<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-KSB/A
(Mark One)
[X] ANNUAL REPORT PURSUANT T0 SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the Fiscal Year Ended December 31, 1996
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from to .
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Commission File No. 0-26232
CHINA PACIFIC, INC.
-------------------
(Name of small business issuer in its charter)
NEVADA 87-0429945
- ------------------------------ ----------------------
(STATE OR JURISDICTION OF (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION) IDENTIFICATION NUMBER)
Rm. 2008 Sun Hung Kai Centre, 30 Harbour Road
Wanchai, Hong Kong
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(address of Principal Executive Offices) (ZIP CODE)
Registrant's Telephone Number, Include Area Code: (852) 2802 3068
Securities Registered Pursuant to Section 12(b) of the Act:
Title Of Each Class Name Of Each Exchange On Which Registered
------------------- -----------------------------------------
None None
Securities Registered Pursuant to Section 12(g) of the Act:
Common Stock, $.001 Par Value
-----------------------------
(Title of Class)
Check whether the issuer (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past twelve (12) months (or
for such shorter period that the registrant was required to file such reports);
and (2) has been subject to such filing requirements for the past ninety (90)
days.
Yes X No
----- -----
Check if disclosure of delinquent filers in response to Item 405 of
Regulation S-B is not contained in this form, and will not be contained, to the
best of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-KSB or any amendment to
this Form 10-KSB.
[ x ]
The issuer's revenues for its most recent fiscal year were $123,504,000.
As of March 10, 1997, 8,956,384 shares of common stock of the Registrant
were outstanding. As of such date, the aggregate market value of the common
stock held by non-affiliates, based on the closing bid price on the Nasdaq
Small-Cap Market, was approximately $19,364,378.
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DOCUMENTS INCORPORATED BY REFERENCE
None
Transitional Small Business Disclosure Format: Yes No X
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<TABLE>
<CAPTION>
TABLE OF CONTENTS
<S> <C>
PART III . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .1
ITEM 9. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL
PERSONS, COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE
ACT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .1
ITEM 10. EXECUTIVE COMPENSATION. . . . . . . . . . . . . . . . . . . . . . . . . . .3
ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .3
ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS. . . . . . . . . . . . . . .4
SIGNATURES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .6
</TABLE>
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Explanatory Note: This amendment to the Company's Form 10-KSB is being filed
to provide information in Items 9, 10, 11 and 12 that was originally intended
to be incorporated by reference from the Company's definitive proxy statement.
PART III
ITEM 9. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL
PERSONS;COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT
INFORMATION REGARDING DIRECTORS
The following table sets forth information with respect to each director.
The information as to age, principal occupation and directorships held
has been furnished by each such director.
<TABLE>
<CAPTION> Served as Director
Name and Age Principal Occupation(1) Continuously Since
- ------------ ----------------------- ------------------
<S> <C> <C>
Mak Shiu Tong, Clement (44) President, Chief Executive Officer and 1993
Chairman of the Board of Directors
(Principal Executive Officer)
Cheng Yuk Ching (43) Vice President, Secretary and Director 1994
Tong Tong Lin, Thomas (31) Chief Financial Officer and Director
(Principal Financial and Accounting Officer) 1996
Kwan Pak Hoo(2)(38) Director 1996
Zhang Guo Liang(3)(52) Director 1996
Zhang Xin Min(4)(50) Director 1996
Tan Jian Sheng(5)(38) Director 1996
</TABLE>
(1) Unless indicated otherwise in the table or in the section captioned
"Information Regarding Executive Officers," the individuals name in the
table have held their positions for more than five years.
(2) From 1994 to 1995, Mr. Kwan served as a Director of IWI Holding Inc., a
listed company on the Nasdaq Stock Exchange. Since 1996, Mr. Kwan has
served as Managing Director of CCT Telecom Holdings Ltd. and
Non-Executive Director of Mei Ah Int'l Ltd. Both companies are listed on
the Hong Kong Stock Exchange.
(3) From 1989 to 1992, Mr. Zhang served as Secretary General of the Xinhua News
Agency, and has served as General Manager of Xinhua News Agency - Asia -
Pacific Region since 1992.
(4) Since 1985, Mr. Zhang has served as Vice Chairman of Office Service
International Centre in Ho Chi Minh City, Vietnam, President of
Chengdu-Guang-Sha Property & Industry & Commerce Co., and President of
Chengdu Guang-Wei House Development Co., Ltd.
