As filed with the Securities and Exchange Commission on March 20, 1997
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM S-8
REGISTRATION STATEMENT
Under the Securities Act of 1933
HENG FAI CHINA INDUSTRIES, INC.
(Exact name of registrant as specified in its charter)
Delaware 93-063633
(State or other (Primary Standard (I.R.S. Employer
jurisdiction of Industrial Classification Identification No.)
incorporation or Code Number)
organization)
650 West Georgia Street
Vancouver, British Columbia
Canada V6B 4N8
(604) 685-8318
(Address and Telephone Number of Registrant's
Principal Executive Office)(Zip Code)
Consulting Agreement by and between
Thomas E. Waite and Heng Fai China Industries, Inc.
(300,000 shares of Common Stock)
Consulting Agreement by and between
Tom Kosta and Heng Fai China Industries, Inc.
(50,000 shares of Common Stock)
(full title of the plans)
Robert H. Trapp, Secretary
650 West Georgia Street
Vancouver, British Columbia
Canada V6B 4N8
(604) 685-8318
(Name, Address & Telephone number, including area code, of agent for service)
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Copies to:
Michael H. Freedman, Esq.
Silverman, Collura, Chernis & Balzano, P.C.
381 Park Avenue South - Suite 1601
New York, New York 10016
(212) 779-8600
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CALCULATION OF REGISTRATION FEE
- --------------------------------------------------------------------------------
Proposed Proposed
Title of Amount maximum maximum Amount of
securities to to be offering price aggregate registration
be registered registered per share (1) offering price (1) fee
- --------------------------------------------------------------------------------
Common Stock(1) 350,000 .9063 317,205 $96.12
- --------------------------------------------------------------------------------
(1) Calculated in accordance with 457(c) using the average of the bid and asked
price for the Common Stock on February 18, 1997.
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PART 1 - INFORMATION REQUIRED IN THE SECTION 10(A) PROSPECTUS
The documents containing information specified in Part 1 (plan
information and registrant information) will be sent or given to the consultants
as specified by Rule 428(b)(1). Such documents need not be filed with the
Securities and Exchange Commission either as part of this registration statement
or as prospectuses or prospectus supplements pursuant to Rule 424. These
documents and the documents incorporated by reference in this registration
statement pursuant to Item 3 of Part 2 of this form taken together constitute a
prospectus that meets the requirements of Section 10(a) of the Securities Act of
1933.
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HENG FAI CHINA INDUSTRIES, INC.
Cross-Reference Sheet Showing Location in Prospectus
of Information Required by Items of Form S-3
Form S-3 Items and Heading Location in Prospectus
1. Forepart of the Registration Statement
and Outside Front Cover Page of Prospectus........... Front cover Page
2. Inside Front And Outside Back Cover..................Inside Front cover Page
3. Summary Information, Risk Factors and Ratio
of Earnings to Fixed Charges......................... The Company
4. Use of Proceeds...................................... Not Applicable
5. Determination of Offering Price...................... Not Applicable
6. Dilution............................................ Not Applicable
7. Selling Security Holders............................. Selling Stockholders
8. Plan of Distribution................................. Plan of Distribution
9. Description of Securities to be Registered ......... Not Applicable
10. Interest of Named Experts and Counsel................ Legal Matters
11. Material Changes..................................... Not Applicable
12. Incorporation of Certain Information by
Reference............................................ Incorporation of
Certain Documents by
Reference
13. Disclosure of Commission Position on
Indemnification for Securities Act
Liabilities.......................................... Indemnification of
Directors and Officers
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RE-OFFER PROSPECTUS
HENG FAI CHINA INDUSTRIES, INC.
650 West Georgia Street
Vancouver, British Columbia
Canada V6B 4N8
Common Stock
This Prospectus relates to offers and sales by certain key consultants
of Heng Fai China Industries, Inc., a Delaware corporation ("Company"), named
herein ("Selling Stockholders"), of shares of the Company's Common Stock, $.01
par value ("Common Stock"), granted or to be granted to them pursuant to written
compensation contracts. The Company has issued 300,000 shares of Common Stock to
Thomas E. Waite pursuant to a consulting agreement dated October 8, 1996 ("Waite
Agreement"). The Company has also entered into an agreement with Tom Kosta for
the issuance of 50,000 stock options pursuant to an agreement dated January 9,
1997 ("Kosta Agreement")(the Waite Agreement and the Kosta Agreement are
collectively referred to herein as the "Plans"). The shares of Common Stock that
have been or will be acquired by such persons pursuant to the Plans are herein
referred to as the "Option and Restricted Shares".
The Option and Restricted Shares may be offered hereby from time to
time by any and all of the Selling Stockholders named herein, for their own
benefit. The Company will receive no portion of the proceeds of sales made
hereunder. All expenses of registration incurred in connection with this
offering are being borne by the Company, but all selling and other expenses
incurred by the Selling Stockholders will be borne by such Selling Stockholders.
All or a portion of the shares of Common Stock offered hereby may be
offered for sale, from time to time, on the OTC Bulletin Board ("Bulletin
Board"), or otherwise, at prices and terms then obtainable. All brokers'
commissions, concessions or discounts will be paid by the Selling Stockholders.
The Selling Stockholders and any broker executing selling orders on
behalf of the Selling Stockholders may be deemed to be an "underwriter" within
the meaning of the Securities Act, in which event commissions received by such
broker may be deemed to be underwriting commissions under the Securities Act.
The Common Stock of the Company are listed on the Bulletin Board under
the symbol HFCI. On February 18, 1997, the last reported sale price of the
Company's Common Stock on the Bulletin Board was $.9375.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION NOR HAS THE COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY
OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
The date of this Prospectus is March 20, 1997.
5
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TABLE OF CONTENTS
Page
Available Information.....................................................7
The Company...............................................................8
Risk Factors.............................................................10
Selling Stockholders.....................................................14
Transfer Agent and Registrar.............................................15
Plan of Distribution.....................................................15
Incorporation of Certain Documents by Reference..........................15
Legal Matters............................................................17
Experts..................................................................17
Indemnification of Directors and Officers................................17
6
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No person is authorized to give any information or to make any
representation, other than those contained in this Prospectus, in connection
with the offering described herein, and, if given or made, such information or
representations must not be relied upon as having been authorized by the Company
or the Selling Stockholders. This Prospectus does not constitute an offer to
sell, or a solicitation of an offer to buy, nor shall there be any sale of these
securities by any person in any jurisdiction in which it is unlawful for such
person to make such offer, solicitation or sale. Neither the delivery of this
Prospectus nor any sale made hereunder shall under any circumstances create an
implication that the information contained herein is correct as of any time
subsequent to the date hereof.
