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: March 16, 1999
Lotus Pacific, Inc.
(Exact name of registrant as specified in its charter)
Delaware
State of Organization
000-24999
Commission File Number
52-1947160
Employer Identification Number
200 Centennial Avenue, Suite 201, Piscataway, New Jersey 08854
Address of Principal Executive Office
(732) 885-1750
Registrant's Telephone Number, Including Area Code
Item 5. OTHER EVENTS
On March 16, 1999, the Registrant announced that it had entered into an
Acquisition Agreement to acquire an equity interest in TurboNet Communications
("TurboNet"), a San Diego, California, corporation. Under the terms of the
Acquisition Agreement, the Registrant will issue $80 million worth of
restricted shares in exchange for 81% of TurboNet's equity. The shares so
issued by the Registrant are prohibited from being sold until TurboNet's
annual gross revenue exceeds $30 million with a before-tax annual net profit
of not less than $6 million. The Registrant also agreed to provide TurboNet
with $20 million in cash as working capital.
TurboNet is a premier developer of advanced cable modem technologies and
products, including DOCSIS compliant cable modem chipsets, TurboPort-MCNS
cable network module, MCNS cable data bridge, and internal and external cable
modems. TurboNet also provides cable modems and infrastructure on an OEM
basis. Toshiba Corporation of Japan is one of TurboNet's shareholders and
partners.
On March 16, 1999, the Registrant announced that it had entered into an
agreement with Arescom Inc. ("Arescom"), a Fremont, California, corporation,
whereby the Registrant will issue $30 million worth of restricted shares to
acquire an 81% equity interest in Arescom. The shares so issued by the
Registrant may not be sold until Arescom's annual gross revenue exceeds $15
million with a before-tax annual net profit of not less than $3 million. The
Registrant also agreed to provide Arescom with $10 million in cash as working
capital.
Arescom designs, manufactures and markets a complete line of high quality
inter-networking router equipment for PSTN, ISDN, xDSL and Ethernet
environments. Arescom provides users with a broad range of remote access
products that integrate voice and data along with Intelligent GUI and 100%
remote management tools for easy set-up and network management. Arescom has
established partners and channels throughout the world to develop and market
its router products for vertical and mass communication markets. Its customers
include ISPs, re-sellers and system integrators in North America. Arescom's
worldwide partners include Telecom Device of Japan, NST of China, EuroBizz of
Germany, Viking Telecom of Sweden, Exer Datacom of France, Dakel Information
of Spain, and PcExpress of Italy.
Both acquisitions are subject to approval by Registrant's shareholders as well
as completion of due diligence. The acquisitions are expected to be completed
before the close of Registrant's fourth fiscal quarter ending June 30, 1999.
Both transactions will be accounted for as purchase method.
Attached hereto and incorporated herein by reference as Exhibits 99.1 and 99.2,
are copies of press releases issued by the Registrant on March 16, 1999,
concerning the TurboNet and Arescom acquisitions, respectively.
Item 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS
(c) Exhibits
Exhibit 99.1 Press release of the Registrant dated March 16, 1999, announcing
its agreement to acquire an 81% equity interest in TurboNet Communications; and
Exhibit 99.2 Press release of the Registrant dated March 16, 1999, announcing
its agreement to acquire an 81% equity interest in Arescom Inc.
Signatures
Pursuant to the requirements of Section 12 of the Securities Exchange Act of
1934, the registrant had duly caused this report to be signed on its behalf by
the undersigned, thereto duly authorized.
LOTUS PACIFIC, INC.
Date: March 16, 1999 By: /s/ James Yao
-------------------------------------
James Yao, Chairman & President
Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below by the following person on behalf of the
registrant and in capacities and on the dates indicated.
By: /s/ Gary Huang
-------------------------------------
Gary Huang, Chief Financial Officer
Exhibit 99.1
FOR IMMEDIATE RELEASE
CONTACT:
Jeff Gull (732) 885-1750
LOTUS PACIFIC INC. ACQUIRES TURBONET COMMUNICATIONS
PISCATAWAY, New Jersey -- March 16, 1999 -- Lotus Pacific Inc. (OTC: LPFC) has
signed an Acquisition Agreement to acquire an equity interest in TurboNet
Communications ("TurboNet"), a San Diego, California, corporation. Under the
terms of the Acquisition Agreement, Lotus Pacific will issue $80 million worth
of restricted shares in exchange for 81% of TurboNet's equity. The shares so
issued by Lotus Pacific are prohibited from being sold until TurboNet's annual
gross revenue exceeds $30 million with a before-tax annual net profit of not
less than $6 million. Lotus Pacific also agreed to provide TurboNet with $20
million in cash as working capital.