(5) From 1989 to 1994, Mr. Tan served as Department Head of the International
Division of The China Construction Bank - Guangdong Branch, and has served
as General Manager for the same company since 1994.
1
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INFORMATION REGARDING EXECUTIVE OFFICERS
The following table sets forth the names, ages and offices of the present
executive officers of the Company. The periods during which such persons have
served in such capacities are indicated in the description of business
occupations of such persons below. Information with respect to non-employee
directors is set forth above.
Mak Shiu Tong, Clement (44) President and Chief Executive Officer
Mo Kat Ling, Connie (35) Vice President
Cheng Yuk Ching (43) Vice President and Secretary
Tong Long Tin, Thomas (31) Chief Financial Officer
Officers and directors are elected on an annual basis. The present terms
for each director will expire at the next annual meeting of shareholders or at
such time as a successor is duly elected. Officers serve at the discretion of
the Board of Directors. See "Beneficial Ownership of Common Stock."
There are no family relationships among any of the directors or officers of
the Company.
The following is a biographical summary of the business experience of the
present executive officers of the Company.
Mak Shiu Tong, Clement. Mr. Mak has served as president, Chief Executive
Officer and Chairman of the Board of the Company since the Company's acquisition
of China Pacific Construction (B.V.I.) Limited ("China Pacific Construction")
(formerly China Treasure Construction (B.V.I.) Limited) in May of 1994. Mr. Mak
was a founder of China Pacific Construction and its affiliates and has served as
Chairman of China Pacific Construction since its inception in 1993. Since 1979,
Mr. Mak has served as Chairman, and was a founder, of Kiu Yin Investment Co.,
Ltd. (formerly, Bondwell Electronics Limited), an electronics manufacturer.
Mo Kat Ling, Connie. Ms. Mo has served as Vice President of the Company
since the Company's acquisition of China Pacific Construction in May of 1994.
Ms. Mo previously served as Treasurer and a director of the Company from May of
1994 until June of 1995. Previously, Ms. Mo served as Vice President, Treasurer
and a director of Kiu Yin Investment Co., Ltd from 1989 to 1995.
Cheng Yuk Ching. Mr. Cheng has served as Vice President, Secretary and a
director of the Company since the Company's acquisition of China Pacific
Construction in May of 1994. Previously, Mr. Cheng served as Vice President,
Secretary and a director of Kiu Yin Investment Co., Ltd from 1984 to 1996.
Tong Long Tin, Thomas. Mr. Tong has served as Financial Controller of the
Company since 1994 and as Chief Financial Officer and a director of the Company
since 1996. Prior to joining the Company, Mr. Tong served as an audit
supervisor of Ho and Ho & Co., a certified public accounting firm in Hong Kong,
from 1988 to 1994.
COMPLIANCE WITH SECTION 16(a) OF EXCHANGE ACT
Under the securities laws of the United States, the Company's directors,
its executive officers, and any persons holding more than ten percent of the
Company's Common Stock are required to report their initial ownership of the
Company's Common Stock and any subsequent changes in that ownership to the
Securities and Exchange Commission. Specific due dates for these reports have
been established and the Company is required to disclose in this Report any
failure to file by these dates during 1996. All of the filing requirements were
satisfied on a timely basis in 1996. In making these disclosures, the Company
has relied solely on written statements of its directors, executive officers and
shareholders and copies of the reports that they filed with the Commission.
2
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ITEM 10. EXECUTIVE COMPENSATION
Executive Compensation and Other Matters
The following table sets forth information concerning cash and non-cash
compensation paid or accrued for services in all capacities to the Company
during the year ended December 31, 1996 of the Chief Executive Officer and each
of the next four most highly compensated executive officers of the Company whose
compensation exceeded $100,000 (the "Named Officers"). Except for the Chief
Executive Officer, the compensation of the Company's other executive officers
did not exceed $100,000.
<TABLE>
<CAPTION>
Long Term
Annual Compensation Compensation
------------------- ------------
Other Annual
NAME AND PRINCIPAL POSITION YEAR SALARY($) BONUS($) COMMISSION STOCK OPTIONS($)
- --------------------------- ---- --------- -------- ---------- ----------------
<S> <C> <C> <C> <C> <C>
Mak Shiu Tong, Clement 1996 316,947 - (1) -
President, Chief Executive 1995 194,069 - (1) -
Officer and Chairman 1994 252,264 - (1) -
</TABLE>
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(1) Although the officers receive certain perquisites such as auto allowances
and Company provided life insurance, the value of such perquisites did not
exceed the lesser of $50,000 or 10% of the officer's salary and bonus.
