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BRITISH VIRGIN ISLANDS (State or other jurisdiction of incorporation or organization) | 5094 (Primary Standard Industrial Classification Code Number) | Not Applicable (I.R.S. Employer Identification No.) |
Martin Pak Chief Financial Officer Man Sang Holdings, Inc, Suite 2208-14, 22/F, Sun Life Tower, The Gateway 15 Canton Road, Tsimshatsui, Kowloon, Hong Kong Telephone : (852) 2317 9888 | Brian Spires Baker & McKenzie 14/F, Hutchison House 10 Harcourt Road Central, Hong Kong Telephone : (852) 2846 1888 |
Proposed Maximum | Proposed Maximum | Amount of | ||||||||||
Title of Each Class of | Amount to be | Offering | Aggregate | Registration | ||||||||
Securities to be Registered | Registered(1) | Price per Share(2) | Offering Price(2) | Fee(3) | ||||||||
Ordinary shares | 6,382,582 | $2.28 | $14,552,287 | $812 | ||||||||
Preferred shares | 100,000 | $72.76(4) | $7,276,061(4) | $406 | ||||||||
(1) | Based on 6,382,582 ordinary shares and 100,000 preferred shares of Man Sang International (B.V.I.) Limited (“Man Sang BVI”) that will be issued and distributed to the holders of the common stock and preferred stock of Man Sang Nevada on a share-for-share basis upon consummation of the liquidation of Man Sang Nevada. | |
(2) | Reflects the market price of the common stock of Man Sang Nevada, computed in accordance with Rule 457(c) and Rule 457(f)(1) under the Securities Act based upon the average of the high and low prices of the common stock of Man Sang Nevada as reported on the NYSE Amex stock exchange (“NYSE Amex,” formerly known as The American Stock Exchange) on July 23, 2009, and is estimated solely to determine the registration fee. Although there is no present market for the securities of Man Sang BVI, upon consummation of the liquidation of Man Sang Nevada, the ordinary shares of Man Sang BVI will be listed on the NYSE Amex. The preferred shares of Man Sang BVI will remain unlisted. | |
(3) | Calculated by multiplying 0.00005580 by the proposed maximum aggregate offering price. | |
(4) | Because the preferred stock of Man Sang Nevada is not listed, the price per share and maximum aggregate offering price of Man Sang Nevada preferred stock reflects the market price of the common stock of Man Sang Nevada, adjusted to reflect that 100,000 shares of preferred stock outstanding are entitled to the votes of 3,191,255 shares of common stock. |
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The information in this proxy statement/prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This proxy statement/prospectus is not an offer to sell these securities and is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted. |
Dear Stockholder: | , 2009 |
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Suite 2208-14, 22/F, Sun Life Tower, The Gateway
15 Canton Road, Tsimshatsui, Kowloon, Hong Kong
To Be Held On , 2009
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ANNEXES | ||||||||
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EX-23.1 | ||||||||
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EX-99.1 |
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• | the court that gave the judgment was competent to hear the action in accordance with private international law principles as applied by the courts in the British Virgin Islands; and | |
• | the judgment was not contrary to public policy in the British Virgin Islands, was not obtained by fraud or in proceedings contrary to the natural justice of the British Virgin Islands, and was not based on an error in British Virgin Islands law. |
• | “Assets” are to all of Man Sang Nevada’s property and assets, which consists of Man Sang BVI ordinary shares and Man Sang BVI preferred shares; | |
• | the “Internal Revenue Code” are to the U.S. Internal Revenue Code of 1986, as amended; | |
• | “Man Sang BVI” are to Man Sang International (B.V.I.) Limited, a company incorporated in the British Virgin Islands; | |
• | “Man Sang Nevada” are to Man Sang Holdings, Inc., a Nevada corporation; | |
• | the “PRC” are to the People’s Republic of China; and | |
• | the “principal stockholders” are to Cheng Chung Hing, Ricky, Cheng Tai Po and entities affiliated with them, which, as of the record date, owned approximately 3,437,501 outstanding shares of Man Sang Nevada common stock and 100,000 outstanding shares of Man Sang Nevada Series A preferred stock, which together represent the votes of 6,628,726 shares of Man Sang Nevada common stock, or 69.2% of the total voting power of Man Sang Nevada common stock and Series A preferred stock. |
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Q: | Why am I receiving this proxy statement/prospectus? |
A: | Pursuant to applicable Nevada law and relevant securities regulations, we are providing you with this proxy statement/prospectus to inform you of the dissolution and liquidation of Man Sang Nevada, a Nevada corporation, listed on the NYSE Amex, and to request your approval of the dissolution and liquidation of Man Sang Nevada and the adoption of the agreement and plan of liquidation. |
Q: | What am I being asked to vote on? |
A: | You are being asked to approve the dissolution and liquidation of Man Sang Nevada and the adoption of the agreement and plan of liquidation. The dissolution and the liquidation of Man Sang Nevada will effectively change our place of incorporation from Nevada to the British Virgin Islands. |
Q: | Who is entitled to vote on the dissolution and liquidation? |
A: | All stockholders of record at the close of business on July 27, 2009, as shown in our records, will be entitled to vote, or to grant proxies to vote, at the special meeting. At the close of business on the Man Sang Nevada record date, there were 6,382,582 shares of Man Sang Nevada common stock outstanding and 100,000 shares of preferred stock outstanding (which, as a class, are entitled to the votes of 3,191,225 shares of common stock) entitled to vote at the special meeting, held by approximately stockholders of record. |
Q: | When and where will the vote on the dissolution and liquidation take place? |
A: | A special meeting of stockholders will be held at 10 a.m., local time, on , 2009, at the offices of Man Sang Holdings, Inc.,Suite 2208-14, 22/F., Sun Life Tower, The Gateway, 15 Canton Road, Tsimshatsui, Kowloon, Hong Kong. |
Q: | What is required to constitute a quorum? |
A: | The presence at the special meeting, in person or by proxy, of the holders representing a majority of the outstanding shares of the common stock and Series A preferred stock entitled to vote at the special meeting is required to constitute a quorum. |
Q: | If the dissolution and liquidation is completed, what will I receive? |
A: | At the effective time of the liquidation, Man Sang Nevada will distribute the Assets to its stockholders on a share-for-share basis. The number and class of Man Sang BVI ordinary and preferred shares you will own as a result of the completion of the liquidation will be the same as the number and class of shares of Man Sang Nevada common and preferred stock you owned immediately prior to the completion of the liquidation. Shareholders’ proportionate ownership and relative voting rights will remain unchanged. |
Q: | Will the Man Sang BVI ordinary shares be listed and publicly traded on the NYSE Amex? |
A: | Yes. Upon the effective time of the liquidation, we expect the Man Sang BVI ordinary shares to be listed and publicly traded on the NYSE Amex under the trading symbol “MHJ.” Man Sang Nevada’s common stock will be cancelled and de-listed from the NYSE Amex and will no longer be publicly traded. However, upon the effective time of the liquidation, the Man Sang BVI preferred shares will remain unlisted. |
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Q: | What vote is required to approve the dissolution and liquidation of Man Sang Nevada and the adoption of the agreement and plan of liquidation, and are there any stockholders already committed to voting in favor of the liquidation? |
A: | The dissolution and liquidation requires at a meeting of stockholders at which a quorum is present, in person or by proxy, the affirmative vote of holders representing a majority of the outstanding shares of common stock and Series A preferred stock entitled to vote. On the record date, the principal stockholders owned approximately 3,437,501 outstanding shares of Man Sang Nevada common stock and 100,000 outstanding shares of Man Sang Nevada preferred stock, which together represent the votes of 6,628,726 shares of Man Sang Nevada common stock, or 69.2% of the total voting power of Man Sang Nevada common stock and Series A preferred stock. The principal stockholders have agreed to vote their shares to approve the dissolution and liquidation of Man Sang Nevada and the adoption of the agreement and plan of liquidation. The principal stockholders own sufficient number of shares of Man Sang Nevada’s common stock and preferred stock to approve the dissolution and liquidation of Man Sang Nevada and the adoption of the agreement and plan of liquidation. See “The Special Meeting — Vote Required.” |
Q: | How do I vote if my shares are registered in my name? |
A: | By completing, signing and returning your proxy card in the enclosed postage-prepaid envelope, you will authorize the persons named on the proxy card to vote your shares according to your instructions. |
Q: | How do I vote if my broker holds my shares in “street name”? |
A: | If you hold your shares in “street name” through a stockbroker, bank or other nominee rather than directly in your own name, you are considered the beneficial owner of shares, and the proxy materials are being forwarded to you by your stockbroker, bank or other nominee together with a voting instruction card. Please carefully consider the information contained in this proxy statement/prospectus and, whether or not you plan to attend the special meeting. Please follow the instructions provided to you by your stockbroker, bank or other nominee so that your shares may be voted in accordance with your wishes. To vote at the special meeting, beneficial owners will need to contact the broker, bank, or other nominee that holds their shares to obtain a proxy issued in your name to bring to the meeting. |
Q: | What if I don’t vote or abstain? |
A: | Shares for which no votes are cast will effectively be treated as shares present for quorum purposes, but not entitled to vote, so they will have no effect on the outcome of the vote for the dissolution and liquidation of Man Sang Nevada and the agreement and plan of liquidation. Abstentions will be treated as shares present for quorum purposes and entitled to vote, so they will have the same effect as votes against the dissolution and liquidation of Man Sang Nevada and the agreement and plan of liquidation. |
Q: | Can I change my vote after I have delivered my proxy? |
A: | Yes. You may revoke your proxy at any time before its exercise. Proxies may be revoked by (1) sending a written notice of revocation dated later than the proxy to the Secretary of Man Sang Nevada at Man Sang Nevada’s principal executive offices, before the special meeting, (2) duly executing a subsequent proxy relating to the same shares and delivering it to American Stock Transfer & Trust Company before the special meeting, or (3) attending the special meeting and voting in person (although attendance at the special meeting will not in and of itself constitute revocation of a proxy). Any written notice revoking a proxy should be delivered to American Stock Transfer & Trust Company before the special meeting. If you are a beneficial stockholder, you must contact your broker, bank or other nominee to change your vote or obtain a proxy to vote your shares if you wish to cast your vote in person at the meeting. |