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the
Securities Exchange Act of 1934 (the "Exchange Act") and in accordance
therewith, files reports, proxy statements and other information with the
Securities and Exchange Commission (the "Commission"). Such reports, proxy
statements and other information can be inspected and copied at the Commission
at Room 1024, Judiciary Plaza, 450 Fifth Street, N.W., Washington, D.C. 20549,
and at the Commission's regional offices at Room 1204, Everett McKinley Dirksen
Building, 219 South Dearborn Street, Chicago, Illinois 60604; and 7 World Trade
Center, Suite 1300, New York, New York 10048. Copies of such material can also
be obtained at prescribed rates from the Public Reference Section of the
Commission at its principal office at 450 Fifth Street, N.W., Washington, D.C.
20549.
This Prospectus does not contain all of the information set forth in
the Registration Statements of which this Prospectus is a part and which the
Company has filed with the Commission. For further information with respect to
the Company and the securities offered hereby, reference is made to the
Registration Statement, including the exhibits filed as a part thereof, copies
of which can be inspected at, or obtained at prescribed rates from the Public
Reference Section of the Commission at the address set forth above. Additional
updating information with respect to the Company may be provided in the future
by means of appendices or supplements to the Prospectus.
The Company hereby undertakes to provide without charge to each person
to whom a copy of this Prospectus is delivered, upon written or oral request of
such person, a copy of any and all of the information that has been or may be
incorporated herein by reference (other than exhibits to such documents unless
such exhibits are specifically incorporated by reference into such documents).
Requests should be directed to Heng Fai China Industries, Inc., 650 West Georgia
Street, Vancouver, British Columbia, Canada V6B 4N8 (604) 685-8318.
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THE COMPANY
Heng Fai China Industries, Inc. (the "Company") was originally
organized on March 24, 1958 as Time Saver Markets, Inc. pursuant to the laws of
the State of California. On October 29, 1973, Alpine International Corporation,
a private Oregon corporation, merged with and into Time Saver Markets, Inc.
Subsequent thereto, Time Saver Markets, Inc. changed its name to Alpine Merger
Corporation ("Alpine-California") after having entered into a merger agreement
with a Delaware corporation named Alpine International Corporation
("Alpine-Delaware") which was formed for the purpose of facilitating the
reincorporation of Alpine-California in the State of Delaware through a merger
with and into Alpine-Delaware. Subsequently, in November 1994, Alpine-Delaware
changed its name to Heng Fai China Industries, Inc. Alpine-California and
Alpine-Delaware may be collectively referred to hereinafter as "Alpine."
Alpine conducted no significant operations between April 1992, when it
emerged form reorganization under Chapter 11 of Title II of the U.S. Bankruptcy
Code, and June 1994, when it acquired Vancouver Hong Kong Properties Limited
("Vancouver Hong Kong") which owns an apartment building in North Vancouver,
British Columbia.
In January 1995, the Company acquired its wholly-owned subsidiary, Heng
Fai China & Asia Industries Limited ("Asia"), a company incorporated in Hong
Kong, along with Asia's two wholly-owned subsidiaries, Heng Fai China Industries
Limited ("China") and Heng Fai Light Products Limited ("Light"). China and Light
were incorporated in Hong Kong and the Peoples' Republic of China (the "PRC"),
respectively. China and Light, through China's wholly-owned subsidiary, Cangzhou
Min You Cement Company, Ltd. (formerly Cangzhou Citizen Cement Product Co., Ltd.
and referred to hereinafter as "Min You") obtained options to acquire direct or
joint venture operating lease interests for three cement factories in the Hebei
province of the PRC: (i) the Hebei Cangzhou City Chemical Corporation Factory
(the "Cangzhou Factory"); (ii) the Qingxian Cement Factory (the "Qingxian
Factory"); and (iii) the Hebei Cangzhou Area Construction Materials Factory (the
"Hebei Factory").
On April 17, 1995, Min You exercised its option to lease a production
line at the Cangzhou Factory. From April through June 1995, Min You suspended
its operations at the Cangzhou Factory to facilitate the Company's expansion and
modernization of such factory as required pursuant to the provisions of the
agreement governing the Company's exercise of its options. Operations at the
factory resumed at the end of June 1995 upon completion of the expansion and
modernization of such factory. As of December 31, 1995, neither the Company nor
its subsidiaries had exercised the options to acquire the interests in the
Qingzian Factory or the Hebei Factory, which options expired unexercised.
In September 1996, the Company formed Worldwide Container Company,
Ltd., a wholly-owned subsidiary, to facilitate the acquisition of 70% of Wuhan
Container Company, Ltd. ("Wuhan") in exchange for approximately 727,000 shares
of the Company's Common Stock, valued at $5.50 per share. Wuhan is a PRC state
company engaged in the design, manufacture, lease and repair of containers and
related steel structure products.
8
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The Company's business focuses primarily on the operations of the
Cangzhou Factory, Wuhan and the Company's apartment building in Vancouver,
British Columbia. The Company's principal executive offices are located at 650
West Georgia Street, Vancouver, British Columbia, Canada V6B 4N8 and the
telephone number of the principal executive offices is (604) 685-8318.
9
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RISK FACTORS
The following factors should be considered carefully in evaluating the
Company's business and before making any investment in the Company.
1. Ability to Continue as a Going Concern.
The Company's independent certified public accountants, in their report
regarding the Company's financial statements, have noted that the Company's
recurring losses from operations and its deficiency in net tangible assets raise
substantial doubt about the Company's ability to continue as a going concern.
The Company's ability to continue as a going concern is currently dependent on
continued financial support from its principal shareholder, who has signed a
letter of financial support to the Company.