COMPENSATION OF DIRECTORS
The Company reimburses each director for all expenses of attending board
meetings. Otherwise, no compensation of any nature is paid to nonemployee
directors, and no compensation is paid to employee directors for their service
as directors.
EMPLOYEE CONTRACTS
The Company has no employment agreements with any of its employees and has
no arrangements of any nature which would result in payments to officers or
other persons as a result of any termination of employment or change in control
of the Company.
ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table is furnished as of January 1, 1997, to indicate
beneficial ownership of shares of the Company's Common Stock by (1) each
shareholder of the Company who is known by the Company to be a beneficial owner
of more than 5% of the Company's Common Stock, (2) each director, nominee for
director and Named Officer of the Company, individually, and (3) all officers
and directors of the Company as a group. The information in the following table
was provided by such persons.
<TABLE>
<CAPTION>
Amount and Nature of
Name and Address Of Beneficial Owners Beneficial Ownership(1)(2) Percent Of Class
- ------------------------------------- -------------------------- ----------------
<S> <C> <C>
Mak Shiu Tong, Clement ..... 1,668,429(2)(4) 18.5%
Room 2008, Sun Hung Kai Centre
30 Harbour Road
Wanchai, Hong Kong
</TABLE>
3
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<TABLE>
<CAPTION> Amount and Nature of
Name and Address Of Beneficial Owners Beneficial Ownership(1)(2) Percent Of Class
- ------------------------------------- -------------------------- ----------------
<S> <C> <C>
China Construction Bank - 1,603,000(3)(4) 17.7%
Guangdong Branch ..........
No. 555, Dong Feng Dong Road
Guangzhou, Guangdong Province, China
Cheng Yuk Ching -0- 0.0%
Tong Long Tin, Thomas -0- 0.0%
Kwan Pak Hoo -0- 0.0%
Zhang Xin Min -0- 0.0%
Tan Jian Sheng -0- 0.0%
Zhang Guo Liang -0- 0.0%
All executive officers and directors as a group 1,668,429 18.5%
(8 persons)
</TABLE>
(1) The persons named in the table have sole voting and investment power with
respect to all shares of common stock shown as beneficially owned by them,
subject to community property laws, where applicable, and the information
contained in the footnotes to the table.
(2) All shares indicated as being held by Mr. Mak are held of record by C.P.
Investment (B.V.I.) Ltd. ("C.P. Investment"), a wholly owned subsidiary of China
Pacific Investment Holdings Ltd. ("China Pacific Investment Holdings"). China
Pacific Investment Holdings is owned 51% by Kiu Yin Investment Co., Ltd., a
company controlled by a discretionary trust established for the benefit of Mr.
Mak's family.
(3) All shares indicated as being held by The China Construction Bank -
Guangdong Branch are held of record by C.P. Investment. China Pacific Investment
Holdings, the parent of C.P. Investment, is owned 49% by Guangdong Construction
(B.V.I.) Co., Ltd., which is, in turn, controlled by The China Construction Bank
- - Guangdong Branch.
(4) In connection with the Company's disposal of its interest in the Sun City
Project, Mak Shiu Tong, Clement and The China Construction Bank - Guangdong
Branch formed China Pacific Investment Holdings, which acquired all of the
shares of C.P. Investment (formerly China Treasure Investment (B.V.I.)
Limited) from China Treasure Holding (B.V.I.) Limited. As a result of such
transactions, The China Construction Bank - Guangdong Branch increased its
beneficial ownership in the Company by 797,143 shares and the beneficial
ownership of a like member of shares through its ownership in China Treasure
Holding (B.V.I.) Ltd., was terminated. See "Certain Relationships and
Transactions."
ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Due to the nature of the Company's participation in the development of "Sun
City" and the Company's operations within the People's Republic of China, the
Company's operations from the commencement of the "Sun City" project involved
significant transactions with affiliates, including Sanhe Group, which is
controlled by the People's Government of Huiyang City, which, until December 29,
1995, was a principal shareholder of the Company.
4
<PAGE>
The Company's former subsidiary, China Treasure Industrial Enterprise
("CTIE"), acquired the land use rights with respect to the "Regent on the Park"
and "Star Place" sites in Sun City from Sanhe Group in 1992. CTIE acquired the
land use rights with respect to such sites for $31.3 million and was obligated
to pay 20% of the after-tax profit on the development of Star Place to Sanhe
Group and 10% of such after-tax profits to Huiyang Property Development Company
Limited, a company also controlled by the Huiyang City Government. $7.3 million
of the consideration payable to Sanhe for the land use rights was paid through
December 31, 1996.