Q: | When do you expect the liquidation to be completed? |
A: | We are working to complete the dissolution and liquidation as quickly as practicable. We currently expect the liquidation to be completed by July 31, 2009. However, we cannot predict the exact effective time of the liquidation because it is subject to certain conditions both within and outside our control. See “The Liquidation — The Agreement and Plan of Liquidation — Conditions to Complete the Liquidation” beginning on page 39. |
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Q: | Are Man Sang Nevada stockholders entitled to dissenters’ rights? |
A: | No. Under Nevada law, Man Sang Nevada stockholders are not entitled to dissenters’ rights because (a) the Nevada Revised Statutes do not provide for dissenters’ rights for this corporate action; and (b) neither Man Sang Nevada’s restated articles of incorporation, as amended, the restated bylaws, nor a resolution of its board of directors grant shareholders dissenters’ rights. |
Q: | Are Man Sang Nevada stockholders entitled to appraisal rights? |
A: | No. Under Nevada law, there are no appraisal rights unless there are dissenters’ rights. |
Q: | Do I have to change my stock certificates? |
A: | Yes. The distribution agent will send you a letter of transmittal, which will instruct you how to surrender your certificates of common stock and preferred stock of Man Sang Nevada. Upon surrender of the certificate with a duly executed letter of transmittal, you will be entitled to receive in exchange the whole number of Man Sang BVI ordinary shares or preferred shares that you have the right to receive pursuant to the agreement and plan of liquidation. If you surrender a Man Sang Nevada stock certificate and request the new Man Sang BVI ordinary shares or preferred shares in dematerialized form to be issued in a name other than the one appearing on the surrendered certificate, you must endorse the stock certificate or otherwise prepare it to be in proper form for transfer. Man Sang Nevada certificates that are surrendered will be cancelled. No interest will be paid or accrued on any amount payable upon surrender of stock certificates. No holder of unsurrendered certificates will receive any dividends or other distributions with respect to Man Sang BVI ordinary shares or preferred shares to which the holder is entitled under the agreement and plan of liquidation until the Man Sang Nevada certificate registered to the holder is surrendered to the distribution agent. For further information, see “The Liquidation — The Agreement and Plan of Liquidation — Share Conversion” on page 41. |
Q: | Will I be able to trade my shares during the time it takes to complete the liquidation? |
A: | Yes. |
Q: | Who will bear the cost for soliciting votes for the special meeting? |
A: | Man Sang Nevada will bear all expenses in conjunction with the solicitation of the enclosed proxy, including the charges of brokerage houses and other custodians, nominees or fiduciaries for forwarding documents to security owners. In addition, proxies may be solicited by mail, in person, or by telephone or fax by certain officers, directors and employees of Man Sang Nevada. |
Q: | Where can I find more information about Man Sang Nevada? |
A: | You can find more information about Man Sang Nevada in the section entitled “Where You Can Find More Information” on page 136 of this proxy statement/prospectus. |
Q: | Will the proposal affect current or future operations? |
A: | The dissolution and liquidation of Man Sang Nevada will have no immediate major impact on how we conduct day-to-day operations. The location of future operations will depend on the needs of our business, independent of our place of incorporation. |
Q: | Who can answer my questions? |
A: | If you have any questions about the liquidation, or if you need additional copies of this proxy statement/prospectus, please contact: |
Man Sang Holdings, Inc.,
Suite 2208-14, 22/F., Sun Life Tower, The Gateway,
15 Canton Road, Tsimshatsui, Kowloon, Hong Kong
(852) 2317 9888
martinpak@man-sang.com
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• | simplify our corporate structure. Man Sang Nevada has no meaningful business or assets other than its equity interest in Man Sang BVI, which is also a holding company. The board of directors of Man Sang Nevada believes that the elimination of the two-tiered holding company structure will reduce administrative expenses by eliminating duplicative costs associated with maintaining both Man Sang Nevada and Man Sang BVI; | |
• | reduce our SEC reporting requirements and related expenses because Man Sang BVI would be a foreign private issuer; | |
• | enhance our cash flow by reducing our worldwide effective tax rate. Any improvement in our cash flow should help us to implement our business strategy more effectively; | |
• | facilitate tax savings through a more flexible corporate structure. However, the amount of taxes we will pay will depend in part on our treatment by the taxing authorities in the jurisdictions in which we operate; | |
• | enhance our business growth prospects by attracting investment fromnon-U.S. investors. Based on our experience, certain PRC investors and potential strategic partners are less willing to invest in Man Sang Nevada primarily as a result of our status as a United States incorporated company and the attendant tax |
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implications associated with such an investment, including primarily withholding taxes payable by such investors under the United States federal tax regime; and |
• | better position ourselves for merger and acquisition opportunities withnon-U.S. strategic partners. |
• | For U.S. federal income tax purposes, as a result of the liquidation, U.S. shareholders will recognize gain or loss equal to the difference, if any, between the fair market value of the Man Sang BVI shares received in the liquidation and the holder’s adjusted tax basis in the holder’s shares of Man Sang Nevada exchanged therefor. | |
• | Man Sang Nevada will recognize gain for U.S. federal income tax purposes on the distribution of the shares of Man Sang BVI to its shareholders as if the shares had been sold to the distributee at fair market value. |
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• | Shareholder Approvals Obtained. Approval by the shareholders of Man Sang Nevada stockholders and Man Sang BVI shareholders has been obtained; | |
• | Registration Statement Declared Effective. This proxy statement/prospectus has been declared effective by the SEC under the Securities Act and the Exchange Act and is not the subject of any stop order or proceedings or similar actions threatened or initiated by the SEC and not concluded or withdrawn; | |
• | NYSE Amex Approval. The NYSE Amex has confirmed that Man Sang BVI ordinary shares to be distributed pursuant to the liquidation in connection with the transactions contemplated thereto have been approved for listing on the NYSE Amex, subject to official notice of issuance and other customary conditions, and may trade on the NYSE Amex and succeed to the ticker symbol “MHJ”; | |
• | Hart-Scott-Rodino Act. Any applicable waiting period under theHart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, and the rules and regulations promulgated thereunder relating to the Liquidation have expired or been terminated. | |
• | Receipt of Tax Opinion. Man Sang Nevada and Man Sang BVI have received an opinion from PricewaterhouseCoopers Limited to the effect that the liquidation constitutes a “complete liquidation” for federal income tax purposes within the meaning of Section 331 of the Internal Revenue Code; | |
• | Covenants and Other Agreements. Man Sang Nevada and Man Sang BVI each have performed in all material respects their respective covenants and agreements contained in the agreement and plan of liquidation required to be performed at or prior to the effective time of the liquidation; | |
• | Governmental, Regulatory and Other Material Third-Party Consents. All filings required to be made with, and all material consents, approvals, permits and authorizations required to be obtained prior to the effective time of the liquidation from, any court or governmental or regulatory authority, or other person, have been made or obtained and are in force; and | |
• | No Injunctions or Restraints. No temporary restraining order, preliminary or permanent injunction or other order issued by any court of competent jurisdiction or other legal restraint or prohibition preventing the consummation of the liquidation have been entered or enforced or continue to be in effect. |
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• | all of Man Sang Nevada’s current board of directors comprise the current board of directors of Man Sang BVI. The existing directors of Man Sang BVI will appoint the officers of Man Sang Nevada to serve in equivalent positions with Man Sang BVI after the effective time of the liquidation; | |
• | all of Man Sang Nevada’s current executive officers will be offered equivalent positions with Man Sang BVI after the effective time of the liquidation; | |
• | Mr. Cheng Chung Hing, Ricky, President, Chief Executive Officer and Chairman of the board of directors, and Mr. Cheng Tai Po, Vice Chairman of the board of directors, each a member of Man Sang Nevada’s board of directors, and entities affiliated with them, who together owned approximately 3,437,501 outstanding shares of Man Sang Nevada common stock and 100,000 outstanding shares of Man Sang Nevada preferred stock, which together represent the votes of 6,628,726 shares of Man Sang Nevada common stock, or 69.2% of the total voting power of Man Sang Nevada common stock and Series A preferred stock as of the date of the agreement and plan of liquidation, executed a voting agreement agreeing to vote in favor of the dissolution and liquidation of Man Sang Nevada, and the agreement and plan of liquidation at the special meeting; | |
• | Mr. Cheng Chung Hing, Ricky and Mr. Cheng Tai Po, and other directors and executive officers of Man Sang Nevada, participated in the preparation of the agreement and plan of liquidation, this proxy statement/prospectus and other documents relating to the liquidation; | |
• | the continued indemnification of the current directors and officers of Man Sang Nevada under the agreement and plan of liquidation and the continuation of directors’ and officers’ liability insurance after the effective time of the liquidation; | |
• | each of Man Sang Nevada’s current board of directors and executive officers is not a resident or a citizen of the United States, and, as a result, will experience a reduction in dividend withholding tax with respect to any future issuance of dividends by Man Sang BVI on shares of Man Sang BVI owned by such directors and officers following the liquidation of Man Sang Nevada. |
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Year Ended March 31, | ||||||||||||||||||||||||
2009 | 2009 | 2008 | 2007 | 2006 | 2005 | |||||||||||||||||||
US$(1) | HK$ | HK$ | HK$ | HK$ | HK$ | |||||||||||||||||||
(Dollars in thousands, except share data) | ||||||||||||||||||||||||
