IYSA 542% .009, .0065 X .008 MERGER COMPLETION 8-K
SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of report (Date of earliest event reported): November 19, 2007
INTELISYS AVIATION SYSTEMS OF AMERICA, INC. (Exact name of registrant as specified in Charter)
Delaware
000-26777
(State or other jurisdiction of incorporation or organization)
(Commission File No.)
(IRS Employee Identification No.)
RM 1302-3 13/F, Crocodile House II, 55 Connaught Road Central Hong Kong (Address of Principal Executive Offices)
86 591 28308388 (Issuer Telephone number)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
The Current Report on Form 8-K contains forward looking statements that involve risks and uncertainties, principally in the sections entitled "Description of Business,” “Risk Factors,” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” All statements other than statements of historical fact contained in this Current Report on Form 8-K, including statements regarding future events, our future financial performance, business strategy and plans and objectives of management for future operations, are forward-looking statements. We have attempted to identify forward-looking statements by terminology including “anticipates,” “believes,” “can,” “continue,” “could,” “estimates,” “expects,” “intends,” “may,” “plans,” “potential,” “predicts,” “should,” or “will” or the negative of these terms or other comparable terminology. Although we do not make forward looking statements unless we believe we have a reasonable basis for doing so, we cannot guarantee their accuracy. These statements are only predictions and involve known and unknown risks, uncertainties and other factors, including the risks outlined under “Risk Factors” or elsewhere in this Current Report on Form 8-K, which may cause our or our industry’s actual results, levels of activity, performance or achievements expressed or implied by these forward-looking statements. Moreover, we operate in a very competitive and rapidly changing environment. New risks emerge from time to time and it is not possible for us to predict all risk factors, nor can we address the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause our actual results to differ materially from those contained in any forward-looking statements.
We have based these forward-looking statements largely on our current expectations and projections about future events and financial trends that we believe may affect our financial condition, results of operations, business strategy, short term and long term business operations , and financial needs. These forward-looking statements are subject to certain risks and uncertainties that could cause our actual results to differ materially from those reflected in the forward looking statements. Factors that could cause or contribute to such differences include, but are not limited to, those discussed in this Current Report on Form 8-K, and in particular, the risks discussed below and under the heading “Risk Factors” and those discussed in other documents we file with the Securities and Exchange Commission that are incorporated into this Current Report on Form 8-K by reference. The following discussion should be read in conjunction with our annual report on Form 10-K and our quarterly reports on Form 10-Q incorporated into this Current Report on Form 8-K by reference, and the consolidated financial statements and notes thereto included in our annual and quarterly reports. We undertake no obligation to revise or publicly release the results of any revision to these forward-looking statements. In light of these risks, uncertainties and assumptions, the forward-looking events and circumstances discussed in this Current Report on Form 8-K may not occur and actual results could differ materially and adversely from those anticipated or implied in the forward-looking statement.
You should not place undue reliance on any forward-looking statement, each of which applies only as of the date of this Current Report on Form 8-K. Before you invest in our common stock, you should be aware that the occurrence of the events described in the section entitled “Risk Factors” and elsewhere in this Current Report on Form 8-K could negatively affect our business, operating results, financial condition and stock price. Except as required by law, we undertake no obligation to update or revise publicly any of the forward-looking statements after the date of this Current Report on Form 8-K to conform our statements to actual results or changed expectations.
2
Item 1.01 Entry Into A Material Definitive Agreement
As more fully described in Item 2.01 below, on November 19, 2007, we entered into a Stock Purchase Agreement and Share Exchange (the “Exchange Agreement”) with Keenway Limited, a company incorporated under the laws of the Cayman Islands and each of the equity owners of Keenway Limited (“Keenway”). The closing of the transaction took place on November 19, 2007 (the “Closing Date”) and resulted in the merger between us and Keenway (the “Merger”). Pursuant to the terms of the Exchange Agreement, we acquired all of the outstanding capital stock and ownership interests of Keenway (the “Interests”) from the Keenway Shareholders for an aggregate of 94,545,042 shares, or 94.5% of the Company’s common stock. In addition, Keenway agreed to pay cash of $550,000.