On December 29, 1995, the Company entered into an agreement with Open View
Properties Ltd., which is controlled by the People's Government of Huiyang City,
whereby the Company's then 51% owned subsidiary, China Pacific Construction,
sold its entire interest in each of its subsidiaries involved in the development
of Sun City (the "Project Subsidiaries") and along therewith, its entire
interest in Sun City (the "Sun City Sale"). As consideration for the Company's
interest in the Sun City development, Open View Properties delivered a series of
three year 8% promissory notes in the amount of US$16.2 million, representing a
return of China Pacific Construction's original capital contributions and loans
to the Project Subsidiaries plus a fee for services to be provided of US$4.1
million. Additionally, the Company was granted a five year option to develop
and market 5 million square meters of land surrounding Sun City at a price of
RMB100 (US$12) per square meter and a five year option to repurchase the
Company's interest in Sun City at cost plus a 10% premium per year. In
conjunction with the Sun City Sale, the People's Government of Huiyang City
obtained a 50% interest in China Pacific Construction, with the Company owning
the remaining 50%.
C.P. Investment loaned $8.8 million and China Treasure Holding (B.V.I.)
Ltd. (an indirect parent of the Company prior to the Sun City Sale, and now an
affiliate of the Company, "China Treasure Holding") loaned $0.8 million to the
Company's subsidiary, China Pacific Construction, during 1994. Such loans were
repayable with interest accruing at commercial bank rates, and were repaid in
1995. During 1995, China Treasure Holding loaned US$12 million to the Company's
subsidiary, China Pacific Steel Limited, in the form of a noninterest bearing
promissory note which is secured by the stock of China Pacific Steel Limited.
China Treasure Holding also loaned US$1.3 million to the Company and its
subsidiaries at a commercial interest rate of 9% per annum. The current balance
remaining on these two loans is US$5.9 million. As of December 31, 1996, C.P.
Investment had outstanding a non-interest bearing loan of US$0.4 million to the
Company.
The China Construction Bank, Guangdong Branch, a shareholder of the
Company, established a banking facility for the Company totaling $92 million for
the Sun City Project, of which US$9.1 million and US$0 had been utilized at
December 31, 1994 and 1995, respectively. Such facility is no longer available
after the disposal of the Sun City subsidiaries.
Prior to the Sun City Sale, the Company paid interest on amounts advanced
by its principal shareholders in the amount of US$1,114,000 during 1995.
C.P. Investment held 3,271,429 shares of common stock of the Company as of
December 31, 1996. C.P. Investment is wholly owned by China Pacific Investment
Holdings, which is 51% owned by Kiu Yin Investment Co., Ltd. (a company
controlled by a discretionary trust established for the benefit of the family of
Clement Mak, the Company's chairman and president), and 49% owned by Guangdong
Construction (B.V.I.) Co., Ltd., which is wholly owned by The China Construction
Bank - Guangdong Branch.
5
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SIGNATURES
In accordance with Section 13 or 15(d) of the Exchange Act, the registrant
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
CHINA PACIFIC, INC.
By: /s/ Mak Shiu Tong, Clement
------------------------------
Mak Shiu Tong, Clement
President
DATED: APRIL 30, 1997
In accordance with the Exchange Act, this report has been signed below by
the following persons on behalf of the registrant and in the capacities and on
the dates indicated.
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
/s/ Mak Shiu Tong, Clement President, Chief Executive Officer April 30, 1997
- -------------------------- and Chairman of the Board of Directors
Mak Shiu Tong, Clement (Principal Executive Officer)
/s/ Cheng Yuk Ching Vice President, Secretary and Director April 30, 1997
- -------------------
Cheng Yuk Ching
/s/ Tong Tong Lin, Thomas Chief Financial Officer (Principal April 30, 1997
- ------------------------- Financial and Accounting Officer)
Tong Long Tin, Thomas
/s/ Tan Jian Sheng Director April 30, 1997
- ------------------
Tan Jian Sheng
/s/ Zhang Guo Liang Director April 30, 1997
- -------------------
Zhang Guo Liang
/s/ Kwan Pak Hoo Director April 30, 1997
- ----------------
Kwan Pak Hoo
/s/ Zhang Xin Min Director April 30, 1997
- -----------------
Zhang Xin Min
</TABLE>
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