UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
SCHEDULE
14C INFORMATION
Information
Statement Pursuant to Section 14(c) 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:
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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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BIOAUTHORIZE
HOLDINGS, INC.
(Name
Of Registrant As Specified In Its Charter)
Payment
of Filing Fee (Check 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:
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Aggregate
number of securities to which transaction applies:
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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 filing fee is
calculated and state how it was determined):
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N/A
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Proposed
maximum aggregate value of transaction:
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Total
fee paid:
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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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Form,
Schedule or Registration Statement No.:
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Party:
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BIOAUTHORIZE
HOLDINGS, INC.
15849 N.
71st
Street, Suite 100
Scottsdale,
AZ 85254-2179
To the
stockholders of BioAuthorize Holdings, Inc.,
This Information Statement is furnished
by the Board of Directors of BioAuthorize Holdings, Inc., a Nevada corporation
("we," "us," "our," or the "Company"), to the holders of
record at the close of business on June 17, 2010 of the outstanding shares of
Common Stock, $.001 par value pursuant to Rule 14c-2 promulgated under the
Securities Exchange Act of 1934, as amended (the "Exchange Act"). The purpose
of this Information Statement is to inform our stockholders that on June 14,
2010, holders of a majority of the voting capital stock of the Company acted by
written consent in lieu of a special meeting of stockholders to approve an
amendment to our Articles of Incorporation to provide for a recapitalization in
which the issued and outstanding shares of our Common Stock will be Reverse
Split in a ratio of one-for-one hundred (1 for 100) on or about August 9, 2010
but no later than September 30, 2010, with the timing thereof to be determined
by the Board of Directors in its sole discretion. This Information Statement is
prepared and delivered to meet the requirements of Section 78.390 of the Nevada
Revised Statutes.
The amendments to our Articles of
Incorporation to effect the recapitalization will not become effective until at
least 40 days after the initial mailing of the Definitive Information
Statement.
No action is required by
you. The accompanying information statement is furnished only to inform
our stockholders of the action described above before it takes effect in
accordance with Rule 14c-2(d) promulgated under the Securities Act of 1934, as
amended. This Information Statement is being mailed to you on or about August 2,
2010.
WE
ARE NOT ASKING YOU FOR A PROXY AND YOU ARE REQUESTED NOT TO SEND US A
PROXY.
PLEASE
NOTE THAT THE COMPANY'S CONTROLLING STOCKHOLDERS HAVE VOTED TO APPROVE THE
AMENDMENTS TO OUR ARTICLES OF INCORPORATION TO CHANGE THE COMPANY’S NAME AND TO
INCREASE THE AUTHORIZED CAPITAL OF THE COMPANY. THE NUMBER OF VOTES HELD BY THE
CONTROLLING STOCKHOLDERS ARE SUFFICIENT TO SATISFY THE STOCKHOLDER VOTE
REQUIREMENT FOR THESE ACTIONS AND NO ADDITIONAL VOTES WILL CONSEQUENTLY BE
NEEDED TO APPROVE THESE TRANSACTIONS.
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By
Order of the Board of Directors
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/s/
Yada Schneider
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Yada
Schneider,
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President
and CEO
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Scottsdale,
Arizona
August 2,
2010
BIOAUTHORIZE
HOLDINGS, INC.
15849 N.
71st
Street, Suite 100
Scottsdale,
AZ 85254-2179
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INFORMATION
STATEMENT
PURSUANT
TO SECTION 14(c) OF THE
SECURITIES
EXCHANGE ACT OF 1934
AND
RULE 14c-2 THEREUNDER
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BIOAUTHORIZE
HOLDINGS, INC. IS NOT SOLICITING PROXIES IN CONNECTION WITH THE MATTERS
DESCRIBED IN THIS INFORMATION STATEMENT. THE ACTIONS DESCRIBED IN
THIS INFORMATION STATEMENT HAVE ALREADY BEEN APPROVED BY THE WRITTEN CONSENT OF
SHAREHOLDERS WITH A MAJORITY OF THE VOTING RIGHTS. NO VOTE OR OTHER
ACTION BY SHAREHOLDERS OF GENESIS HOLDINGS, INC. IS REQUIRED TO BE TAKEN IN
CONNECTION WITH THIS INFORMATION STATEMENT.
This
Information Statement is expected to be mailed on or about August 2, 2010, to
the holders of record at the close of business on June 17, 2010 of the
outstanding shares of Common Stock, $.001 par value, of BioAuthorize Holdings,
Inc., a Nevada corporation ("we," "us," "our," or the "Company"), to notify them about
action that the holders of a majority of our outstanding voting capital stock
have taken by written consent in lieu of a meeting of the
stockholders. This action was taken on June 14, 2010, in accordance with
relevant sections of the Nevada Revised Statutes. This action was taken by
our majority stockholders who own in excess of the required majority of our
outstanding Common Stock necessary for adoption of the actions. The amendments
to our Articles of Incorporation to be made in connection with the matters
subject to approval of the stockholders will not be completed until at least 40
days after deliver of this Information Statement. The Information Statement
is being delivered only to inform you of the corporate action described herein
before it takes effect in accordance with Rule 14c-2(d) promulgated under the
Securities Exchange Act of 1934, as amended.