2. Relatively New Venture, Need for Further Acquisitions.
The Company must be regarded as in a formative stage. The Company's
future success depends upon its ability to continue to expand its existing
operations through the acquisition of strategic businesses. There can be no
assurance that the Company will be successful in making such acquisitions. The
Company has recently entered into agreements to acquire both a company involved
in duck farming in China and a company which owns an, as yet uncompleted, office
tower in China. The Company is subject to all the risks inherent in attempting
to expand a relatively new business venture. These risks include the potential
inability of the Company to efficiently operate additional companies, the
existence of undisclosed actual or contingent liabilities, the inability to fund
the working capital requirements of additional companies and the inability to
locate companies which have a positive effect on the Company's operations. There
can be no assurance that the Company will achieve a level of profitability that
will provide a return on invested capital or will result in an increase in the
market value of the Company's securities.
3. Need for Additional Financing.
The Company's business plan includes an aggressive program to identify
acquisition candidates that meet certain demographic and other criteria, and to
seek to acquire them. Growth to date has been funded initially with cash
advanced by shareholders and from acquisitions. However, there can be no
assurance that the remaining cash, coupled with the Company's Common Stock which
has been used as currency to facilitate certain acquisitions, will enable the
Company to finance all of its acquisition plans. Moreover, additional funds may
be needed to fund the working capital requirements of newly acquired companies.
No assurance can be given that additional needed financing will be available to
the Company, or if available, on terms acceptable to the Company. If further
financing is needed, but not available, the Company will be required to scale
down its acquisition plans.
10
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4. Dependence Upon Key Personnel.
The Company is substantially dependent upon the continued services of
Fai H. Chan, its Chairman and Chief Executive Officer. The loss of the services
of Mr. Chan through incapacity or otherwise would have a material adverse effect
upon the Company's business and prospects. To the extent that his services
become unavailable, the Company will be required to retain other qualified
personnel, and there can be no assurance that it will be able to recruit and
hire qualified persons upon acceptable terms. The Company does not maintain key
person life and disability insurance on the life of Mr. Chan.
5. Foreign Operations.
Some of the Company's existing operations currently relate to the
conduct of operations in China and Hong Kong. The Company may also seek to
establish business in other foreign countries. These operations will be subject
to the risks of conducting business internationally, including the possible
instability of foreign governments, changes in regulatory requirements,
difficulties in obtaining foreign licenses, as well as other general barriers
and restrictions in relation to compliance with foreign laws. In addition, any
future revenues generated by the Company upon successful consummation of its
planned activities would be subject to currency fluctuations which could
negatively affect the Company. Furthermore, the laws of various jurisdictions
where the Company intends to establish its business activities may not recognize
or permit the assertion of certain claims with respect to violation of
securities laws which are commonly recognized in the United States. Accordingly,
should the Company be in violation of any such securities laws, shareholders may
be unable to seek and/or obtain redress with respect to such violations against
assets of the Company's operations located in international jurisdictions.
6. No Assurance as to Future Acquisitions.
The Company's business has grown solely through acquisitions of new
companies. The Company's business plan calls for the acquisition of select
entities engaged in activities related to infrastructure manufacturing and
design, focusing primarily on companies operating in the People's Republic of
China. The Company's ability to achieve its expansion plans depends in large
part on its sound business judgment relative to quality targets and its
negotiating strength. If potential sellers are receptive to accepting equity in
the Company as part of the purchase price, the Company's ability to expand will
be enhanced. There can be no assurance, however, that the Company's acquisition
targets will continue to be receptive to such proposals. Nor can there be
assurance that the Company will succeed in effecting future acquisitions of
additional companies that meet management's criteria of profitability, physical
attributes and demographics in the targeted states and locales. Moreover there
can be no assurance that once acquisitions are made they will have a positive
effect on the Company's operations.
11
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7. OTC Bulletin Board.
The Company's Common Stock is currently quoted on the OTC Bulletin
Board. The OTC Bulletin Board is an NASD sponsored and operated inter-dealer
automated quotation system for equity securities not included on the NASDAQ
System. The OTC Bulletin Board has only recently been introduced as an
alternative to "pink sheets" trading of over-the-counter securities.
Consequently, liquidity and stock price of the Company's securities in the
secondary market may be adversely affected.
8. Possible Volatility of Stock Price.
There can be no assurance that a public market price for the Common
Stock will continue. The market prices of the Common Stock may be significantly
affected by factors such as announcements by the Company or its competitors, as
well as variations in the Company's results of operations and market conditions
in general. The market prices may also be affected by movements in prices of
stocks in general. The relatively limited amount of publicly trading shares
(float) renders the Company's securities especially susceptible to sharp price
fluctuations.
9. Penny Stock Regulations.
The Securities Enforcement Penny Stock Act of 1990 requires specific
disclosure to be made available in connection with trades in the stock of
companies defined as "penny stocks. The Commission has adopted regulations that
generally define a penny stock to be any equity security that has a market price
of less than $5.00 per share, subject to certain exceptions. Such exceptions
include any equity security listed on NASDAQ and any equity security issued by
an issuer that has (i) net tangible assets of at least $2,000,000, if such
issuer has been in continuous operation for three years; (ii) net tangible
assets of at least $5,000,000, if such issuer has been in continuous operation
for less than three years; or (iii) average annual revenue of at least
$6,000,000, if such issuer has been in continuous operation for less than three
years. Unless an exception is available, the regulations require the delivery,
prior to any transaction involving a penny stock, of a disclosure schedule
explaining the penny stock market and the risk associated therewith as well as
the written consent of the purchaser of such security prior to engaging in a
penny stock transaction. The regulations on penny stocks may limit the ability
of the purchasers of the Company's securities to sell their securities in the
secondary marketplace. The Company's Shares are currently considered a penny
stock.
10. Shares Eligible for Future Sale.
A large number of shares of Common Stock presently outstanding are
currently eligible for public sale under the Securities Act of 1933, as amended.
Possible or actual sales of Common Stock in the future by existing shareholders
may have a depressive effect on the price of the Common Stock in the open
market.
12
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11. Possible Effects of Certain Articles of Incorporation and Bylaw
Provisions.
The Company's Articles of Incorporation and Bylaws contain provisions
that may discourage acquisition bids for the Company. The Company has
substantial authorized but unissued capital stock available for issuance. The
Company's Articles of Incorporation contain provisions which authorize the Board
of Directors, without the consent of stockholders, to issue additional shares of
Common Stock and issue shares of Preferred Stock in series, including
establishment of the voting powers, designation, preferences, limitations,
restrictions and relative rights of each series of Preferred Stock.
