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
Check the appropriate box:
☐
Preliminary Information
Statement
☐
Confidential, for
Use of the Commission Only (as permitted by Rule 14c- 5(d)(2))
☒
Definitive Information
Statement
Labor Smart, Inc.
(Name of Registrant as Specified in its Charter)
Nevada
(State or other jurisdiction of incorporation)
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000-54654
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45-2433287
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(Commission File Number)
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(IRS Employer Identification No.)
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5604 Wendy Bagwell Parkway, Ste 223
Hiram, GA 30141
(
Address of principal executive offices and
zip code)
(770) 222-5888
(Registrant's telephone
number including area code)
Payment of Filing Fee (Check the appropriate box):
☒
No fee required
☐
Fee computed on table
below per Exchange Act Rules 14c-5(g) and 0-11.
(1) Title of each class of securities to which transaction applies:
N/A.
(2) Aggregate number of securities to which transaction applies:
N/A.
(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):
N/A.
(4) Proposed maximum aggregate value of transaction: N/A.
(5) Total fee paid: N/A.
☐
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 number, or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid: $0.
(2) Form, Schedule or Registration Statement No.: N/A
(3) Filing Party: N/A
(4) Date Filed: N/A
Contact Person:
Ryan Schadel
5604 Wendy Bagwell Parkway, Ste 223
Hiram, GA 30141
Labor Smart, Inc.
5604 Wendy Bagwell Parkway, Suite 223
Hiram, Georgia 30141
INFORMATION STATEMENT
WE ARE NOT ASKING YOU FOR A PROXY AND YOU
ARE
REQUESTED NOT TO SEND US A PROXY
INTRODUCTION
This Information Statement is being furnished
to the stockholders of Labor Smart, Inc., a Nevada corporation (the “Company,” “we,” “our,”
“us,” or words of similar import), in connection with certain proposed amendments to our Articles of Incorporation
and other corporate actions. First, the Company proposed an amendment to our Articles of Incorporation that would increase the
number of authorized shares of the Company’s common stock from 75,000,000 to 150,000,000 (the “Authorized Increase
Amendment”). Second, the Board of Directors has deemed it in the best interests of the Company to create a class of “blank
check” preferred stock and authorize 5,000,000 shares of preferred stock (the “Preferred Stock Amendment”).
The amendments to our Articles of Incorporation
were unanimously adopted by written consent of our Board of Directors, and our principal stockholder, Ryan Schadel, who owns 15,079,800
shares of our common stock, or 66.8% of our outstanding voting securities (the “Majority Stockholder”), effective May
19, 2014. No other votes were required or necessary to adopt the amendments to our Articles of Incorporation, and none is being
solicited hereunder. See the captions “Voting Securities and Principal Holders Thereof” and “Vote Required for
Approval,” herein.
The amendments to our Articles of Incorporation
will become effective on the opening of business on June 27, 2014, a date that is at least 21 days from the mailing of this Information
Statement to our stockholders.
APPROXIMATE DATE OF MAILING: June 6, 2014.
REASONS FOR THE ADOPTION OF THE AMENDMENTS
TO OUR ARTICLES OF INCORPORATION
See the heading “Changes in Control”
of the caption “Voting Securities and Principal Holders Thereof,” below. The Authorized Increase Amendment is being
sought to enhance corporate flexibility and to advance to the Company’s business plan. Similarly, we believe that for us
to successfully execute our business strategy we may need to raise investment capital and it may be preferable or necessary to
issue preferred stock to investors and or to retain key personnel. Preferred stock usually grants the holders certain preferential
rights in voting, dividends, liquidation or other rights in preference over a company's common stock. Accordingly, in order to
grant us the flexibility to issue our equity securities in the manner best suited for our Company, or as may be required by the
capital markets, the Preferred Stock Amendment will create 5,000,000 authorized shares of “blank check” preferred stock
for us to issue.
The term “blank check” refers to
preferred stock, the creation and issuance of which is authorized in advance by our stockholders and the terms, rights and features
of which are determined by our Board of Directors upon issuance. The authorization of such “blank check” preferred
stock permits our Board of Directors to authorize and issue preferred stock from time to time in one or more series without seeking
further action or vote of our stockholders.