Keenway is a corporation formed on May 9, 2007 under the laws of Cayman Islands. Keenway holds 100% of the issued and outstanding stock and ownership of Hong Kong Yi Tat International Investment Limited, a limited company incorporated under the laws of Hong Kong Special Administration Region.
Prior to the closing of the Exchange Agreement, Chen Minhua, Fan Yanling, Extra Profit International Limited, Luck Glory International Limited a nd Zhang Xinchen were the shareholders of Keenway (the “Keenway Shareholders”). In addition, Chen Minhua and Fan Yanling were officers and directors of Keenway.
As a result of the Exchange Agreement, the Keenway Shareholders transferred all their interest in Keenway to the Company and, as a result, Keenway became a wholly owned subsidiary of the Company, which in turn, made the Company the indirect owner of the Hong Kong subsidiary of Keenway.
As a further condition of the Exchange Agreement, the current officers and directors of the Company resigned and new officers and directors of the Company were appointed.
The merger agreement contains customary terms and conditions for a transaction of this type, including representations, warranties and covenants, as well as provisions describing the merger consideration, the process of exchanging the consideration and the effect of the merger. Specifically, the Exchange Agreement also requires that the Company cancel all outstanding options, warrants and convertible preferred stock prior to the closing of the Exchange Agreement.
This transaction is discussed more fully in Section 2.01 of this Current Report. This brief discussion is qualified by reference to the provisions of the Exchange Agreement which is attached to this report as Exhibit 2.2.
Item 2.01 Completion of Acquisition or Disposition of Assets
CLOSING OF EXCHANGE AGREEMENT
As described in Item 1.01 above, on November 19, 2007, we acquired Keenway Limited, a company incorporated under the laws of the Cayman Islands, in accordance with the Exchange Agreement. The closing of the transaction took place on November 19, 2007 (the “Closing Date”). On the Closing Date, pursuant to the terms of the Exchange Agreement, we acquired all of the outstanding capital stock and ownership interests of Keenway from the Keenway Shareholders; and the Keenway Shareholders transferred and contributed all of their share interests in Keenway to us. In exchange, we issued to the Keenway Shareholders 94,545,042 shares, or approximately 94.5% of our common stock. On the Closing Date, Keenway became our wholly owned subsidiary.
Keenway owns 100% of the issued and outstanding capital stock of Hong Kong Yi Tat International Investment Limited, a limited company incorporated under the laws Hong Kong Special Administration Region. Prior to the Merger, Chen Minhua owned 43.4% of the issued and outstanding capital stock of Keenway; Fan Yanling owned 43.4% of Keenway, Extra Profit International owned 4.5% of Keenway; Luck Glory International owned 4.5% of Keenway and Zhang Xinchen owned 4.2% of the issued and outstanding capital stock of Keenway.
3
The Registrant was a “shell company” (as such term is defined in Rule 12b-2 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) immediately before the completion of the Merger. Accordingly, pursuant to the requirements of Item 2.01(a)(f) of Form 8-K, set forth below is the information that would be required if the Company were filing a general form for registration of securities on Form 10-SB under the Exchange Act, reflecting the Company’s common stock, which is the only class of its securities subject to the reporting requirements of Section 13 or Section 15(d) of the Exchange Act upon consummation of the Merger, with such information reflecting the Company and its securities upon consummation of the Merger.
BUSINESS
DESCRIPTION OF BUSINESS
We were originally incorporated on June 4, 1999 as Apta Holdings, Inc. (“Apta”) in the State of Delaware. Apta was a wholly owned subsidiary of ARCA Corp. and Apta subsequently acquired all of ARCA’s assets and liabilities as part of ARCA’s merger with another company.