Income Statement Data: | ||||||||||||||||||||||||
Net sales | 42,710 | 333,138 | 633,691 | 398,279 | 378,297 | 412,262 | ||||||||||||||||||
Cost of sales | (27,952 | ) | (218,030 | ) | (352,195 | ) | (285,580 | ) | (272,443 | ) | (295,014 | ) | ||||||||||||
Gross profit | 14,758 | 115,108 | 281,496 | 112,699 | 105,854 | 117,248 | ||||||||||||||||||
Rental income, gross | 3,410 | 26,596 | 6,802 | 4,225 | 3,362 | 4,646 | ||||||||||||||||||
Expenses from rentals | (3,218 | ) | (25,097 | ) | (5,956 | ) | (5,888 | ) | (6,802 | ) | (11,027 | ) | ||||||||||||
192 | 1,499 | 846 | (1,663 | ) | (3,440 | ) | (6,381 | ) | ||||||||||||||||
Selling, general and administrative expenses | (19,091 | ) | (148,905 | ) | (118,430 | ) | (84,134 | ) | (70,411 | ) | (81,862 | ) | ||||||||||||
Operating income | (4,141 | ) | (32,298 | ) | 163,912 | 26,902 | 32,003 | 29,005 | ||||||||||||||||
Equity in loss of an affiliate | (7 | ) | (54 | ) | (7 | ) | — | — | — | |||||||||||||||
Interest expenses | — | — | — | — | — | (100 | ) | |||||||||||||||||
Interest income | 1,288 | 10,043 | 17,872 | 9,394 | 7,140 | 1,067 | ||||||||||||||||||
Gain on sales of a real estate investment | 109 | 854 | 10,485 | — | — | 34,248 | ||||||||||||||||||
Other income | 606 | 4,724 | 3,693 | 28,981 | 2,312 | 1,617 | ||||||||||||||||||
Other than temporary decline in fair value of marketable securities | (660 | ) | (5,148 | ) | — | — | — | — | ||||||||||||||||
(Loss) Income before income taxes and minority interests | (2,805 | ) | (21,879 | ) | 195,955 | 65,277 | 41,455 | 65,837 | ||||||||||||||||
Income taxes expense | 401 | 3,132 | (75,267 | ) | (6,776 | ) | (4,095 | ) | (6,129 | ) | ||||||||||||||
Minority interests | 987 | 7,694 | (80,753 | ) | (30,536 | ) | (19,748 | ) | (32,792 | ) | ||||||||||||||
Net income | (1,417 | ) | (11,053 | ) | 39,935 | 27,965 | 17,612 | 26,916 | ||||||||||||||||
Basic earnings per common share | (0.20 | ) | (1.71 | ) | 6.16 | 4.31 | 2.90 | 4.80 | ||||||||||||||||
Diluted earnings per common share | (0.20 | ) | (1.71 | ) | 5.94 | 4.23 | 2.74 | 4.24 | ||||||||||||||||
Weighted average number of shares of common stock outstanding : | ||||||||||||||||||||||||
— Basic | 6,382,582 | 6,382,582 | 6,382,582 | 6,382,582 | 5,980,870 | 5,509,847 | ||||||||||||||||||
— Diluted | 6,382,582 | 6,382,582 | 6,382,582 | 6,382,582 | 6,323,848 | 6,231,653 | ||||||||||||||||||
Weighted average number of shares of preferred stock outstanding: | ||||||||||||||||||||||||
— Basic | 100,000 | 100,000 | 100,000 | 100,000 | 100,000 | 100,000 | ||||||||||||||||||
— Diluted | 100,000 | 100,000 | 100,000 | 100,000 | 100,000 | 100,000 | ||||||||||||||||||
Dividend per common share | — | — | — | — | — | — | ||||||||||||||||||
Dividend per preferred share | — | — | — | — | — | — |
(1) | Translations of Hong Kong dollars into U.S. dollars were made at the rate of HK$7.80 = US$1.00. |
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As of March 31, | ||||||||||||||||||||||||
2009 | 2009 | 2008 | 2007 | 2006 | 2005 | |||||||||||||||||||
US$(1) | HK$ | HK$ | HK$ | HK$ | HK$ | |||||||||||||||||||
(Dollars in thousands) | ||||||||||||||||||||||||
Balance Sheet Data: | ||||||||||||||||||||||||
Non-current assets | 97,699 | 762,056 | 705,367 | 252,491 | 167,847 | 166,463 | ||||||||||||||||||
Current assets | 122,252 | 953,573 | 1,076,270 | 426,618 | 440,928 | 392,778 | ||||||||||||||||||
Total assets | 219,951 | 1,715,629 | 1,781,637 | 679,109 | 608,775 | 559,241 | ||||||||||||||||||
Total current liabilities (including current portion of long-term debt) | (77,431 | ) | (603,963 | ) | (567,402 | ) | (42,600 | ) | (35,859 | ) | (35,750 | ) | ||||||||||||
Long-term debt | (13,038 | ) | (101,700 | ) | (166,500 | ) | — | — | — | |||||||||||||||
Other liabilities (including minority interests) | (77,566 | ) | (605,016 | ) | (631,758 | ) | (316,150 | ) | (282,020 | ) | (258,775 | ) | ||||||||||||
Total liabilities | (168,035 | ) | (1,310,679 | ) | (1,365,660 | ) | (358,750 | ) | (317,879 | ) | (294,525 | ) | ||||||||||||
Shareholders equity | (51,916 | ) | (404,950 | ) | (415,977 | ) | (320,359 | ) | (290,896 | ) | (264,716 | ) |
(1) | Translations of Hong Kong dollars into U.S. dollars were made at the rate of HK$7.80 = US$1.00. |
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• | reduction, delay or cancellation of orders from one or more of our significant customers; | |
• | loss of one or more of our significant customers due to disputes, dissatisfaction with our products or otherwise, and our failure to attract additional or replacement customers; and | |
• | failure of any of our significant customers to make timely payment for our products. |
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• | adverse changes in international, national, regional and local economic and market conditions; | |
• | changes in interest rates or financial markets; | |
• | fluctuating local real estate conditions and changes in local laws and regulations; | |
• | changes or promulgation and enforcement of governmental regulations relating to land use and zoning, environmental, occupational and safety matters; | |
• | changes in real estate tax rates and other operating expenses; |
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• | existence of uninsured or uninsurable risks; and | |
• | natural disasters, acts of war or terrorism. |
• | we may lease or sell developed properties at below expected rental rates or sales prices, and we may experience delays in the sale or leasing of developed properties; | |
• | we may be unable to complete construction of our real estate projects on schedule, or on budget, due to a variety of factors including shortages of materials, equipment, technical skills and labor, adverse weather conditions, natural disasters, labor disputes, disputes with contractors and sub-contractors, accidents, changes in government priorities and policies, changes in market conditions, delays in the relocation process, delays in obtaining the requisite licenses, permits and approvals from the relevant authorities and other problems and circumstances, resulting in increased debt service expense and construction costs; | |
• | occupancy rates, rents and sales prices at our real estate properties may fluctuate depending on a number of factors, including market and economic conditions, and may result in our investments being less profitable than we expected or not profitable at all; | |
• | the services rendered by our contractors may not always meet our quality requirements, and negligence or poor work quality by any contractors may result in defects in our buildings or trade center units, which could in turn cause us to suffer financial losses, harm our reputation or expose us to third-party claims; | |
• | since it normally takes several years for us to complete a real estate project, we expect that we will be affected by increases in the costs of construction materials and the costs of other goods and services, most significantly labor costs. | |
• | we may delay, or change the structure of, real estate projects and as a result we may lose deposits paid to participate in the land tender process or fail to recover expenses already incurred; | |
• | we may be unable to obtain, or face delays in obtaining, required zoning, land-use, building, occupancy, and other governmental permits, rights and authorizations, which could result in increased costs with respect to a project; |
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• | actual or anticipated variations in operating results from guidance provided by us; | |
• | announcements relating to strategic relationships or acquisitions; | |
• | changes in financial estimates or other statements by securities analysts or research firms; | |
• | changes in general economic conditions; and | |
• | changes in the economic performanceand/or market valuations of other competitors. |
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• | actual or anticipated variations in operating results from guidance provided by us; | |
• | announcements relating to strategic relationships or acquisitions; | |
• | changes in financial estimates or other statements by securities analysts or research firms; | |
• | changes in general economic conditions; and | |
• | changes in the economic performanceand/or market valuations of other competitors. |
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• | the amount of government involvement; | |
• | the level of development; | |
• | the growth rate; | |
• | the control of foreign exchange; and | |
• | the allocation of resources. |
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• | our ability to consummate the liquidation; | |
• | our ability to realize the expected benefits of the liquidation and the change of our place of incorporation within the expected time frame, or at all; | |
• | costs or difficulties related to the liquidation, the change of our place of incorporation and related transactions, which could be greater than expected; | |
• | the availability, terms and cost of funding for our operations and development projects; | |
• | difficulties and delays in obtaining regulatory approvals for the liquidation; | |
• | potential difficulties in meeting conditions set forth in the agreement and plan of liquidation; | |
• | the tax treatment of the liquidation; | |
• | the accounting treatment of the liquidation; | |
• | materially adverse changes in international economic, market and political conditions, especially in Europe and the United States and elsewhere where our customers are located, which would reduce discretionary spending on luxury goods; | |
• | exposure to the credit risk of our customers; | |
• | our ability to attract and retain employees; | |
• | the level and volatility of equity prices, commodity prices and interest rates, currency values (especially any change to the current pegging of the Hong Kong dollar to the U.S. dollar at the rate of US$1.00 to HK$7.8, or any substantial adverse change in the exchange rate between the Renminbi and the Hong Kong dollar or U.S. dollar), investments and other market indices; | |
• | materially adverse changes in customer preferences for pearls as against other gems and other precious stones and metals; | |
• | our ability to obtain a stable supply of pearls in the quantities, of the quality, and on the terms required by us; | |
• | materially adverse changes in the taxes imposed on our operating subsidiaries in the PRC; | |
• | materially adverse changes in climate and environmental conditions in the regions where we source pearls; | |
• | materially adverse changes in the real estate markets in the PRC and Hong Kong; | |
• | the actions and initiatives of current and potential competitors; | |
• | the impact of current, pending and future legislation, regulation and regulatory and legal actions; | |
• | unforeseen catastrophic events; | |
• | existing and future litigation; and | |
• | compliance with applicable laws, including environmental, health and safety laws. |
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Exchange Rate | ||||||||||||||||
Period End | High | Average(1) | Low | |||||||||||||
(HK$ per US$) | ||||||||||||||||
Last Five Fiscal Years | ||||||||||||||||
Fiscal Year Ended March 31, 2005 | 7.7990 | 7.8010 | 7.7935 | 7.7698 | ||||||||||||
Fiscal Year Ended March 31, 2006 | 7.7597 | 7.7995 | 7.7652 | 7.7506 | ||||||||||||
Fiscal Year Ended March 31, 2007 | 7.8137 | 7.8177 | 7.7817 | 7.7510 | ||||||||||||