We have
asked brokers and other custodians, nominees and fiduciaries to forward this
Information Statement to the beneficial owners of the Common Stock held of
record by such persons and will reimburse such persons for out-of-pocket
expenses incurred in forwarding such material.
THIS
IS NOT A NOTICE OF A MEETING OF STOCKHOLDERS AND NO STOCKHOLDERS' MEETING WILL
BE HELD TO CONSIDER ANY MATTER DESCRIBED HEREIN.
PLEASE
NOTE THAT THE COMPANY'S CONTROLLING STOCKHOLDERS HAVE VOTED TO APPROVE THE
AMENDMENTS TO OUR ARTICLES OF INCORPORATION TO CHANGE THE COMPANY’S NAME AND TO
INCREASE THE AUHTHORIZED CAPITAL OF THE COMPANY. THE NUMBER OF VOTES HELD BY THE
CONTROLLING STOCKHOLDER IS SUFFICIENT TO SATISFY THE STOCKHOLDER VOTE
REQUIREMENT FOR THE AMENDMENTS TO OUR ARTICLES OF INCORPORATION TO CHANGE THE
COMPANY’S NAME AND TO INCREASE THE AUHTHORIZED CAPITAL OF THE COMPANY AND NO
ADDITIONAL VOTES WILL CONSEQUENTLY BE NEEDED TO APPROVE THESE
ACTIONS.
GENERAL
INFORMATION
This
Information Statement is provided in connection with the amendment to our
Articles of Incorporation to provide for a recapitalization in which the issued
and outstanding shares of our Common Stock will be Reverse Split in a ratio of
one-for-one hundred (1 for 100) (the “Reverse Split”) on or about August 9, 2010
but no later than September 30, 2010 with the timing thereof to be determined by
the Board of Directors in its sole discretion (the “Amendment”). Our board of
directors has determined that the Reverse Split is in the best interests of the
Company. This Information Statement is being provided solely for
information purposes and not in connection with a vote of our
shareholders.
In
accordance with the requirements of applicable law we are required, following
the Closing, to file this Information Statement with the Securities and Exchange
Commission ("SEC") and to mail this
Information Statement to each registered holder of our Common
Stock.
This
Information Statement is being furnished pursuant to Section 14(c) of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and Regulation 14C and
corresponding rules promulgated thereunder.
PROPOSAL
TO
AMEND
OUR ARTICLES OF INCORPORATION TO PROVIDE FOR A RECAPITALIZATION IN WHICH THE
ISSUED AND OUTSTANDING SHARES OF OUR COMMON STOCK ARE TO BE REVERSE SPLIT AT A
RATIO OF ONE-FOR-ONE HUNDRED (1 FOR 100) ON OR ABOUT AUGUST 9, 2010 BUT NO LATER
THAN SEPTEMBER 30, 2010, WITH THE TIMING THEREOF TO BE DETERMINED BY THE BOARD
OF DIRECTORS IN ITS SOLE DISCRETION.
Description
of the Proposed Amendment
On June
14, 2010, the board of directors unanimously approved an amendment to the
Company’s Articles of Incorporation, subject to required stockholder approval
and the requirements of Regulation 14C, to provide for a recapitalization in
which the issued and outstanding shares of our Common Stock are to be Reverse
Split at a ratio of one for one hundred (1 for 100) on or about August 9, 2010
but no later than September 30, 2010 with the timing thereof to be determined by
the Board of Directors in its sole discretion (the “Amendment”) with the
Amendment to be effected upon its filing with the Secretary of State of the
State of Nevada. The full text of the proposed Amendment is set out
in Appendix A to
this Information Statement. The text of the proposed Amendment is subject to
modification to include such changes as may be required by the office of the
Secretary of State of Nevada or as our Board of Directors deems necessary and
advisable to effect the Reverse Split.
Following
approval of the Amendment by our Board of Directors, action was taken on June
14, 2010 to approve the Amendment without a meeting of the stockholders by
written consent signed by a majority of the voting power of the stockholders as
required by Nevada law. Therefore, the Amendment has been
approved by our board of directors and shareholders but will not become
effective until the Amendment is filed with the Secretary of State of the State
of Nevada. No filing of the Amendment can be made with the Secretary of State of
the State of Nevada until at least 40 calendar days following the filing
of this Information Statement with the SEC and the transmission of this
Information Statement to all holders of record of our Common Stock as of the
Record Date of June
17, 2010.
Reasons
for the Reverse Split
The Board
of Directors believes that the Reverse Split is in the best interests of the
Company by reducing the number of shares of Common Stock available on the public
market, and thereby proportionately increasing the per share price of the
Company’s Common Stock. The Board has considered certain factors
including existing and expected marketability and liquidity of the Company’s
Common Stock, prevailing market conditions and the likely effect on the market
price of the Company’s Common Stock, the recent trading history of the Common
Stock, the overall market conditions at the time and other relevant factors.
