SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934
(Amendment No. __)
Filed by the Registrant [x]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[x] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
[ ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to ss.240.14a-11(c) or ss.240.14a-12
SOYO GROUP, INC.
(Name of Registrant as Specified In Its Charter)
ANDREW N. BERNSTEIN, ESQ.
(Name of Person(s) Filing Proxy Statement if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[x] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) 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 fee is calculated and state how it was determined):
______________________________________________________________
4) Proposed maximum aggregate value of transaction:
______________________________________________________________
5) Total fee paid:
[ ] 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:
______________________________________________________________
2) Form, Schedule or Registration Statement No.:
______________________________________________________________
3) Filing Party:
______________________________________________________________
4) Date Filed:
SOYO GROUP, INC.
1420 South Vintage Avenue
Ontario, California 91761-3646
Telephone: (909) 292-2500
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
To Be Held Tuesday, July 15, 2008
To Our Shareholders:
PLEASE TAKE NOTICE that the Annual Meeting of Shareholders of Soyo
Group, Inc. will be held at the Sheraton Ontario Airport Hotel, 429 North
Vineyard Ave., Ontario, California 91764, on Tuesday, July 15, 2008 at 10:00
a.m., local time, for the following purposes:
1. To elect five (5) directors to hold office for the term specified in
the Proxy Statement or until their successors are elected and
qualified;
2. To approve an amendment to our 2005 Stock Compensation Plan to
increase the authorized number of shares of common stock from
5,000,000 to 15,000,000 (the "2005 Stock Compensation Plan Amendment
Proposal");
3. To approve an amendment to our Articles of Incorporation to increase
the number of our authorized shares of common stock from 75,000,000 to
200,000,000 (the "Authorization of Securities Proposal"); and
4. To transact such other business as may properly come before the
meeting or any adjournment.
The board of directors has fixed the close of business on June 3, 2008
as the record date for the determination of shareholders entitled to notice of
and to vote at the meeting and at any adjournment. A proxy statement which
describes the foregoing proposal and a form of proxy accompany this notice.
By Order of the Board of Directors
Nancy Chu
CFO and Secretary
Dated: June 10, 2008
IMPORTANT
Whether or not you expect to attend the meeting, please execute the
accompanying proxy and return it promptly in the enclosed reply envelope which
requires no postage. If you grant a proxy, you may revoke it at any time prior
to the meeting. Also, whether or not you grant a proxy, you may vote in person
if you attend the meeting.
SOYO GROUP, INC.
1420 South Vintage Avenue
Ontario, California 91761-3646
PROXY STATEMENT
ANNUAL MEETING OF SHAREHOLDERS
To Be Held Tuesday, July 15, 2008
SOLICITATION OF PROXY
The accompanying proxy is solicited on behalf of the board of directors
of Soyo Group, Inc. for use at our annual meeting of shareholders to be held at
the Sheraton Ontario Airport Hotel, 429 North Vineyard Ave., Ontario, California
91764 on Tuesday, July 15, 2008 at 10:00 a.m., local time, and at any
adjournment. In addition to mail, proxies may be solicited by personal
interview, telephone or telegraph by our officers, directors and other
employees, who will not receive additional compensation for such services. We
may also request brokerage houses, nominees, custodians and fiduciaries to
forward the soliciting material to the beneficial owners of stock held of record
and will reimburse them at the rates suggested by the New York Stock Exchange.
We will bear the cost of this solicitation of proxies, which is expected to be
nominal. Proxy solicitation will commence with the mailing of this proxy
statement on or about June 10, 2008.
Execution and return of the enclosed proxy will not affect your right
to attend the meeting and to vote in person. If you execute a proxy, you still
retain the right to revoke it at any time prior to exercise at the meeting. A
proxy may be revoked by delivery of written notice of revocation to our
secretary, by execution and delivery of a later proxy, or by voting the shares
in person at the meeting. A proxy, when executed and not revoked, will be voted
in accordance with its instructions. If there are no specific instructions,
proxies will be voted "FOR" the election as directors of those nominees named in
the proxy statement, "FOR" the proposal to approve an amendment to our 2005
Stock Compensation Plan, "FOR" the proposal to approve an amendment to our
Articles of Incorporation, and in accordance with her best judgment on all other
matters that may properly come before the meeting.