On November 22, 2002, Apta entered into a Share Exchange Agreement with Convergix, Inc. whereby Apta acquired all of the shares of Convergix in exchange for issuing 25,000,000 shares of Apta to the shareholders of Convergix, Inc. Pursuant to this Share Exchange Agreement, the control of Apta changed and Ralph Eisenschmid, Jock English and Malcolm Little became the new directors of Apta. As part of the Share Exchange Agreement, Apta changed its name to InteliSys Aviation Systems of America, Inc.(“InteliSys”) to better reflect its business. This name change was filed with the State of Delaware on July 21, 2003. In addition, Apta increased its authorized shares to 50,000,000 as evidenced by the Amendment filed with the State of Delaware on December 5, 2003.
Prior to June 29, 2006, InteliSys was a provider of integrated software solutions for regional, mid-sized airlines and fleet operators.
On June 29, 2006, certain of our subsidiaries which were incorporated in Canada, Convergix Inc., Cynaptec Information Systems Inc., InteliSys Aviation Systems Inc., InteliSys Acquisition Inc., and InteliSys (NS) Co. (the “Canadian Subsidiaries”), filed with the Queens Bench of the Province of New Brunswick, Canada, a Notice of Intention to make a Proposal under the Canadian Bankruptcy and Insolvency Act (the “Notice of Intention”).
On August 7, 2006, we filed with the Queens Bench of the Province of New Brunswick, Canada, a Notice of Intention to make a Proposal under the Canadian Bankruptcy and Insolvency Act (the “Notice of Intention”).
On August 31, 2006, we filed with the Queens Bench a proposal to make a settlement with our creditors pursuant to Section 50.4(1) of the Canadian Bankruptcy and Insolvency Act (the “Settlement Proposal”), in which we proposed that our debts be settled as follows: (a) Secured creditors will be paid in accordance with present arrangements or as may be arranged between them and us; (b) Holders of preferred claims under the Canadian Bankruptcy and Insolvency Act will be paid by September 30, 2006; (c) Tax liabilities owed by us to the Canadian government will be paid within 90 days after the Settlement Proposal is approved by the Queens Bench; and (d) Unsecured creditors will be paid by September 30, 2006.
On October 4, 2006, the proposal submitted by us and the proposal submitted by our subsidiaries in the Court of Queen’s Bench of the Province of New Brunswick, Canada were approved by the Court. Pursuant to such proposal, a new company consisting of our existing employees and a group of new equity investors (“Newco”) would acquire all the assets of our subsidiaries (the “Subsidiaries”). Jock English, Chief Operating Officer of our Company, would be the Chief Executive Officer and President of Newco. The consideration for such purchase would consist of $200,000 CDN in cash and $250,000 CDN in 3-year 8% notes to be issued by Newco (the “Newco Notes”). Such notes would be secured by all the assets of Newco. In addition, the beneficial ownership of Newco would be held by certain of the current employees of the Subsidiaries and irrevocably transferred to the holders of the Notes if the intellectual property of Newco was ever sold, there would be a sale of more than 51% of the initial common shares of Newco or the initiation of any process to take Newco public within 3 years of the Court Order. If the Newco Notes were in default, the 3-year period would be extended to 5 years.
4
In accordance with the terms of the proposal, the secured claims of the creditors of the Subsidiaries were assumed by Newco. The unsecured claims of our creditors received $1,250 CDN within two months of court approval of the proposal. After the payment of fees and any taxes owed pursuant to the Income Tax Act (Canada), the Class A Unsecured Creditors of the Subsidiaries received $150 CDN in cash for each claim, the balance of cash from the sale of assets after payment to secured creditors and the balance thereof by having their respective proportion share of the Newco Notes. We, as the Class B Creditor, did not receive any cash or Newco notes from the sale of the subsidiaries. The Class C creditors (the employees of the subsidiaries) received $50,000 CDN in Newco notes which were distributed on a prorata basis.
The Court of Queen’s Bench of the Province of New Brunswick, Canada approved the proposals on October 6, 2006. The Court issued a Court Order ordering the sale of all assets of the subsidiaries to Newco, subject to the conditions of the proposal.
On November 17, 2006, subject to the terms of the Court Order issued by the Court of Queen's Bench of the Province of New Brunswick, all assets of the Canadian Subsidiaries were sold to 627450 New Brunswick Inc.