Theoretically, decreasing the number of shares of Common Stock outstanding
should not, by itself, affect the marketability of the shares, the type of
investor who would be interested in acquiring them, or our reputation in the
financial community. In practice, many investors and market makers
consider low-priced stocks as unduly speculative in nature and, as a matter of
policy, avoid investment and trading in such stocks. The presence of these
negative perceptions may be adversely affecting, and may continue to adversely
affect, not only the pricing of our Common Stock, but also its trading
liquidity. In addition, these perceptions may affect our ability to raise
additional capital through the sale of stock or the cost of debt we may incur.
Upon approval of and filing of the Amendment with the Nevada Secretary of State,
we will have 505,040 shares of our Common Stock outstanding as of the date of
this proxy statement. The Reverse Split will also make available a
substantial number of additional authorized, but unissued shares of Common Stock
which we believe will provide increased flexibility in structuring possible
future financing, in taking advantage of future business opportunities such as
acquisitions, and in meeting corporate needs as they arise, all without the
delay and expense of calling a meeting of our stockholders to authorize an
increase in authorized capital. The Company’s Common Stock may then
be more appealing to institutional investors and institutional
funds.
We hope
that the decrease in the number of shares outstanding of our Common Stock
resulting from the Reverse Split, and the anticipated increase in the price per
share, will encourage greater interest in our Common Stock among members of the
financial community. However, the possibility exists that stockholder liquidity
may be adversely affected by the reduced number of shares which would be
outstanding if the Reverse Split is effected, particularly if the price per
share of the Common Stock begins a declining trend after the Reverse Split is
effected. Such a decrease in the price per share of the Common Stock
will reduce the value of your holdings in the Company as you will have fewer
shares as a result of the Reverse Split.
The Board
of Directors believes that the share price of our Common Stock is a factor in
whether our Common Stock meets investing guidelines for certain institutional
investors and investment funds. Also, the Board of Directors believes that our
stockholders will benefit from relatively lower trading costs for a higher
priced stock. The combination of lower transaction costs and increased interest
from institutional investors and investment funds may ultimately improve the
trading liquidity of our Common Stock.
We are
not aware of any present efforts by anyone to accumulate the Common Stock, and
the proposed Reverse Split is not intended to be an anti-takeover device. The
Board of Directors did not seek authority to implement a Reverse Split in
anticipation of any future transaction or series of transactions, including any
"going private" transaction, other than the implementation of its proposed
business objectives regarding the marketplace of applications for handheld
personal electronic devices that have been disclosed in prior public
filings.
Currently,
our Common Stock is listed on the FINRA OTC Pink Sheets under the symbol “BAZH”.
The Company has failed to file its annual report on Form 10-K for the year ended
December 31, 2009 and for the three month period ended March 31, 2010 and as a
result, our Common Stock was recently removed from the OTC Bulletin Board and
appeared on the Pink Sheets. It is unknown whether we can satisfy the criteria
that companies must satisfy in order for our Common Stock to be quoted on the
OTC Bulletin Board. The OTC Bulletin Board is viewed by most
investors as a less desirable and less liquid marketplace. A Reverse Split may
give the Company the opportunity to attempt a listing on a higher quality
exchange, but there can be no assurance that the Reverse Split will help the
Company achieve this desired result.
The Board
has made the determination that the Reverse Split is in the Company’s and the
stockholders’ best interests at that time. In connection with any determination
to effect the Reverse Split, the Board, with the advice of its experts, will set
the time for such a Reverse Split from on or about August 9, 2010 up to
September 30, 2010. The Board of Directors will implement the Reverse
Split during this period of time. This determination will be made by
the Board with the intention to create the greatest marketability for the
Company’s Common Stock based upon prevailing market conditions at that
time.
There can
be no assurance that the Reverse Split will achieve any of the desired results.
There also can be no assurance that the price per share of the Common Stock
immediately after the Reverse Split will increase proportionately with the
Reverse Split, or that any increase will be sustained for any period of time. A
decrease in the price per share of the Common Stock will reduce the value of
your holdings in the Company as you will have fewer shares as a result of the
Reverse Split.
Purpose
of the Reverse Stock Split
The
purpose of the Reverse Split is to increase the per share trading price of the
Company’s Common Stock. The Board intends to effect the proposed Reverse Split
only if it believes that a decrease in the number of shares outstanding is
likely to improve the trading price for the Company’s Common Stock, and only if
the implementation of a Reverse Split is determined by the Board to be in the
best interest of the Company and its stockholders. The Board may exercise its
discretion not to implement a Reverse Split.
The
Company believes that a number of institutional investors and investment funds
are reluctant to invest, and in some cases may be prohibited from investing, in
lower-priced stocks and that brokerage firms are reluctant to recommend
lower-priced stocks to their clients. By effecting a Reverse Split, the Company
believes it may be able to raise its Common Stock price to a level where the
Company’s Common Stock could be viewed more favorably by potential
investors.