The enclosed form of proxy provides a method for you to withhold
authority to vote for any one or more of the nominees for director while
granting authority to vote for the remaining nominees. The names of all nominees
are listed on the proxy. If you wish to grant authority to vote for all
nominees, check the box marked "FOR." If you wish to withhold authority to vote
for all nominees, check the box marked "WITHHOLD." If you wish your shares to be
voted for some nominees and not for one or more of the others, check the box
marked "FOR" and indicate the names(s) of the nominee(s) for whom you are
withholding the authority to vote by writing the name(s) of such nominee(s) on
the proxy in the space provided.
1
PURPOSE OF MEETING
As stated in the notice of annual meeting of shareholders accompanying
this proxy statement, the business to be conducted and the matters to be
considered and acted upon at the meeting are as follows:
1. To elect five (5) directors to hold office for the term specified in
the Proxy Statement or until their successors are elected and
qualified;
2. To approve an amendment to our 2005 Stock Compensation Plan to
increase the authorized number of shares of common stock from
5,000,000 to 15,000,000 (the "2005 Stock Compensation Plan Amendment
Proposal");
3. To approve an amendment to our Articles of Incorporation to increase
the number of our authorized shares of common stock from 75,000,000 to
200,000,000 (the "Authorization of Securities Proposal"); and
4. To transact such other business as may properly come before the
meeting or any adjournment.
VOTING AT MEETING
Our voting securities consist solely of common stock, $0.001 par value
per share.
The record date for shareholders entitled to notice of and to vote at
the meeting is the close of business on June 3, 2008, at which time we had
outstanding and entitled to vote at the meeting 53,063,656 shares of common
stock. Shareholders are entitled to one vote, in person or by proxy, for each
share of common stock held in their name on the record date. Shareholders
representing a majority of the common stock outstanding and entitled to vote
must be present or represented by proxy to constitute a quorum.
The election of each director and approval of the 2005 Stock
Compensation Plan Amendment Proposal will each require the affirmative vote of
the holders of a majority of all of our shares of common stock present or
represented by proxy at the meeting and entitled to vote at the meeting.
Cumulative voting for directors is not authorized and proxies cannot be voted
for more than five nominees.
Approval of the Authorization of Securities Proposal will require the
affirmative vote of the holders of a majority of all of our shares of common
stock outstanding and entitled to vote at the meeting.
Ming Tung Chok, our president, chief executive officer and director,
and Nancy Chu, our chief financial officer, secretary and director, have advised
2
us that they intend to vote all of their 25,985,548 shares held by them as of
the record date, representing 48.97% of all outstanding shares, in favor of the
election as director of all five nominees, the 2005 Stock Compensation Plan
Amendment Proposal and the Authorization of Securities Proposal.
STOCK OWNERSHIP
The following table sets forth certain information as of June 3, 2008
regarding the beneficial ownership of our shares of common stock by:
(i) each of our executive officers; (ii) each of our directors;
(iii) each person who is known by us to own beneficially more than 5% of our
outstanding common stock; and (iv) all of our directors and executive officers
as a group.
This information gives effect to securities deemed outstanding pursuant to Rule
13d-3(d)(1) under the Securities Exchange Act of 1934, as amended. As of June 3,
2008, we had 53,063,656 shares of our common stock issued and outstanding. As
far as is known to our management, no person owns beneficially more than five
percent of our outstanding shares of common stock as of June 3, 2008 except as
set forth below.
Name and Address of Amount and Nature Percentage of Class
Beneficial Owner of Beneficial Ownership Beneficially Owned
---------------- ----------------------- ------------------
Ming Tung Chok (1)(2) 11,776,000 22.19%
Nancy Chu (1)(2) 14,209,548 26.78%
Chung Chin Keung (1) 10,000 0.02%
Jay Schrankler (1) 20,000 0.04%
Henry Song (1) 20,000 0.04%
All executive officers and 26,035,548 49.06%
directors as a group (5 persons)
----------
(1) The address of these holders is 1420 South Vintage Avenue, Ontario,
California 91761.
(2) Ming Tung Chok and Nancy Chu are husband and wife and are considered to be
the beneficial owner of each other's shares. Collectively, they own
25,985,548 shares.
3
BOARD OF DIRECTORS
Our board of directors has the responsibility for establishing broad
corporate policies and for our overall performance, although it is not involved
in day-to-day operating details. The board meets regularly throughout the year,
including the annual organization meeting following the annual meeting of
shareholders, to review significant developments affecting us and to act upon
matters requiring board approval. It also holds special meetings as required
from time to time when important matters arise requiring board action between
scheduled meetings. During the fiscal year ended December 31, 2007, the board
met once.