Fiscal Year Ended March 31, 2008 | 7.7819 | 7.8289 | 7.7946 | 7.7497 | ||||||||||||
Fiscal Year Ended March 31, 2009 | 7.7500 | 7.8159 | 7.7731 | 7.7497 | ||||||||||||
Last Six Months | ||||||||||||||||
January 2009 | 7.7544 | 7.7618 | 7.7563 | 7.7504 | ||||||||||||
February 2009 | 7.7551 | 7.7551 | 7.7534 | 7.7511 | ||||||||||||
March 2009 | 7.7500 | 7.7593 | 7.7530 | 7.7497 | ||||||||||||
April 2009 | 7.7500 | 7.7508 | 7.7501 | 7.7495 | ||||||||||||
May 2009 | 7.7519 | 7.7526 | 7.7510 | 7.7500 | ||||||||||||
June 2009 | 7.7500 | 7.7516 | 7.7505 | 7.7499 | ||||||||||||
July 2009 (through July 17) | 7.7499 | 7.7505 | 7.7501 | 7.7495 |
(1) | For the years indicated, the average exchange rates are determined by averaging the exchange rates on the last business day of each month during the relevant period. For the months indicated, the average exchange rates are determined by averaging the exchange rates on each day of the month. |
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AND OTHER MATTERS
Over the Quarter | On the Last Day of Quarter | |||||||||||||||
High | Low | High | Low | |||||||||||||
US$ | ||||||||||||||||
2009 | ||||||||||||||||
First Quarter (April-June, 2008) | 8.35 | 5.50 | 6.90 | 6.17 | ||||||||||||
Second Quarter (July-September, 2008) | 6.50 | 2.62 | 3.49 | 2.80 | ||||||||||||
Third Quarter (October-December, 2008) | 3.48 | 1.10 | 1.46 | 1.43 | ||||||||||||
Fourth Quarter (January-March, 2009) | 1.92 | 0.96 | 1.92 | 1.68 | ||||||||||||
2008 | ||||||||||||||||
First Quarter (April-June, 2007) | 9.34 | 5.62 | 8.88 | 8.38 | ||||||||||||
Second Quarter (July-September, 2007) | 15.95 | 6.92 | 12.91 | 12.05 | ||||||||||||
Third Quarter (October-December, 2007) | 16.46 | 8.06 | 9.83 | 8.80 | ||||||||||||
Fourth Quarter (January-March, 2008) | 9.00 | 5.30 | 6.90 | 5.90 | ||||||||||||
2007 | ||||||||||||||||
First Quarter (April-June, 2006) | 5.89 | 4.75 | 5.08 | 4.85 | ||||||||||||
Second Quarter (July-September, 2006) | 5.10 | 3.52 | 4.24 | 3.91 | ||||||||||||
Third Quarter (October-December, 2006) | 5.45 | 3.95 | 4.90 | 4.80 | ||||||||||||
Fourth Quarter (January-March, 2007) | 6.93 | 4.50 | 6.19 | 5.95 |
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• | simplify our corporate structure. Man Sang Nevada has no meaningful business or assets other than its equity interest in Man Sang BVI, which is also a holding company. The board of directors of Man Sang Nevada believes that the elimination of the two-tiered holding company structure will reduce administrative expenses by eliminating duplicative costs associated with maintaining both Man Sang Nevada and Man Sang BVI; | |
• | reduce our SEC reporting requirements and related expenses because Man Sang BVI would be a foreign private issuer; | |
• | enhance our cash flow by reducing our worldwide effective tax rate. Any improvement in our cash flow should help us to implement our business strategy more effectively; | |
• | facilitate tax savings through a more flexible corporate structure. However, the amount of taxes we will pay will depend in part on our treatment by the taxing authorities in the jurisdictions in which we operate; | |
• | enhance our business growth prospects by attracting investment fromnon-U.S. investors. Based on our experience, certain PRC investors and potential strategic partners are less willing to invest in Man Sang Nevada primarily as a result of our status as a United States incorporated company and the attendant tax |
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implications associated with such an investment, including primarily withholding taxes payable by such investors under the United States federal tax regime; and |
• | better position ourselves for merger and acquisition opportunities with non-U.S. strategic partners. |
• | is a business center, which exhibits political, economic and regulatory stability; | |
• | has an effective judicial system with a tradition of respecting the rule of law; | |
• | has a well-developed financial and regulatory environment; | |
• | has a favorable tax system and is party to reliable tax treaties; | |
• | does not have exchange control or currency restrictions; and | |
• | has wide availability of professional and support services. |
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• | For U.S. federal income tax purposes, as a result of the liquidation, U.S. shareholders will recognize gain or loss equal to the difference, if any, between the fair market value of the Man Sang BVI shares received in the liquidation and the holder’s adjusted tax basis in the holder’s shares of Man Sang Nevada exchanged therefor. | |
• | Man Sang Nevada will recognize gain for U.S. federal income tax purposes on the distribution of the shares of Man Sang BVI to its shareholders as if the shares had been sold to the distributee at fair market value. |
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• | Shareholder Approvals Obtained. Approval by the shareholders of Man Sang Nevada stockholders and Man Sang BVI shareholders have been obtained; | |
• | Registration Statement Declared Effective. This proxy statement/prospectus filed has been declared effective by the SEC under the Securities Act and the Exchange Act and is not the subject of any stop order or proceedings or similar actions threatened or initiated by the SEC and not concluded or withdrawn; | |
• | NYSE Amex Approval. The NYSE Amex has confirmed that Man Sang BVI ordinary shares to be distributed pursuant to the liquidation in connection with the transactions contemplated thereto have been approved for listing on the NYSE Amex, subject to official notice of issuance and other customary conditions, and may trade on the NYSE Amex and succeed to the ticker symbol “MHJ;” | |
• | Hart-Scott-Rodino Act. Any applicable waiting period under theHart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, and the rules and regulations promulgated thereunder relating to the Liquidation have expired or been terminated. | |
• | Receipt of Tax Opinion. Man Sang Nevada and Man Sang BVI have received an opinion from PricewaterhouseCoopers Limited to the effect that the liquidation constitutes a “complete liquidation” for federal income tax purposes within the meaning of Section 331 of the Internal Revenue Code; | |
• | Covenants and Other Agreements. Man Sang Nevada and Man Sang BVI each have performed in all material respects their respective covenants and agreements contained in the agreement and plan of liquidation required to be performed at or prior to the effective time of the liquidation; | |
• | Governmental, Regulatory and Other Material Third-Party Consents. All filings required to be made with, and all material consents, approvals, permits and authorizations required to be obtained prior to the effective time of the liquidation from, any court or governmental or regulatory authority, or other person, have been made or obtained and are in force; and | |
• | No Injunctions or Restraints. No temporary restraining order, preliminary or permanent injunction or other order issued by any court of competent jurisdiction or other legal restraint or prohibition preventing the consummation of the liquidation have been entered or enforced or continue to be in effect. |
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• | an effective registration statement under the Securities Act covering the resale of those shares; | |
• | an exemption under the volume and other limitations of Rule 144 or 145 under the Securities Act; or | |
• | any other applicable exemption under the Securities Act. |
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• | On November 9, 2008, the State Council announced a RMB4 trillion (US$584 billion) economic stimulus plan, RMB120 billion (US$17.5 billion) of which was to be spent by year-end. On November 10, 2008, the State Council announced a value-added tax reform, shifting the basis from production to consumption, and effectively reducing the value-added tax rates, effective January 1, 2009. | |
• | On November 26, 2008, the State Council announced six policies for economic stimulus, including plans to support the rail, auto, shipbuilding, logistics, petrochemical, light industry, textile, nonferrous metals, equipment manufacturing, and electronics and information technology industries. | |
• | On December 3, 2008, the State Council announced an additional RMB100 billion (US$14.6 billion) of lending by PRC policy banks prior to year-end. | |
• | On December 13, 2008, the State Council announced 30 measures to support the financial industry, including raising China’s total money supply by 17% in 2009. | |
• | On December 21, 2008, the State Council announced an exemption on real estate sales taxes to homeowners selling homes after an ownership period of two years, lowered from a previous minimum of five years. | |
• | In March 2009, the State Council and the Central Committee of the Communist Party of China announced a healthcare reform plan to increase the accessibility of healthcare, healthcare coverage and the availability of medicines, and to spend an additional RMB850 billion (US$124 billion) from 2009 to 2011 on the healthcare industry. |
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• | We will strengthen and formalize our existing procedures for the review of the calculations and results of our goodwill impairment test to ensure that the material weakness does not impair our ability to produce accurate and timely financial statements. These policies and procedures will require that our test of goodwill impairment be subject to an independent review. | |
• | Our Audit Committee will monitor these remediation efforts and may direct additional measures as deemed appropriate. |
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• | We have instituted monthly business reviews led by our Chief Executive Officer and monthly operating and financial statement reviews by various levels of our management team, including our executive officers; | |
• | We are taking steps to create a new disclosure review group in order to further formalize our internal review processes related to preparation of our reports filed with the SEC and other public disclosures, which will include directors, executive management, senior financial management and senior operating personnel; and | |
• | We are expanding our educational assistance to all our accounting staff to ensure a thorough and consistent understanding of changes in accounting principles and modifications and enhancement in our internal controls and procedures. |
Fiscal Year Ended March 31, | ||||||||||||||||||||||||
2009 | 2008 | 2007 | ||||||||||||||||||||||
HK$ | % | HK$ | % | HK$ | % | |||||||||||||||||||
(HK$ in thousands, except for percentages) | ||||||||||||||||||||||||
Net sales | 333,138 | 100.0 | 633,691 | 100.0 | 398,279 | 100.0 | ||||||||||||||||||
Cost of sales | (218,030 | ) | (65.5 | ) | (352,195 | ) | (55.6 | ) | (285,580 | ) | (71.7 | ) | ||||||||||||
Gross profit | 115,108 | 34.5 | 281,496 | 44.4 | 112,699 | 28.3 | ||||||||||||||||||
Rental income, gross | 26,596 | 8.0 | 6,802 | 1.1 | 4,225 | 1.1 | ||||||||||||||||||
Expenses from rentals | (25,097 | ) | (7.5 | ) | (5,956 | ) | (0.9 | ) | (5,888 | ) | (1.5 | ) | ||||||||||||
1,499 | 0.5 | 846 | 0.2 | (1,663 | ) | (0.4 | ) | |||||||||||||||||
Selling, general and administrative expenses | (148,905 | ) | (44.7 | ) | (118,430 | ) | (18.7 | ) | (84,134 | ) | (21.1 | ) | ||||||||||||
