spyxdef14c.htm
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
SCHEDULE
14C
Information
Statement Pursuant to Section 14(c) of the Securities Exchange Act of
1934
(Amendment
No. __)
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Check
the appropriate box:
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Preliminary
Information Statement
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Confidential,
for Use of the Commission Only (as permitted by Rule
14c-5(d)(2))
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x
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Definitive
Information Statement
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SMARTPAY EXPRESS,
INC.
(Name of
Registrant As Specified In Its Charter)
Payment
of Filing Fee (Check the appropriate box):
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x
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No
fee required
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Fee
computed on table below per Exchange Act Rules 14c-5(g) and
0-11
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(1)
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Title
of each class of securities to which transaction applies:
Common
Stock, $.001 par value.
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(2)
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Aggregate
number of securities to which transaction applies:
64,607,460
shares of Common Stock outstanding on September 30, 2008.
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(3)
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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 fee is
calculated and state how it was determined): N/A
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(4)
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Proposed
maximum aggregate value of transaction: N/A
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(5)
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Total
fee paid: N/A
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Fee
paid previously with preliminary materials.
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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.
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(1)
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Amount
Previously Paid:
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(2)
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Form,
Schedule or Registration Statement No.:
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(3)
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Filing
Party:
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(4)
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Date
Filed:
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Copies
to:
Harold H.
Martin, Esq.
17115
Kenton Drive, Suite 202A
Cornelius,
North Carolina 28031
Tel:
(704) 584-0268
SMARTPAY
EXPRESS, INC.
5TH Floor,
Chigo Sales Center
Fenggang
Road, Lishui Town, Nanhai
Guangdong
Province, P.R. China
To the
stockholders of SmartPay Express, Inc.:
SmartPay
Express, Inc., a Nevada corporation, (the “Company”) has obtained the written
consent of the stockholders holding a majority of the common shares on October
16, 2008 (the “Consent”). The Consent authorizes the amendment of our
articles of incorporation to effect a 1:50 reverse stock split (the “Reverse
Split”) pursuant to NRS 78.2055 and Article 9.1 of the Company’s
By-Laws. This proposal was approved by the Board of Directors on
October 16, 2008.
The
accompanying Information Statement is being provided to you for your information
to comply with requirements of the Securities and Exchange Act of 1934, as
amended. The Information Statement also constitutes notice of
corporate action without a meeting by less than unanimous consent of the
Company’s stockholders pursuant to NRS 78.320. You are urged to read the
Information Statement carefully in its entirety. However, no action
is required on your part in connection with the Reverse Split. No
meeting of the Company’s stockholders will be held or proxies requested for
these matters since they have already been approved by the requisite written
consent of the holders of a majority of the common shares.
Under the
rules of the Securities and Exchange Commission, the Reverse Split cannot become
effective until at least 20 days after the accompanying Information Statement
has been filed and mailed to the stockholders of the Company.
By order
of the Board of Directors
/s/ Benny
Lee October
28, 2008
Benny
Lee
Director
and CEO
SMARTPAY
EXPRESS, INC.
5TH Floor,
Chigo Sales Center
Fenggang
Road, Lishui Town, Nanhai
Guangdong
Province, P.R. China
INFORMATION
STATEMENT PURSUANT TO SECTION 14C OF THE SECURITIES EXCHANGE ACT OF 1934, AS
AMENDED
This
information statement is being mailed on or about October 31, 2008, to the
holders of record at the close of business on October 31, 2008 of shares of
common stock, $.001 par value (the “Shares”) of SmartPay Express, Inc., a Nevada
corporation (the “Company”). You are receiving this information statement in
connection with a written consent approved on October 16, 2008 by shareholders
owning the majority of the Shares, which consent provides that the Company shall
have the authority to amend our articles of incorporation to effect a 1:50
reverse stock split of our common stock pursuant to NRS 78.2055 and Article 9.1
of the Company’s By-Laws. This was approved by the Company’s board of directors
on October 16, 2008.
