convertible or exercisable or convertible within 60 days of March 17, 2004 are deemed to be outstanding and beneficially owned by the holder for the purpose of computing shares and percentage ownership of that holder, but are not treated as outstanding for the purpose of computing the percentage ownership of any other person. The percentage of beneficial ownership is based on 1,063,147 shares of common stock outstanding as of March 19, 2004.
|
Name and Address of Beneficial Owner |
Number of Shares
Beneficially Owned |
|
Percentage of Shares
Outstanding (1) |
|
Mark L. Baum (2)
249 South Highway 101, Suite 432
Solana Beach, California 92075 |
882,352 |
|
82.9% |
|
All current directors and executive officers as a group (1 person) |
882,352 |
|
82.9% |
(1) Includes shares of common stock subject to warrants currently exercisable or convertible within 60 days of March 17, 2004 are deemed outstanding for computing the percentage of the person holding such option or warrant but are not deemed outstanding for computing the percentage of any other person.
(2) Officer and/or Director
PROPOSAL TO AMEND THE ARTICLES OF INCORPORATION TO INCREASE THE AUTHORIZED NUMBER OF SHARES OF COMMON STOCK TO 50,000,000 SHARES AND TO AUTHORIZE 10,000,000 SHARES OF UNDESIGNATED PREFERRED STOCK, PAR VALUE $0.01 PER SHARE
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INTRODUCTION
The holders of a majority of our voting stock have proposed to approve an amendment to TSLU's articles of incorporation to increase the number of shares of common stock that TSLU is authorized to issue from 20,000,000 to 50,000,000 and to authorize 10,000,000 shares of undesignated preferred stock, par value $0.01 per share. The board of directors has unanimously approved the proposal.
A copy of the certificate of amendment to the articles of incorporation, which we refer to as the "amendment" in this information statement, is attached to this information statement as Appendix A.
The undesignated preferred stock may be issued from time to time in one or more series. Under the amendment, 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 series. The board of directors is also authorized to determine or alter the rights, preferences, privileges, and restrictions granted to or imposed upon any wholly unissued series of preferred stock and, within the limits and restrictions stated in any resolution or resolutions of the board of directors originally fixing the number of shares constituting any series, to increase or decrease (but not below the number of shares of any such series then outstanding) the number of shares of any such shares of that series.
TSLU's articles of incorporation currently authorize 20,000,000 shares of common stock. Of the 20,000,000 shares of common stock authorized, as of March 17, 2004 , 1,063,147 shares were outstanding.
On March 3, 2004 , TSLU entered into an Agreement and Plan of Merger with Chembio Diagnostic Systems, Inc., a Delaware corporation ("Chembio") and New Trading Solutions, Inc., a Nevada corporation and a wholly-owned subsidiary of TSLU ("Merger Sub"), pursuant to which Merger Sub will merge with and into Chembio and Chembio will survive as a wholly-owned subsidiary of TSLU. In connection with the merger, all of the issued and outstanding shares of common stock of Chembio will be converted into the right to receive shares of Common Stock of TSLU. The closing of the merger is contingent upon the completion or waiver of certain closing conditions, including the closing of financings of at least $1.5 million additional debt and/or equity financing by TSLU for the business of Chembio (the "Financing"). It is presently anticipated that the Financing will consist of newly created shares of TSLU Series A Preferred Stock (the "Series A Preferred") and will close simultaneously with the closing of the merger. The terms and provisions of the Series A Preferred are yet to be determined.
Presently, the Financing calls for the creation of an undesignated preferred stock which would require an amendment to TSLU’s Articles of Incorporation.
The board of directors believes that the proposed increase in the number of authorized shares of common stock and the authorization of the undesignated preferred stock will benefit TSLU by improving its flexibility in responding to future business needs and opportunities regardless of whether or not the proposed transaction with Chembio closes. The additional authorized shares could be used for possible future acquisitions, financings, stock dividends, stock options and other proper corporate purposes.
The Company has disclosed (please see the Company's Form 8K filed with the SEC on April 5, 2004) that has executed an agreement which calls for a merger between the Company and Chembio Diagnostic Systems, Inc. ("Chembio"). However, it is not necessary to increase the number of authorized common shares in order to effect the proposed merger with Chembio. An increase in the authorized number of common shares is not a closing condition to the proposed merger. In fact, if all of the shares (including common shares underlying warrants due to be issued pursuant to the terms of the proposed merger) related to the merger were issued, the Company would still have approximately 15-20% of its common stock treasury unissued.