Since November 17, 2006, we did not have any operations or revenues and had decided to attempt to acquire other assets or business operations that will maximize shareholder value.
BUSINESS DEVELOPMENT OF KEENWAY
Overview
Keenway Limited is a company incorporated under the laws of Cayman Islands and owns 100% of the issued and outstanding capital stock of Hong Kong Yi Tat International Investment Limited, a limited company incorporated under the laws of Hong Kong Special Administration Region (“Yi Tat”). Yi Tat owns 100% of the issued and outstanding capital stock of Fujian Jintai Tourism Development, a company formed under the laws of the PRC (“Fujian Jintai,” collectively, referred to herein as “Keenway” or the “Company”).
Business
Our operations are headquartered in China. We are a profitable, mid-sized Chinese company that focuses primarily on two industries: 1)
tourism; and 2)
mass media.
Fujian Jintai Tourism Industrial Development Co., Ltd. is an entity that was established on October 29, 2001, and is domiciled at Floor 4, 1, Helping Street, Taining County, Fujian Province. Its primary business relates to tourism and, specifically, tourism at the Great Golden Lake. The company offers bamboo rafting, parking lot service, photography services and ethnic cultural communications.
Fujian FETV Media Co., Ltd. is the entity that concentrates on the mass media portion of the business and was established on October 9, 2004 and is domiciled in Wangjiang Tower, 18, Longgu Holiday Inn, Langqi Economic Zone, Fuzhou City. Its primary business is focused on advertisements, including media publishing, television, cultural and artistic communication activities, and performance operation and management activities.
Fujian Fuyu Advertising Co., Ltd. is an entity established on April 24, 2007 and its primary place of business is located at Room 309, (Langqi Economic Development Company), Guoyuzhou, Hongqi Administration Area, Langqi Town, Langqi Economic Zone, Fuzhou City.
These three businesses of the Company provide it with a unique opportunity to integrate industries that are at the forefront of Chinese growth. The Company’s business plan focuses around the combination of tourism and mass media and creating growth through the use of relationships established by the Company.
SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of report (Date of earliest event reported): November 19, 2007
INTELISYS AVIATION SYSTEMS OF AMERICA, INC. (Exact name of registrant as specified in Charter)
Delaware
000-26777
(State or other jurisdiction of incorporation or organization)
(Commission File No.)
(IRS Employee Identification No.)
RM 1302-3 13/F, Crocodile House II, 55 Connaught Road Central Hong Kong (Address of Principal Executive Offices)
86 591 28308388 (Issuer Telephone number)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
The Current Report on Form 8-K contains forward looking statements that involve risks and uncertainties, principally in the sections entitled "Description of Business,” “Risk Factors,” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” All statements other than statements of historical fact contained in this Current Report on Form 8-K, including statements regarding future events, our future financial performance, business strategy and plans and objectives of management for future operations, are forward-looking statements. We have attempted to identify forward-looking statements by terminology including “anticipates,” “believes,” “can,” “continue,” “could,” “estimates,” “expects,” “intends,” “may,” “plans,” “potential,” “predicts,” “should,” or “will” or the negative of these terms or other comparable terminology. Although we do not make forward looking statements unless we believe we have a reasonable basis for doing so, we cannot guarantee their accuracy. These statements are only predictions and involve known and unknown risks, uncertainties and other factors, including the risks outlined under “Risk Factors” or elsewhere in this Current Report on Form 8-K, which may cause our or our industry’s actual results, levels of activity, performance or achievements expressed or implied by these forward-looking statements. Moreover, we operate in a very competitive and rapidly changing environment. New risks emerge from time to time and it is not possible for us to predict all risk factors, nor can we address the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause our actual results to differ materially from those contained in any forward-looking statements.