Other
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 lower-priced stocks. A higher stock price after a Reverse Split could
alleviate this concern.
The
combination of lower transaction costs and increased interest from institutional
investors and investment funds could have the effect of improving the trading
liquidity of the Company’s Common Stock.
Certain
Risk Factors Associated with the Reverse Stock Split
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While
the Board of Directors believes that a higher stock price may help
generate investor interest, there can be no assurance that the Reverse
Split will result in any particular price for the Company’s Common Stock
or result in a per-share price that will attract institutional investors
or investment funds or that such share price will satisfy the investing
guidelines of institutional investors or investment funds. As a result,
the trading liquidity of the Company’s Common Stock may not necessarily
improve.
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There
can be no assurance that the market price per new share of the Company’s
Common Stock after a Reverse Split will remain unchanged or increase in
proportion to the reduction in the number of shares of the Company’s
Common Stock outstanding before the Reverse Split. For example, based on
the closing price of the Company’s Common Stock on July 2, 2010 of $0.01
per share, if the Reverse Split was implemented and approved for a Reverse
Split ratio of 1-for-100, there can be no assurance that the post-split
market price of the Company’s Common Stock would be $1.00 or
greater. Accordingly, the total market capitalization of the Company’s
Common Stock, and the value of your holdings of our Common Stock, after
the Reverse Split may be lower than the total market capitalization before
the Reverse Split. Moreover, in the future, the market price of the
Company’s Common Stock following the Reverse Split may not exceed or
remain higher than the market price prior to the Reverse
Split.
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If
the Reverse Split is effected and the market price of the Company’s Common
Stock declines, the percentage decline may be greater than would occur in
the absence of a Reverse Split. The value of your holdings of our Common
Stock would also decline in the same manner. The market price
of the Company’s Common Stock will, however, also be based on performance
and other factors, which are unrelated to the number of shares
outstanding. Furthermore, the liquidity of the Company’s Common Stock
could be adversely affected by the reduced number of shares that would be
outstanding after the Reverse
Split.
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Impact
of the Proposed Reverse Stock Split
The
Reverse Split will be realized simultaneously and in the same ratio for all of
the Company’s Common Stock. The Reverse Split will affect all issued and
outstanding shares of the Company’s Common Stock and outstanding rights to
acquire the Company’s Common Stock uniformly. It will not affect any
stockholder’s percentage ownership interest in the Company, except to the extent
that the Reverse Split would result in any holder of the Company’s Common Stock
receiving whole shares instead of fractional shares. As described below, holders
of the Company’s Common Stock otherwise entitled to fractional shares as a
result of the Reverse Split will receive an amount in cash in lieu of such
fractional shares based upon a per share value, and that value or the method of
determining that value is specified by a resolution of the Board of Directors.
In addition, the Reverse Split will not affect any stockholder’s proportionate
voting power (subject to the treatment of fractional shares). After the Reverse
Split, the number of authorized shares of Common Stock will be 100,000,000
shares and the number of unissued shares of Common Stock will be approximately
504,050 shares. The number of authorized but unissued shares of our Common Stock
will make available a sufficient number of additional authorized but unissued
shares of Common Stock for structuring possible future financings, in taking
advantage of future business opportunities such as acquisitions, and in meeting
corporate needs as they arise.
The
principal effects of the Reverse Split will be that:
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Each
100 shares of the Company’s Common Stock owned by a stockholder will be
combined into one new share of Common
Stock;
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the
number of shares of Common Stock issued and outstanding will be reduced
from approximately 50,405,006 shares to approximately 504,050 shares;
and
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There
are no outstanding warrants, options, restricted stock awards and
restricted stock units entitling the holders to purchase shares of Common
Stock so no proportionate adjustments will need to be made to the
per-share exercise price of any outstanding options, restricted stock
awards and restricted stock units entitling the holders to purchase shares
of Common Stock as a result of the Reverse
Split.
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At the
ratio approved, the Reverse Split will not result in some stockholders owning a
single “odd lot” of less than 100 shares of Common Stock because those
stockholders will receive an amount in cash in lieu of such fractional shares
based upon a per share value, and that value or the method of determining that
value is specified by a resolution of the Board of Directors. Odd lot shares may
be more difficult to sell, and brokerage commissions and other costs of
transactions in odd lots are generally somewhat higher than the costs of
transactions in “round lots” of even multiples of 100 shares. Some stockholders
who own more than 100 shares of Common Stock may own both round lots and odd
lots. The Board believes, however, that these potential effects are
substantially outweighed by the benefits of the Reverse Split.
The
Company will continue to have 10,000,000 authorized shares of Preferred Stock of
which no shares are issued or outstanding. Authorized but unissued
shares will be available for issuance, and we may issue such shares in the
future. The exercise of stock options and warrants that may be granted in the
future will increase the number of issued and outstanding shares of our Common
Stock. In addition, if we were to issue any additional shares in connection with
any future financing, acquisition or other type of transaction, the ownership
interest of holders of our Common Stock will be diluted.
