Activeworlds Corp. To Acquire A Leading Chinese 24-K Gold Jewelry Manufacturer
NEW YORK--(BUSINESS WIRE)--Activeworlds Corp. (OTCBB:AWLD) (the “Company”), announced that it has entered into a definitive agreement to acquire Wuhan Kingold Jewelry Co., Ltd., (“Kingold”). Kingold, located in Wuhan, Hubei Province, was founded in 2002 and is a leading Chinese designer and manufacturer of 24-K gold jewelry.
The transaction is structured as an acquisition of the corporate parent of Wuhan Vogue-Show Jewelry Co., Ltd. (“Vogue Show”), a People’s Republic of China (“PRC”) corporation which has entered into a series of captive agreements with Kingold pursuant to which it will receive 95.83% of the profits of Kingold. Known as a variable interest agreement or “VIE”, this is a common structure used to acquire PRC corporations within certain industries designated by MOFCOM, the PRC’s Ministry of Commerce. Vogue Show, a wholly-foreign owned enterprise (“WFOE”), is owned by Dragon Lead Group Limited, a British Virgin Islands corporation. At the closing, Activeworlds will acquire 100% of Dragon Lead Group Limited.
Consummation of the acquisition is subject to numerous conditions, including satisfactory due diligence reviews conducted by Activeworlds and Kingold and a private placement of Activeworlds common stock and warrants in the amount of $5 million prior to the closing. Thus, there can be no assurance that the transaction will be consummated.
Additional information concerning the transaction will be included in the necessary and appropriate filings with the Securities and Exchange Commission.
This news release may contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Act of 1934, as amended; such statements are subject to risks and uncertainties that could cause actual results to vary materially from those projected in the forward-looking statements. The Company may experience significant fluctuations in operating results due to a number of economic, competitive and other factors. These factors could cause operations to vary significantly from prior periods, and those projected in forward-looking statements. Information with respect to these factors which could materially affect the Company and its operations are included on certain forms the Company files with the Securities and Exchange Commission.