Operating (loss) income | (32,298 | ) | (9.7 | ) | 163,912 | 25.9 | 26,902 | 6.8 | ||||||||||||||||
Interest income | 10,043 | 3.0 | 17,872 | 2.8 | 9,394 | 2.3 | ||||||||||||||||||
Non-operating income | 376 | 0.1 | 14,171 | 2.2 | 28,981 | 7.3 | ||||||||||||||||||
(Loss) Income before income taxes and minority interests | (21,879 | ) | (6.6 | ) | 195,955 | 30.9 | 65,277 | 16.4 | ||||||||||||||||
Income tax expenses | 3,132 | 1.0 | (75,267 | ) | (11.9 | ) | (6,776 | ) | (1.7 | ) | ||||||||||||||
Net (loss) income before minority interests | (18,747 | ) | (5.6 | ) | 120,688 | 19.0 | 58,501 | 14.7 | ||||||||||||||||
Minority interests | 7,694 | 2.3 | (80,753 | ) | (12.7 | ) | (30,536 | ) | (7.7 | ) | ||||||||||||||
Net (loss) income | (11,053 | ) | (3.3 | ) | 39,935 | 6.3 | 27,965 | 7.0 | ||||||||||||||||
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Less Than | More Than | |||||||||||||||||||
Contractual Obligations | Total | 1 Year | 1-3 Year | 3-5 Year | 5 Years | |||||||||||||||
(HK$ in thousands) | ||||||||||||||||||||
Long-term debt(1) | 192,100 | 90,400 | 101,700 | — | — | |||||||||||||||
Capital commitment obligations | 117,173 | 88,604 | 28,567 | — | — | |||||||||||||||
Operating lease obligations | 27,791 | 14,365 | 13,426 | — | — | |||||||||||||||
Total contractual obligations | 337,064 | 193,369 | 143,693 | — | — | |||||||||||||||
(1) | Excluding interest on long-term bank loans. |
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(1) | The shares of Man Sang International Limited are listed on The Stock Exchange of Hong Kong Limited. Mr. Cheng Chung Hing, Ricky and Mr. Cheng Tai Po indirectly control the 40.368% ownership interest of Man Sang International (B.V.I.) Limited in Man Sang International Limited through their controlling interest in Man Sang International (B.V.I.) Limited. In addition, Mr. Cheng Chung Hing, Ricky and Mr. Cheng Tai Po directly hold a 17.318% ownership interest in Man Sang International Limited. As a result, we account for Man Sang International Limited as a consolidated subsidiary because we continue to have control over the operating and financial decisions of Man Sang International Limited through the direct and indirect aggregate interest of 57.686% held by Mr. Cheng Chung Hing, Ricky and Mr. Cheng Tai Po in Man Sang International Limited. The remaining interests of Man Sang International Limited are held by public shareholders. |
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Size | Price per 16-Inch Strand | |||
(In millimeters) | US$ | |||
Freshwater pearls | 2-13 | 2-1,000 | ||
Chinese cultured pearls | 5-7.5 | 10-400 | ||
Japanese cultured pearls | 7-10 | 100-2,000 | ||
Tahitian pearls | 8-16 | 120-15,000 | ||
South Sea pearls | 8-18 | 300-70,000 |
Freshwater | Cultured | Non-Pearl | ||||||||||||||||||
Loose and | Assembled | Loose and | Assembled | Assembled | ||||||||||||||||
Strands | Pearl Jewelry | Strands | Pearl Jewelry | Jewelry | ||||||||||||||||
% | % | % | % | % | ||||||||||||||||
Year Ended March 31, | ||||||||||||||||||||
2009 | 4.4 | 35.9 | 30.8 | 20.1 | 8.8 | |||||||||||||||
2008 | 4.7 | 27.0 | 38.3 | 18.6 | 11.4 | |||||||||||||||
2007 | 6.7 | 26.0 | 41.7 | 17.4 | 8.2 |
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Fiscal Year Ended March 31, | ||||||||||||||||||||||||
2009 | 2008 | 2007 | ||||||||||||||||||||||
HK$ | % | HK$ | % | HK$ | % | |||||||||||||||||||
(HK$ in thousands, except for percentages) | ||||||||||||||||||||||||
Cultured Pearls | ||||||||||||||||||||||||
North America | 18,685 | 6.0 | 39,806 | 9.8 | 47,616 | 12.0 | ||||||||||||||||||
Europe | 26,041 | 8.2 | 26,554 | 6.6 | 28,121 | 7.1 | ||||||||||||||||||
Hong Kong | 12,234 | 3.8 | 22,442 | 5.5 | 22,462 | 5.6 | ||||||||||||||||||
Other Asian countries | 36,473 | 11.5 | 58,032 | 14.3 | 58,681 | 14.7 | ||||||||||||||||||
Others | 4,028 | 1.3 | 8,281 | 2.1 | 6,325 | 1.6 | ||||||||||||||||||
Sub-total | 97,461 | 30.8 | 155,115 | 38.3 | 163,205 | 41.0 | ||||||||||||||||||
Freshwater Pearls | ||||||||||||||||||||||||
North America | 2,156 | 0.7 | 3,389 | 0.8 | 3,569 | 0.9 | ||||||||||||||||||
Europe | 3,074 | 1.1 | 4,496 | 1.1 | 7,188 | 1.8 | ||||||||||||||||||
Hong Kong | 932 | 0.3 | 1,639 | 0.4 | 2,296 | 0.6 | ||||||||||||||||||
Other Asian countries | 6,998 | 2.2 | 12,430 | 3.1 | 13,969 | 3.5 | ||||||||||||||||||
Others | 800 | 0.2 | 2,199 | 0.6 | 1,194 | 0.3 | ||||||||||||||||||
Sub-total | 13,960 | 4.5 | 24,153 | 6.0 | 28,216 | 7.1 | ||||||||||||||||||
Assembled Jewelry | ||||||||||||||||||||||||
North America | 49,104 | 15.5 | 60,990 | 15.0 | 62,891 | 15.8 | ||||||||||||||||||
Europe | 123,842 | 39.0 | 137,566 | 33.9 | 119,706 | 30.1 | ||||||||||||||||||
Hong Kong | 2,800 | 0.9 | 2,767 | 0.7 | 5,171 | 1.3 | ||||||||||||||||||
Other Asian countries | 8,723 | 2.7 | 8,453 | 2.1 | 6,653 | 1.6 | ||||||||||||||||||
Others | 20,813 | 6.6 | 16,400 | 4.0 | 12,437 | 3.1 | ||||||||||||||||||
Sub-total | 205,282 | 64.7 | 226,176 | 55.7 | 206,858 | 51.9 | ||||||||||||||||||
Total | 316,703 | 100.0 | 405,444 | 100.0 | 398,279 | 100.0 | ||||||||||||||||||
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Fiscal Year Ended March 31, | ||||||||||||||||||||||||
2009 | 2008 | 2007 | ||||||||||||||||||||||
HK$ | % | HK$ | % | HK$ | % | |||||||||||||||||||
(HK$ in thousands, except for percentages) | ||||||||||||||||||||||||
First Quarter | 81,831 | 25.8 | 100,652 | 24.8 | 97,937 | 27.5 | ||||||||||||||||||
Second Quarter | 108,610 | 34.3 | 109,407 | 27.0 | 95,395 | 28.5 | ||||||||||||||||||
Third Quarter | 76,404 | 24.1 | 108,616 | 26.8 | 106,780 | 23.8 | ||||||||||||||||||
Fourth Quarter | 49,858 | 15.8 | 86,769 | 21.4 | 98,167 | 20.2 | ||||||||||||||||||
Total | 316,703 | 100.0 | 405,444 | 100.0 | 398,279 | 100.0 | ||||||||||||||||||
• | Man Sang Industrial City, an industrial complex located in Gong Ming Zhen, Shenzhen Special Economic Zone, PRC with a total site area of approximately 470,000 square feet; and | |
• | China Pearls and Jewellery City, a pearl market center located in Shanxiahu, Zhuji, Zhejiang Province, PRC. As of March 31, 2009, we had completed construction of our phase one pearl market center at China Pearls and Jewellery City and expect to complete construction of the remaining phases of China Pearls and Jewellery City in phases over the next three to five years. Upon its completion, we expect China Pearls and Jewellery City to cover a total gross site area of approximately 1.2 million square meters and to comprise various supporting facilities, including manufacturing, processing, exhibition and residential facilities. |
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• | 957 square feet at Room 407, Wing Tuck Commercial Centre,177-183 Wing Lok Street, Sheung Wan, Hong Kong. We entered into a tenancy agreement for a term of three years starting from September 22, 2005 at a rental of HK$7,000 per month. Total rental income was approximately HK$39,900 for fiscal year 2008 and approximately HK$84,000 for fiscal year 2007. See “— Property — Hong Kong.” | |
• | 10,880 square feet at 19th Floor, Railway Plaza, 39 Chatham Road South, Tsimshatsui, Kowloon, Hong Kong. In May 2008, we vacated this property, which was formerly our headquarters, and changed the holding purpose to rental property. Commencing from June 20, 2009, we had leased this property for a two-year term for HK$174,080 per month, exclusive of a two-month rent free period. |
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• | tightening lending of bank loans to property developers and purchasers of developed properties and increasing the reserve requirements for commercial banks; | |
• | restricting the ability of foreign invested real estate companies to raise funds offshore for the purpose of funding such companies either through capital increase or by way of shareholder loans; | |
• | restricting the conversion and sale of foreign exchange on the capital account for foreign invested real estate companies that have not undergone an examination by the local examination and approval authority; | |
• | imposing strict requirements before commencement of a real estate project can begin, including the requirement that proposed projects with a total investment value of at least RMB50 million establish administration files and receive relevant approval or permits prior to the commencement of construction; | |
• | prohibiting the extension of loans to real estate developers that do not satisfy certain loan conditions, such as those with a percentage of project capital of less than 35% and those that are not in possession of necessary certificates and permits | |
• | requiring the payment of an idle land charge for land that is idle for one year and recovery of such land by the State without consideration if the land is idle for two years. | |
• | requiring property developers to pay all land grant fees prior to issuing land-use rights certificates; and | |
• | requiring all industrial and commercial land to be granted through an invitation of bids or auction. |
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Hong Kong | PRC | Total | ||||||||||
Senior management | 5 | 5 | 10 | |||||||||
Marketing and sales | 24 | 32 | 56 | |||||||||
Purchasing | 3 | 2 | 5 | |||||||||
Finance and accounting | 16 | 22 | 38 | |||||||||
Processing and logistics | 15 | 710 | 725 | |||||||||
Human resources and administration | 13 | 52 | 65 | |||||||||
Real estate leasing | — | 20 | 20 | |||||||||
Property development | — | 50 | 50 | |||||||||
Information technology | 2 | 16 | 18 | |||||||||
Total | 78 | 909 | 987 |
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Name | Age | Position | ||
Mr. Cheng Chung Hing, Ricky | 48 | President and Chairman of the Board Chief Executive Officer | ||
Mr. Cheng Tai Po | 56 | Vice Chairman of the Board | ||
Mr. Lai Chau Ming, Matthew | 56 | Director | ||
Mr. Wong Gee Hang, Henry | 73 | Director | ||
Mr. Tsui King Chung, Francis | 47 | Director |
Name | Age | Position Held | ||||
Mr. Cheng Chung Hing, Ricky | 48 | President and Chairman of the Board Chief Executive Officer | ||||
Mr. Cheng Tai Po | 56 | Vice Chairman of the Board | ||||
Mr. Pak Wai Keung, Martin | 45 | Chief Financial Officer | ||||
Ms. Yan Sau Man, Amy | 46 | Director of Man Sang International Limited | ||||
Ms. Wong Hung Flavia Yuen Yee | 41 | Director of Man Sang International Limited |
(1) | On June 25, 2009, Ms. Wong Hung Flavia Yuen Yee resigned as director of Man Sang International Limited with effect from June 26, 2009. |
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• | reviewed and discussed with our independent registered public accounting firm and with management the audited financial statements for the year ended March 31, 2008; | |
• | discussed with our independent registered public accounting firm the matters outlined in the Statement on Auditing Standards No. 61 (Codification of Auditing Standards AU §380), as may be modified or supplemented; | |
• | received the written disclosures and the letter from our independent registered public accounting firm required by Independence Standards Board Standard No. 1 (Independence Standards Board Standards No. 1, Independence Discussions with Audit Committees); and | |
• | discussed with our independent registered public accounting firm the independence of our independent registered public accounting firm. |
• | reviewed and discussed with our independent registered public accounting firm and with management the audited financial statements for the year ended March 31, 2009; | |