Board
Discretion on the Timing to Implement the Reverse Stock Split
The
Reverse Split will be effected, on or about August 9, 2010 but no later than
September 30, 2010 with the timing thereof to be determined by the Board of
Directors in its sole discretion. The Board of Directors is required to
implement the reverse stock split.
Effective
Date
The
proposed Reverse Split of the Common Stock would become effective as of 11:59
p.m., Mountain Time, (the “Effective Date”) on the date of filing the Amendment
with the office of the Nevada Secretary of State. Except as explained below with
respect to fractional shares, on the Effective Date, each one hundred (100)
shares of the Company’s Common Stock issued and outstanding immediately prior
thereto will be converted, automatically and without any action on the part of
the stockholders, into one (1) share of the Company’s Common Stock.
After the
Effective Date, the Company’s Common Stock will have new committee on uniform
securities identification procedures (“CUSIP”) numbers, which is a number used
to identify the Company’s equity securities, and stock certificates with the
older CUSIP numbers will need to be exchanged for stock certificates with the
new CUSIP numbers by following the procedures described below.
After the
Effective Date and upon payment of cash with respect to fractional shares, the
Company will have fewer than 200 stockholders and upon filing the appropriate
form may elect to terminate the registration of its class of Common Stock and
its obligations to be subject to periodic reporting and other requirements of
the Securities Exchange Act of 1934, as amended. The Company’s Common Stock will
continue to be reported on the FINRA OTC Pink Sheets under the symbol “BAZH”,
although FINRA will add the letter “D” to the end of the trading symbol for a
period of 20 trading days after the Effective Date to indicate that the Reverse
Split has occurred.
Fractional
Shares
Stockholders
will not receive fractional shares of Common Stock from the conversion of the
one-for-one hundred (1 for 100) ratio following the Reverse Split. Instead, such
stockholders will receive an amount in cash in lieu of such fractional shares
based upon a per share value, and the method of determining that value has been
specified by a resolution of the Board of Directors. The per share value for fractional
shares is calculated to be the average of the closing price of the Corporation’s
Common Stock for the five (5) trading days preceding the date the Amendment is
filed with the Nevada Secretary of State to effect the Reverse Stock Split (the
“Per Share Value”) multiplied by the number of shares held by each such
stockholder immediately prior to the filing of the Amendment (the “Cash
Payment”).
Effect
on Registered and Beneficial Holders of Common Stock
Upon the
Reverse Split, the Company intends to treat shares held by stockholders in
“street name,” through a bank, broker or other nominee, in the same manner as
registered stockholders whose shares are registered in their names. Banks,
brokers or other nominees will be instructed to effect the Reverse Split for
their beneficial holders holding the Company’s Common Stock in “street
name”.
Effect
on Registered “Book-Entry” Holders of Common Stock
Certain
of the Company’s registered holders of Common Stock may hold some or all of
their shares electronically in book-entry form with the Company’s transfer
agent. These stockholders do not have stock certificates evidencing their
ownership of the Company’s Common Stock. They are, however, provided with a
statement reflecting the number of shares registered in their
accounts.
If a
stockholder holds registered shares in book-entry form with the transfer agent,
no action needs to be taken to receive post-Reverse Split shares. If
a stockholder is entitled to post-Reverse Split shares, a transaction statement
will automatically be sent to the stockholder’s address of record indicating the
number of shares of Common Stock held following the Reverse Split.
Effect
on Certificated Shares
Stockholders
holding shares of the Company’s Common Stock in certificate form will not be
required to surrender his or her certificate(s) representing shares of the
Company’s Common Stock (“Old Certificates”). As a result of the Reverse Split,
our transfer agent, Island Stock Transfer, Inc., will reflect in its records the
change as to the number of shares that each stockholder holds. We will deem
outstanding Old Certificates held by stockholders to be canceled and only to
represented the number of whole shares of Common Stock to which these
stockholders are entitled following the Reverse Split.
Even
though there is no mandatory surrender of share certificates, each stockholder
may voluntarily elect to surrender his or her Old Certificate(s) to the transfer
agent in exchange for certificates representing the appropriate number of whole
shares of Common Stock following the Reverse Split (“New Certificates”). If a
stockholder wants to make such an election to exchange Old Certificates for New
Certificates, please contact Island Stock Transfer, Inc. at 727-289-0010 with
regard to the process. Each stockholder is responsible for all transfer and
other fees associated with the exchange. No New Certificates will be issued to a
stockholder until such stockholder has surrendered all Old Certificates,
together with properly completed and executed documents as required by our
transfer agent.
Any Old
Certificates submitted for exchange, whether because of a sale, transfer or
other disposition of stock, will automatically be exchanged for New
Certificates.
If an Old
Certificate has a restrictive legend on the back of the Old Certificate(s), the
New Certificate will be issued with the same restrictive legends that are on the
back of the Old Certificate(s).
STOCKHOLDERS
SHOULD NOT DESTROY ANY STOCK CERTIFICATE(S).