TurboNet Communications is a premier developer of advanced cable modem
technologies and products. Its products include DOCSIS-compliant cable modem
chipsets, TurboPort-MCNS cable network module, MCNS cable data bridge, and
internal & external cable modems. TurboNet Communications is also providing
cable modem and infrastructure equipment on an OEM basis. Toshiba Corporation
of Japan is one of the shareholders and partners of TurboNet Communications.
"Our OEM cable modem for Toshiba just became the first of two DOCSIS cable
modems certified by CableLabs," (see news at: http://www.cablelabs.com/PR/
/certification0399_rel.html) said Harold Tuan, President of TurboNet
Communications. "We are delighted our OEM cable modem is one of two cable
modems that have been certified among many applicants including 3Com Corp.
(Nasdaq: COMS), Cisco Systems Inc. (Nasdaq:CSCO), Com21 Inc. (Nasdaq:CMTO),
General Instrument Corp. (NYSE:GIC), and Nortel Networks (NYSE:NTL). We believe
that the integration of TurboNet products with Lotus Pacific's Internet-
WallStreet Solutions(TRADEMARK) concept will significantly strengthen our
customer base and the demand for our cable modems."
"We are extremely excited about TurboNet Communications joining the Lotus
family," stated Jeff Gull, Director of Strategic Development at Lotus Pacific.
"The cable modem industry with its ever-growing market and potential will bring
significant revenue growth to both TurboNet and Lotus Pacific. With the
acquisition of TurboNet Communications, Lotus Pacific has a total of five
subsidiaries including two financial service firms and three high-tech
companies, which include products like TV set-top boxes, Internet routers,
and cable modems. As the parent company, Lotus Pacific will combine and harness
the synergy of all five subsidiaries. With the addition of TurboNet, the
company can now - better than ever - realize its Internet-WallStreet Solutions
(TRADEMARK) concept to offer its financial customers the fastest, the most
efficient, and the easiest online trading hardware and software."
ABOUT LOTUS PACIFIC, INC.
Lotus Pacific Inc. is an Internet technology and services company focused on
developing and marketing Internet-related products and services in the U.S. and
international markets with an emphasis on financial services. Through its
subsidiaries, Regent Electronics Corporation, Arescom, TurboNet Communications,
US Securities & Futures Corp. and Professional Market Brokerage, Lotus Pacific
offers unique Internet-related products like the TeleWeb system, WonderTV
(TRADEMARK) set-top box, Internet routers, cable modems, and online financial
trading system. Through realizing its Internet-WallStreet Solutions(TRADEMARK)
concept, Lotus Pacific provides new Internet solutions, services, and
opportunities for its customers and shareholders.
For more information about Lotus Pacific see the company's web site at
www.lpfc.com.
For more information about TurboNet Communications see the company's web site
at www.turbonet-comm.com.
Please note: Private Securities Litigation Reform Act of 1995 provides a "safe
harbor" for forward-looking statements. Certain information included in this
news release (as well as information in oral statements or other written
statements made or to be made by Lotus Pacific, Inc.) contain statements that
are forward-looking, such as statements relating to the future anticipated
direction of the futures and securities industry, plans for future expansion,
various business development activities, planned capital expenditures,
anticipated sales, potential contracts, dependence on existing management,
domestic and global economic conditions, changes in federal or state laws, and
market competition factors. Such forward-looking information involves important
risks and uncertainties that could significantly affect anticipated results in
the future, and accordingly, such results may differ from those expressed in
any forward-looking statements made by or on behalf of Lotus Pacific, Inc.
Exhibit 99.2
FOR IMMEDIATE RELEASE
CONTACT:
Jeff Gull (732) 885-1750
LOTUS PACIFIC INC. ACQUIRES ARESCOM INC.