• | discussed with our independent registered public accounting firm the matters outlined in the Statement on Auditing Standards No. 61 (Codification of Auditing Standards AU § 380), as may be modified or supplemented; | |
• | received the written disclosures and the letter from our independent registered public accounting firm required by Independence Standards Board Standard No. 1 (Independence Standards Board Standards No. 1, Independence Discussions with Audit Committees); and | |
• | discussed with our independent registered public accounting firm the independence of our independent registered public accounting firm. |
Mr. Lai Chau Ming, Matthew; and
Mr. Tsui King Chung, Francis
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• | convening shareholders��� annual general meetings and reporting its work to shareholders at such meetings; | |
• | declaring dividends and distributions; | |
• | appointing officers and determining the terms of office of the officers; |
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• | exercising the borrowing powers of our company and mortgaging the property of our company; and | |
• | approving the transfer of shares in our company, including the registering of such shares in our share register. |
• | the service agreement of each of Mr. Cheng Chung Hing, Ricky, Mr. Cheng Tai Po and Ms. Yan Sau Man, Amy is for an initial term of three years commencing on September 1, 1997, and was renewed for successive three year terms on September 1, 2000, September 1, 2003 and September 1, 2006. Each service agreement may be terminated by either party by giving the other party written notice of not less than three months; | |
• | the annual base salary payable to each of Mr. Cheng Chung Hing, Ricky, Mr. Cheng Tai Po and Ms. Yan Sau Man, Amy in fiscal year 2008 is US$384,615 (HK$3.0 million), US$461,538 (HK$3.6 million) and US$230,769 (HK$1.80 million), respectively. The annual base salary payable to each of Mr. Cheng Chung Hing, Ricky, Mr. Cheng Tai Po and Ms. Yan Sau Man, Amy is subject to annual review by the board of directors of Man Sang International Limited; | |
• | each of Mr. Cheng Chung Hing, Ricky, Mr. Cheng Tai Po and Ms. Yan Sau Man, Amy is also entitled to an annual discretionary bonus. The amount of the discretionary bonus is determined by the remuneration committee of the board of directors of Man Sang International Limited. With respect to Mr. Cheng Chung Hing, Ricky and Mr. Cheng Tai Po, the discretionary bonus is determined in conjunction with the compensation committee of the board of directors of Man Sang Nevada. This determination is made on an annual basis, provided that the aggregate of all discretionary bonuses payable by Man Sang International Limited to its executive directors in any fiscal year may not exceed 10% of Man Sang International Limited’s net profits for such year (after tax and after extraordinary items) as shown in its audited accounts. |
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Non-Qualified | ||||||||||||||||||||||||||||||||||||
Non-Equity | Deferred | |||||||||||||||||||||||||||||||||||
Stock | Option | Incentive Plan | Compensation | All Other | ||||||||||||||||||||||||||||||||
Name and Principal Position | Year | Salary | Bonus | Awards | Awards(5) | Compensation | Earnings | Compensation | Total | |||||||||||||||||||||||||||
(US$) | (US$) | (US$) | (US$) | (US$) | (US$) | (US$) | ||||||||||||||||||||||||||||||
Mr. Cheng Chung Hing, | 2009 | 384,615 | 128,205 | (2) | — | — | — | — | 209,745 | (9) | 722,565 | |||||||||||||||||||||||||
Ricky (Chairman of the | 2008 | 384,615 | 128,205 | (2) | — | — | — | — | 160,307 | 673,127 | ||||||||||||||||||||||||||
Board, President and | 2007 | 384,615 | 128,205 | (2) | — | 9,253 | (6) | — | — | 121,385 | 643,458 | |||||||||||||||||||||||||
Chief Executive Officer) | ||||||||||||||||||||||||||||||||||||
Mr. Cheng Tai Po | 2009 | 461,538 | 128,205 | (2) | — | — | — | — | 4,407 | 594,150 | ||||||||||||||||||||||||||
(Vice Chairman) | 2008 | 461,538 | 128,205 | (2) | — | — | — | — | 1,192 | 590,935 | ||||||||||||||||||||||||||
2007 | 384,615 | 128,205 | (2) | — | 9,253 | (6) | — | — | 2,846 | 524,919 | ||||||||||||||||||||||||||
Mr. Pak Wai Keung, | 2009 | 211,538 | 38,461 | (3) | — | — | — | — | — | 249,999 | ||||||||||||||||||||||||||
Martin (Chief Financial | 2008 | 192,307 | 38,461 | (3) | — | — | — | — | — | 230,768 | ||||||||||||||||||||||||||
Officer) | 2007 | 95,824 | 12,821 | (3) | — | 177,288 | (7) | — | — | — | 285,933 | |||||||||||||||||||||||||
Ms. Yan Sau Man, Amy | 2009 | 230,769 | 153,846 | (4) | — | — | — | — | — | 384,615 | ||||||||||||||||||||||||||
(Director of Man Sang International Limited) | 2008 | 230,769 | 205,128 | (4) | — | — | — | — | — | 435,897 | ||||||||||||||||||||||||||
2007 | 211,538 | 205,128 | (4) | — | 92,530 | (8) | — | — | — | 509,196 | ||||||||||||||||||||||||||
Ms. Wong Hung Flavia Yuen Yee (Director of Man Sang International Limited) | 2009 | 165,426 | — | — | — | — | — | — | 165,426 |
(1) | All compensation values reported in the Summary Compensation Table are presented in U.S. dollars. However, the named executive officers received all compensation in Hong Kong dollars. The translation of Hong Kong dollar amounts into U.S. dollars have been made at the rate of HK$7.8 to US$1, the approximate free rate of exchange as of March 31, 2009. Such translations should not be construed as representations that Hong Kong dollar amounts could be converted into U.S. dollars at that rate or any other rate. | |
(2) | Each of Mr. Cheng Chung Hing, Ricky and Mr. Cheng Tai Po received a bonus of US$128,205 (HK$1,000,000) from our company for each of fiscal years 2009, 2008 and 2007. | |
(3) | Mr. Pak Wai Keung, Martin received a bonus of US$38,461 (HK$300,000), US$38,461 (HK$300,000) and US$12,821 (HK$100,000) from Man Sang International Limited for fiscal years 2009, 2008 and 2007, respectively. | |
(4) | Ms. Yan Sau Man, Amy received a bonus of US$153,846 (HK$1,200,000), US$205,128 (HK$1,600,000) and US$205,128 (HK$1,600,000) from Man Sang International Limited for fiscal years 2009, 2008 and 2007, respectively. | |
(5) | During the fiscal year 2007, Man Sang International Limited granted 73,000,000 share options to purchase shares in Man Sang International Limited at three different times. The aggregate fair value of all share options granted was US$847,051 (HK$6,607,000), computed in accordance with the Black-Scholes option pricing model. |
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(6) | Each of Mr. Cheng Chung Hing, Ricky and Mr. Cheng Tai Po received 1,000,000 share options from Man Sang International Limited in fiscal year 2007. The fair value of the share options to each of them is US$9,253 (HK$72,173). | |
(7) | Mr. Pak Wai Keung, Martin received 5,000,000 share options from Man Sang International Limited in fiscal year 2007. The fair value of these share options is US$177,288 (HK$1,382,846). | |
(8) | Ms. Yan Sau Man, Amy received 10,000,000 share options from Man Sang International Limited in fiscal year 2007. The fair value of these share options is US$92,530 (HK$721,734). | |
(9) | The 2009 amount listed in this column for Mr. Cheng Chung Hing, Ricky includes use of our leasehold property as a personal residence (US$176,308), residential management fees (US$16,968), residential government fees (US$10,261), use of a residential parking space (US$4,308), payment of mandatory provident fund (US$1,538), travel insurance fees (US$203), medical and life insurance fees (US$96) and employment compensation insurance fees (US$65). The estimated fair rental value of the leasehold property is based on the “ratable value” assessed by the Rating and Valuation Department of The Government of Hong Kong Special Administrative Region, being an estimate of the annual rental of the premises at a designated valuation reference date based on factors including age, size, location and quality of the premises. |
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Option Awards | Stock Awards | |||||||||||||||||||||||||||||||||
Equity | ||||||||||||||||||||||||||||||||||
Incentive | ||||||||||||||||||||||||||||||||||
Equity | Plan | |||||||||||||||||||||||||||||||||
Incentive | Awards: | |||||||||||||||||||||||||||||||||
Plan | Market or | |||||||||||||||||||||||||||||||||
Awards: | Payout | |||||||||||||||||||||||||||||||||
Equity | Number of | Value of | ||||||||||||||||||||||||||||||||
Incentive | Number | Market | Unearned | Unearned | ||||||||||||||||||||||||||||||
Plan | of | Value of | Shares, | Shares, | ||||||||||||||||||||||||||||||
Number of | Number of | Awards: | Shares | Shares | Units or | Units or | ||||||||||||||||||||||||||||
Securities | Securities | Number of | or Units | or Units | Other | Other | ||||||||||||||||||||||||||||
Underlying | Underlying | Securities | of Stock | of Stock | Rights | Rights | ||||||||||||||||||||||||||||
Unexercised | Unexercised | Underlying | That | That | That | That | ||||||||||||||||||||||||||||
Options | Options | Unexercised | Option | Option | Have | Have | Have | Have | ||||||||||||||||||||||||||
(#) | (#) | Unearned | Exercise | Expiration | Not | Not | Not | Not | ||||||||||||||||||||||||||
Name | Exercisable(2) | Unexercisable | Options | Price | Date | Vested | Vested | Vested | Vested | |||||||||||||||||||||||||
(#) | (US$) | (#) | (US$) | (#) | (#) | |||||||||||||||||||||||||||||
Mr. Cheng Chung Hing, Ricky | 1,000,000 | (3) | — | — | 0.0324 | (6) | May 1, 2012 | — | — | — | — | |||||||||||||||||||||||
Mr. Cheng Tai Po | 1,000,000 | (3) | — | — | 0.0324 | (6) | May 1, 2012 | — | — | — | — | |||||||||||||||||||||||
Mr. Pak Wai Keung, Martin | 5,000,000 | (4) | — | — | 0.0641 | (7) | March 12, 2012 | — | — | — | — | |||||||||||||||||||||||
Ms. Yan Sau Man, Amy | 10,000,000 | (5) | — | — | 0.0324 | (6) | May 1, 2012 | — | — | — | — | |||||||||||||||||||||||
Ms. Wong Hung Flavia Yuen Yee | — | — | — | — | — | — | — | — | — |
(1) | All values reported in the above Outstanding Equity Awards At Fiscal Year-End Table are presented in United States dollars. However, the option exercise price of the option awards is in Hong Kong dollars. The translation of Hong Kong dollar amounts into United States dollars has been made at the rate of HK$7.8 to US$1, the approximate free rate of exchange as of March 31, 2009. Such translations should not be construed as representations that Hong Kong dollar amounts could be converted into United States dollars at that rate or any other rate. | |
(2) | The shares options granted by Man Sang International Limited to each of Mr. Cheng Chung Hing, Ricky, Mr. Cheng Tai Po and Ms. Yan Sau Man, Amy are exercisable immediately on the grant date. | |
(3) | Represents 1,000,000 share options granted by Man Sang International Limited to purchase shares of Man Sang International Limited to each of Mr. Cheng Chung Hing, Ricky and Mr. Cheng Tai Po. | |
(4) | Represents 5,000,000 share options granted by Man Sang International Limited to purchase shares of Man Sang International Limited to Mr. Pak Wai Keung, Martin. | |
(5) | Represents 10,000,000 share options granted by Man Sang International Limited to purchase shares of Man Sang International Limited to Ms. Yan Sau Man, Amy. | |
(6) | The exercise price of each share option is US$0.0324 (HK$0.253), which is determined by the arithmetic average of the closing price of Man Sang International Limited shares for each of the five trading days immediately prior to and including May 2, 2006. | |