Accounting
Matters
The
Reverse Split will not affect the par value of a share of the Company’s Common
Stock. As a result, as of the Effective Date of the Reverse Split, the stated
capital attributable to Common Stock on the Company’s balance sheet will be
reduced proportionately based on the Reverse Split ratio (including a
retroactive adjustment of prior periods), and the additional paid-in capital
account will be credited with the amount by which the stated capital is reduced.
Reported per-share net income or loss and net book value of the Company’s Common
Stock will be restated because there will be fewer shares of Common Stock
outstanding.
Potential
Anti-Takeover Effect
The
proportion of unissued authorized shares to issued shares could, under certain
circumstances, have an anti-takeover effect. For example, the issuance of a
large block of Common Stock could dilute the stock ownership of a person seeking
to effect a change in the composition of the Board of Directors or contemplating
a tender offer or other transaction for the combination of the Company with
another company. However, the Reverse Split proposal is not being proposed in
response to any effort of which the Company is aware to accumulate shares of
Common stock or obtain control of the Company, nor is it part of a plan by
management to recommend to the Board and stockholders a series of amendments to
the Company’s Articles of Incorporation, as amended. Other than the proposal for
the Amendment, the Board of Directors does not currently contemplate
recommending the adoption of any other amendments to the Company’s Articles of
Incorporation, as amended, that could be construed to reduce or interfere with
the ability of third parties to take over or change the control of the
Company.
Stockholder
Approval
On June
17, 2010, the record date for determination of the stockholders entitled to
receive this Information Statement, there were 50,405,006 shares of Common Stock
issued and outstanding. The holders of our Common Stock are entitled to one vote
per share on all matters submitted to a vote of our stockholders. Therefore, the
Company needed the affirmative vote of at least a majority of the outstanding
shares of our Common Stock or 25,202,504 shares to approve the Amendment. By
unanimous written consent on Jun 14, 2010, as required under Nevada law, our
board of directors adopted a resolution approving the Amendment. By written
consent dated June 14, 2010, our two executive officers, Yada Schneider and
Jeffrey Perry, who collectively own 32,336,888 shares, or approximately 64.15%
of the issued and outstanding shares of our Common Stock, approved, adopted and
ratified the Amendment.
Effective
Date of the Amendment
The
proposal discussed above will become effective upon filing the Amendment with
the Nevada Secretary of State, which we intend to complete 40 days after this
Information Statement is transmitted to our stockholders pursuant to Rule
14c-2(d).
Dissenter’s
Rights
Dissenter’s
rights to obtain fair value are available under Nevada law to any stockholder
who before filing of the Amendment owns 1% or more of the outstanding shares of
Common Stock and would receive the Cash Payment in exchange for the cancellation
of such fractions of shares that would otherwise be issued in the Reverse
Split.
Nevada law provides shareholders with
rights to dissent from the corporate action taken regarding the Reverse Split
and filing of the Amendment. This means that you are entitled to receive payment
of the fair value of the fractional shares of Common Stock for which you are
receiving the Cash Payment. It does not provide any dissenting stockholder the
right to challenge the corporate action creating such entitlement unless the
action is unlawful or fraudulent with respect to the dissenting stockholder or
the company.
Fair value is the value of the shares
immediately before the effectuation of the corporate action to which the
dissenter objects, excluding any appreciation or depreciation in anticipation of
the merger unless exclusion is inequitable. The three traditional methods for
evaluating the fair value are market value, asset value and earnings value. Each
stockholder who has dissenter’s rights will receive a written notice from us no
later than 10 days after the Effective Date of the Amendment to effect the
Reverse Split. That written notice will provide the following:
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(i)
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State
where the demand for payment must be sent and where and when certificates,
if any, for shares must be deposited;o
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(ii)
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Inform
the holders of shares not represented by certificates to what extent the
transfer of the shares will be restricted after the demand for payment is
received;o
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(iii)
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Supply
a form for demanding payment that includes the date of the first
announcement to the news media or to the stockholders of the terms of the
proposed action and requires that the person asserting dissenter's rights
certify whether or not he acquired beneficial ownership of the shares
before that date;o
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(iv)
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Set
a date by which the subject corporation must receive the demand for
payment, which may not be less than 30 nor more than 60 days after the
date the notice is delivered; ando
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(v)
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Be
accompanied by a copy of NRS Sections 92A.300 to 92A.500,
inclusive.
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If a stockholder who has dissenter’s
rights is unwilling to accept the Cash Payment and desires to demand payment
under the stockholders dissenter’s rights, the stockholder must do the
following:
(i)Demand payment;o
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(ii)
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Certify
whether he acquired beneficial ownership of the shares before the date
required to be set forth in the dissenter's notice for this certification;
ando
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(iii)
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Deposit
his certificates, if any, in accordance with the terms of the notice. (For
fractional shares not represented by a certificate, we may restrict
transfer from the date the demand for payment is
received.)
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Within 30
days after receipt of a demand for payment, we will pay to each dissenting
stockholder who complies with the demand requirements the amount we estimate to
be the fair value of the fractional shares, plus accrued interest. Our
obligation may be enforced by the district court of Maricopa County, Arizona or
Carson City, Nevada or at the election of any dissenting stockholder residing or
having its registered office in Nevada, of the county where the dissenting
stockholder resides or has its registered office. The court shall dispose of the
complaint promptly.