PRINCIPAL EFFECTS OF THE CREATION OF SHARES
OF “BLANK CHECK” PREFERRED STOCK
Subject to the provisions of the Preferred
Stock Amendment and the limitations prescribed by law, our Board of Directors would be expressly authorized, at its discretion,
to adopt resolutions to issue shares, to fix the number of shares and to change the number of shares constituting any series and
to provide for or change the voting powers, designations, preferences and relative, participating, optional or other special rights,
qualifications, limitations or restrictions thereof, including dividend rights (including whether the dividends are cumulative),
dividend rates, terms of redemption (including sinking fund
provisions), redemption prices, conversion rights and liquidation preferences of the shares constituting any series of the preferred
stock, in each case without any further action or vote by our stockholders. Our Board of Directors would be required to make any
determination to issue shares of preferred stock based on its judgment as to what is in our best interests and the best interests
of our stockholders. The Preferred Stock Amendment will give our Board of Directors flexibility, without further stockholder action,
to issue preferred stock on such terms and conditions as our Board of Directors deems to be in our best interests and the best
interests of our stockholders.
The authorization of the “blank check”
preferred stock will provide us with increased financial flexibility in meeting future capital requirements. It will allow preferred
stock to be available for issuance from time to time and with such features as determined by our Board of Directors for any proper
corporate purpose. It is anticipated that such purposes may include, without limitation, exchanging preferred stock for Common
Stock, the issuance for cash as a means of obtaining capital for our use, or issuance as part or all of the consideration required
to be paid by us for acquisitions of other businesses or assets.
The issuance by us of preferred stock could
dilute both the equity interests and the earnings per share of existing holders of our common stock. Such dilution may be substantial,
depending upon the amount of shares issued. The newly authorized shares of preferred stock could also have voting rights superior
to our common stock, and therefore would have a dilutive effect on the voting power of our existing stockholders.
Any issuance of preferred stock with voting
rights could, under certain circumstances, have the effect of delaying or preventing a change in control of our Company by increasing
the number of outstanding shares entitled to vote and by increasing the number of votes required to approve a change in control
of our Company. Shares of voting or convertible preferred stock could be issued, or rights to purchase such shares could be issued,
to render more difficult or discourage an attempt to obtain control of our Company by means of a tender offer, proxy contest, merger
or otherwise. The ability of our Board of Directors to issue such shares of preferred stock, with the rights and preferences it
deems advisable, could discourage an attempt by a party to acquire control of our Company by tender offer or other means. Such
issuances could therefore deprive our stockholders of benefits that could result from such an attempt, such as the realization
of a premium over the market price that such an attempt could cause. Moreover, the issuance of such shares of preferred stock to
persons friendly to our Board of Directors could make it more difficult to remove incumbent managers and directors from office
even if such change were to be favorable to stockholders generally.
The Company has (i) no present plans or commitments
for the issuance or use of the preferred stock in connection with any financing, and (ii) no present plans, proposals or arrangements,
written or otherwise, at this time to issue any of the preferred stock in connection with a merger, share exchange or acquisition.
DISSENTERS’ RIGHTS
There are no dissenters’ rights applicable
with respect to the amendments to our Articles of Incorporation.
INTEREST OF CERTAIN PERSONS IN MATTERS TO
BE ACTED UPON
No director, executive officer, nominee for
election as a director, associate of any director, executive officer or nominee or any other person has any substantial interest,
direct or indirect, by security holdings or otherwise, in the amendments to our Articles of Incorporation, which is not shared
by all other stockholders.
VOTING SECURITIES AND PRINCIPAL HOLDERS THEREOF
Voting Securities
The securities that would have been entitled
to vote if a meeting was required to have been held regarding the amendments to our Articles of Incorporation consist of shares
of our common stock. Each share of our common stock is entitled to one vote. The number of outstanding shares of our common stock
at the close of business on May 19, 2014, the record date for determining our stockholders who would have been entitled to notice
of and to vote on the amendment to our Articles of Incorporation, was 22,567,807 shares.
Security Ownership of Principal Holders and Management
The following table sets forth certain information
as of May 19, 2014, regarding current beneficial ownership of the shares of our common stock by: (i) each person known by us to
own more than 5% of the outstanding shares of our common stock, (ii) each of our executive officers and directors, and (iii) all
of our executive officers and directors as a group. Except as noted, each person has sole voting and sole investment or dispositive
power with respect to the shares shown. The address for all officers and directors listed below is 5604 Wendy Bagwell Parkway,
Ste 223, Hiram, GA, which is the principal executive office address of the Company. The information presented is based upon 22,567,807
outstanding shares of our common stock.