No director attended fewer than 75 percent of the aggregate of the
total number of meetings of the board of directors and the total number of
meetings held by all committees of the board of directors on which he/she
served.
ELECTION OF DIRECTORS
At the meeting, five directors are to be elected. Each director will be
elected for a one-year term or until his successor is elected and qualified.
Shares represented by properly executed proxies will be voted, in the
absence of contrary indication or revocation by the shareholder granting such
proxy, in favor of the election of the persons named below as directors. The
person named as proxy has been designated by management and intends to vote for
the election to the board of directors of the persons named below, each of whom
now serves as a director. If any nominee is unable to serve as a director, the
shares represented by the proxies will be voted, in the absence of contrary
indication, for any substitute nominee that management may designate. We know of
no reason why any nominee would be unable to serve. The information presented
with respect to the nominees was obtained in part from each of them and in part
from our records.
Nominees for Election as Directors
----------------- --------- ------------------------------------------------
Name Age Position Held
----------------- --------- ------------------------------------------------
Ming Tung Chok 47 Chief Executive Officer and Director
----------------- --------- ------------------------------------------------
Nancy Chu 51 Chief Financial Officer, Secretary and Director
----------------- --------- ------------------------------------------------
Jay Schrankler 50 Director
----------------- --------- ------------------------------------------------
Chung Chin Keung 42 Director
----------------- --------- ------------------------------------------------
Henry Song 49 Director
----------------- --------- ------------------------------------------------
Ming Tung Chok has served as the President, Chief Executive Officer and Director
of the Company since October 25, 2002. Prior to serving in this capacity, Mr.
Chok was the Vice President of Engineering of SOYO Group, Inc. for the past five
years. Mr. Chok received his Bachelor Degree in Electrical Engineering from the
California State University, Long Beach. Mr. Chok is married to Ms. Nancy Chu
4
who is a Director, the Chief Financial Officer and the Secretary of the Company.
Nancy Chu has served as the Chief Financial Officer, the Secretary and Director
of the Company since October 25, 2002. Prior to serving in this capacity, Ms.
Chu was the Vice President of Operations of SOYO Group, Inc. for the past 5
years. Ms. Chu holds a Bachelor Degree in Accounting and Statistics from the Sji
Jiang College, Taiwan R.O.C. Ms. Chu is married to Mr. Chok who is the
President, Chief Executive Officer and a Director of the Company.
Chung Chin Keung was appointed in October 2005 as an independent non-executive
director, audit committee member and compensation committee member. In 2007, Mr.
Chung was named Chairman of the Audit committee. Mr. Chung has more than 14
years commercial experience, including more than 10 years in accounting and
finance for publicly listed companies in various countries. Mr. Chung is
currently the chief finance officer of KPI Co. Ltd. (0605, Hong Kong Stock
Exchange), a listed company in Hong Kong. Mr. Chung holds a Master of Business
Administration from the University of Manchester, England.
Jay Shrankler was appointed in September 2007 as an independent non-executive
director and compensation committee member. Mr. Shrankler was a Vice President
of Licensing and Marketing for Honeywell International Inc.'s Automation and
Control Solutions Group from 2003 to 2007. From 2001 to 2003, he served as the
Vice President of Environmental Controls for Honeywell International Inc.'s
Automation and Control Solutions. He was Vice President and General Manager of
the Honeywell International Inc. Home and Building Control from 1999 to 2001.
Currently, he works at the University of Minnesota as an Executive Director in
the Office for Tech Communications.
Henry Song was appointed in September 2007 as an independent non-executive
director, audit committee member and compensation committee member. Mr. Song has
worked as the Chief Executive Officer and Chairman of the Board for Shenzhen
DiGuang Electronics since 1996. He has also served as the Chief Executive
Officer and Chairman of the Board for Shenzhen DiGuang Electronics Equipment
since 1994. Mr. Song and his companies are known for leading edge LED displays.
Each director received 10,000 unregistered shares of our Company's common stock
in 2005. The two directors who joined us in 2007 received 20,000 shares each
upon joining the board of directors. The directors receive no other compensation
for serving on the board of directors, but are reimbursed for any out-of-pocket
expenses incurred in attending board meetings, and may be compensated for other
work done on our behalf.
