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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) February 17, 2000
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Creative Master International, Inc.
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(Exact name of registrant as specified in its charter)
Delaware
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(State or other jurisdiction of incorporation)
33-18521-NY 11-2854355
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(Commission File Number) (IRS Employer Identification No.)
Casey Ind. Bldg., 8th Floor, 18 Bedford Rd., Taikoktsui, Kowloon, Hong Kong
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(Address of principal executive offices) (Zip Code)
N/A
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(Former name or former address) (Zip Code)
Registrant's telephone number, including area code: 011-852-2396-0147
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ITEM 5. OTHER EVENTS.
Agreement to Acquire PacificNet.com LLC
Pursuant to the terms of a Share Exchange Agreement, signed on
February 17, 2000, among the Registrant, PacificNet.com LLC ("PNC"), and the
owners of PNC, the Registrant has reached an agreement in principle to
acquire PNC. In consideration for this acquisition, the Registrant expects to
issue 21 million shares of its common stock to the owners of PNC, or
approximately 80% of the common stock of the Registrant expected to be
outstanding immediately following the acquisition.
PNC is a privately-held Internet start-up company headquartered in
Minneapolis, Minnesota and Hong Kong that focuses on trans-Pacific
business-to-business electronic commerce. The owners of PNC include China
Strategic Holdings Limited ("CSH"), an investment holding company listed on the
Hong Kong Stock Exchange, and Mr. Oei Hong Leong, the chairman of CSH. CSH is
the parent company of China Tire Holdings Ltd., which is listed on the New York
Stock Exchange. Fortune Tele.com Limited, a Hong Kong-listed mobile
telecommunications company with operations in China, is also a strategic
investor in PNC.
The parties are currently preparing a supplement to the Share
Exchange Agreement to document the parties' understanding of certain details
of the proposed acquisition. The consummation of the proposed acquisition is
subject to the execution of the supplement, the Registrant's receipt of a
favorable fairness opinion from its fairness adviser, the approval of the
Registrant's shareholders, and other customary conditions. In connection
with obtaining the approval of its shareholders, the Registrant will prepare
a definitive proxy statement which will include a complete description of the
proposed acquisition and the business of PNC. It is anticipated that the
proxy statement will be mailed to the Registrant's shareholders in May.
If the transaction is consummated, it is anticipated that the
Registrant's primary business focus will be business-to-business electronic
commerce, instead of its current focus, which is the manufacture of
collectible-quality, die-cast replicas of cars, trucks, buses and other
items. PNC has indicated its interest in disposing of the Registrant's
current business following completion of the acquisition. In light of this,
as previously reported, a management group led by the Registrant's chairman
and chief executive officer, Mr. Carl Tong, has indicated an interest in
negotiating a purchase of the Registrant's current business. However, the
Registrant has not entered into any formal understanding or arrangement with
respect to any disposition of its current business, and it is not expected
that any such disposition will be a condition to the acquisition of PNC.
Resignation of Chou Kong Seng
Chou Kong Seng has resigned from the Registrant's board of directors,
effective February 17, 2000. Mr. Chou's resignation was unrelated to the other
matters described in this report.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS.
(c) Exhibits
10.1 Share Exchange Agreement, signed on February 17, 2000, by
and among the Registrant, PacificNet.com LLC and each of
the Members of PacificNet.com LLC.
99 Press Release dated as of February 17, 2000.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
Dated: March 7, 2000 CREATIVE MASTER INTERNATIONAL, INC.
By: /s/ Carl Ka Wing Tong
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Carl Ka Wing Tong
Chief Executive Officer and President
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EXHIBIT INDEX
10.1 Share Exchange Agreement, signed on February 17, 2000, by and between the
Registrant and PacificNet.com LLC.
