As filed with the Securities and Exchange Commission on March 7, 2005
Registration No. 333-______
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
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SOYO GROUP, INC.
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(Exact name of Registrant as specified in its charter)
Nevada 95-4502724
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(State or other jurisdiction of (I.R.S. Employer Identification
incorporation or organization) No.)
1420 South Vintage Avenue
Ontario, California 91761-3646
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(Address of principal executive offices) (zip code)
Soyo Group, Inc.
The 2005 Stock Compensation Plan
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(Full title of the plan)
Andrew N. Bernstein, Esq.
Andrew N. Bernstein, P.C.
5445 DTC Parkway, Suite 520
Greenwood Village, Colorado 80111
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(Name and address of agent for service)
(303) 770-7131
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(Telephone number, including area code, of agent for service)
Approximate date of commencement of proposed sale pursuant to the plan:
From time to time after the Registration Statement becomes effective.
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Exhibit Index Begins at Page 15
CALCULATION OF REGISTRATION FEE
Title of Amount to be Proposed Proposed Amount of
securities to be registered (1) maximum maximum registration
registered offering aggregate fee
price per offering
share price
Common Stock,
$0.001 par value 5,000,000 shares (2) $4,100,000(2) $482.57
(1) Pursuant to Rule 416, this Registration Statement covers any
additional shares of Common Stock ("shares") which become issuable under the
Plan set forth herein by reason of any stock dividend, stock split,
recapitalization or any other similar transaction without receipt of
consideration which results in an increase in the number of shares outstanding.
(2) Pursuant to Rules 457(h) and 457(c), the offering price per share,
the aggregate offering price and the amount of the filing fee were computed upon
the basis of the closing price of the Common Stock within five business days
prior to the date of filing of the Registration Statement ($0.82 per share).
ii
PART I
INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS
Pursuant to the requirements of the Note to Part I of Form S-8 and Rule
428(b)(1) of the Rules under the Securities Act of 1933, as amended, the
information required by Part I of Form S-8 is incorporated by reference in the
Reoffer Prospectus which follows. The Reoffer Prospectus, together with the
documents incorporated by reference pursuant to Item 3 of Part II of this
Registration Statement, constitutes the Section 10(a) Prospectus.
REOFFER PROSPECTUS
The material which follows, up to but not including the pages beginning
Part II of this Registration Statement, constitutes a prospectus prepared in
accordance with the applicable requirements of Part I of Form S-3 and General
Instruction C to Form S-8, to be used in connection with resales of securities
acquired under the Registrant's 2005 Stock Compensation Plan by affiliates of
the Registrant, as defined in Rule 405 under the Securities Act of 1933, as
amended.
iii
REOFFER PROSPECTUS
5,000,000 SHARES
COMMON STOCK
SOYO GROUP, INC.
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THE 2005 STOCK COMPENSATION PLAN
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We are registering on behalf of our employees, officers, directors and
advisors up to 5,000,000 shares of our common stock purchasable by them pursuant
to common stock options granted under our 2005 Stock Compensation Plan. As of
this date, no options have been issued under the Plan and 5,000,000 shares
remain available for grant of options.
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This prospectus will be used by persons who are our "affiliates" to
resell shares purchased by them under the Plan. We will receive no part of the
proceeds of any such sales, although we will receive the exercise price for the
stock options.
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NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THE SECURITIES OR PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
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No person is authorized to give any information or to make any
representation regarding the securities we are offering and investors should not
rely on any such information. The information provided in the prospectus is as
of this date only.
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The date of this prospectus is March 7, 2005.
AVAILABLE INFORMATION
We are a fully reporting company subject to the informational
requirements of the Securities Exchange Act of 1934, as amended, and we file
reports and other information with the Securities and Exchange Commission.
Reports and other information which we file can be inspected and copied at the
public reference facilities maintained by the Commission at 450 Fifth Street,
N.W., Washington, D.C. 20549; 500 West Madison Street, Suite 1400, Chicago,
Illinois 60661-2511; and 7 World Trade Center, New York, New York 10048. Copies
of such material can be obtained from the Public Reference Section of the
Commission, 450 Fifth Street, N.W., Washington, D.C. 20549 at prescribed rates.
Our common stock is traded on the OTC Bulletin Board under the symbol
"SOYO.OB."
We intend to furnish annual reports to our shareholders which include
audited financial statements. We may furnish such other reports as may be
authorized, from time to time, by our board of directors.