Family Relationships
Ming Tung Chok, President and CEO, and Nancy Chu, CFO and Secretary, are husband
and wife.
5
Section 16(a) Beneficial Ownership Compliance
The Company does not have any shares registered under Section 12 of the Exchange
Act and, therefore, the owners of the Company's equity securities are not
required to report their beneficial ownership under Section 16(a) of the
Exchange Act.
Audit Committee
The Audit Committee of the Board of Directors is comprised of Mr. Chung and Mr.
Song. The first Audit Committee meeting is scheduled to coincide with our annual
meeting on July 15, 2008. None of the directors is an Audit Committee Financial
Expert.
Communications with the Board
Any shareholder may communicate directly with the board of directors. The board
of directors has established the following system to receive, track and respond
to communications from shareholders addressed to the board of directors and its
committees and members. Any shareholder may address his or her communication to
the board of directors, or an individual board member and send the communication
addressed to the recipient group or individual, in care of SOYO Group, Inc.,
Corporate Secretary, 1420 South Vintage Ave., Ontario, CA 91761. The Corporate
Secretary will review all communications and deliver the communications to the
appropriate party in the Corporate Secretary's discretion. The Corporate
Secretary may take additional action or respond to communications in accordance
with instructions from the recipient of the communication.
Code of Ethics
We believe that good corporate governance practices promote the principles of
fairness, transparency, accountability and responsibility and will ensure that
our Company is managed for the long-term benefit of our shareholders. During the
past year, we have continued to review our corporate governance policies and
practices and to compare them to those suggested by various authorities in
corporate governance and the practices of other public companies. Accordingly,
in March 2004, the board adopted a Code of Ethics and Conduct. You may obtain a
copy of the Code of Ethics and Conduct and other information regarding our
corporate governance practices by writing to our Corporate Secretary, 1420 South
Vintage Ave., Ontario, CA 91761.
THE BOARD OF DIRECTORS RECOMMENDS TO THE SHAREHOLDERS THAT YOU VOTE "FOR" THE
ELECTION OF SUCH NOMINEES. ---
EXECUTIVE COMPENSATION
COMPENSATION DISCUSSION AND ANALYSIS
The compensation committee of our board of directors and our CEO, CFO and head
of Human Resources are collectively responsible for implementing and
administering all aspects of our benefit and compensation plans and programs, as
well as developing specific policies regarding compensation of our executive
6
officers. Both of the members of our Compensation Committee, Chung Chin Keung
and Jay Schrankler, are independent directors.
Compensation Objectives
The stated goal of our compensation committee with respect to executive
compensation has been to set compensation at levels that attract and retain the
most talented and dedicated executives possible. We attempt to set individual
executive compensation levels comparable with executives in other companies of
similar size and stage of development. We attempt to reward employees for strong
Company performance through the use of stock options. Our executive officers,
Ming Tung Chok and Nancy Chu, are husband and wife, and are also our founders
and largest shareholders.
Elements of Compensation
Base Salary. All full time executives are paid a base salary. In all cases, the
committee establishes a minimum base salary for our executive officers. Base
salaries for our executives are established based on the scope of their
responsibilities and the current financial situation of the Company. We also try
to take into account competitive market compensation paid by other companies in
our industry for similar positions, professional qualifications, academic
background, and the other elements of the executive's compensation, namely
stock-based compensation.
Equity Compensation. We believe that long-term performance is achieved through
an ownership culture participated in by our executive officers through the use
of stock-based awards. Currently, we do not maintain any incentive compensation
plans based on pre-defined performance criteria. The compensation committee has
the general authority, however, to award equity incentive compensation, i.e.
stock options, to our executive officers in such amounts and on such terms as
the committee determines in its sole discretion. The committee does not have a
determined formula for determining the number of options available to be
granted, subject to the number of options available through our 2005 Stock
Compensation Plan. Incentive compensation is intended to compensate officers for
accomplishing strategic goals such as meeting defined revenue goals and
profitability. The compensation committee awarded stock options to executive
officers, employees and consultants upon the filing of our 2005 Stock
Compensation Plan and awarded additional stock options to employees and
consultants in 2007. No stock options were granted in 2006. Our compensation
committee grants equity compensation only at times when we do not have material
non-public information to avoid timing issues and the appearance that such
awards are made based on any such information.