99 Press Release dated as of February 17, 2000.
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Exhibit 10.1
SHARE EXCHANGE AGREEMENT
THIS SHARE EXCHANGE AGREEMENT ("Agreement") is dated as of February 17,
2000 by and between Creative Master International, Inc. ("Company") and Tony
Tong, Wan Sang Hui, Lee Li, James Mullin, John Farrell, Paul Poung-Hwa Chow,
Fung Oi Ip Alfonso, Oei Hong Leung, Fortune E-Commerce Limited, B2B Limited
(collectively, "Shareholders"), the owner of PacificNet.com LLC ("PNC") and PNC.
R E C I T A L S
WHEREAS, Shareholders own 100% of the issued and outstanding stock of
PNC (the "Shares"), and;
WHEREAS, PNC is a Minnesota limited liability company and is engaged in
the business of providing Internet business-to-business and business-to-consumer
e-commerce services, e-commerce software application and other e-commerce
related services.
WHEREAS, Company is a Delaware incorporated US public company,
currently traded on the NASDAQ National Market under the symbol CMST, and;
WHEREAS, Company desires to acquire the Shares and Shareholders desire
to exchange the Shares for newly issued stock in the Company.
A G R E E M E N T
NOW, THEREFORE, in consideration of the mutual covenants and terms
contained herein and in reliance upon the representations and warranties
hereinafter set forth, the parties agree as follows:
I. EXCHANGE OF THE SHARES AND CONSIDERATION
1.01 SHARES BEING EXCHANGE. Effective at the closing of this Agreement
(the "Closing"), and subject to the terms and conditions of this Agreement,
Shareholders shall assign, transfer and deliver to the Company all of the
Shares.
1.02 CONSIDERATION. Subject to the terms and conditions of this
Agreement, and in consideration of the assignment and delivery of the Shares to
the Company, the Company shall at Closing issue to Shareholders under/or their
designees, and Shareholders and/or their designees shall purchase, acquire
and/or accept from the Company, 21,000,000 shares in the Company (the
"Consideration").
1.03 CLOSING. The Closing of the transaction contemplated by this
Agreement (the "Closing") shall take place at the offices of Troy & Gould or
other such place as mutually agreed upon, following by the necessary Company
shareholders approval procedures.
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1.04 METHOD OF CLOSING. The method of closing shall require the parties
to satisfy the conditions specified in Section 6.
II. REPRESENTATIONS AND WARRANTIES OF SHAREHOLDERS AND PNC
Shareholders and PNC represent and warrant to the Company as follows,
as of the closing:
2.01 ORGANIZATION. PNC is a corporation duly organized, validly
existing and in good standing under the laws of Minnesota. PNC has the corporate
power and authority to carry on its business as presently conducted; and is
qualified to do business in all jurisdictions where the failure to be so
qualified would have a material adverse effect on its business.
2.02 CAPITALIZATION.
2.02(a) All issued and outstanding shares of PNC are duly
authorized, validly issued, issued for value, fully paid and
non-assessable. Shareholders own 100% of all the shares in PNC.
2.02(b) There are no outstanding preferred stock, options,
warrants, or any other rights to purchase any securities of PNC.
Company acknowledges and agrees that any outstanding options, warrants,
and other rights to purchase securities in Shareholders shall be
transferred to Company on an equivalent basis, at the time of closing.
2.03 AUTHORITY. Shareholders have full power and authority to enter
into this Agreement and to carry out the transactions contemplated herein. The
execution and delivery of this Agreement and the consummation of the
transactions contemplated hereby, have been duly authorized and approved by
Shareholders and no other corporate proceedings on the part of PNC and/or
Shareholders are necessary to authorize this Agreement and the transactions
contemplated hereby.
2.04 FINANCIAL INFORMATION. The Financial Information provided by
Shareholders to Company is accurate and no misleading, to the best of
Shareholders' knowledge.
2.05 LITIGATION. There is no litigation, proceeding or investigation
pending or threatened against PNC affecting any of its properties, subsidiaries,
or assets that might result, either in any case or in the aggregate, in any
adverse change in the business, operations, affairs or condition of PNC or its
properties or assets, or that might call into question the validity of this
Agreement, or any action taken or to be taken pursuant hereto.
2.06 ASSETS. Shareholders have good and marketable title to their
shares in PNC, and PNC has good and marketable title to all of its assets and
properties now carried on its books.