(7) | The exercise price of each share option is US$0.0641 (HK$0.500), which is determined by the arithmetic average of the closing price of Man Sang International Limited shares for each of the five trading days immediately prior to and including March 13, 2007. |
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Change in | ||||||||||||||||||||||||||||
Pension Value | ||||||||||||||||||||||||||||
and | ||||||||||||||||||||||||||||
Nonqualified | ||||||||||||||||||||||||||||
Fees Earned | Non-Equity | Deferred | ||||||||||||||||||||||||||
or Paid | Stock | Option | Incentive Plan | Compensation | All Other | |||||||||||||||||||||||
Name | in Cash(2) | Awards | Awards | Compensation | Earnings | Compensation | Total | |||||||||||||||||||||
(US$) | (US$) | (US$) | (US$) | (US$) | (US$) | |||||||||||||||||||||||
Mr. Lai Chau Ming, Matthew | 21,794 | — | — | — | — | — | 21,794 | |||||||||||||||||||||
Mr. Wong Gee Hang, Henry | 21,794 | — | — | — | — | — | 21,794 | |||||||||||||||||||||
Mr. Tsui King Chung, Francis | 19,230 | — | — | — | — | — | 19,230 |
(1) | All compensation values reported in the above Non-Executive Director Compensation Table are presented in U.S. dollars. However, the directors received all compensation in Hong Kong dollars. The translation of Hong Kong dollar amounts into U.S. dollars have been made at the rate of HK$7.8 to US$1, the approximate free rate of exchange as of March 31, 2009. Such translations should not be construed as representations that Hong Kong dollar amounts could be converted into U.S. dollars at that rate or any other rate. | |
(2) | This column represents the amount of cash compensation earned in fiscal year 2009 for director and committee service. |
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• | the nature of the related person’s interest in the transaction; | |
• | the material terms of the transaction, including, without limitation, the amount and type of transaction; | |
• | the importance of the transaction to the related person; | |
• | the importance of the transaction to us; | |
• | whether the transaction would impair the judgment of a director or executive officer to act in our best interest; and | |
• | any other matters the board of directors deems appropriate. |
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Amount and Nature of | ||||||||
Name and Address of Beneficial Owner(1) | Beneficial Ownership(2) | Percent of Class | ||||||
Cafoong Limited(3) | 3,437,501 | 53.86 | % | |||||
Mr. Cheng Chung Hing, Ricky(3) | 3,437,501 | 53.86 | % | |||||
Mr. Cheng Tai Po(3) | 3,437,501 | 53.86 | % | |||||
Mr. Lai Chau Ming, Matthew | — | — | ||||||
Mr. Wong Gee Hang, Henry | — | — | ||||||
Mr. Tsui King Chung, Francis | — | — | ||||||
Mr. Pak Wai Keung, Martin | — | — | ||||||
Ms. Yan Sau Man, Amy(4) | — | — | ||||||
All executive officers and directors as a group (seven persons) | 3,437,501 | 53.86 | % |
(1) | Address for each person is Suite 2208, 22/F Sun Life Tower, The Gateway, 15 Canton Road, Tsimshatsui, Kowloon, Hong Kong. | |
(2) | Represents shares of our common stock held and options held by such individuals that were exercisable as of the record date. As of the record date, none of these individuals had the right to acquire beneficial ownership of additional securities, as defined inRule 13d-3(a) of the Exchange Act, within sixty days. This amount does not include securities that may be acquired under options or other rights more than 60 days after the record date. This disclosure is made pursuant to certain rules and regulations promulgated by the SEC and the number of shares shown as beneficially owned by any person may not be deemed to be beneficially owned for other purposes. Unless otherwise indicated in these footnotes, each named individual has sole voting and investment power with respect to such shares of common stock, subject to community property laws, where applicable. | |
(3) | Cafoong Limited owns directly 1,697,344 shares of common stock of our company. Cafoong Limited also owns indirectly 1,740,157 shares of common stock of our company by virtue of holding all issued and outstanding shares of certain British Virgin Islands companies which own such shares of common stock of our company. Because Mr. Cheng Chung Hing, Ricky and Mr. Cheng Tai Po own 60% and 40%, respectively, of all issued and outstanding stock, and are directors, of Cafoong Limited, they may be deemed to be the beneficial owners of the shares of common stock of our company which are owned, directly or indirectly, by Cafoong Limited. In addition, Cafoong Limited owns directly 100,000 shares of Man Sang Nevada Series A preferred stock, which as a class, is entitled to the votes of 3,191,225 shares of common stock of Man Sang Nevada. For further information on the Series A preferred stock of Man Sang Nevada, see “— Series A Preferred Stock.” | |
(4) | The board of directors of Man Sang Nevada considers Ms. Yan Sau Man, Amy, who serves as a director of Man Sang International Limited, to perform policy making functions for Man Sang Nevada and therefore to act as an executive officer of Man Sang Nevada. |
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Amount and Nature of | ||||||||
Name and Address of Beneficial Owner(1) | Beneficial Ownership(2) | Percent of Class | ||||||
Cafoong Limited(3) | 100,000 | 100 | % | |||||
Mr. Cheng Chung Hing, Ricky(3) | 100,000 | 100 | % | |||||
Mr. Cheng Tai Po(3) | 100,000 | 100 | % | |||||
Mr. Lai Chau Ming, Matthew | — | — | ||||||
Mr. Wong Gee Hang, Henry | — | — | ||||||
Mr. Tsui King Chung, Francis | — | — | ||||||
Mr. Pak Wai Ming, Martin | — | — | ||||||
Ms. Yan Sau Man, Amy(4) | — | — | ||||||
All executive officers and directors as a group (seven persons) | 100,000 | 100 | % |
(1) | Address for each person is Suite 2208, 22/F Sun Life Tower, The Gateway, 15 Canton Road, Tsimshatsui, Kowloon, Hong Kong. | |
(2) | This disclosure is made pursuant to certain rules and regulations promulgated by the SEC and the number of shares shown as beneficially owned by any person may not be deemed to be beneficially owned for other purposes. Unless otherwise indicated in these footnotes, each named individual has sole voting and investment power with respect to such shares of preferred stock, subject to community property laws, where applicable. As of the record date, name of the shares of the applicable stockholders are pledged as security. | |
(3) | Mr. Cheng Chung Hing, Ricky and Mr. Cheng Tai Po own 60% and 40%, respectively, of all issued and outstanding stock of, and are directors of, Cafoong Limited and, accordingly, are deemed to be the beneficial owners of the Series A preferred stock of Man Sang Nevada owned by Cafoong Limited. | |
(4) | The board of directors of Man Sang Nevada considers Ms. Yan Sau Man, Amy, who serves as a director of Man Sang International Limited, to perform policy making functions for Man Sang Nevada and therefore to act as an executive officer of Man Sang Nevada. |
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• | divide its shares, including issued shares, into a larger number of shares; or | |
• | combine its shares, including issued shares, into a smaller number of shares; |
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• | is or was a party or is threatened to be made a party to any threatened, pending or completed proceedings, whether civil, criminal, administrative or investigative, by reason of the fact that the person is or was a director, an officer or a liquidator of our company; or | |
• | is or was, at the request of our company, serving as a director, officer or liquidator of, or in any other capacity is or was acting for, another body corporate or a partnership, joint venture, trust or other enterprise. |
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• | an individual citizen or resident of the United States; | |
• | a corporation (or other entity treated as a corporation) that is created or organized (or treated as created or organized) in or under the laws of the United States, any state thereof or the District of Columbia; | |
• | an estate whose income is includible in gross income for U.S. federal income tax purposes regardless of its source; or | |
• | a trust if (i) a U.S. court can exercise primary supervision over the trust’s administration and one or more U.S. persons are authorized to control all substantial decisions of the trust, or (ii) it has a valid election in effect under applicable U.S. Treasury regulations to be treated as a U.S. person. |
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• | financial institutions or “financial services entities”; | |
• | broker-dealers; | |
• | taxpayers who have elected mark-to-market accounting; | |
• | tax-exempt organizations, plans or accounts; | |
• | governments or agencies or instrumentalities thereof; | |
• | insurance companies; | |
• | regulated investment companies; | |
• | real estate investment trusts; | |
• | certain expatriates or former long-term residents of the United States; | |
• | persons that actually or constructively own 10% or more of our voting shares; | |
• | persons that hold Man Sang Nevada common shares as part of a straddle, constructive sale, hedging, conversion or other integrated transaction; or | |
• | persons whose functional currency is not the U.S. dollar. |
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• | at least 75% of Man Sang BVI’s gross income for such taxable year consists of passive income (e.g., dividends, interest, capital gains and rents derived other than in the active conduct of a rental business); or | |
• | at least 50% of the average value of the assets held by the corporation during such taxable year produce, or are held for the production of, passive income. |
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• | the excess distribution or gain would be allocated ratably over the Non-Electing Holders’ aggregate holding period for the ordinary shares; | |
• | the amount allocated to the current taxable year and any taxable year before Man Sang BVI became a passive foreign investment company would be taxed as ordinary income; and | |
• | the amount allocated to each of the other taxable years would be subject to tax at the highest rate of tax in effect for the applicable class of taxpayer for that year, and an interest charge for the deemed deferral benefit would be imposed with respect to the resulting tax attributable to each such other taxable year. |
• | Man Sang Nevada is a “U.S. Real Property Holding Corporation”; | |
• | the gain is effectively connected with the conduct by thenon-U.S. Holder of a U.S. trade or business (or in the case of an applicable tax treaty, attributable to a permanent establishment in the United States); | |
• | thenon-U.S. Holder is an individual who has been present in the United States for 183 days or more in the taxable year of disposition and certain other requirements are met; or | |
• | thenon-U.S. Holder was formerly a citizen or resident of the United States and is subject to special rules that apply to certain expatriates. |
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• | fails to provide an accurate taxpayer identification number; | |
• | is notified by the IRS that backup withholding is required; or | |
• | in certain circumstances, fails to comply with applicable certification requirements. |
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MAN SANG BVI SHAREHOLDERS
Nevada | British Virgin Islands | |||