The
payment must be accompanied by:
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(i)
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Our
balance sheet as of the end of a fiscal year ending not more than 16
months before the date of payment, a statement of income for that year, a
statement of changes in the stockholders' equity for that year and the
latest available interim financial statements, if any;o
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(ii)
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A
statement of our estimate of the fair value of the shares;o
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(iii)
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An
explanation
of how the interest was calculated;o
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(iv)
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A
statement of the dissenter's rights to demand payment under Section
92A.480 of the Nevada Revised Statutes, as amended; ando
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(v)
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A
copy of Sections 92A.300 to 92A.500 of the Nevada Revised Statutes, as
amended, inclusive.
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We may elect to withhold payment from a
dissenting stockholder unless he was the beneficial owner of the shares before
the date set forth in the dissenter's notice as the date of the first
announcement to the news media or to the stockholders of the terms of the
proposed action.o
To the extent we elect to withhold payment, after taking the proposed action, we
will estimate the fair value of the fractional shares, plus accrued interest,
and shall offer to pay this amount to each dissenting stockholder who agrees to
accept it in full satisfaction of his demand. We will send with our offer a
statement of our estimate of the fair value of the fractional shares, an
explanation of how the interest was calculated, and a statement of the
dissenters' right to demand payment as set forth below.
A dissenting stockholder may notify us
in writing of his own estimate of the fair value of his fractional shares and
the amount of interest due, and demand payment of his estimate, less any payment
we have already made as stated above, or reject the offer set forth above and
demand payment of the fair value of his shares and interest due, if he believes
that the amount paid as stated above or offered as set forth above is less than
the fair value of his fractional shares or that the interest due is incorrectly
calculated.o A
dissenting stockholder waives his right to demand payment unless he notifies the
subject corporation of his demand in writing within 30 days after we made or
offered payment for his fractional shares.
If a
demand for payment remains unsettled, we shall commence a proceeding within 60
days after receiving the demand and petition the court to determine the fair
value of the shares and accrued interest. If the subject corporation does not
commence the proceeding within the 60-day period, we will pay each dissenting
stockholder whose demand remains unsettled the amount demanded. We will commence
the proceeding in the district court of Carson City, Nevada. We will make all
dissenting stockholders, whether or not residents of Nevada, whose demands
remain unsettled, parties to the proceeding as in an action against their
fractional shares. All parties will be served with a copy of the petition.
Nonresidents may be served by registered or certified mail or by publication as
provided by law.o
The jurisdiction of the court in Carson City, Nevada is plenary and exclusive.
The court may appoint one or more persons as appraisers to receive evidence and
recommend a decision on the question of fair value. The appraisers have the
powers described in the order appointing them, or any amendment thereto. The
dissenting stockholders are entitled to the same discovery rights as parties in
other civil proceedings.o Each dissenting
stockholder who is made a party to the proceeding is entitled to a
judgment:
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(i)
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For
the amount, if any, by which the court finds the fair value of his
fractional shares, plus interest, exceeds the amount paid by us; oro
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(ii)
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For
the fair value, plus accrued interest, of his after-acquired fractional
shares for which the subject corporation elected to withhold payment as
set forth above.
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The court
in a proceeding to determine fair value shall determine all of the costs of the
proceeding, including the reasonable compensation and expenses of any appraisers
appointed by the court. The court shall assess the costs against us, except that
the court may assess costs against all or some of the dissenting stockholders,
in amounts the court finds equitable, to the extent the court finds the
dissenting stockholders acted arbitrarily, vexatiously or not in good faith in
demanding payment. oThe court may also
assess the fees and expenses of the counsel and experts for the respective
parties, in amounts the court finds equitable:
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(i)
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Against
us and in favor of all dissenting stockholders if the court finds the
subject corporation did not substantially comply with the requirements of
Sections 92A.300 to 92A.500 of the Nevada Revised Statutes, as amended,
inclusive; oro
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(ii)
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Against
either us or a dissenting stockholder in favor of any other party, if the
court finds that the party against whom the fees and expenses are assessed
acted arbitrarily, vexatiously or not in good faith with respect to the
rights provided by Sections 92A.300 to 92A.500 of the Nevada Revised
Statutes, as amended, inclusive.
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If the court finds that the services of
counsel for any dissenting stockholder were of substantial benefit to other
dissenting stockholders similarly situated, and that the fees for those services
should not be assessed against us, the court may award to those counsel
reasonable fees to be paid out of the amounts awarded to the dissenting
stockholders who were benefited.o In a proceeding
commenced in district court, the court may assess the costs against us, except
that the court may assess costs against all or some of the dissenting
stockholders who are parties to the proceeding, in amounts the court finds
equitable, to the extent the court finds that such parties did not act in good
faith in instituting the proceeding.o There are certain
exceptions to this.