2.07 CONTRACTS AND UNDERTAKINGS. PNC and its subsidiary business
operations are not in material default, or alleged to be in material default,
under any Contract or Undertaking.
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2.08 NO CONFLICT. The execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby will not conflict with or
result in a breach of any form or provision of, or constitute a default under,
the Articles of PNC, or any agreement, contract or instrument to which PNC is a
party or by which it or any of its assets are bound.
2.09 ACCURACY. No document furnished to the Company by or on behalf of
the Company in connection with the transactions contemplated hereby, contains
any untrue statement of a material fact or when taken as a whole omits to state
a material fact necessary in order to make the statements contained herein or
therein not misleading.
2.10 FINANCIAL STATEMENTS AND TAX FILINGS. The financial statements of
PNC (the "Financial Statements") submitted to the Company (a) were prepared in
accordance with the books and records of PNC; (b) were prepared in accordance
with generally accepted accounting principles consistently applied; (c) are
accurate and fairly present PNC's financial condition and the results of its
operations as of the relevant dates thereof and for the periods covered thereby;
(d) contain and reflect all necessary adjustments and accruals for a fair
presentation of PNC's financial condition and the results of its operations for
the periods covered by the said financial statements; and (e) contain and
reflect adequate provisions for all reasonably anticipated liabilities with
respect to the period(s) then ended.
2.11 ABSENCE OF MATERIAL CHANGES. Since December 31, 1999, except as
described in any Exhibit hereto or as required or permitted under this
Agreement, there has not been any material negative change in the condition
(financial or otherwise) of the properties, assets, liabilities or business of
Company, except changes in the ordinary course of business which, individually
and in the aggregate, have not been materially adverse.
2.12 COMPLIANCE WITH LAW. PNC has in all material respects complied
with and is now in all material respects in compliance with, all relevant laws
applicable to PNC. The transfer of PNC stock contemplated by this Agreement will
take place in compliance with relevant laws applicable to such transfer.
III. REPRESENTATIONS AND WARRANTIES OF THE COMPANY
The Company hereby represents and warrants to Shareholders as follows,
as of the Closing:
3.01 ORGANIZATION.
3.01(a) The Company is a corporation duly organized, validly
existing, and in good standing under the laws of the State of Delaware,
has the corporate power and authority to carry on its business as
presently conducted and is qualified to do business in all
jurisdictions where the failure to be so qualified would have a
material adverse effect on the business of the Company.
3.01(b) Copies of the Certificate of Incorporation and the
Article and Bylaws of the Company, supplied to PNC prior to closing,
are complete and correct copies of the
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Articles of Incorporation and the Bylaws of the Company as amended and
in effect on the date hereof. All minutes of meetings and actions in
writing without a meeting of the Board of Directors and shareholders of
the Company are contained in the minute book of the Company and no
minutes or actions in writing without a meeting have been excluded in
such minute book.
3.02 CAPITALIZATION OF THE COMPANY. The authorized capital stock of the
Company consists of 50,000,000 shares of Common Stock. 5,500,000 shares will be
issued and outstanding prior to the closing. In addition, there are 340,500
stock options outstanding, at $5 per share, subject to specific vesting terms.
All outstanding shares are duly authorized, validly issued, fully paid and
non-assessable. Except for that described above, there are no outstanding shares
of capital stock or other securities or other equity interests of the Company or
rights of any kind to acquire stock, other securities or other equity interests.
3.03 AUTHORITY. The Company has full power and authority to enter into
this Agreement and to carry out the transactions contemplated herein.
3.04 FINANCIAL STATEMENTS. The Company's financial statements have been
prepared in accordance with US generally accepted accounting principles. The
Company is not subject to any material undisclosed liability or obligation of
any nature, whether absolute, accrued, contingent, or otherwise and whether due
or to become due.
