Value Exchange International, Inc. - Quarter Report: 2008 November (Form 10-Q)

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-Q

Commission file number 000-53537

SINO PAYMENTS, INC.
(Exact name of registrant as specified in its charter)

NEVADA
(State or other jurisdiction of incorporation or organization)

212-214 Des Voeux Rd.
Des Voeux Commercial Building, 12^th Fl.
Sheung Wan, Hong Kong
(Address of principal executive offices, including zip code.)

(852) 2544-0733
(telephone number, including area code)

Check whether the issuer (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the last 90 days.
YES [X]    NO [   ]

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer, “accelerated filer,” “non-accelerated filer,” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). YES [X]    NO [   ]

State the number of shares outstanding of each of the issuer’s classes of common equity, as of the latest practicable date: 14,620,000 as of January 12, 2009

PART I – FINANCIAL INFORMATION

ITEM 1.      FINANCIAL STATEMENTS

-2-

See accompanying notes to financial statements.
F-1

-3-

See accompanying notes to financial statements.
F-2

-4-

See accompanying notes to financial statements.
F-3

-5-

Sino Payments, Inc.
(formerly China Soaring, Inc.)
(A Development Stage Company)
Notes to the Financial Statements
 

F-4

-6-

ITEM 2.      MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION.

     This section of the report includes a number of forward-looking statements that reflect our current views with respect to future events and financial performance. Forward-looking statements are often identified by words like: believe, expect, estimate, anticipate, intend, project and similar expressions, or words which, by their nature, refer to future events. You should not place undue certainty on these forward-looking statements, which apply only as of the date of this report. These forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from historical results or our predictions.

     We are a start-up stage corporation and have not started operations or generated or realized any revenues from our business operations.

     There is substantial doubt that we can continue as an on-going business for the next twelve months unless we obtain additional capital to pay our bills. This is because we have not generated any revenues and no revenues are anticipated until we complete the development of our website, source out purveyors of services for products to sell and source out clients to buy our services. We believe the technical aspects of our website will be sufficiently developed to use for our operations 90 days from the completion of our offering. Accordingly, we must raise cash from sources other than operations. Our only other source for cash at this time is investments by others in our company. We may need to raise more cash to implement our project and begin our operations. We do not know how long money raised in our public offering, will last, however, we do believe that we can continue operation for at least twelve months.

     We believe that we have raised enough money through our public offering to begin operations but we cannot guarantee that once we begin operations we will stay in business after operations have commenced. If we are unable to successfully negotiate strategic alliances with purveyors of services to enable us to offer these services to our clients, or if we are unable to attract enough clients to utilize our services, we may quickly use up the proceeds from the minimum amount of money from our public offering and will need to find alternative sources, like a second public offering, a private placement of securities, or loans from our officers or others in order for us to maintain our operations. At the present time, we have not made any arrangements to raise additional cash, other than through our public offering.

Plan of Operation

     We believe with the completion of our placement, we can satisfy our cash requirements during the next 12 months. At this time, we intend to focus our research and development to upgrading our IP payment processing global platform as needed by our expanding list of potential customer projects. We expect to purchase 3-5 computer servers and related technology equipment. Further we do not expect significant changes in the number of employees.

     We have completed the public offering and our specific goal is to profitably provide credit and debit card processing services primarily to large multinational retail store groups located in Asia. We intend to accomplish the foregoing through the following milestones:

-7-

     In summary, we should implement our business plan and expect to be receiving orders in 2009. We estimate that we will generate revenue 120 to 180 days after beginning operations.

     We believe we will be able to offer credit and debit card processing services to potential clients in early 2009.

     If we are unable to negotiate suitable terms with customers to enable us to provide credit and/or debit card processing services, or if we are unable to attract clients to use our credit and debit card processing services, we may have to suspend or cease operations.

     If we cannot generate sufficient revenues to continue operations, we will suspend or cease operations. If we cease operations, we do not know what we will do and we do not have any plans to do anything else.

Limited operating history; need for additional capital

     There is limited historical financial information about us upon which to base an evaluation of our performance. We are in start-up stage operations and have not generated any revenues. We cannot guarantee we will be successful in our business operations. Our business is subject to risks inherent in the establishment of a new business enterprise, including limited capital resources and possible cost overruns due to price and cost increases in services and products.

     To become profitable and competitive, we have to locate and negotiate agreements with merchants to allow us to provide credit and debit card processing services for fees. We are seeking equity financing to provide for the capital required to implement our operations.

-8-

     We have no assurance that future financing will be available to us on acceptable terms. If financing is not available on satisfactory terms, we may be unable to continue, develop or expand our operations. Equity financing could result in additional dilution to existing shareholders.

Results of Operations

From Inception on June 26, 2007 to November 30, 2008

     Since inception, we incorporated the company, hired the attorney, and hired the auditor for the preparation of this report. We have prepared an internal business plan. We have established the website “www.sinopayments.com”. Our loss since inception is $ 80,034, all of which is for the general and administrative expenses. We have begun to establish our operations and have begun actively marketing our services to potential clients and related partners. We expect to further develop our operations and to sign initial customer agreements for provision of our services in early 2009.

     Since inception, we sold 13,000,000 shares of common stock to our former sole officer and director and three other persons for $130. On August 1, 2008 we completed our public offering. We sold 1,620,000 shares of common stock to 50 investors raising $81,000.