Should the transaction with Chembio close, the current Company shareholders shall retain not less than 8.3% of the post-merger common stock.
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 TSLU 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 TSLU. Except as set forth above, the board of directors has no present plans, understandings, or agreements to issue the additional shares to be authorized.
The board of directors does not currently intend to propose any amendments to TSLU's 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 if the future if it believes the interests of the stockholders would be protected thereby.
Except for the increase of the number of authorized shares and the name change discussed below, the proposed amendment would not change any of the provisions of TSLU's articles of incorporation. All shares of common stock or preferred stock, including the additional shares of common stock and preferred stock that will be authorized when the proposed amendment becomes effective, which are not issued and outstanding 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 or securities into which TSLU may hereafter enter or issue or applicable law.
The additional shares of common stock which would be authorized by the proposed amendment would have the same rights and privileges as, and otherwise be identical to the shares of common stock currently authorized and outstanding. The proposed amendment would empower the board of directors to determine the relative rights and limitations of series of preferred stock, including, among other things, dividend rights, conversion prices, voting rights, redemption prices and the preferences, if any, of such series over shares of common stock as to dividends or distributions of assets of TSLU. It is possible that the future issuance of preferred stock having dividend and liquidation preferences could affect amounts that might otherwise be available to holders of common stock as dividends or upon liquidation. Holders of TSLU 's shares have no preemptive rights and, as a result, existing stockholders would not have any preferential right to purchase any of the additional shares of common stock or undesignated preferred stock when issued.
PROPOSAL TO AMEND THE ARTICLES OF INCORPORATION TO CHANGE THE NAME TO
CHEMBIO DIAGNOSTIC, INC.
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The company’s board of directors has declared it advisable and in the best interests of the company and directed that there be submitted to the stockholders a proposed amendment to Article I of the articles of incorporation to change its name from Trading Solutions,com, Inc. to Chembio Diagnostic, Inc. The company's board of directors feels that this name change is in the best interest of the company. In light of the company's pending acquisition of Chembio pursuant to the merger described above, the name "Trading Solutions.com, Inc." no longer accurately reflects the company's operations and interests.
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Exhibits
Exhibit A Certificate of Amendment to Articles of Incorporation of Trading Solutions.com, Inc.,
FORWARD-LOOKING STATEMENTS
The following is a "safe harbor" statement under the Private Securities Litigation Reform Act of 1995: Statements contained in this document that are not based on historical facts are "forward-looking statements". Terms such as "anticipates", "believes", "estimates", "expects", "plans", "predicts", "may", "should", "will", the negative thereof and similar expressions are intended to identify forward-looking statements. Such statements are by nature subject to uncertainties and risks, including but not limited to: our reliance on certain major clients; the successful combination of revenue growth with operating expense reduction to result in improved profitability and cash flow; government regulation and tax policy; economic conditions; competition and pricing; dependence on our labor force; reliance on technology; telephone and internet service dependence; the ability, means, and willingness of financial markets to finance our operations; and other operational, financial or legal risks or uncertainties detailed in our SEC filings from time to time. Should one or more of these uncertainties or risks materialize, actual results may differ materially from those described in the forward-looking statements. We disclaim any intention or obligation to revise any forward-looking statements whether as a result of new expectations, conditions or circumstances, or otherwise.
WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and current reports, proxy statements and other information with the SEC. You may read and copy any reports, statements or other information that we file with the SEC at the SEC's public reference room, 450 Fifth Street, N.W., Washington, DC 20549. Please call the SEC at 1-800-SEC-0330 for further information on the operation of the public reference room. Our SEC filings are also available to the public at the Internet site maintained by the SEC at http://www.sec.gov.
You should rely only on the information contained in, or incorporated by reference as an Annex to, this Information Statement. We have not authorized anyone else 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 March 19, 2004, or such earlier date as is expressly set forth herein.
By Order of the board of directors
/s/ Mark L. Baum
Mark L. Baum
President, Chief Executive Officer
April 7, 2004