3.05 LITIGATION. There is no litigation, proceeding, government
inquiry, or investigation pending or to the knowledge of the Company, threatened
against the Company affecting any of its properties or assets, or, to the
knowledge of the Company that might result, either in any case or in the
aggregate, in any material adverse change in the business, operations, affairs
or condition of the Company or any of its properties or assets, or that might
call into question the validity of this Agreement, or any action taken or to be
taken pursuant hereto.
3.06 TITLE TO ASSETS. The Company has good and marketable title to all
of its assets and properties now carried on its books including those reflected
in the balance sheet contained in the Company's financial statements, free and
clear of all liens, claims, charges, security interests or other encumbrances,
except as described in the balance sheet included in the Company's finance
statements or on any Exhibits attached hereto.
3.07 CONTRACTS AND UNDERTAKINGS. The Company is not in material
default, or alleged to be in material default, under any Contract and, to the
knowledge of the Company, no other party to any Contract to which the Company is
a party is in default thereunder nor, to the knowledge of the Company, does
there exist any condition or event which, after notice or lapse of time or both,
would constitute a default by any party to any such Contract.
3.08 NO CONFLICT. The execution and delivery of this Agreement and the
consummation of the transaction contemplated hereby will not conflict with or
result in a breach of any term or provision of, or constitute a default under,
the Certificate of Incorporation or Bylaws of the Company, or any agreement,
contract or instrument to which the Company is a party or by which it or nay of
its assets are bound.
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3.09 ACCURACY. No public filing, certificate or other document
furnished to Shareholders by or on behalf of the Company in connection with the
transactions contemplated hereby, contains any untrue statement of a material
fact or when taken as a whole omits to state a material fact necessary in order
to make the statements contained herein or therein not misleading.
3.10 FINANCIAL STATEMENTS. The financial statements of the Company (the
"Financial Statements") set forth in its public filings (a) were prepared in
accordance with the books and records of the Company; (b) were prepared in
accordance with generally accepted accounting principles consistently applied;
(c) are accurate and fairly present the Company's financial condition and the
results of its operations as of the relevant dates thereof and for the periods
covered thereby; (d) contain and reflect all necessary adjustments and accruals
for a fair presentation of the Company's financial condition and the results of
its operations for the periods covered by the said financial statements; and (e)
contain and reflect adequate provisions for all reasonably anticipated
liabilities with respect to the period(s) then ended.
3.11 ABSENCE OF MATERIAL CHANGES. Since the September 30, 1999 SEC Form
10QSB filing, except as described in any Exhibit hereto or as required or
permitted under this Agreement, there has been:
3.11(a) any material change in the condition (financial or
otherwise) of the properties, assets, liabilities or business of the
Company, except changes in the ordinary course of business which,
individually and in the aggregate, have not been materially adverse.
3.11(b) any undisclosed redemption, purchase or other
acquisition of any shares of the capital stock of Company, or any
issuance of any shares of capital stock or the granting, issuance or
exercise of any rights, warrants, options or commitments by the Company
relating to their authorized or issued capital stock.
3.12 COMPLIANCE WITH LAW. The Company has in all material respects
complied with and it is now in all material respects in compliance with, all
Federal and State laws applicable to the Company, including that the Company is
current in its SEC filings. The Consideration will be issued in full compliance
with all state and federal securities laws.
IV. COVENANTS AND AGREEMENTS OF THE PARTIES EFFECTIVE PRIOR TO CLOSING
4.01 CORPORATE EXAMINATIONS AND INVESTIGATIONS. Prior to the Closing,
Shareholders shall be entitled, through their employees and representatives, to
make such investigations and examinations of the books, records and financial
condition of the Company as Shareholders may request to verify the Company's
representations. Company shall furnish Shareholders and their representatives
during such period with all such information as Shareholders or their
representatives may reasonably request and cause the Company's officers,
employees, consultants, agents, accountants and attorneys to cooperate fully
with Shareholder or its
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representatives in connection with such review and examination and to make full
disclosure of all information and documents requested by Shareholders and/or
their representatives. Company shall have the right to request additional
information on PNC. Company acknowledges that US GAAP audits will not be
available on PNC until after the Closing. Shareholders agree to supply Company
with copies of available financial and business information as requested. Each
party's investigations and examinations shall be conducted at reasonable times
and under reasonable circumstances, with copies of requested documents to be
provided to the other party upon request.