Determination of Compensation
Our CEO, CFO and head of Human Resources meet annually to evaluate each
non-executive employee's performance. A meeting is held towards the end of the
fiscal year to determine each employee's compensation for the following year. In
the case of our executive officers, the compensation committee similarly
evaluates the executive's performance and the objectives set forth above at or
about the end of our fiscal year to determine executive compensation.
7
The following table sets forth the cash and other compensation paid by us in
2007, 2006 and 2005 to the individuals who served as our chief executive officer
and chief financial officer, and all other executive officers who received total
compensation greater than $100,000 in 2007.
Summary Compensation Table
----------------------------- -------- ----------- -------------------
Name Year Salary Options Granted
----------------------------- -------- ----------- -------------------
Ming Tung Chok 2007 $144,000 0
President, Chief Executive 2006 $144,000 0
Officer 2005 $144,000 600,000 (a)
and Director
----------------------------- -------- ----------- -------------------
Nancy Chu 2007 $120,000 0
Chief Financial Officer and 2006 $120,000 0
Secretary 2005 $120,000 600,000 (a)
----------------------------- -------- ----------- -------------------
Harvey Schneider 2007 $116,533 250,000
Director of Sales
(a) Both Mr. Chok and Ms. Chu forfeited and returned the stock options to the
Company in 2007.
Outstanding Stock Options At December 31, 2007
--------------------------------------------------------------------------------
Name Number of Exercise Vesting Date Option Expiration
Exercisable Price Date
Options
--------------- ------------- -------- --------------- -----------------
Ming Tung Chok NONE
--------------- ------------ -------- --------------- -----------------
Nancy Chu NONE
--------------- ------------ -------- --------------- -----------------
Harvey Schneider 83,000 .35 February 2, 2007 February 2, 2012
83,000 .35 February 2, 2008 February 2, 2012
84,000 .35 February 2, 2009 February 2, 2012
Pension Benefits
We do not sponsor any qualified or non-qualified defined benefit plans.
Nonqualified Deferred Compensation
We do not maintain any non-qualified defined contribution or deferred
compensation plans. Our compensation committee, which is comprised solely of
"outside directors" as defined for purposes of Section 162(m) of the Code, may
elect to provide our officers and other employees with non-qualified defined
contribution or deferred compensation benefits if the compensation committee
determines that doing so is in our best interests.
8
Compensation of Directors
Each director received 10,000 unregistered shares of our common stock in 2005.
The two directors who joined us in 2007 each received 20,000 shares upon joining
the board of directors. The directors receive no other compensation for serving
on the board of directors, but are reimbursed for any out-of-pocket expenses
incurred in attending board meetings, and may be compensated for other work done
on the our behalf.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
None of the members of the compensation committee has any relationship with the
Company or any of its officers or employees other than in connection with their
role as a director. None of the members of the compensation committee has
participated in any related party transactions with the Company since the
beginning of our last fiscal year.
EMPLOYMENT CONTRACTS
During 2007 we entered into employment contracts with our Chief Executive
Officer, our Chief Financial Officer, our Director of Sales and our Director of
Marketing. We do not currently have employment contracts with any other
executive officers, employees or consultants. We may enter into employment
contracts with our executive officers, employees or consultants at any time if
we deem it to be in the best interests of the company.
ADDITIONAL MATTERS TO BE VOTED UPON BY SHAREHOLDERS
THE 2005 STOCK COMPENSATION PLAN AMENDMENT PROPOSAL
Our board of directors and our shareholders have adopted and approved
the 2005 Stock Compensation Plan. We believe that the plan is accomplishing its
purpose which is to promote our and your interests by providing key employees
with an opportunity to acquire a proprietary interest in us and to develop a
stronger incentive to put forth maximum effort for our continued success and
growth. In addition, the opportunity to acquire a proprietary interest in us
aids us in attracting and retaining key personnel of outstanding ability.
We believe that an increase in the number of shares available for grant
under the plan is necessary to continue accomplishing its purpose. As of June 3,
2008, no shares remained available for grant during the remaining term of the
plan through February 2015. Accordingly, we have approved an amendment to
increase the number of shares of common stock subject to the plan from 5,000,000
shares to 15,000,000 shares, subject to approval of our shareholders.