12. Absence of Cash Dividends.
The Board of Directors does not anticipate paying cash dividends on the
Common Stock for the foreseeable future and intends to retain any future
earnings to finance the growth of the Company's business. Payment of dividends,
if any, will depend, among other factors, on earnings, capital requirements and
the general operating and financial conditions of the Company. There are no
statutory or Company restrictions on the payment of dividends.
13
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SELLING STOCKHOLDERS
The Prospectus covers Option and Restricted Shares that have been or
may be acquired pursuant to written compensation contracts by the Selling
Stockholders, named herein or to be supplementally named, as of February 18,
1997.
The following table sets forth the name of each Selling Stockholder,
the nature of his or her position, office, or other material relationship with
the Company, the number of shares of Common Stock beneficially owned by each
Selling Stockholder prior to the offering, and the number of shares and (if one
percent or more) the percentage of the class to be beneficially owned by such
Selling Stockholder after the offering. Non-affiliate Selling Stockholders who
hold less than 1,000 shares of Common Stock issued under the Plans and not named
below may use this Prospectus for reoffers and resales of such Common Stock.
Shares owned
After Offering(2)
Shares Owned Number of Shares -----------------
Name Prior to Offering(1) Offered Herein Number Percent
- ---- -------------------- -------------- ------ -------
Thomas E. Waite, 300,000 300,000 0 **
Consultant (3)
Tom Kosta, 0 50,000 0 **
Consultant (4)
- ----------
** less than 1%
(1) For purposes of this table, a person is deemed to have "beneficial
ownership" of any shares of Common Stock when such person has the right to
acquire such shares within 60 days of February 18, 1997. For purposes of
computing the percentage of outstanding shares of Common Stock held by each
person named above, any security which such person has the right to acquire
within such date is deemed to be outstanding but is not deemed to be
outstanding for the purpose of computing the percentage ownership of any
other person. Except as indicated in the footnotes to this table and
pursuant to applicable community property laws, the Company believes based
on information supplied by such persons, that the persons named in this
table have sole voting and investment power with respect to all shares of
Common Stock which they beneficially own.
(2) For purposes of this table, the number and percentage of Option or
Restricted Shares owned after the offering presumes the sale and/or
exercise of all Option or Restricted Shares offered herein.
(3) Represents restricted shares of Common Stock issued pursuant to the Waite
Agreement and prior to this offering.
(4) Represents shares of Common Stock underlying stock options to be issued
pursuant to the Kosta Agreement.
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TRANSFER AGENT AND REGISTRAR
The Transfer Agent and Registrar for the Common Stock of the Company is
Oxford Transfer & Registrar, 317 SW Alder, Suite 1120, Portland, Oregon 97204.
PLAN OF DISTRIBUTION
The Selling Stockholders may sell shares of Common Stock in any of the
following ways (i) through dealers; (ii) through agents; or (iii) directly to
one or more purchasers. The distribution of the shares of Common Stock may be
effected from time to time in one or more transactions (which may involve
crosses or block transactions) (A) on Nasdaq or the BSE (or on such other
national stock exchanges on which the shares of Common Stock may be traded from
time to time) in transactions which may include special offerings, exchange
distributions and/or secondary distributions pursuant to and in accordance with
rules of such exchanges, (B) in the over-the-counter market, or (C) in
transactions other than on such exchanges or in the over-the-counter market, or
a combination of such transactions. Any such transaction may be effected at
market prices prevailing at the time of sale, at prices related to such
prevailing market prices, at negotiated prices or fixed prices. The Selling
Stockholders may effect such transactions by selling shares of Common Stock to
or through broker-dealers, and such broker-dealers may receive compensation in
the form of discounts, concessions, or commissions from Selling Stockholders
and/or commissions from purchasers of shares of Common Stock for whom they may
act as agent. The Selling Stockholders and any broker-dealers or agents that
participate in the distribution of shares of Common Stock by them might be
deemed to be underwriters, and any discounts, commissions or concessions
received by any such broker-dealers or agents might be deemed to be underwriting
discounts and commissions, under the Securities Act.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The documents listed below have been filed by the Company with the
Commission and are incorporated herein by reference:
(a) The Company's Annual Report on Form 10-K for its fiscal year ended
December 31, 1995;
(b) The Company's Quarterly Report on Form 10-Q for the periods ended
March 31, 1996, June 30, 1996 and September 30, 1996;
(c) All other reports filed by the Company pursuant to Section 13(a)
and 15(d) of the Exchange Act since the Company's fiscal year ended December 31,
1995.
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All documents filed by the Company with the Commission pursuant to
Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act subsequent hereto, but
prior to the termination of the offering of securities made by this Prospectus
shall be deemed to be incorporated by reference herein and to be part hereof
from their respective dates of filing.
(d) The description of Common Stock as set forth in the Form 10 filed
with the Securities and Exchange Commission on February 9, 1974 on behalf of
Alpine-California (as defined below), as the same has been or may hereafter be
amended (File No. 0-7619), is incorporated by reference in its entirety. In
connection therewith, the following description is provided:
The Common Stock was initially registered under Section 12(g) of the
Securities and Exchange Act of 1934 on February 19, 1974 on Form 10 on behalf of
Alpine International Corporation, a California corporation
("Alpine-California"), formerly the parent of Alpine Merger Corporation, a
Delaware corporation ("Alpine-Delaware"), which changed its name to Heng Fai
China Industries, Inc. (previously defined herein as the "Company"). The Company
is currently authorized to issue up to 30,000,000 shares of Common Stock, $.01
par value, and 500,000 shares of Preferred Stock, $10 par value ("Preferred
Stock"). As of the date hereof, there are 13,686,814 shares of Common Stock
issued and outstanding and no shares of Preferred Stock are outstanding.
Holders of Common Stock are entitled to one vote per share on each
matter submitted to vote at any meeting of shareholders. Shares of Common Stock
do not carry cumulative voting rights and therefore, holders of a majority of
the outstanding shares of Common Stock will be able to elect the entire board of
directors of the Company. The Company's board of directors has authority,
without action by the Company's shareholders, to issue all or any portion of the
authorized but unissued shares of Common Stock, which would have the effect of
reducing the percentage of securities ownership of the Company's shareholders
and diluting the book value of the Common Stock.