4.02 COOPERATION; CONSENTS. Prior to the Closing Date, each party shall
cooperate with the other parties to the end that the parties shall (i) in a
timely manner make all necessary filings with, and conduct negotiations with,
all authorities and other persons the consent or approval of which, or a license
or permit from which is required for the consummation of the transactions
contemplated by this Agreement and (ii) provide to each other party such
information as the other party may reasonably request in order to enable it to
prepare such filings and to conduct such negotiations.
4.03 CONDUCT OF BUSINESS. From the date hereof through the Closing, the
Company and PNC shall (i) conduct its business in the ordinary course and in
such a manner so that the representations and warranties contained herein shall
continue to be true and correct as of the Closing as if made at and as of the
Closing. Without the prior written consent of Shareholders, except as expressly
set forth herein, the Company shall not undertake or fail to undertake any
action if such action or failure would render any of said warranties and
representations untrue as of the Closing.
4.04 NOTICE OF DEFAULT. From the date hereof through the Closing, each
party hereto shall give to the other parties prompt written notice of the
occurrence or existence of any event, condition or circumstance occurring which
would constitute a violation or breach of this Agreement by such party or which
would render inaccurate in any material respect any of such party's
representations or warranties contained herein.
V. SURVIVAL OF REPRESENTATIONS, WARRANTIES AND COVENANTS
All representations, warranties and covenants of the Company,
Shareholders and PNC contained herein shall survive the closing for a period of
two years.
VI. CONDITIONS PRECEDENT TO CLOSING
6.01 CONDITIONS PRECEDENT TO OBLIGATION OF SHAREHOLDERS. The
obligations of Shareholders under this Agreement shall be subject to each of the
following conditions:
(a) REPRESENTATIONS AND WARRANTIES OF COMPANY TO BE TRUE. The
representations and warranties of Company herein contained shall be
true in all material respects at the Closing with the same effect as
though made at such time. The Company shall have performed in all
material respects all obligations and complied in all material
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respects, to its actual knowledge, with all covenants and conditions
required by this Agreement to be performed or complied with by it at or
prior to the Closing.
(b) NO LEGAL PROCEEDINGS. No injunction or restraining order
shall be in effect prohibiting this Agreement, and no action or
proceeding shall have been instituted and, at what would otherwise have
been the Closing, remain pending before the court to restrain or
prohibit the transactions contemplated by this Agreement.
(c) STATUTORY REQUIREMENTS. All statutory requirements for the
valid consummation by the Company of the transactions contemplated by
this Agreement shall have been fulfilled. All authorizations, consents
and approvals of all governments and other persons required to be
obtained in order to permit consummation by the Company of the
transactions contemplated by this Agreement shall have been obtained.
(d) DIRECTOR RESIGNATION. Prior to the Closing, all bust one
of the directors of the Company shall have submitted their resignations
to Company to be held in escrow and to become effective at the Closing.
(e) NO MATERIAL ADVERSE CHANGE. Following the execution of
this Agreement, there shall not have occurred any material adverse
change in the financial condition, business, or operations of, nor
shall nay event have occurred which, with the lapse of time or the
giving of notice, may cause or create any material adverse change in
the financial condition, business, or operations, of Company.
(f) BOARD OF DIRECTORS' APPROVAL. This Agreement shall have
received Shareholders Board of Director's approval prior to Closing.
6.02 CONDITIONS PRECEDENT TO OBLIGATIONS OF COMPANY. The obligation of
the Company under this Agreement shall be subject to the following conditions:
(a) REPRESENTATIONS AND WARRANTIES OF SHAREHOLDERS AND PNC TO BE
TRUE. The representations and warranties of Shareholders herein contained shall
be true in all material respects as of the Closing, and shall have the same
effect as though made at the Closing; Shareholders shall have performed in all
material respects all obligations and complied in all material respects, with
all covenants and conditions required by this Agreement to be performed or
complied with by them prior to the Closing.