After the date of this Schedule 14C and
in accordance with applicable Nevada law, we will separately deliver a written
dissenter’s notice to all stockholders entitled to assert dissenter’s rights
including a copy of the applicable Nevada statutory provisions regarding
dissenter’s rights.
Although
the nature and extent of such rights or actions are uncertain and may vary
depending upon the facts or circumstances, stockholder challenges to corporate
action in general are related to the fiduciary responsibilities of corporate
officers and directors and to the fairness of corporate
transactions.
Effect
on Legal Ability to Pay Dividends
The
Amendment will have no material impact on the legal ability of the Company to
pay dividends.
Delivery
of Documents to Security Holders Sharing an Address
Only one
copy of this Information Statement is being delivered to multiple stockholders
sharing an address, unless the Company has received contrary instructions from
one or more of the stockholders. The Company will deliver promptly, upon written
or oral request, a separate copy of this Information Statement to a stockholder
at a shared address to which a single copy of this document was delivered. A
stockholder may mail a written request to BioAuthorize Holdings, Inc.,
Attention: President and CEO, 15849 N. 71st Street,
Suite 100, Scottsdale, AZ 85254, or call (928) 300-5965, to
request:
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A
separate copy of this Information
Statement;
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A
separate copy of Information Statements or Annual Reports of the Company
in the future; or
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Delivery
of a single copy of Information Statements or Annual reports of the
Company, if such stockholder is receiving multiple copies of these
documents.
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SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, the Registrant has
duly caused this Information Statement on Schedule 14C to be signed on its
behalf by the undersigned hereunto duly authorized.
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BIOAUTHORIZE
HOLDINGS, INC.
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Dated:
August 2, 2010
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By:
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/s/ Yada Schneider
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Yada
Schneider, President and
CEO
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Appendix
A
CERTIFICATE
OF AMENDMENT
TO
ARTICLES
OF INCORPORATION
OF
BIOAUTHORIZE
HOLDINGS, INC.,
a Nevada
corporation
Pursuant
to Chapter 78 of the Nevada Revised Statutes of the State of Nevada, the
undersigned, Yada Schneider, President and Chief Executive Officer of
BioAuthorize Holdings, Inc., a corporation organized and existing under and by
virtue of the laws of the State of Nevada, DOES HEREBY CERTIFY,
FIRST:
The name of the Corporation is BioAuthorize Holdings, Inc. (hereinafter the
“Corporation”).
SECOND:
Pursuant to Section 78.390 of the Nevada Revised Statutes, the Board of
Directors of the Corporation has duly adopted a resolution proposing and
declaring advisable the amendment to the Articles of Incorporation of the
Corporation, as amended, set forth in this Certificate of Amendment as
follows:
RESOLVED,
that Article 3 is hereby amended as follows by adding a second paragraph after
the existing provisions entitled “Total shares authorized to
issue”:
“Upon
the effectiveness of the amendment contained in this Certificate of Amendment
(the “Effective Date”)
each one hundred (100) shares of Common Stock, par value $.001 per share, of
this Corporation’s issued and outstanding Common Stock at the close of business
on the Effective Date shall be converted into one (1) share of fully paid and
nonassessable Common Stock, without change in the aggregate number of shares of
Common Stock this Corporation shall be authorized to issue pursuant to this
Article 3. Each stockholder who would be entitled to a fraction of a share of
Common Stock as a result of the conversion (the “Share Fraction”) will not be
issued a certificate for such Share Fraction (the “Qualifying Stockholders”)
but in exchange for the cancellation of their Share Fraction each Qualifying
Stockholder will receive only an amount in cash based upon a per share value
calculated to be the average of the closing price of the Corporation’s Common
Stock for the five (5) trading days preceding the Effective Date multiplied by
the number of shares held by the Qualifying Stockholder immediately prior to the
Effective Date.”
THIRD:
Pursuant to 78.390 of the Nevada Revised Statutes, the Board of Directors has
directed that the proposed Certificate of Amendment be considered by the
stockholders at a special meeting of the stockholders entitled to vote on the
amendment and a written consent of such action has been signed and delivered by
stockholders holding at least a majority of the voting power for approval of
such amendment.
FOURTH:
Pursuant to Section 78.390 of the Nevada Revised Statutes, 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 64.15%.
FIFTH:
Pursuant to Section 78.390 of the Nevada Revised Statutes, the percentage of
outstanding shares of Common Stock affected by this Certificate of Amendment is
100% with only .01905763% of such outstanding shares being Share
Fractions.
SIXTH:
This amendment shall be effective on the date this Certificate of Amendment is
filed and accepted by the Secretary of State of the State of
Nevada.
IN WITNESS WHEREOF, the undersigned,
being the President and Chief Executive Officer of the Corporation, for purposes
of amending its Articles of Incorporation pursuant to the Nevada Revised
Statutes, acknowledges that it is his act and deed and that the facts stated
herein are true, and has signed this instrument this __ day of __________,
2010.
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BIOAUTHORIZE
HOLDINGS, INC.
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By:
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Name:
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Yada
Schneider
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Title:
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President
& Chief Executive
Officer
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