Shareholders of the Company have no preemptive rights to acquire
additional shares of Common Stock. The Common Stock is not subject to redemption
and carries no subscription or conversion rights. In the event of liquidation of
the Company, the holders of shares of Common Stock are entitled to share equally
in corporate assets after the holders, if any, of Preferred Stock and after
satisfaction of liabilities. Holders of Common Stock are entitled to receive
such dividends as the Company's board of directors may from time to time declare
out of funds legally available for the payment thereof. The Company has never
paid cash dividends on its Common Stock and does not anticipate that it will pay
such dividends in the future.
Any statement contained in a document incorporated by reference herein
shall be deemed to be modified or superseded for purposes of this Prospectus, to
the extent that a statement contained herein or in any other subsequently filed
document which also is or is deemed to be incorporated by reference herein
modifies or supersedes such statement. Any such statement so modified or
superseded shall not be deemed, except as so modified or superseded, to
constitute a part of this Prospectus.
16
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LEGAL MATTERS
The legality of the shares offered hereby has been passed upon for the
Company by Silverman, Collura & Chernis, P.C., 381 Park Avenue South, Suite
1601, New York, New York 10016.
EXPERTS
The Company's consolidated financial statements incorporated in this
Registration Statement by reference from the Company's Annual Report on Form 10K
for the year ended December 31, 1995 have been audited by Deloitte Touche
Tohmatsu, independent auditors, as stated in their report, which is incorporated
herein by reference (which report expresses an unqualified opinion and includes
an explanatory paragraph referring to doubt about the Company's ability to
continue as a going concern) and have been so incorporated in reliance upon the
report of such firm, given upon their authority as experts in accounting and
auditing.
INDEMNIFICATION OF DIRECTORS AND OFFICERS
Section 145 of the General Corporation Law of the State of Delaware and
Article 7 of the Company's Articles of Incorporation contain provisions for
indemnification of officers, directors, employees and agents of the Company. The
Articles of Incorporation require the Company to indemnify such persons to the
full extent permitted by Delaware law. Each person will be indemnified in any
proceeding if he acted in good faith and in a manner which he reasonably
believed to be in, or not opposed to, the best interest of the Company.
Indemnification would cover expenses, including attorney's fees, judgments,
fines and amounts paid in settlement.
Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers, and controlling persons of the
Company, the Company has been advised that in the opinion of the Commission such
indemnification is against public policy as expressed in the Securities Act and
is, therefore unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the Company of expense
incurred or paid by a director, officer, or controlling person of the Company in
the successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person of the Company in connection with the
securities being registered, the Company will, unless in the opinion of its
counsel the matter has been settled by a controlling precedent, submit to a
court of appropriate jurisdiction the question whether such indemnification by
it is against public policy as expressed in the Securities Act and will be
governed by the final adjudication of such issues.
17
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PART II
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE
The documents listed below have been filed by the Company with the
Commission and are incorporated herein by reference:
(a) The Company's Annual Report on Form 10-K for its fiscal year ended
December 31, 1995;
(b) The Company's Quarterly Report on Form 10-Q for the periods ended
March 31, 1996, June 30, 1996 and September 30, 1996;
(c) All other reports filed by the Company pursuant to Section 13(a) or
15(d) of the Exchange Act since the Company's fiscal year ended December 31,
1995.
All documents filed by the Company with the Commission pursuant to
Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act subsequent hereto, but
prior to the termination of the offering of securities made by this Prospectus
shall be deemed to be incorporated by reference herein and to be part hereof
from their respective dates of filing.
(d) The description of Common Stock as set forth in the Form 10 filed
with the Securities and Exchange Commission on February 9, 1974 on behalf of
Alpine-California (as defined below), as the same has been or may hereafter be
amended (File No. 0-7619), is incorporated by reference in its entirety. In
connection therewith, the following description is provided:
The Common Stock was initially registered under Section 12(g) of the
Securities and Exchange Act of 1934 on February 19, 1974 on Form 10 on behalf of
Alpine International Corporation, a California corporation
("Alpine-California"), formerly the parent of Alpine Merger Corporation, a
Delaware corporation ("Alpine-Delaware"), which changed its name to Heng Fai
China Industries, Inc. (previously defined herein as the "Company"). The Company
is currently authorized to issue up to 30,000,000 shares of Common Stock, $.01
par value, and 500,000 shares of Preferred Stock, $10 par value ("Preferred
Stock"). As of the date hereof, there are 13,686,814 shares of Common Stock
issued and outstanding and no shares of Preferred Stock are outstanding.
Holders of Common Stock are entitled to one vote per share on each
matter submitted to vote at any meeting of shareholders. Shares of Common Stock
do not carry cumulative voting rights and therefore, holders of a majority of
the outstanding shares of Common Stock will be able to elect the entire board of
directors of the Company. The Company's board of directors has authority,
without action by the Company's shareholders, to issue all or any portion of the
authorized but unissued shares of Common Stock, which would have the effect of
reducing the percentage of securities ownership of the Company's shareholders
and diluting the book value of the Common Stock.
18
<PAGE>
Shareholders of the Company have no preemptive rights to acquire
additional shares of Common Stock. The Common Stock is not subject to redemption
and carries no subscription or conversion rights. In the event of liquidation of
the Company, the holders of shares of Common Stock are entitled to share equally
in corporate assets after the holders, if any, of Preferred Stock and after
satisfaction of liabilities. Holders of Common Stock are entitled to receive
such dividends as the Company's board of directors may from time to time declare
out of funds legally available for the payment thereof. The Company has never
paid cash dividends on its Common Stock and does not anticipate that it will pay
such dividends in the future.
Any statement contained in a document incorporated by reference herein
shall be deemed to be modified or superseded for purposes of this Prospectus, to
the extent that a statement contained herein or in any other subsequently filed
document which also is or is deemed to be incorporated by reference herein
modifies or supersedes such statement. Any such statement so modified or
superseded shall not be deemed, except as so modified or superseded, to
constitute a part of this Prospectus.