INCORPORATION BY REFERENCE
Certain documents have been incorporated by reference into this
prospectus, either in whole or in part. We will provide without charge to each
person to whom a prospectus is delivered, upon written or oral request, (i) a
copy of the information that has been incorporated by reference (not including
exhibits to the information unless such exhibits are specifically incorporated
by reference into the information), and (ii) a copy of all documents and
information required to be delivered to our employees pursuant to Rule 428(b).
Requests for such information shall be addressed to us at Soyo Group, Inc., 1420
South Vintage Avenue, Ontario, California 91761-3646, telephone: (909) 292-2500.
TABLE OF CONTENTS
Introduction...................................................................3
Selling Stockholders...........................................................3
Method of Sale.................................................................3
SEC Position Regarding Indemnification.........................................3
Description of the Plan........................................................4
Applicable Securities Law Restrictions.........................................5
Tax Consequences...............................................................5
Legal Matters..................................................................6
Experts........................................................................6
2
INTRODUCTION
We are a distributor of computer products, consumer electronics,
networking, and broadband telecommunications products and services. Through Soyo
Group, Inc. we offer a full line of designer motherboards and related
peripherals for intensive multimedia applications, corporate alliances,
telecommunications and specialty market requirements. The product line also
includes Bare Bone systems, Voice Over IP (VOIP) products and solutions, flash
memory and small hard disk drives for corporate and mobile users, internal
multimedia reader/writer and wireless networking solutions products for any home
and office (SOHO) users.
Our products are sold through an extensive network of authorized
distributors to resellers, system integrators and value-added resellers (VARs).
These products are also sold through major retailers, mail-order catalogs and
e-tailers to the consumers throughout North America and Latin America.
Our executive offices are located at 1420 South Vintage Avenue,
Ontario, California 91761-3646, telephone (909) 292-2500.
SELLING STOCKHOLDERS
This prospectus covers possible sales by our executive officers,
directors, advisors and employees of shares they acquire through exercise of
options granted under our 2005 Stock Compensation Plan. The names of our
affiliates who may be Selling Stockholders from time to time and who may offer
shares for resale in the future, along with the number of shares which may be
sold by each affiliate from time to time, will be updated in supplements to this
prospectus, which will be filed with the Commission in accordance with Rule
424(b) under the Securities Act. All Selling Stockholders will be executive
officers and/or directors. The address of each Selling Stockholder will be the
same as our address.
METHOD OF SALE
Sales of the shares offered by this prospectus will be made on The OTC
Bulletin Board, where our common stock is listed for trading, in other markets
where our common stock may be traded, or in negotiated transactions. Sales will
generally involve payment of customary brokers' commissions by the Selling
Stockholders. There is no present plan of distribution.
3
SEC POSITION REGARDING INDEMNIFICATION
Our Articles of Incorporation provide for indemnification of officers
and directors, among other things, in instances in which they acted in good
faith and in a manner they reasonably believed to be in, or not opposed to, our
best interests and in which, with respect to criminal proceedings, they had no
reasonable cause to believe their conduct was unlawful.
Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to our directors, officers or persons controlling us under
the provisions described above, we have been informed that, in the opinion of
the Commission, indemnification is against public policy as expressed in that
Act and is therefore unenforceable.
DESCRIPTION OF THE AMENDED PLAN
Our board of directors have adopted and approved the Plan subject to
shareholder approval. Options granted pursuant to the Plan constitute either
incentive stock options within the meaning of Section 422 of the Internal
Revenue Code of 1986, as amended, or options which constitute nonqualified
options at the time of issuance of such options. The Plan provides that
incentive stock options and/or nonqualified stock options may be granted to our
officers, directors, employees and advisors selected by our Compensation
Committee. A total of 5,000,000 shares of common stock are authorized and
reserved for issuance under the Plan, subject to adjustment to reflect changes
in our capitalization in the case of a stock split, stock dividend or similar
event.
The Plan is administered by our Compensation Committee which has the
sole authority to interpret the Plan and to make all determinations necessary or
advisable for administering the Plan, including but not limited to:
o who shall be granted options under the Plan;
o the term of each option;
o the number of shares covered by such option;
o whether the option shall constitute an incentive option or a
nonqualified option;
o the exercise price for the purchase of the shares covered by
the option, provided that the exercise price for any option
must be at least equal to the fair market value of the shares
as of the date of grant of such option;
o the period during which the option may be exercised;
o whether the right to purchase the number of shares covered by
the option shall be fully vested on issuance of the option so
that such shares may be purchased in full at one time or
whether the right to purchase such shares shall become vested
over a period of time so that such shares may only be
purchased in installments; and
o the time or times at which the options shall be granted.