INFORMATION
STATEMENT
GENERAL
The
Company’s current articles of incorporation provide for an authorized
capitalization consisting of 300,000,000 shares of common stock, $.001 par value
(the “Common Stock”), and 5,000,000, shares of preferred stock, $.001 par value
(the “Preferred Stock”). As of September 30, 2008, there were 64,607,460 shares
of Common Stock outstanding and no shares of Preferred Stock
outstanding.
REVERSE
SPLIT
At the
effective time of the Reverse Split, all of the outstanding shares of our
outstanding Common Stock will be automatically converted into a smaller number
of shares, at the reverse split ratio of 1:50. There will be no corresponding
change in the authorized shares of common stock.
THE
REASONS FOR THE REVERSE SPLIT
The
Reverse Split is intended to reduce the number of outstanding shares in an
effort to increase the market value of the remaining outstanding shares. In
approving the Reverse Split, the board of directors considered that the
Company's Common Stock may not appeal to brokerage firms that are reluctant to
recommend lower priced securities to their clients. Investors may also be
dissuaded from purchasing lower priced stocks because the brokerage commissions,
as a percentage of the total transaction, tend to be higher for such stocks.
Moreover, the analysts at many brokerage firms do not monitor the trading
activity or otherwise provide coverage of lower priced stocks. The Board of
Directors also believes that most investment funds are reluctant to invest in
lower priced stocks.
However,
the effect of the Reverse Split upon the market price for the Company's Common
Stock cannot be predicted with certainty, and the history of similar stock split
combinations for companies in like circumstances is varied. There can be no
assurance that the market price per share of the Company's Common Stock after
the Reverse Split will rise in proportion to the reduction in the number of
shares of Common Stock outstanding resulting from the Reverse Split. The market
price of the Company's Common Stock may also be based on its performance and
other factors, some of which may be unrelated to the number of shares
outstanding.
POTENTIAL
RISKS OF THE REVERSE SPLIT
There can
be no assurance that the bid price of the Company's Common Stock will continue
at a level in proportion to the reduction in the number of outstanding shares
resulting from the Reverse Split, that the Reverse Split will result in a per
share price that will increase its ability to attract employees and other
service providers or that the market price of the post-split Common Stock can be
maintained. The market price of the Company's Common Stock will also be based on
its financial performance, market condition, the market perception of its future
prospects and the Company's industry as a whole, as well as other factors, many
of which are unrelated to the number of shares outstanding. If the market price
of the Company's Common Stock declines after the Reverse Split, the percentage
decline as an absolute number and as a percentage of the Company's overall
capitalization may be greater than would occur in the absence of a Reverse
Split.
POTENTIAL
EFFECTS OF THE REVERSE SPLIT
General. For each holder of
Common Stock, the number of shares held will be reduced by the Reverse Split as
follows: the number of shares held before the Reverse Split will be
divided by 50, and if the result has a fractional component, the result will be
rounded up to the next whole number. By way of example, a shareholder with
200,001 shares of Common Stock before the Reverse Split will hold 4,001 shares
of Common Stock upon completion of the Reverse Split.
The
rounding up of fractional shares will effect a small change in the relative
percent ownership of the respective common shareholders. This change
is not expected to be material.
Accounting Matters. The par
value of the Company’s Common Stock would remain unchanged at $0.001 per share
after the Reverse Split. Also the capital account of the Company
would remain unchanged, and the Company does not anticipate that any other
accounting consequences would arise as a result of the Reverse
Split.
Effect on Authorized and Outstanding
Shares. Based on the stockholdings at September 30, 2008, there are
64,607,460 shares of Common Stock issued and outstanding. As a result
of the Reverse Split, the number of shares of capital stock issued and
outstanding (as well as the number of shares of Common Stock underlying any
options, warrants, convertible debt or other derivative securities) will be
reduced to the number of shares of capital stock issued and outstanding
immediately prior to the effectiveness of the Reverse Split, divided by fifty
(50), plus any shares issued to round up fractional shares.