ITEM 4. DESCRIPTION OF SECURITIES
Not Applicable
ITEM 5. INTEREST OF NAMED EXPERTS AND COUNSEL
Not applicable.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Section 145 of the General Corporation Law of the State of Delaware and
Article 7 of the Company's Articles of Incorporation contain provisions for
indemnification of officers, directors, employees and agents of the Company. The
Articles of Incorporation require the Company to indemnify such persons to the
full extent permitted by Delaware law. Each person will be indemnified in any
proceeding if he acted in good faith and in a manner which he reasonably
believed to be in, or not opposed to, the best interest of the Company.
Indemnification would cover expenses, including attorney's fees, judgments,
fines and amounts paid in settlement.
Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers, and controlling persons of the
Company, the Company has been advised that in the opinion of the Commission such
indemnification is against public policy as expressed in the Securities Act and
is, therefore unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the Company of expense
incurred or paid by a director, officer, or controlling person of the Company in
the successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person of the Company in connection with the
securities being registered, the Company will, unless in the opinion of its
counsel the matter has been settled by a controlling precedent, submit
19
<PAGE>
to a court of appropriate jurisdiction the question whether such indemnification
by it is against public policy as expressed in the Securities Act and will be
governed by the final adjudication of such issues.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED
Not applicable.
ITEM 8 EXHIBITS
4.1 Consulting Agreement between Thomas E. Waite and the Company
4.2 Consulting Agreement between Tom Kosta and the Company
5.1 Opinion of Silverman, Collura & Chernis, P.C.
23.1 Consent of Silverman, Collura & Chernis, P.C. (included in
Exhibit 5.1)
23.2 Consent of Deloitte Touche Tohmatsu
ITEM 9. UNDERTAKINGS
(a) The undersigned registrant hereby undertakes;
(1) To file, during any period in which offers or sales are being made,
a post-effective amendment to the Registration Statement;
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933, as amended (the "Securities Act");
(ii) To reflect in the prospectus any facts or events arising after
the effective date of this Registration Statement (or the most recent
post-effective amendment thereof) which, individually or in the aggregate,
represent a fundamental change in the information set forth in the
Registration Statement;
(iii) To include any material information with respect to the plan of
distribution not previously disclosed in the Registration Statement or any
material change of such information in the Registration Statement;
Provided however that paragraphs (a)(1)(i) and (a)(1)(ii) shall not
apply to information contained in periodic reports filed by the registrant
pursuant to Section 13 or Section 15(d) of the Exchange Act that are
incorporated by reference in this Registration Statement.
20
<PAGE>
(2) That, for the purpose of determining any liability under the
Securities Act, each such post-effective amendment shall be deemed to be a new
registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof
(3) To remove from registration by means of a post effective amendment
any of the securities being registered which remain unsold at the termination of
the offering.
(b) The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act, each filing of the
registrant's annual report pursuant to section 13(a) or section 15(d) of the
Exchange Act that is incorporated by reference in this Registration Statement
shall be deemed to be a new registration statement relating to the securities
offered herein, and the offering of such securities at that time shall be deemed
to be the initial bona fide offering thereof.
(c) Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers and controlling persons
of the registrant pursuant to the foregoing provisions or otherwise, the
registrant has been advised that in the opinion of the Commission, such
indemnification is against public policy as expressed in the Securities Act and
is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the registrant of expenses
incurred or paid by a director, officer or controlling person of the registrant
in the successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification is against public policy
as expressed in the Securities Act and will be governed by the final
adjudication of such issue.
21
<PAGE>
INDEX TO EXHIBITS
4.1 Consulting Agreement between Thomas E. Waite and the Company
4.2 Consulting Agreement between Tom Kosta and the Company
5.1 Opinion of Silverman, Collura & Chernis, P.C.
23.1 Consent of Silverman, Collura & Chernis, P.C. (included in Exhibit 5.1)
23.2 Consent of Deloitte Touche Tohmatsu
22
<PAGE>
SIGNATURES
Pursuant to the requirement of the Securities Act, the Registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-8 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, therewith duly
authorized, in the City of Vancouver on February 28, 1997.
HENG FAI CHINA INDUSTRIES, INC.
By: /s/ Robert H. Trapp
-----------------------------
Robert H. Trapp, Secretary
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature
appears below, hereby constitutes and appoints Robert H. Trapp, his true and
lawful attorney-in-fact, with full power of substitution and resubstitution, for
his and in his name, place and stead, in any and all capacities, to sign any or
all amendments or supplements to this Registration Statement and to file the
same with all exhibits thereto and other documents in connection therewith, with
the Commission, granting unto said attorney-in-fact full power and authority to
do and perform each and every act and thing necessary or appropriate to be done
with respect to this Registration Statement or any amendments or supplements
hereto and about the premises, as fully to all intents and purposes as he might
or could do in person, hereby ratifying and confirming all that said
attorney-in-fact, or his substitute or substitutes, may lawfully do or cause to
be done by virtue hereof.
Pursuant to the requirements of the Securities Act, this Registration
Statement has been signed by the following persons in their respective
capacities with Heng Fai China Industries, Inc. and on the dates indicated.
SIGNATURES
Signature Title Date
- --------- ----- ----
/s/ Fai H. Chan
- -------------------- Chief Executive Officer, February 28, 1997
Fai H. Chan President and Director
(Principal Executive Officer)
/s/ Robert H. Trapp
- -------------------- Secretary, Treasurer and February 28, 1997
Robert H. Trapp Director (Principal Financial
and Accounting Officer)
/s/ Ronald M.T. Lau
- -------------------- Director February 28, 1997
Ronald M.T. Lau
23
EXHIBIT 4.1
<PAGE>
CONSULTING AGREEMENT
This Consulting Agreement (the "Agreement") is entered into as of this
27th date of September, 1996, by and among Thomas E. Waite ("Consultant") with
offices at 106 Ridge Road, Lake May, Florida 32746 and Heng Fai China
Industries, Inc., a Delaware corporation ("HFCI"), with corporate offices at 650
West Georgia St., Suite 588, Vancouver, British Columbia, Canada V68 4N8.
WHEREAS, HFCI desires to engage Consultant to perform certain services
including public relations services on its behalf and to advise HFCI on certain
business opportunities; and
WHEREAS, Consultant has represented that it has the expertise to
perform those certain services which will enhance the growth and value of HFCI;
NOW, THEREFORE, in consideration of the premises and mutual covenants
set forth herein, the parties hereto agree as follows;
1. Representations of HFCI. HFCI represents and warrants that:
(a) HFCI has the full power and authority to execute and deliver this
Agreement, and to perform all of its obligations herein.