(b) NO LEGAL PROCEEDINGS. No injunction or restraining order shall
be in effect, and no action or proceeding shall have been instituted and, at
what would otherwise have been the Closing, remain pending before the court to
restrain or prohibit the transactions contemplated by this Agreement.
(c) STATUTORY REQUIREMENTS. All statutory requirements for the
valid consummation by Shareholders of the transactions contemplated by this
Agreement shall have been fulfilled. All authorizations, consents and approvals
of all governments and other persons required to be obtained in order to permit
consummation by Shareholders of
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the transactions contemplated by this Agreement shall have been obtained,
including, but not limited to, requirements imposed by the government of Hong
Kong.
(d) NO MATERIAL ADVERSE CHANGE. Following the execution of this
Agreement, there shall not have occurred any material adverse change in the
financial condition, business, or operations of, nor shall any event have
occurred which, with the lapse of time or the giving of notice, may cause or
create any material adverse change in the financial condition, business, or
operations, of PNC.
(e) BOARD OF DIRECTOR'S APPROVAL. This Agreement shall have
received Company Board of Director's approval prior to Closing.
VII. MISCELLANEOUS
7.01 EXPENSES OF SALE. Except as otherwise provided herein, each party
shall bear its own direct and indirect expenses incurred in connection with the
negotiation and preparation of this Agreement and the consummation and
performance of the transactions contemplated herein. Without limitation, such
expenses shall include the fees and expenses of all attorneys, brokers,
investment bankers, accountants, agents, advisors, and finders and other
professionals incurred in connection herewith, acting on behalf of such party.
7.02 PARTIES IN INTEREST. Except otherwise expressly provided herein,
all the terms and provisions of this Agreement shall binding upon, shall inure
to the benefit of and shall be enforceable by the respective heirs,
beneficiaries, personal and legal representatives, successors, designees and
assigns of the parties hereto.
7.03 ENTIRE AGREEMENT; AMENDMENTS. This Agreement, including any
Schedules, Exhibits and other documents and writings referred to herein or
delivered pursuant hereto, which form a part hereof, contains the entire
understanding of the parties with respect to its subject matter. There are no
restrictions, agreements, promises, warranties, covenants or undertakings other
than those expressly set forth herein or therein. This Agreement supersedes all
prior agreements and understandings between the parties with respect to its
subject matter. This Agreement may be amended only by a written instrument duly
executed by the parties or their respective successors or assigns.
7.04 COUNTERPARTS. This Agreement may be executed in several
counterparts, each of which shall be deemed an original but all of which
together shall constitute on e and the same instrument.
7.05 TERMINATION. In the event that one party's due diligence
determines a material breach or inaccuracy in the other's representation(s) or
other terms of this Agreement, the party may terminate its obligations under
this Agreement by providing written notice of the breach. If the breach is not
cured within 10 calendar days, the agreement is terminated, with no further
obligations of the parties.
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7.06 GOVERNING LAW. This Agreement shall be subject to New York law and
jurisdiction, except insofar as the laws of the jurisdictions of domicile of the
parties shall control in any conflict of laws dispute.
IN WITNESS WHEREOF, this Agreement has been duly executed and delivered
by the parties hereto as of the date first above written.
<TABLE>
<CAPTION>
<S> <C>
PacificNet.com LLC Creative Master International, Inc.
By : /s/ Tony Tong By: /s/ Carl Tong
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Name: Tony Tong Name: Carl Tong
Title: CEO Title: CEO
Tong I, Tony Wan Sang Hui
/s/ Tony Tong /s/Wan Sang Hui*
- -------------------------------- --------------------------------
Lee Li James Mullin
/s/ Lee Li* /s/ James Mullin*
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John Farrell Paul Poung-Hwa Chow
/s/ John Farrell* /s/ Paul Poung Hwa Chow*
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Fung Oi Ip Alfonso Oei Hong Leong
/s/ Fung Oi Ip Alfonso* /s/ Oei Hong Leong*
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Fortune E-Commerce Limited B2B Limited
By: * By: *
---------------------------- ----------------------------
Name: Name:
Title: Title:
*By Tony Tong, attorney-in-fact.