We have based these forward-looking statements largely on our current expectations and projections about future events and financial trends that we believe may affect our financial condition, results of operations, business strategy, short term and long term business operations , and financial needs. These forward-looking statements are subject to certain risks and uncertainties that could cause our actual results to differ materially from those reflected in the forward looking statements. Factors that could cause or contribute to such differences include, but are not limited to, those discussed in this Current Report on Form 8-K, and in particular, the risks discussed below and under the heading “Risk Factors” and those discussed in other documents we file with the Securities and Exchange Commission that are incorporated into this Current Report on Form 8-K by reference. The following discussion should be read in conjunction with our annual report on Form 10-K and our quarterly reports on Form 10-Q incorporated into this Current Report on Form 8-K by reference, and the consolidated financial statements and notes thereto included in our annual and quarterly reports. We undertake no obligation to revise or publicly release the results of any revision to these forward-looking statements. In light of these risks, uncertainties and assumptions, the forward-looking events and circumstances discussed in this Current Report on Form 8-K may not occur and actual results could differ materially and adversely from those anticipated or implied in the forward-looking statement.
You should not place undue reliance on any forward-looking statement, each of which applies only as of the date of this Current Report on Form 8-K. Before you invest in our common stock, you should be aware that the occurrence of the events described in the section entitled “Risk Factors” and elsewhere in this Current Report on Form 8-K could negatively affect our business, operating results, financial condition and stock price. Except as required by law, we undertake no obligation to update or revise publicly any of the forward-looking statements after the date of this Current Report on Form 8-K to conform our statements to actual results or changed expectations.
2
Item 1.01 Entry Into A Material Definitive Agreement
As more fully described in Item 2.01 below, on November 19, 2007, we entered into a Stock Purchase Agreement and Share Exchange (the “Exchange Agreement”) with Keenway Limited, a company incorporated under the laws of the Cayman Islands and each of the equity owners of Keenway Limited (“Keenway”). The closing of the transaction took place on November 19, 2007 (the “Closing Date”) and resulted in the merger between us and Keenway (the “Merger”). Pursuant to the terms of the Exchange Agreement, we acquired all of the outstanding capital stock and ownership interests of Keenway (the “Interests”) from the Keenway Shareholders for an aggregate of 94,545,042 shares, or 94.5% of the Company’s common stock. In addition, Keenway agreed to pay cash of $550,000.
Keenway is a corporation formed on May 9, 2007 under the laws of Cayman Islands. Keenway holds 100% of the issued and outstanding stock and ownership of Hong Kong Yi Tat International Investment Limited, a limited company incorporated under the laws of Hong Kong Special Administration Region.
Prior to the closing of the Exchange Agreement, Chen Minhua, Fan Yanling, Extra Profit International Limited, Luck Glory International Limited a nd Zhang Xinchen were the shareholders of Keenway (the “Keenway Shareholders”). In addition, Chen Minhua and Fan Yanling were officers and directors of Keenway.
As a result of the Exchange Agreement, the Keenway Shareholders transferred all their interest in Keenway to the Company and, as a result, Keenway became a wholly owned subsidiary of the Company, which in turn, made the Company the indirect owner of the Hong Kong subsidiary of Keenway.
As a further condition of the Exchange Agreement, the current officers and directors of the Company resigned and new officers and directors of the Company were appointed.
The merger agreement contains customary terms and conditions for a transaction of this type, including representations, warranties and covenants, as well as provisions describing the merger consideration, the process of exchanging the consideration and the effect of the merger. Specifically, the Exchange Agreement also requires that the Company cancel all outstanding options, warrants and convertible preferred stock prior to the closing of the Exchange Agreement.
This transaction is discussed more fully in Section 2.01 of this Current Report. This brief discussion is qualified by reference to the provisions of the Exchange Agreement which is attached to this report as Exhibit 2.2.
Item 2.01 Completion of Acquisition or Disposition of Assets
CLOSING OF EXCHANGE AGREEMENT
As described in Item 1.01 above, on November 19, 2007, we acquired Keenway Limited, a company incorporated under the laws of the Cayman Islands, in accordance with the Exchange Agreement. The closing of the transaction took place on November 19, 2007 (the “Closing Date”). On the Closing Date, pursuant to the terms of the Exchange Agreement, we acquired all of the outstanding capital stock and ownership interests of Keenway from the Keenway Shareholders; and the Keenway Shareholders transferred and contributed all of their share interests in Keenway to us. In exchange, we issued to the Keenway Shareholders 94,545,042 shares, or approximately 94.5% of our common stock. On the Closing Date, Keenway became our wholly owned subsidiary.