(b) All news releases or other publicity about HFCI will be coordinated
with the Consultant and will be issued in accordance with the legal
requirements of a public company.
(c) HFCI shall approve or disapprove the issuance of all press releases
and any other material representations about HFCI suggested by
Consultant.
(d) The common stock of HFCI (the "Shares") to be issued to Consultant as
compensation shall be properly authorized, issued and registered under
the Securities Act of 1933, on a Form S-8 registration statement or
other appropriate form. The Consultant shall not engage in any direct
or indirect capital raising activities on behalf of HFCI and/or its
affiliates.
2. Representations of Consultant. Consultant represents and warrants that:
(a) Consultant has the full power and authority to execute and deliver
this Agreement, and to perform all of his obligations herein.
(b) Consultant shall limit his representations about HFCI to facts
disclosed by HFCI to Consultant.
<PAGE>
3. Services to be Performed. Consultant agrees to provide the following
services on behalf of HFCI for one calendar year from the date this
Agreement is signed:
(a) Consultant shall assist HFCI in its efforts to open channels of
distribution for HCFI's product throughout the world;
(b) Consultant shall provide input on HFCI's marketing and sales plans and
materials;
(c) Consultant shall review, advise and have input on HFCI's distribution
agreements.
(d) Consultant shall provide advice and assistance to HFCI with regard to
public relations, mergers, acquisitions and other business
opportunities;
(e) Consultant shall provide public relations services to HFCI and shall
advise HFCI regarding press releases and communications with the
investment community, including mutual funds, money managers,
investors and brokerage firms;
(f) Consultant shall review and upon HFCI's request, release all press
releases and public announcements in coordination with HFCI and HFCI's
legal counsel;
(g) Consultant shall, subject to HFCI's directions, coordinate press
conferences with the general media, newspapers, trade publications,
magazines, financial news letters, investment advisory reports, wire
services such as Dow Jones, Reuters, and Bloomberg, and financial
television and radio programs; and
(h) Consultant shall serve as a non-exclusive spokesperson for HFCI to the
investment community.
4. Term of this Agreement. This Agreement shall be binding and in effect for
one calendar year from the date this Agreement is signed.
5. Compensation.
(a) Base Compensation. As compensation for Consultant's services, HFCI
shall transfer to Consultant 300,000 shares of HFCI common stock (the
"Shares"). These Shares shall be delivered to Consultant
simultaneously with the execution of this Agreement. HFCI shall
simultaneously undertake to register such Shares under the Securities
Act of 1933 on Form S-8 or any other available forms, at HFCI's sole
cost and expense. On the date of this Agreement, shares of HFCI are
quoted at a bid price of $1.0625 on the Bulletin Board of the National
Association of Securities Dealers, Inc.
2
<PAGE>
(b) Bonus Compensation. The Board of Directors of HFCI, in its sole
discretion, shall, from time to time, review the activities of
Consultant with a view towards bonus compensation which may be awarded
such compensation may take the form of cash, common stock or other
property, and shall be commensurate with the services rendered by
Consultant on behalf of HFCI and the value thereby added to HFCI and
to its stockholders.
6. Expenses. Consultant shall be responsible during the entire term of this
Agreement for all of his own expenses incurred in connection with this
Agreement. HFCI shall not reimburse Consultant for any out-of-pocket
expenses incurred by Consultant in the performance of this Agreement and
its activities for HFCI.
7. Notices. All notices, requests, demands and other communications hereunder
shall be in writing and personally delivered or sent by registered or
certified mail to the following addressees:
If to HFCI: Heng Fai China Industries, Inc.
650 West Georgia Street
Suite 588
Vancouver, British Columbia, Canada V6E 4N8
Copy to: Anthony M. Collura, Esq.
Silverman, Collura & Cherris, P.C.
381 Park Avenue South
Suite 1601
New York, NY 10016
Fax: (212) 779-8858
If to Consultant: Thomas E. Waite
106 Ridge Road
Lake Mary, Florida 32746
Fax; (407) 324-0664
Copy to: Victor L. Chapman, Esquire
Barretto Chapman & Ruta, P.A.
940 Highland Avenue
Orlando, Florida 32803
Fax: (407) 648-1190
Provided, however, that either party hereto may, from time to time give to the
other party written notice, in the manner provided herein, of some other
address, to which communications to such party shall be sent, in which event
notices to such party shall be personally delivered or sent by
3
<PAGE>
registered or certified mail to such address. Notice shall be deemed effectively
give hereunder when personally delivered or deposited in the United States mail
postage prepaid, registered or certified, return receipt requested, or
transmittal by overnight receipted courier as the case may be.
8. Legal Fees. Subject to the rights of indemnification and release contained
herein, in the event of any legal action or proceeding instituted with
respect to this Agreement, the party prevailing in such action or
proceeding shall be entitled to collect from the non-prevailing in such
action or proceeding shall be entitled to collect from the non-prevailing
party reasonable attorney fees, paralegal fees, law clerk fees and other
legal costs and expenses, whether incurred at or before trial, and whether
incurred at the trial level or in any appellate proceeding.
9. Binding Effect, Assignment. This Agreement shall be binding upon and inure
to the benefit of the parties hereto and their respective personal
representatives, heirs, spouses, beneficiaries, successors and permitted
assigns. Neither party to this Agreement may assign such party's rights or
obligations hereunder without the prior written consent of the other party.
10. Complete Assignment. This Agreement constitutes the complete understanding
between the parties with respect to the subject matter hereof. This
Agreement constitutes the entire agreement between the parties hereto with
respect to the matters covered herein and supersedes all prior or
contemporaneous agreements, negotiations, representations or discussions
with respect to such subject matter. This Agreement may not be amended or
modified except by a written instrument executed by the parties hereto.
11. Governing Law. This Agreement and performance hereunder shall be governed
by and construed in accordance with the laws of the State of Florida. In
the event of any legal or equitable action arising under this Agreement,
the parties hereto hereby agree that the courts of Orange County, in the
State of Florida shall have sole and exclusive jurisdiction and venue over
any such action and hereby consent to such jurisdiction.