As stated
above there will be no change in the number of authorized shares of Preferred
Stock. There will be 5,000,000 such shares authorized before and
after the Reverse Split. There will be no change to the number of authorized
shares of Common Stock as a result of the Reverse Split.
With the
exception of the number of shares issued and outstanding, the rights and
preferences of the shares of capital stock prior and subsequent to the Reverse
Split will remain the same. It is not anticipated that the Company's financial
condition, the percentage ownership of management, the number of shareholders,
or any aspect of the Company's business would materially change, solely as a
result of the Reverse Split. The Reverse Split will be effectuated
simultaneously for all of the Company's Common Stock and the exchange ratio will
be the same for all shares of the Company's Common Stock. The Reverse Split will
affect all of our shareholders uniformly and will not affect any shareholder's
percentage ownership interests in the Company or proportionate voting power,
except to the extent caused by rounding up fractional shares. The Reverse Split
will not alter the respective voting rights and other rights of
shareholders.
The
Company will continue to be subject to the periodic reporting requirements of
the Securities Exchange Act of 1934, as amended (the "Exchange Act"). The
Company's Common Stock is currently registered under Section 12(g) of the
Exchange Act and as a result, is subject to periodic reporting and other
requirements. The proposed Reverse Split will not affect the registration of the
Company's Common Stock under the Exchange Act. The Reverse Split is
not intended as, and will not have the effect of, a "going private transaction"
covered by Rule 13e-3 under the Exchange Act.
Increase of Shares of All Classes of
Capital Stock Available for Future Issuance. As a result of the Reverse
Split, there will be a reduction in the number of shares of Common Stock issued
and outstanding and no change to the number of authorized shares of the
Company’s Common Stock under the Company’s Articles of Incorporation, as
amended. Because the number of issued and outstanding shares of Common Stock
will decrease, the number of shares of Common Stock remaining available for
issuance in the future will increase.
EFFECTIVENESS
OF THE REVERSE SPLIT
The
Reverse Split will become effective after the filing with the Secretary of State
of the State of Nevada of the Certificate of Amendment to our articles of
incorporation (attached hereto as Appendix “A”). It is expected
that such filing will take place on or about the date that is 20 calendar days
after the mailing of this Information Statement.
Exchange of Certificates After
Split. It will not be necessary for stockholders to exchange their old
certificates. However, after the effective date of the Reverse Split,
those stockholders who wish to obtain new certificates should contact the
transfer agent, Guardian Registrar & Transfer, Inc., 7951 Southwest 6th Street,
Suite 216, Plantation, FL 33324, Attn: Elson Soto, Jr., Telephone: (954) 915-0105.
Tax Impact of the Reverse
Split. The following discussion summarizing material federal income tax
consequences of the Reverse Split is based on the Internal Revenue Code of 1986,
as amended (the "Code"), the applicable Treasury Regulations promulgated
thereunder, judicial authority and current administrative rulings and practices
in effect on the date this Information Statement was first mailed to
shareholders. This discussion does not discuss consequences that may apply to
special classes of taxpayers (e.g., non-resident aliens, broker-dealers, or
insurance companies). Stockholders should consult their own tax advisors to
determine the particular consequences to them.
The
receipt of the Common Stock following the effective date of the Reverse Split,
solely in exchange for the Common Stock held prior to the Reverse Split, will
not generally result in recognition of a gain or loss to the shareholders.
Although the issue is not free from doubt, additional shares received in lieu of
fractional shares, including shares received as a result of the rounding up of
fractional ownership, should be treated in the same manner. The adjusted tax
basis of a shareholder in the Common Stock received after the Reverse Split will
be the same as the adjusted tax basis of the Common Stock held prior to the
Reverse Split exchanged therefor, and the holding period of the Common Stock
received after the Reverse Split will include the holding period of the Common
Stock held prior to the Reverse Split exchanged therefor.