</TABLE>
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CREATIVE MASTER ANNOUNCES AGREEMENT IN PRINCIPLE TO ACQUIRE PACIFICNET.COM
HONG KONG, Feb 17, 2000 -- Creative Master International, Inc. (the "Company" or
"Creative Master") (Nasdaq: CMST) today announced that the Company has entered
into an agreement to acquire PacificNet.com, an internet start-up company
headquartered in Minneapolis USA and Hong Kong that focuses on trans-Pacific B2B
e-commerce. The agreement provides that the owners of PacificNet.com will
receive 21,000,000 new shares of Creative Master, representing a substantial
majority interest. The principal shareholders of PacificNet.com are China
Strategic Holdings Limited ("CSH") (HKSE:0235), an investment holding company
listed on the Hong Kong Stock Exchange, and Mr. Oei Hong Leong, the chairman of
CSH. CSH is the parent company of China Tire Holdings Ltd (NYSE: TIR). Fortune
Tele.com Limited (HKSE: 8040), a Hong Kong listed mobile telecommunications
company with operations in China, is also a strategic investor in
PacificNet.com.
Mr. Carl Tong, CEO of Creative Master said, "We welcome the opportunity to
transform Creative Master into a China-US B2B e-commerce company with the
acquisition of PacificNet.com." Mr. Tong also explained that, in light of the
intended shift in focus of the new enterprise to B2B e-commerce, it is
contemplated that the existing business and operations of Creative Master would
be sold to a group led by Mr. Tong, other management of Creative Master and Acma
Strategic Holdings Limited, a major shareholder of CMST. Mr. Tong stated,
however, "There is no formal understanding or arrangement among PacificNet.com,
the Company or management to sell the business and assets of Creative Master.
Any transactions with PacificNet.com and management would be subject to the
preparation of definitive agreements, receipt of fairness opinions and approval
of the boards of directors and shareholders of Creative Master and
PacificNet.com."
Tony Tong, President/CEO of PacificNet.com, (no relationship to Carl Tong),
said, "We believe PacificNet.com has the technology, vision, and leadership to
take advantage of the exploding opportunities in the trans-Pacific B2B
e-commerce. To date, we have signed up over one thousand corporate customers in
China and Hong Kong for our eMerchant2000-TM- web based commerce system with
integrated payment services."
About Creative Master International, Inc.
Creative Master International, established in 1987, is a leading independent
manufacturer of collectible-quality, die-cast replicas of cars, trucks, buses,
marine products and other items. The Company offers customers turnkey product
development and manufacturing capabilities, from design to completion of the
product. The die-cast replicas Creative Master International manufactures are
marketed and distributed by the Company's customers primarily to collectors,
hobbyists and other vehicle enthusiasts in the U.S. and Europe.
About PacificNet.com
Headquartered in Minneapolis and Hong Kong, PacificNet.com (www.PacificNet.com)
is a Business-To-Business (B2B) e-commerce solutions provider focusing on
trans-Pacific B2B
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trade. PacificNet.com provides comprehensive front-end and back-end e-commerce
services including site launch, promotion, payment, fulfillment, and customer
support services.
For further information on Creative Master visit the Company's website at
www.creativemaster.com or, via fax free of charge, dial 1-800-PRO-INFO and enter
company code "CMST."
Certain matters discussed within this press release are forward-looking
statements within the meaning of the Private Securities Litigation Reform Act of
1995. Although management of Creative Master believes the expectations reflected
in such forward-looking statements are based on reasonable assumptions, it can
give no assurance that its expectations will be attained. Factors that could
cause actual results to differ materially from expectations include the
composition, timing and size of orders from and shipments to major customers;
market acceptance of new products and other risks detailed from time to time in
Creative Master's SEC reports, including the Company's most recent annual report
on Form 10-K.