12. Further Actions. Each party to this Agreement shall take such further
actions to execute, file, record, publish and deliver such additional
certificates, instruments, agreements and other documents as the other
party may from time to time, reasonably request in order to effectuate the
transfer contemplated herein, or otherwise to accomplish the purposes of
this Agreement.
13. Waiver. No waiver of any breach of any term or condition of this Agreement
shall be deemed to be a waiver of any subsequent breach of any term or
condition of a like or different nature.
14. Severability. If any provision of this Agreement shall be held invalid or
unenforceable, such validity or unenforceability shall not, if possible,
affect the validity or enforceability
4
<PAGE>
of any other provision of this Agreement, and this Agreement shall, if
possible, be construed and enforced in all respects are if such invalid or
unenforceable provision had not been contained herein.
15. Draftsmanship. The fact that one of the parties may have drafted or
structured any provision hereof shall not be considered in construing the
particular provision either in favor of, or against, such party.
16. Counterparts. This Agreement may be executed simultaneously in several
counterparts each of which shall be deemed an original, but all of which
shall only constitute one instrument. Facsimile signatures are acceptable.
IN WITNESS WHEREOF, each of the parties having agreed to the above
mentioned terms and conditions have hereunder set their hands and seals as of
this 27th day of September, 1996.
THOMAS E. WAITE - CONSULTANT
By: /s/ Thomas E. Waite 10/8/96
-------------------------------
Thomas E. Waite
HENG FAI CHINA INDUSTRIES, INC.
By: /s/ Robert H. Trapp
-------------------------------
10/8/96
EXHIBIT 4.2
<PAGE>
KOSTECH SMALLCAP RESEARCH
http://www.kostech.com
1-888-KOSTECH
This agreement is hereby entered into on the 9 day of January, 1997 between Tom
Kosta and Heng Fai China Industries.
Heng Fai China Industries Inc. (hereinafter referred to as "the company") hereby
enters into agreement with Tom Kosta (hereinafter referred to as "Consultant")
for the purpose of maintaining an ongoing Internet based investor relations
program.
Consultant will publish a corporate profile for the company and distribute this
profile to its subscriber base when appropriate. Consultant reserves the right
to make final decisions regarding when and if this Research Bulletin is released
and the content therein.
In addition, all subscribers to Consultant's service will be updated frequently
on the progress of the company. This contract will run for a period of 12 months
from date incepted.
The complete cost for this program with regular mailings to Consultants entire
subscriber base is 50,000 stock options to be dispersed as follows:
25,000 at 1.00 six month term
25,000 at 1.25 six month term
The common stock of Heng Fai China Industries Inc. to be issued to Tom Kosta
("Consultant") as compensation shall be properly authorized, issued, and
registered under the Securities act of 1933, on a form S-8 registration
statement or other appropriate form. The Consultant shall not engage in any
direct or indirect capital raising activities on behalf of Heng Fai China
Industries Inc. and/or its affiliates.
Agreed and Accepted:
Tom Kosta Robert Trapp/HFCI
By: /s/ Tom Kosta By: /s/ Robert H. Trapp, Director
----------------------------- -----------------------------
Date: 1-09-97 Date: 1-13-97
----------------------------- -----------------------------
Tom Kosta
Exhibit 5.1
<PAGE>
[Letterhead of Silverman, Collura & Chernis, P.C.]
March 20, 1997
Hengfai China Industries, Inc.
650 West Georgia Street
Vancouver, British Columbia
Canada V6B 4N8
Re: Registration Statement on Form S-8
Gentlemen:
We have acted as counsel to Hengfai China Industries, Inc. ("Company"), a
Delaware corporation, pursuant to a Registration Statement on Form S-8, as filed
with the Securities and Exchange Commission on March 20, 1997 (the "Registration
Statement"), covering an aggregate of 350,000 shares of the Company's Common
Stock, $.01 par value (the "Common Stock") representing (i) 300,000 shares of
Common Stock issuable pursuant to a consulting agreement between the Company and
Thomas E. Waite; and (ii) 50,000 shares of Common Stock issuable pursuant to a
consulting agreement between the Company and Tom Kosta.
In acting as counsel for the Company and arriving at the opinions as
expressed below, we have examined and relied upon originals or copies, certified
or otherwise identified to our satisfaction, of such records of the Company,
agreements and other instruments, certificates of officers and representatives
of the Company, certificates of public officials and other documents as we have
deemed necessary or appropriate as a basis for the opinions expressed herein.
In connection with our examination we have assumed the genuineness of all
signatures, the authenticity of all documents tendered to us as originals, the
legal capacity of natural persons and the conformity to original documents of
all documents submitted to us as certified or photostated copies.
Based on the foregoing, and subject to the qualifications and limitations
set forth herein, it is our opinion that:
1. The Company has authority to issue the Common Stock in the manner
and under the terms set forth in the Registration Statement.
<PAGE>
2. The Common Stock has been duly authorized and when issued,
delivered and paid for by recipients in accordance with their respective
terms, will be validly issued, fully paid and non-assessable.
We express no opinion with respect to the laws other than those of the
State of New York and Federal Laws of the United States of America, and we
assume no responsibility as to the applicability or the effect of the laws of
any other jurisdiction.
We hereby consent to the filing of this opinion as Exhibit 5.1 to the
Registration Statement and its use as part of the Registration Statement.
We are furnishing this opinion to the Company solely for its benefit in
connection with the Registration Statement. It is not to be used, circulated,
quoted or otherwise referred to for any other purpose. Other than the Company,
no one is entitled to rely on this opinion.
Very truly yours,
SILVERMAN, COLLURA & CHERNIS, P.C.
/s/ Silverman, Collura & Chernis, P.C.
--------------------------------------
HENGFAI\REGSTATE\OPINION.RW
Exhibit 23.2
<PAGE>
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in this Registration
Statement of Heng Fai China Industries, Inc. on Form S-8 of our report dated
June 14, 1996 (which report expresses an unqualified opinion and includes an
explanatory paragraph referring to doubt about the Company's ability to continue
as a going concern), appearing in the Annual Report on Form 10-K of Heng Fai
China Industries, Inc. for the year ended December 31, 1995 and to the reference
to us under the heading "Experts" in the Prospectus, which is part of this
Registration Statement.
/s/ Deloitte Touche Tohmatsu
Hong Kong
March 6, 1997