PISCATAWAY, New Jersey -- March 16, 1999 -- Lotus Pacific Inc. (OTC: LPFC) has
signed an agreement with Arescom Inc. ("Arescom"), a Fremont, California,
corporation, whereby Lotus Pacific will issue $30 million worth of restricted
shares to acquire an 81% equity interest in Arescom. The shares so issued by
Lotus Pacific may not be sold until Arescom's annual gross revenue exceeds $15
million with a before-tax annual net profit of not less than $3 million. Lotus
Pacific also agreed to provide Arescom with $10 million in cash as working
capital.
Arescom designs, manufactures and markets a complete line of high quality
inter-networking router equipment for PSTN, ISDN, xDSL and Ethernet
environments. Arescom provides users a broad range of remote access products
that offer an unprecedented level of technical features integrating voice
and data along with Intelligent GUI and 100% remote management tools for easy
set-up and network management. Arescom's customers include ISPs, re-sellers,
and system integrators in North America. Arescom's worldwide partners include
Telecom Device in Japan, NST in China, EuroBizz in Germany, Viking Telecom in
Sweden, Exer Datacom in France, Dakel Information in Spain, PcExpress in Italy,
etc.
Arescom has established worldwide partners and channels to develop and market
proven router products for vertical and mass communication markets. Its current
and future products include:
* Remote Manager - configuration, diagnostics and management of Arescom
routers from anywhere in the world
* NetCruz - Japan ISDN BRI HUB/PBX router
* NetLinker - router HUB - Ethernet HUB/ISDN/DSU/POTS
* Apex 1100 - router, Ethernet/ISDN/POTS, US, Korea specifications
* Apex 1000 - high speed leased line router, Frame Relay
* Flash 200 - ISDN internal TA with POTS, US, Korea specifications
* XDSL Router - supports ADSL, IDSL, SDSL, and G.Lite WAN interfaces
* ADSL DSLAM - High-speed ADSL concentrator capable of delivering data,
voice, and video concurrently in campus environment.
"Teaming up with Lotus Pacific is our first step to leverage our technical
advantages in the Internet service industry," commented Max Lu, President of
Arescom. "We think it's a win-win cooperation for both Arescom and Lotus
Pacific. With the WonderTV A9000 set-top box from Regent Electronics Corp.
(a subsidiary of Lotus Pacific), we are progressively entering the hotel
service market providing hotel guests with fast, reliable and easy-to-use
Internet access. Our router technology will also improve the online financial
trading systems of US Securities & Futures Corp. and Professional Market
Brokerage (two financial firms recently acquired by Lotus Pacific)."
"We are excited to have Arescom join the Lotus family," stated Jeremy Wang,
vice president of Lotus Pacific. "It is of vital importance for Lotus Pacific
to have the best Internet router technology integrated into our set-top box
and online trading system. We are thrilled about the addition of Arescom and
believe this acquisition will realize Lotus Pacific's Internet-WallStreet
Solutions(TRADEMARK) concept by capitalizing on Arescom's supreme products
and R&D capability."
ABOUT LOTUS PACIFIC, INC.
Lotus Pacific Inc. is an Internet technology and services company focused on
developing and marketing Internet-related products and services in the U.S.
and international markets with an emphasis on financial services. Through its
subsidiaries, Regent Electronics Corporation, Arescom, TurboNet Communications,
US Securities & Futures Corp. and Professional Market Brokerage, Lotus Pacific
offers unique Internet-related products like the TeleWeb system, WonderTV
(TRADEMARK) set-top box, Internet routers, cable modems, and online financial
trading system. Through realizing its Internet-WallStreet Solutions(TRADEMARK)
concept, Lotus Pacific provides new Internet solutions, services, and
opportunities for its customers and shareholders.
For more information about Lotus Pacific see the company's web site
at www.lpfc.com.
For more information about Arescom see the company's web site at
www.arescom.com
Please note: Private Securities Litigation Reform Act of 1995 provides a "safe
harbor" for forward-looking statements. Certain information included in this
news release (as well as information in oral statements or other written
statements made or to be made by Lotus Pacific, Inc.) contain statements that
are forward-looking, such as statements relating to the future anticipated
direction of the futures and securities industry, plans for future expansion,
various business development activities, planned capital expenditures,
anticipated sales, potential contracts, dependence on existing management,
domestic and global economic conditions, changes in federal or state laws, and
market competition factors. Such forward-looking information involves important
risks and uncertainties that could significantly affect anticipated results in
the future, and accordingly, such results may differ from those expressed in
any forward-looking statements made by or on behalf of Lotus Pacific, Inc.