Keenway owns 100% of the issued and outstanding capital stock of Hong Kong Yi Tat International Investment Limited, a limited company incorporated under the laws Hong Kong Special Administration Region. Prior to the Merger, Chen Minhua owned 43.4% of the issued and outstanding capital stock of Keenway; Fan Yanling owned 43.4% of Keenway, Extra Profit International owned 4.5% of Keenway; Luck Glory International owned 4.5% of Keenway and Zhang Xinchen owned 4.2% of the issued and outstanding capital stock of Keenway.
3
The Registrant was a “shell company” (as such term is defined in Rule 12b-2 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) immediately before the completion of the Merger. Accordingly, pursuant to the requirements of Item 2.01(a)(f) of Form 8-K, set forth below is the information that would be required if the Company were filing a general form for registration of securities on Form 10-SB under the Exchange Act, reflecting the Company’s common stock, which is the only class of its securities subject to the reporting requirements of Section 13 or Section 15(d) of the Exchange Act upon consummation of the Merger, with such information reflecting the Company and its securities upon consummation of the Merger.
BUSINESS
DESCRIPTION OF BUSINESS
We were originally incorporated on June 4, 1999 as Apta Holdings, Inc. (“Apta”) in the State of Delaware. Apta was a wholly owned subsidiary of ARCA Corp. and Apta subsequently acquired all of ARCA’s assets and liabilities as part of ARCA’s merger with another company.
On November 22, 2002, Apta entered into a Share Exchange Agreement with Convergix, Inc. whereby Apta acquired all of the shares of Convergix in exchange for issuing 25,000,000 shares of Apta to the shareholders of Convergix, Inc. Pursuant to this Share Exchange Agreement, the control of Apta changed and Ralph Eisenschmid, Jock English and Malcolm Little became the new directors of Apta. As part of the Share Exchange Agreement, Apta changed its name to InteliSys Aviation Systems of America, Inc.(“InteliSys”) to better reflect its business. This name change was filed with the State of Delaware on July 21, 2003. In addition, Apta increased its authorized shares to 50,000,000 as evidenced by the Amendment filed with the State of Delaware on December 5, 2003.
Prior to June 29, 2006, InteliSys was a provider of integrated software solutions for regional, mid-sized airlines and fleet operators.
On June 29, 2006, certain of our subsidiaries which were incorporated in Canada, Convergix Inc., Cynaptec Information Systems Inc., InteliSys Aviation Systems Inc., InteliSys Acquisition Inc., and InteliSys (NS) Co. (the “Canadian Subsidiaries”), filed with the Queens Bench of the Province of New Brunswick, Canada, a Notice of Intention to make a Proposal under the Canadian Bankruptcy and Insolvency Act (the “Notice of Intention”).
On August 7, 2006, we filed with the Queens Bench of the Province of New Brunswick, Canada, a Notice of Intention to make a Proposal under the Canadian Bankruptcy and Insolvency Act (the “Notice of Intention”).
On August 31, 2006, we filed with the Queens Bench a proposal to make a settlement with our creditors pursuant to Section 50.4(1) of the Canadian Bankruptcy and Insolvency Act (the “Settlement Proposal”), in which we proposed that our debts be settled as follows: (a) Secured creditors will be paid in accordance with present arrangements or as may be arranged between them and us; (b) Holders of preferred claims under the Canadian Bankruptcy and Insolvency Act will be paid by September 30, 2006; (c) Tax liabilities owed by us to the Canadian government will be paid within 90 days after the Settlement Proposal is approved by the Queens Bench; and (d) Unsecured creditors will be paid by September 30, 2006.