No gain
or loss will be recognized by the Company as a result of the Reverse Split. The
Company's views regarding the tax consequences of the Reverse Split are not
binding upon the Internal Revenue Service or the courts, and there can be no
assurance that the Internal Revenue Service or the courts would accept the
positions expressed above.
THIS
SUMMARY IS NOT INTENDED AS TAX ADVICE TO ANY PARTICULAR PERSON. IN PARTICULAR,
AND WITHOUT LIMITING THE FOREGOING, THIS SUMMARY ASSUMES THAT THE SHARES OF
COMMON STOCK ARE HELD AS "CAPITAL ASSETS" AS DEFINED IN THE CODE, AND DOES NOT
CONSIDER THE FEDERAL INCOME TAX CONSEQUENCES TO THE COMPANY'S SHAREHOLDERS IN
LIGHT OF THEIR INDIVIDUAL INVESTMENT CIRCUMSTANCES OR TO HOLDERS WHO MAY BE
SUBJECT TO SPECIAL TREATMENT UNDER THE FEDERAL INCOME TAX LAWS (SUCH AS DEALERS
IN SECURITIES, INSURANCE COMPANIES, FOREIGN INDIVIDUALS AND ENTITIES, FINANCIAL
INSTITUTIONS AND TAX EXEMPT ENTITIES). IN ADDITION, THIS SUMMARY DOES NOT
ADDRESS ANY CONSEQUENCES OF THE REVERSE SPLIT UNDER ANY STATE, LOCAL OR FOREIGN
TAX LAWS. THE STATE AND LOCAL TAX CONSEQUENCES OF THE REVERS SPLIT MAY VARY AS
TO EACH STOCKHOLDER DEPENDING ON THE STATE IN WHICH SUCH STOCKHOLDER RESIDES. AS
A RESULT, IT IS THE RESPONSIBILITY OF EACH SHAREHOLDER TO OBTAIN AND RELY ON
ADVICE FROM HIS, HER OR ITS TAX ADVISOR AS TO, BUT NOT LIMITED TO, THE
FOLLOWING: (A) THE EFFECT ON HIS, HER OR ITS TAX SITUATION OF THE REVERSE SPLIT,
INCLUDING, BUT NOT LIMITED TO, THE APPLICATION AND EFFECT OF STATE, LOCAL AND
FOREIGN INCOME AND OTHER TAX LAWS; (B) THE EFFECT OF POSSIBLE FUTURE LEGISLATION
OR REGULATIONS; AND (C) THE REPORTING OF INFORMATION REQUIRED IN CONNECTION WITH
THE REVERSE SPLIT ON HIS, HER OR ITS OWN TAX RETURNS. IT WILL BE THE
RESPONSIBILITY OF EACH SHAREHOLDER TO PREPARE AND FILE ALL APPROPRIATE FEDERAL,
STATE AND LOCAL TAX RETURNS.
APPROVAL OF PROPOSED
AMENDMENT.
Under NRS
78.2055, the Proposed Amendment relating to the Reverse Split must be approved
in writing by the holders of at least a majority of the voting stock of the
Company. The following persons voted their approval and collectively represent
66.5 % of the voting stock of the Company: East Sincere Management Limited and
Profit Gain Management Limited.
The
Proposed Amendment, therefore, has been approved by the majority of the
stockholders of the Company, and the Reverse Split will become effective after
the filing with the Secretary of State of the State of Nevada of the Certificate
of Amendment to our articles of incorporation, which is attached hereto as
Appendix “A”. It is expected that such filing will take place on or about
November 20, 2008, which is the date that is 20 calendar days after the mailing
of this Information Statement.
Because
the Proposed Amendment already has been approved, you are not required to take
any action at this time; however, at your option, you may submit a written
consent to the Proposed Amendment. This information statement is your notice
that the proposal concerning the Reverse Split has been approved; you will
receive no further notice when the change becomes effective.
SHARE
CERTIFICATES.