THE BOARD OF DIRECTORS RECOMMENDS TO OUR SHAREHOLDERS THAT YOU VOTE "FOR" THE
ADOPTION OF THE AMENDMENT TO THE 2005 STOCK COMPENSATION PLAN. ---
9
THE AUTHORIZATION OF SECURITIES PROPOSAL
Effective as of May 5, 2008, our board of directors approved, subject
to shareholder approval, an amendment to our Articles of Incorporation to
increase the number of our authorized shares of common stock from 75,000,000 to
200,000,000. The board of directors has directed that the proposed amendment be
submitted to a vote of our shareholders at this annual meeting.
THE BOARD OF DIRECTORS RECOMMENDS TO OUR SHAREHOLDERS THAT YOU VOTE "FOR" THE
APPROVAL AND ADOPTION OF THE AUTHORIZATION OF SECURITIES PROPOSAL. ---
Our board has determined that an increase in the number of our
authorized shares of common stock is in the best interests of the Company and
our shareholders. We intend to use authorized and unissued shares of common
stock for various corporate purposes, including, but not limited to, possible
future financing and acquisition transactions, possible recapitalization through
a stock split or stock dividend, issuances of stock options or awards, and other
corporate purposes. Authorized and unissued shares of common stock may be issued
by the board without further shareholder action unless the issuance is in
connection with a transaction for which shareholder approval is otherwise
required under our Articles of Incorporation, applicable law, regulation or
agreement.
We currently have no commitments, agreements, plans or undertakings to
issue any amount of additional shares of common stock. Shares of common stock,
including the additional shares proposed for authorization, do not have
preemptive or similar rights. The issuance of additional shares of common stock
could have the effect of diluting existing shareholder earnings per share, book
value per share and voting power. In addition, issuance of shares of common
stock could be used to make a change in control of the Company more difficult or
costly by diluting stock ownership of persons seeking to obtain control of the
Company or by permitting the board of directors to issue shares to purchasers
favorable to the board of directors in opposing an effort to obtain control of
the company.
The adoption of the proposed amendment to our Articles of Incorporation
could have the effect of discouraging attempts to acquire control of the
Company. Our board of directors has no knowledge of any present effort to
accumulate our securities or to obtain control of us. Our board has no plans at
the present time to submit to shareholders for approval, or take any other
action with respect to, any proposals, other than the proposed amendment to our
Articles of Incorporation, that might be deemed to have an anti-takeover effect.
In the judgment of our board of directors, there are now no provisions in our
Articles of Incorporation or bylaws that could be viewed as having, to a
significant extent, such an effect other than provisions in our Articles of
Incorporation providing that vacancies in the board of directors may be filled
by a majority of the remaining directors.
Article V, Sentence One, is proposed to be deleted and the following
language is to be substituted:
10
"The total number of shares of all classes of capital stock
that the Corporation shall have the authority to issue is Two
Hundred Million (200,000,000) shares of common stock, $0.001
par value per share."
INDEPENDENT PUBLIC ACCOUNTANTS
A representative of Vasquez and Company, LLP is expected to attend the
meeting and will have the opportunity to make a statement if he so desires. This
representative is expected to be available to respond to appropriate shareholder
questions at that time.
Independent Accountant Fees
The following table sets forth the fees for professional audit services rendered
by Vasquez & Company LLP for the audit of the Company's annual financial
statements for the fiscal years 2007 and 2006.
--------------------------- --------------- ---------------
2007 2006
--------------------------- --------------- ---------------
Audit Fees (1) $ 199,000 $ 158,500
--------------------------- --------------- ---------------
Audit-related Fees* 58,500 -
--------------------------- --------------- ---------------
Tax Fees 20,000 20,000
--------------------------- --------------- ---------------
All other Fees - -
--------------------------- --------------- ---------------
Total Fees $ 277,500 $ 178,500
--------------------------- --------------- ---------------
*Assisting client in replying to SEC comments, educational guidance
for SOX 404 implementation, explanation of audit work to internal
auditor of prospective lender.
(1) Includes annual audit fees and fees for preissuance review of quarterly
filings.
In 2006, Grobstein, Horwath & Company, the Company's predecessor auditors,
charged $6,000 for a review and reissuance of the Company's 2003 audit report.
PROPOSALS OF SHAREHOLDERS FOR PRESENTATION
AT NEXT ANNUAL MEETING OF SHAREHOLDERS
Any shareholder of record who desires to submit a proper proposal for
inclusion in the proxy materials relating to our next annual meeting of
shareholders must do so in writing and it must be received at our principal
executive offices by December 31, 2008. You must be a record or beneficial owner
entitled to vote at the next annual meeting on your proposal and must continue
to own such security entitling you to vote through the date on which the meeting
is held.