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Except in the case of disability or death, no option shall be
exercisable after an optionee who is an employee ceases to be employed by the
Company; provided, however, the Compensation Committee has the right to extend
the exercise period following the date of termination of such optionee's
employment. If an optionee's employment is terminated by reason of death or
disability, the Compensation Committee may extend the option term following the
date of termination of the optionee's employment. Upon the exercise of the
option, the exercise price must be paid in full either in cash, shares of our
common stock or a combination.
If any option to purchase reserved shares shall not be exercised for
any reason or if such option to purchase shall terminate as provided by the
Plan, such shares which have not been so purchased shall again become available
for the purposes of the Plan unless the Plan shall have been terminated.
The provisions of the Federal Employee Retirement Income Security Act
of 1974 do not apply to the Plan. Shares issuable upon exercise of options will
not be purchased in open market transactions but will be issued by us from
authorized shares. Shares issuable under the Plan may be sold in the open
market, without restrictions, as free trading securities. There are no assets
administered under the Plan and, accordingly, no investment information is
furnished.
No options may be assigned, transferred, hypothecated or pledged by the
option holder except by will, the laws of intestate succession or as permitted
by the Commission. No person may create a lien on any securities under the Plan,
except by operation of law. However, there are no restrictions on the resale of
the shares underlying the options.
The Plan will remain in effect until February 18, 2015. Additional
information concerning the Plan may be obtained from us at our address and
telephone number.
APPLICABLE SECURITIES LAW RESTRICTIONS
If the optionee is deemed to be an "affiliate" (as that term is defined
under the Securities Act), the resale of the shares purchased upon exercise of
options covered hereby may be subject to certain restrictions and requirements,
including compliance with the provisions of Rule 144 promulgated under the
Securities Act.
In addition to the requirements imposed by the Securities Act, the
antifraud provisions of the Exchange Act and the rules thereunder (including
Rule 10b-5) are applicable to any sale of shares acquired pursuant to the Plan.
A maximum of 5,000,000 shares may be issued under the Plan. We have
authorized 75,000,000 shares of common stock, $0.001 par value, of which
40,000,000 shares were outstanding as of March 7, 2005. Shares of common stock
outstanding are, and those to be issued upon exercise of options will be, fully
paid and nonassessable, and each share of common stock is entitled to one vote
at all shareholders' meetings. All shares are equal to each other with respect
5
to lien rights, liquidation rights and dividend rights. There are no preemptive
rights to purchase additional shares by virtue of the fact that a person is one
of our shareholders. Shareholders do not have the right to cumulate their votes
for the election of directors.
Our officers and directors and owners of at least ten percent of our
stock must comply with certain reporting requirements and resale restrictions
pursuant to Sections 16(a) and 16(b) of the Exchange Act and the rules
thereunder upon the receipt or disposition of any options.
TAX CONSEQUENCES
We have been advised that the federal income tax consequences of the
Plan to us and the optionees, and possible exercise of options granted under the
Plan, will depend upon future circumstances and possible changes in the tax
laws. The following summary discussion addresses certain federal income tax
consequences of the Plan. This discussion does not address all of the tax
consequences that may be applicable to any particular optionee or to us. In
addition, this discussion does not address foreign, state, or local taxes, nor
does it address federal taxes other than federal income tax. This discussion is
based upon applicable statutes, regulations, case law, administrative
interpretations and judicial decisions in effect as of the date of this
prospectus.
The income tax treatment of nonstatutory options is governed by ss.83
of the Code. This section basically provides that if an option has a readily
ascertainable fair market value when granted, then the optionee must recognize
ordinary income at the time of grant but not at the time of exercise or
disposal; if an option does not have a readily ascertainable fair market value
when granted, the optionee must recognize ordinary income at the time of its
exercise or disposal of the option but not at the time of its grant. We will
receive a corresponding compensation deduction for the amount included by the
optionee as income in the same year that the optionee includes such amount as
income. Consequently, whether a nonstatutory option has a readily ascertainable
fair market value at grant will determine whether the grant or the exercise of
the nonstatutory option is the taxable event for the optionee who rendered the
services for which the option was granted.