Ownership of Officers and Directors and Principal Stockholders
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Number of Shares
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Percentage
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Name and Address
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Position
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Beneficially Owned
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Of Class
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Officers and Directors
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Ryan Schadel
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Chief Executive Officer, President, Director
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15,339,800
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(1)
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70.1
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%
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Matthew Rodgers
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Director
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100,000
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(2)
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0.5
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%
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Officers and Directors as a Group:
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15,439,800
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70.6
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%
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Principal Stockholders:
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Ryan Schadel
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15,339,800
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70.1
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%
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(1)
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This number includes 15,079,800 shares held directly plus
50,000 shares of common stock
held by Dana Schadel and 210,000 shares of common stock issuable upon the exercise of 210,000 options granted to Dana Schadel,
the wife of Ryan Schadel.
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(2)
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100,000 shares of common stock issuable upon the exercise of 100,000 options granted.
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The Authorized Increase Amendment and the Preferred
Stock Amendment may have the effect of preventing or delaying the acquisition by third parties of a controlling interest in us,
even though the Majority Stockholder owns approximately 66.8% of our currently outstanding voting securities. Our ability to issue
a vastly increased number of voting securities may lead to an increase in the number of votes required in order to approve a future
change in control and may make it substantially more difficult for third parties to gain control of us through a tender offer,
proxy contest, merger or other transaction. The ability to prevent a change in control may deprive our stockholders of any benefits
that may result from such a change in control, including the potential realization of a premium over the market price for our common
stock that such a transaction may cause. Furthermore, the issuance of a large block of additional shares to parties who may be
deemed “friendly” to our Board of Directors may make it more difficult to remove incumbent directors from office, even
if such removal would benefit our common stockholders. Despite these potential anti-takeover effects, however, the Board of Directors
believed that the financial flexibility afforded by any increase in our authorized common stock outweighed any potential disadvantages.
Our management and our Board of Directors have no present intention to use the increased number of authorized common shares for
any anti-takeover purpose.
Our issuance of any additional shares of our
common stock in the future may dilute both the equity interests and the earnings per share of our existing common stockholders.
Such dilution may be substantial, depending on the number of shares issued. Any newly authorized shares of common stock will have
voting and other rights identical to those of the currently authorized shares of common stock.
Changes in Control
There are no present contractual arrangements
or pledges of our securities that may result in a change in control of the Company.
VOTE REQUIRED FOR APPROVAL AND EFFECTIVE
DATE
Nevada Law
Pursuant to the Nevada Revised Statutes, amendments
to the Articles of Incorporation are required to be approved by a majority of our shareholders. This approval could be obtained
either by the written consent of the holders of a majority of our issued and outstanding voting securities, or it could be considered
by our shareholders at a special shareholders’ meeting convened for the specific purpose of approving the name change. The
Company’s voting securities consist of common stock. Each share of common stock is entitled to one vote per share on any
matter requiring shareholder vote. In order to eliminate the costs and management time involved in holding a special meeting, our
Board of Directors voted to utilize the written consent of the majority shareholders. The elimination of the need for a meeting
of shareholders to approve this action is made possible by Section 78.320 of the Nevada Revised Statutes, as may be amended, which
provides that the written consent of the holders of a majority of the outstanding shares of voting capital stock, having no less
than the minimum number of votes which would be necessary to authorize or take such action at a meeting at which all shares entitled
to vote thereon were present.
Resolutions to effect the amendments were unanimously
adopted by our Board of Directors and the Majority Stockholder on May 19, 2014. The Majority Stockholder owns 70.1% of our outstanding
voting securities. No other votes or consents are required or necessary to effect the amendments to our Articles of Incorporation.
Effective Date of Amendment
The effective date of the amendments to our
Articles of Incorporation will be on the opening of business on June 27, 2014, or a date that is 21 days from the mailing of this
Information Statement to our stockholders, subject to the filing of Articles of Amendment to our Articles of Incorporation with
the State of Nevada, Division of Corporations.
NOTICE
THE MAJORITY STOCKHOLDER OF OUR COMPANY HAS CONSENTED TO THE
ADOPTION OF THE AMENDMENT TO OUR ARTICLES OF INCORPORATION BY OWNING IN EXCESS OF THE REQUIRED NUMBER OF OUR OUTSTANDING VOTING
SECURITIES TO ADOPT THE AMENDMENT UNDER NEVADA LAW, AND HAS DONE SO. NO FURTHER CONSENTS, VOTES OR PROXIES ARE NEEDED, AND NONE
ARE REQUESTED.
BY ORDER OF THE BOARD OF DIRECTORS
Date: June 6, 2014
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/s/ Ryan Schadel
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