ANNUAL REPORT
Our annual report to shareholders concerning our operations during the
fiscal year ended December 31, 2007, including audited financial statements, has
been distributed to all record holders as of the record date. The annual report
11
is not incorporated in the proxy statement and is not to be considered a part of
the soliciting material.
OTHER BUSINESS
Our management is not aware of any other matters which are to be
presented at the meeting, nor have we been advised that other persons will
present any such matters. However, if other matters properly come before the
meeting, the individual named in the accompanying proxy shall vote on such
matters in accordance with her best judgment.
AVAILABILITY OF ANNUAL REPORT ON FORM 10-K
UPON WRITTEN REQUEST, WE WILL PROVIDE, WITHOUT CHARGE, A COPY OF OUR
ANNUAL REPORT ON FORM 10-K FOR THE FISCAL YEAR ENDED DECEMBER 31, 2007, TO EACH
SHAREHOLDER OF RECORD OR TO EACH SHAREHOLDER WHO OWNED OUR COMMON STOCK LISTED
IN THE NAME OF A BANK OR BROKER, AS NOMINEE, AT THE CLOSE OF BUSINESS ON JUNE 3,
2008. ANY REQUEST BY A SHAREHOLDER FOR OUR ANNUAL REPORT ON FORM 10-K SHOULD BE
SENT TO OUR CORPORATE SECRETARY, SOYO GROUP, INC., 1420 SOUTH VINTAGE AVENUE,
ONTARIO, CALIFORNIA 91761-3646, (909) 292-2500.
The above notice and proxy statement are sent by order of our board of
directors.
Nancy Chu
Chief Financial Officer
and Secretary
June 10, 2008
12
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
PROXY
FOR THE ANNUAL MEETING OF SHAREHOLDERS OF
SOYO GROUP, INC.
TO BE HELD TUESDAY, JULY 15, 2008
The undersigned hereby appoints Nancy Chu as the lawful agent and Proxy
of the undersigned (with all powers the undersigned would possess if personally
present, including full power of substitution), and hereby authorizes her to
represent and to vote, as designated below, all the shares of common stock of
Soyo Group, Inc. held of record by the undersigned as of the close of business
on June 3, 2008, at the Annual Meeting of Shareholders to be held on Tuesday,
July 15, 2008, or any adjournment or postponement.
1. ELECTION OF DIRECTORS
___ FOR all nominees listed below ___ WITHHOLD AUTHORITY
(except as marked to the to vote for all nominees
contrary below) listed below
M.Chok; N. Chu; J. Schrankler; C. Keung; H. Song
(INSTRUCTION: To withhold authority to vote for any nominees, write the
nominees' names on the space provided below.)
_____________________________________________________________________
2. To approve an amendment to our 2005 Stock Compensation Plan to
increase the authorized number of shares of common stock from
5,000,000 to 15,000,000 (the "2005 Stock Compensation Plan
Amendment")
____ FOR ____ AGAINST ____ ABSTAIN
3. To approve an amendment to our Articles of Incorporation to
increase the number of our authorized shares of common stock from
75,000,000 to 200,000,000 (the "Authorization of Securities
Proposal")
____ FOR ____ AGAINST ____ ABSTAIN
It is understood that when properly executed, this proxy will be voted in the
manner directed herein by the undersigned shareholder. WHERE NO CHOICE IS
SPECIFIED BY THE SHAREHOLDER, THE PROXY WILL BE VOTED IN FAVOR OF ITEMS (1), (2)
AND (3) ABOVE.
The undersigned hereby revokes all previous proxies relating to the
shares covered hereby and confirms all that said Proxy or her substitutes may do
by virtue hereof.
Please sign exactly as name appears below. When shares are held by joint
tenants, both should sign. When signing as attorney, executor, administrator,
trustee or guardian, please give full title as such. If a corporation, please
sign in full corporate name by President or other authorized officer. If a
partnership, please sign in partnership name by authorized person.
Dated:_______________, 2008 ____________________________________
Signature
____________________________________
Signature if held jointly
PLEASE MARK, SIGN, DATE AND
RETURN THE PROXY CARD PROMPTLY
USING THE ENCLOSED ENVELOPE.
[ ] PLEASE CHECK THIS BOX IF YOU INTEND TO BE PRESENT AT THE MEETING.