No tax consequences result from the granting of an incentive stock
option or from the exercise of an incentive stock option by the employee. In
addition, the employer generally will not be allowed a business expense
deduction with respect to an incentive stock option unless the employee disposes
of the stock prior to the required holding period. The employee will be taxed at
capital gain rates when he sells stock acquired under an incentive stock option
plan, provided he has not disposed of the stock for at least two years from the
date the option was granted to him and he has held the stock itself at least one
year after the stock was transferred to him. If the foregoing holding period
rules are not satisfied, the gain that would have been realized at the time the
option was exercised is included as ordinary income in the year of the
disqualifying sale. For this purpose, the gain is equal to the lesser of (i) the
fair market value of the stock on the date of exercise over the option price of
6
the stock, or (ii) the amount realized on disposition over the adjusted basis of
the stock. The employer is allowed to deduct a corresponding amount as a
business deduction at the same time the employee is required to recognize the
ordinary income arising from the early disposition.
Notwithstanding the preceding, when calculating income for alternative
minimum tax purposes, the favorable tax treatment of ss.421(a) is disregarded
and the bargain purchase element (that is, the spread between the option price
and the fair market value of the option stock at exercise) of the incentive
stock option will be considered as part of the taxpayer's alternative minimum
taxable income.
LEGAL MATTERS
The validity of the shares offered hereby have been passed on for us by
Andrew N. Bernstein, P.C., 5445 DTC Parkway, Suite 520, Greenwood Village,
Colorado 80111.
EXPERTS
Our balance sheets for the years ended December 31, 2003 and 2002 and
our related consolidated statements of operations, stockholders' deficiency and
cash flows for the years then ended, incorporated by reference to our Annual
Report on Form 10-K for the fiscal year ended December 31, 2003, have been
audited by Grobstein, Horwath & Company LLP, Sherman Oaks, California, as set
forth in their report included therein and incorporated by reference. Our
financial statements referred to above are incorporated by reference in reliance
upon such report and upon the authority of such firm as an expert in auditing
and accounting.
Our statements of operations, shareholders' deficiency and cash flows
for the year ended December 31, 2001, incorporated by reference to our Annual
Report on Form 10-K for the fiscal year ended December 31, 2003, have been
audited by Malone & Bailey, PLLC, Houston, Texas, as set forth in their report
included therein and incorporated by reference. Our financial statements
referred to above are incorporated by reference in reliance upon such report and
upon the authority of such firm as an expert in auditing and accounting.
7
Our future financial statements and reports thereon also will be
incorporated by reference in this prospectus in reliance upon the authority of
our auditors as experts in giving those reports to the extent said firms have
audited those financial statements and consented to the use of their reports
thereon.
8
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference
The Registrant hereby incorporates by reference in this Registration
Statement the following documents previously filed with the Commission:
(a) The Registrant's Annual Report on Form 10-K for the fiscal year
ended December 31, 2003 (including its audited financial statements for the
years ended December 31, 2003 and 2002, together with the report of independent
public accountants) filed pursuant to the Exchange Act;
(b) The Registrant's Quarterly Reports on Form 10-Q for the fiscal
quarters ended March 31, 2004, June 30, 2004, and September 30, 2004;
(c) The Registrant's Current Report on Form 8-K filed July 28, 2004 as
amended on August 10, 2004; and
(d) All subsequent reports filed pursuant to Section 13(a) or 15(d) of
the Exchange Act.
All reports and definitive proxy or information statements filed by the
Registrant pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange Act
after the date of this Registration Statement and prior to the filing of a
post-effective amendment which indicates that all securities offered hereby have
been sold or which deregisters all securities then remaining unsold at the time
of such amendment will be deemed to be incorporated by reference into this
Registration Statement and to be a part hereof from the date of filing of such
documents. Any statement contained in a document incorporated or deemed to be
incorporated by reference herein shall be deemed to be modified or superseded
for purposes of this Registration Statement to the extent that a statement
contained herein or in any other subsequently filed document which also is or is
deemed to be incorporated by reference herein modifies or supersedes such
statement. Any such statement so modified or superseded shall not be deemed,
except as so modified or superseded, to constitute a part of this Registration
Statement.
Item 4. Description of Securities
Not applicable.
Item 5. Interests of Named Experts and Counsel
Not applicable.