Following
the Reverse Split, the share certificates you now hold will continue to be
valid. In the future, new share certificates will contain a legend reflecting
the reverse split, but this in no way will affect the validity of your current
share certificates.
OUTSTANDING
VOTING SECURITIES.
At the
close of business on September 30, 2008, there were 64,607,460 shares of Common
Stock and no shares of Preferred Stock issued and outstanding. These constitute
the only equity securities of the Company. At any meeting of shareholders, each
shareholder is entitled to cast one vote for each share of Common Stock held by
the shareholder.
SECURITY
OWNERSHIP OF CERTAIN BENEFICIAL OWNERS.
Set out
below is the ownership, as of September 30, 2008, of our Common Stock by each
person known by us to be the beneficial owner of more than 5% of our outstanding
Common Stock, our directors, and our executive officers and directors as a
group. To the best of our knowledge, the persons named have sole voting and
investment power with respect to such shares, except as otherwise noted. There
are not any pending or anticipated arrangements that may cause a change in
control of the Company.
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Title
of Class
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Name
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Number
of
Shares
Owned(1)
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Percent
of
Voting
Power
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Common
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East
Sincere Management Limited
Benny
Lee - CEO, CFO and Sole Owner
[Director,
CEO and CFO of SPYX]
Flat
A-1, 2/F, Maiden Court
46
Cloud View Road, Hong Kong
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20,078,390
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31.1%
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Common
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Profit
Gain Management Limited
Xiuhe
Li – CEO and Sole Owner
5th
Floor, Chigo Sales Center
Fenggang
Road, Lishui Town, Nanhai
Guangdong
Province, P.R. China
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22,347,355
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34.6%
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Common
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All
Officers and Directors as a Group (1 person)
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20,078,390
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31.1%
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(1)
Calculation based on 64,607,460 shares outstanding as of September 30,
2008.
(2)
Except as otherwise indicated, the shares are owned of record and beneficially
by the persons named in the table.
WE
ARE NOT ASKING YOU FOR A PROXY AND YOU ARE REQUESTED NOT TO SEND US A
PROXY.
Except as
set forth above, no director or officer of the Company or nominee for election
as a director of the Company or associate of any director or officer of the
Company has a substantial interest in the Proposed Amendment. No director of the
Company has informed the Company in writing that such director intends to oppose
the adoption of the Proposed Amendment. No security holder entitled to vote at a
meeting or by written consent has submitted to the Company any
proposal.
By Order
of the Sole Director
/s/ Benny
Lee
Benny
Lee
Sole
Director and CEO
Appendix
A
Certificate
of Amendment to Articles of Incorporation
For
Nevada Profit Corporations
(Pursuant
to NRS 78.385 and 78.390 – After Issuance of Stock)
1. Name
of corporation:
SmartPay
Express, Inc.
2. The
articles have been amended as follows (provide article numbers, if
available):
Upon the
filing of this certificate of amendment, the corporation shall effect a
one-for-50 reverse split whereby each share of common stock, par value $0.001
per share shall, without any action on the part of the holder, become and be
converted into 0.02 shares of common stock, par value $0.001 per share. In
connection with the reverse split, no fractional shares shall be
issued. In lieu of fractional shares, any fractional share that would
result from this action will be rounded up to the next whole number of shares
for each shareholder.
3. The
vote by which the stockholders holding shares in the corporation entitling them
to exercise at least a majority of the voting power, or such greater proportion
of the voting power as may be required in the case of a vote by classes or
series, or as may be required by the provisions of the articles of incorporation
have voted in favor of the amendment is:
The
amendment was approved by the written consent of stockholders holding 42,425,745
shares of the corporation’s common stock, which constituted approximately 65.7%
of the 64,607,460 shares of the corporation’s common stock issued and
outstanding as of September 30, 2008.
4.
Effective date of filing (optional):
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5.
Signature (required):
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Signature
of Officer
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Benny
Lee, Chief Executive Officer and
Director
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