On October 4, 2006, the proposal submitted by us and the proposal submitted by our subsidiaries in the Court of Queen’s Bench of the Province of New Brunswick, Canada were approved by the Court. Pursuant to such proposal, a new company consisting of our existing employees and a group of new equity investors (“Newco”) would acquire all the assets of our subsidiaries (the “Subsidiaries”). Jock English, Chief Operating Officer of our Company, would be the Chief Executive Officer and President of Newco. The consideration for such purchase would consist of $200,000 CDN in cash and $250,000 CDN in 3-year 8% notes to be issued by Newco (the “Newco Notes”). Such notes would be secured by all the assets of Newco. In addition, the beneficial ownership of Newco would be held by certain of the current employees of the Subsidiaries and irrevocably transferred to the holders of the Notes if the intellectual property of Newco was ever sold, there would be a sale of more than 51% of the initial common shares of Newco or the initiation of any process to take Newco public within 3 years of the Court Order. If the Newco Notes were in default, the 3-year period would be extended to 5 years.
4
In accordance with the terms of the proposal, the secured claims of the creditors of the Subsidiaries were assumed by Newco. The unsecured claims of our creditors received $1,250 CDN within two months of court approval of the proposal. After the payment of fees and any taxes owed pursuant to the Income Tax Act (Canada), the Class A Unsecured Creditors of the Subsidiaries received $150 CDN in cash for each claim, the balance of cash from the sale of assets after payment to secured creditors and the balance thereof by having their respective proportion share of the Newco Notes. We, as the Class B Creditor, did not receive any cash or Newco notes from the sale of the subsidiaries. The Class C creditors (the employees of the subsidiaries) received $50,000 CDN in Newco notes which were distributed on a prorata basis.
The Court of Queen’s Bench of the Province of New Brunswick, Canada approved the proposals on October 6, 2006. The Court issued a Court Order ordering the sale of all assets of the subsidiaries to Newco, subject to the conditions of the proposal.
On November 17, 2006, subject to the terms of the Court Order issued by the Court of Queen's Bench of the Province of New Brunswick, all assets of the Canadian Subsidiaries were sold to 627450 New Brunswick Inc.
Since November 17, 2006, we did not have any operations or revenues and had decided to attempt to acquire other assets or business operations that will maximize shareholder value.
BUSINESS DEVELOPMENT OF KEENWAY
Overview
Keenway Limited is a company incorporated under the laws of Cayman Islands and owns 100% of the issued and outstanding capital stock of Hong Kong Yi Tat International Investment Limited, a limited company incorporated under the laws of Hong Kong Special Administration Region (“Yi Tat”). Yi Tat owns 100% of the issued and outstanding capital stock of Fujian Jintai Tourism Development, a company formed under the laws of the PRC (“Fujian Jintai,” collectively, referred to herein as “Keenway” or the “Company”).
Business
Our operations are headquartered in China. We are a profitable, mid-sized Chinese company that focuses primarily on two industries: 1)
tourism; and 2)
mass media.
Fujian Jintai Tourism Industrial Development Co., Ltd. is an entity that was established on October 29, 2001, and is domiciled at Floor 4, 1, Helping Street, Taining County, Fujian Province. Its primary business relates to tourism and, specifically, tourism at the Great Golden Lake. The company offers bamboo rafting, parking lot service, photography services and ethnic cultural communications.
Fujian FETV Media Co., Ltd. is the entity that concentrates on the mass media portion of the business and was established on October 9, 2004 and is domiciled in Wangjiang Tower, 18, Longgu Holiday Inn, Langqi Economic Zone, Fuzhou City. Its primary business is focused on advertisements, including media publishing, television, cultural and artistic communication activities, and performance operation and management activities.
Fujian Fuyu Advertising Co., Ltd. is an entity established on April 24, 2007 and its primary place of business is located at Room 309, (Langqi Economic Development Company), Guoyuzhou, Hongqi Administration Area, Langqi Town, Langqi Economic Zone, Fuzhou City.
These three businesses of the Company provide it with a unique opportunity to integrate industries that are at the forefront of Chinese growth. The Company’s business plan focuses around the combination of tourism and mass media and creating growth through the use of relationships established by the Company.
-------------------- Men lie......Women lie........numbers don't......... Posts: 526 | From: Atlantic city | Registered: Mar 2006
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