II-1
Item 6. Indemnification of Directors and Officers
Section 78.751 of the Nevada Revised Statutes and Article XII of the
Company's Articles of Incorporation contain provisions for indemnification of
officers, directors, employees and agents of the Company. The Articles of
Incorporation require the Company to indemnify such persons to the full extent
permitted by Nevada law. Each person will be indemnified in any proceeding if he
acted in good faith and in a manner which he reasonably believed to be in, or
not opposed to, the best interest of the Company. Indemnification would cover
expenses, including attorney's fees, judgments, fines and amounts paid in
settlement.
Item 7. Exemption from Registration Claimed
Not applicable.
Item 8. Exhibits
The following documents are filed as exhibits to this Registration
Statement.
Exhibit
Number Description of Exhibit
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4.1 -- The 2005 Stock Compensation Plan of Soyo Group, Inc.
5.1 -- Opinion of Andrew N. Bernstein, P.C.
23.1 -- Consent of Grobstein, Horwath & Company LLP,
independent public accountants
23.2 -- Consent of Malone & Bailey, PC, Certified Public
Accountants
23.3 -- Consent of Andrew N. Bernstein, P.C. (included in its
opinion filed as Exhibit 5.1)
Item 9. Undertakings
(a) Rule 415 Offerings.
The undersigned registrant hereby undertakes that it will:
(1) File, during any period in which it offers or sells
securities, a post-effective amendment to this Registration Statement to:
(i) Include any prospectus required by Section
10(a)(3) of the Securities Act of 1933;
(ii) Reflect in the prospectus any facts or
events arising after the effective date of
the Registration Statement which,
individually or in the aggregate, represent
a fundamental change in the information set
forth in the Registration Statement; and
II-2
(iii) Include any material information with
respect to the plan of distribution not
previously disclosed in the Registration
Statement or any material change to such
information in the Registration Statement;
(2) For the purpose of determining any liability under the
Securities Act of 1933, treat each such post-effective amendment as a new
registration statement relating to the securities offered therein, and the
offering of such securities at that time to be the initial bona fide offering
thereof; and
(3) Remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold at the
termination of the offering.
III-3
(b) Filings Incorporating Subsequent Exchange Act documents by
reference.
The undersigned registrant hereby undertakes that, for
purposes of determining any liability under the Securities Act of 1933, each
filing of the registrant's annual report pursuant to section 13(a) or section
15(d) of the Securities Exchange Act of 1934 (and, where applicable, each filing
of an employee benefit plan's annual report pursuant to section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by reference in the
registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
(c) Request for acceleration of effective date or filing of
registration statement on Form S-8.
Insofar as indemnification for liabilities arising under the
Securities Act of 1933, as amended (the "Act"), may be permitted to directors,
officers and controlling persons of the registrant pursuant to the foregoing
provisions, or otherwise, the registrant has been advised that in the opinion of
the Securities and Exchange Commission such indemnification is against public
policy as expressed in the Act and is, therefore, unenforceable. In the event
that a claim for indemnification against such liabilities (other than the
payment by the registrant of expenses incurred or paid by a director, officer or
controlling person of the registrant in the successful defense of any action,
suit or proceeding) is asserted by such director, officer or controlling person
in connection with the securities being registered, the registrant will, unless
in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the Act and
will be governed by the final adjudication of such issue.
II-4
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-8 and has duly caused this Registration
Statement or amendment thereto to be signed on its behalf by the undersigned,
thereunto duly authorized, in Ontario, California on March 7, 2005.
SOYO GROUP, INC.
By: /s/ MING TUNG CHOK
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Ming Tung Chok
President
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement or amendment thereto has been signed by the following
persons in the capacities and on the dates indicated.
Signature Title Date
/s/ MING TUNG CHOK President, Chief Executive Officer, 3/7/05
---------------------- and Director (Principal Executive ------
Ming Tung Chok Officer)
/s/ NANCY CHU Chief Financial and Chief 3/7/05
---------------------- Accounting Officer (Principal ------
Nancy Chu Financial and Accounting Officer),
Secretary and Director
EXHIBIT INDEX
Exhibit
Number Description of Exhibit
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4.1 The 2005 Stock Compensation Plan of Soyo Group, Inc.
5.1 Opinion of Andrew N. Bernstein, P.C.
23.1 Consent of Grobstein, Horwath & Company LLP, independent
public accountants
23.2 Consent of Malone & Bailey, PC, Certified Public Accountants
23.3 Consent of Andrew N. Bernstein, P.C. (included in its opinion
filed as Exhibit 5.1) x