Liquidity and capital resources

     As of the date of this report, we have yet to generate any revenues from our business operations.

     On August 7, 2007 we issued 10,000,000 restricted shares of common stock to Paul F. Manning our former sole officer and director in consideration of $100; 1,040,000 restricted shares of common stock to Bradley Miller in consideration of $10.40; 960,000 restricted shares of common stock to Moon Gate Ltd. in consideration of $9.60; and, 1,000,000 restricted shares of common stock to Greater Asia Capital Ltd. in consideration of $10.00, all pursuant to the exemption from registration contained in section 4(2) of the Securities Act of 1933. The foregoing was accounted for as sales of common stock.

     On August 1, 2008 we completed our public offering a placement to 50 shareholders for 1,620,000 shares in consideration of $81,000.

-9-

Use of Proceeds

     On November 28, 2007, the SEC declared our Form SB-2 registration statement effective (SEC Filing No. 333-147493), permitting us to sell up to 3,000,000 shares of common stock at an offering price of $0.05 per share. There was no underwriter involved in our public offering. On August 1, 2008, we completed our public offering by selling 1,620,000 shares of common stock to 50 individuals and raised $81,000. Since then we have spent the proceeds as follows:

     As of the closing of our $81,000 offering on August 1, 2008, we have changed the name of our Company to Sino Payments, Inc. to reflect the change in our Company’s business to that of providing debit and credit card processing services to retailers throughout Asia. To further this effort, we expanded the Board of Directors to 3 and added Anthony Robinson who is based in Shanghai to our initial team of Paul Manning and our Chairman Matthew Mecke.

     Sino Payments has completed the creation of our Global Payment Processing Platform (SinoPay) and we are in the process of reviewing future potential projects and the need for version 2.0 upgrades to our initial system.

     In addition to setting up our offices in Hong Kong, we also completed an arrangement for the hosting of servers for the purpose of creating an R&D and testing network for our IP payment processing hub from the servers located in our offices in Hong Kong. We have installed an initial server and plan to upgrade the cluster in Q1 2009 and to increase the dedicated data lines to that network to enhance our ability to remotely update and manage this R&D and testing computer network cluster.

     Sino Payments signed a Memorandum of Understanding with PowerE2E in Shanghai for the purpose of creating a joint marketing effort with PowerE2E to sell Sino Payments IP processing services to their new and existing clients. In addition the MOU provides for support from PowerE2E’s data center in Shanghai for the hosting and maintenance of Sino Payments systems in Shanghai should such a need arise as per mutual expectations.

     The Company is also actively marketing our IP payment processing services to TAP Group with its headquarters in Hong Kong also as a joint marketing effort to their existing and new clients. This process is going well and we hope to have further news related to this joint marketing effort in Q1 2009.

-10-

     As a result of these and other ongoing marketing and sales efforts, we hope to have initial customer client contracts in the near future and will use these funds to support our administrative, sales, and R&D efforts.

     We do anticipate adding some programming staff in the near future but we prefer to keep the organization lean and utilize consulting agreements on both short and long term periods whenever possible. Other than these costs, we will attempt to keep our cost base in line with our ability to receive funds from customer contracts going forward.

     As of November 30, 2008, our total assets were $2,058 and our total liabilities were $962. As of November 30, 2008, we had cash of $326.

 
ITEM 3.      QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

     We are a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 and are not required to provide the information under this item.

 
ITEM 4.      CONTROLS AND PROCEDURES.

Evaluation of Disclosure Controls and Procedures

     We maintain “disclosure controls and procedures,” as such term is defined in Rule 13a-15(e) under the Securities Exchange Act of 1934 (the “Exchange Act”), that are designed to ensure that information required to be disclosed in our Exchange Act reports is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission rules and forms, and that such information is accumulated and communicated to our management, including our Principal Executive Officer and Principal Financial Officer, as appropriate, to allow timely decisions regarding required disclosure. We conducted an evaluation under the supervision and with the participation of our Principal Executive Officer and Principal Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures as of the end of the period covered by this report pursuant to Rule 13a-15 of the Exchange Act. Based on this Evaluation, our Principal Executive Officer and Principal Financial Officer concluded that our Disclosure Controls were not effective as of the end of the period covered by this report due to adjustments identified by our Registered Public Accounting Firm. The adjustments were in the areas of expense recognition and accumulated deficit. .

Changes in Internal Controls

     We have also evaluated our internal controls for financial reporting, and there have been no significant changes in our internal controls or in other factors that could significantly affect those controls subsequent to the date of their last evaluation.

-11-

PART II. OTHER INFORMATION

ITEM 1A.    RISK FACTORS

     We are a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 and are not required to provide the information under this item.

 
ITEM 2.      UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.

     On November 28, 2007 at 4:00 p.m, the Securities and Exchange Commission declared our Form SB-2 Registration Statement effective (File number 333-147493) permitting us to offer up to 3,000,000 shares of common stock at $0.05 per share. There was no underwriter involved in our public offering. As of the date of this report, we raised $81,000 in total funds in our public offering and, as a result, closed the offering on August 1, 2008. As of the date of this report, we have spent the proceeds as follows:

 
ITEM 6.      EXHIBITS.

     The following documents are included herein:

-12-

SIGNATURES

     Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following person on behalf of the Registrant and in the capacities on this 14^th day of January, 2009.

-13-

EXHIBIT INDEX

-14-