General Meetings of Shareholders | It is common practice in Nevada that the date and time of the annual meeting of shareholders is typically set forth in our company’s bylaws unless the board of directors decides to change the date and time of the annual meeting. The board of directors also determines the place of such meeting either within or without of the State of Nevada or may determine that such meeting shall not be held at any place and instead be held by means of remote communication. | Under the BVI Companies Act, there is no requirement for an annual meeting of shareholders. Under the amended and restated articles of association of Man Sang BVI, we are required to hold an annual meeting of shareholders within six months from the date of the financial year end at the time designated by the board of directors. |
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Nevada | British Virgin Islands | |||
meeting is to be held. | shareholders’ meeting to those persons whose names on the date the notice is given appear as members in our register of members and are entitled to vote at the meeting. | |||
Calling a Shareholders’ Meeting | Under Nevada law, special meetings of the shareholders of a corporation may be called by the entire board of directors, any two directors or the president unless the articles of incorporation or the bylaws of the corporation provide otherwise. | Under the BVI Companies Act, subject to any limitations in the memorandum and articles of association, meetings of shareholders of a company, in the British Virgin Islands called ‘members,’ may be convened by the directors or (subject to any provision in the memorandum or articles of association for a lesser percentage) upon the written request of members holding not less than 30% of the votes of the outstanding voting shares of our company, the directors shall convene a meeting of members. In the case of Man Sang BVI, the amended and restated articles of association provide that the directors shall convene a meeting of members upon the written request of members holding 30% or more of the outstanding voting shares of Man Sang BVI; provided that shareholders shall receive not less than 10 days nor more than 60 days’ notice of the meeting. |
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Nevada | British Virgin Islands | |||
Voting Rights | Under Nevada law, unless the company’s articles of incorporation provide otherwise, each shareholder is entitled to one vote for each share of capital stock held by the shareholder. | Under British Virgin Islands law, except as otherwise provided in the memorandum or articles of association, all shares vote as one class and each whole share has one vote. Under the amended and restated memorandum of association of Man Sang BVI, each ordinary share is entitled to one vote. The holders of Man Sang BVI preferred shares have rights equivalent to the rights of the holders of shares of Man Sang Nevada preferred stock. Holders of 100,000 issued and outstanding Man Sang BVI preferred shares are entitled to the votes of 3,191,225 ordinary shares. Holders of Man Sang BVI ordinary shares and preferred shares vote together as a single class at a meeting of shareholders; provided, however, that under certain circumstances under British Virgin Islands law and pursuant to Man Sang BVI’s amended and restated memorandum and articles of association, the preferred shares may be entitled to vote as a separate class. | ||
Action by Written Consent | Under Nevada law, unless otherwise provided in the articles of incorporation or bylaws, shareholders may take any action required or permitted to be taken at a shareholders’ meeting without a meeting if a written consent thereto is consented to in writing by shareholders holding the same number of votes that would be required if the action were to be taken at a meeting. Man Sang Nevada’s amended and restated bylaws provide that shareholders may take action by the written consent of shareholders in lieu of a meeting. Unless restricted by the | Under the BVI Companies Act and amended and restated articles of association of Man Sang BVI, an action that may be taken by members at a meeting may also be taken by a resolution of members consented to in writing without the need for any notice. An action that may be taken by the directors or a committee of directors may also be taken by a resolution of directors or a committee of directors consented to in writing by all directors or all members of the committee as the case may be, without the need for any notice. | ||
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Nevada | British Virgin Islands | |||
articles of incorporation or bylaws of the , any action that may be taken at a meeting of the directors or a committee of the board of directors may also be taken without a meeting if a written consent of directors or a committee of the board of directors is signed by all directors or by all members of the committee without the need for notice. Man Sang Nevada’s articles of incorporation and bylaws do not restrict the taking of action by unanimous written consent in lieu of a meeting. | ||||
Rights Upon a Liquidation or Dissolution | Under Nevada law, unless otherwise provided in the articles of incorporation, a liquidation, dissolution or winding-up of a corporation, including the sale of all of a corporation’s property and assets, must be approved by the board of directors, recommended to the stockholders and then approved by the affirmative vote of holders of a majority of the outstanding shares entitled to vote. In the event of a liquidation, dissolution or winding-up, the stockholders are entitled to share ratably according to the number of shares held by them in all remaining assets available for distribution to the holders of common stock after payment, or the provision for payment of all of the corporation’s obligations and liabilities, and subject to the prior rights of any holders of preferred stock then outstanding. | Under the BVI Companies Act and Man Sang BVI’s amended and restated articles of association, Man Sang BVI may be dissolved, liquidated or wound up by the vote of holders of not less than a simple majority of its shares voting at a meeting or by the written resolution of shareholders holding a simple majority of the issued shares of Man Sang BVI. | ||
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Nevada | British Virgin Islands | |||
letter agreement with Man Sang Nevada dated July 24, 2009, pursuant to which they have agreed that their receipt of a pro rata portion of the Man Sang BVI preferred shares with an equivalent liquidation preference will constitute payment in full of their rights to the assets of Man Sang Nevada in the liquidation and they have agreed to waive any and all other rights to preferential amounts of the assets of Man Sang Nevada which each holder may otherwise be entitled to receive under the Certificate of Designation, as amended, of Man Sang Nevada Series A preferred stock. | ||||
Dissenters’ or Appraisal Rights | Under Nevada law, Man Sang Nevada stockholders are not entitled to dissenters’ rights for a dissolution preceding a liquidation because (a) the Nevada Revised Statutes do not provide for dissenters’ rights for a dissolution preceding a liquidation; and (b) neither Man Sang Nevada’s restated articles of incorporation, as amended, the restated bylaws, nor a resolution of its board of directors grant shareholders dissenters’ rights. | A shareholder may dissent from a mandatory redemption of his shares, an arrangement (if permitted by the court), a merger (unless the shareholder was a shareholder of the surviving company prior to the merger and continues to hold the same or similar shares after the merger) and a consolidation. A shareholder properly exercising his dissent rights is entitled to payment in cash of the fair value of his shares. |
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in the national market system by the Financial Industry Regulatory Authority (which was formed in 2007 through the consolidation of the National Association of Securities Dealers, Inc. and the member regulation, enforcement and arbitration functions of the New York Stock Exchange) or held of record by more than 2,000 shareholders, unless the articles of incorporation of the corporation issuing the shares provide otherwise; or the holders of the class or series of stock are required under the plan of merger or exchange to accept for their shares anything except cash, owner’s interests or owners interests and cash in lieu of fractional owner’s interests of (a) the surviving or acquiring entity, (b) any other entity which at the effective date of the plan of merger or exchange were either listed on a national securities exchange, included in the national market system by the Financial Industry Regulatory Authority or held of record by at least 2,000 shareholders or (c) some combination of the above. In addition, dissenters’ rights are not available to any holders of shares of the surviving domestic corporation if the plan of merger did not require the vote of the shareholders of the surviving corporation. | any rights of a shareholder except the right to be paid the fair value of his shares. As such, the merger or consolidation may proceed in the ordinary course notwithstanding the dissent. | |||
Rights of Non-resident or Foreign Shareholders | There are no limitations under Nevada law that restrict the rights of non-resident or foreign stockholders from holding stock in a Nevada corporation or exercising voting rights in connection therewith. | There are no limitations imposed by our amended and restated memorandum and articles of association on the rights of non-resident or foreign shareholders to hold or exercise voting rights on our shares. In addition, there are no provisions in our amended and restated memorandum and articles of association governing the ownership threshold above which shareholder ownership must be disclosed. | ||
Sources and Payment of Dividends | Under Nevada law, the board of directors, subject to any restrictions in the corporation’s articles of incorporation, may declare and make distributions (including the payment of a dividend) generally out of: | Under the BVI Companies Act and the amended and restated articles of association of Man Sang BVI, the directors may, by a resolution of directors, authorize a distribution by Man Sang BVI to members at such | ||
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(1) operating surplus of the corporation, which is defined as net assets less statutory capital; or (2) if no operating surplus exists, out of the net profits of the corporation for the fiscal year in which the dividend is declared and/or the preceding fiscal year; subject to criteria set forth in the Nevada Revised Statutes; provided, however, the board of directors may not make distributions to its shareholders if, after giving it effect, the corporation would not be able to pay its debts as they become due in the usual course of business; or, except as set forth in the articles of incorporation, the corporation’s total assets would be less than the sum of its total liabilities plus that amount needed if the corporation were dissolved at the time of distribution to satisfy the preferential rights upon dissolution of shareholders whose preferential rights are superior to those receiving the distribution. The holders of preferred shares are entitled to receive on a preferred basis a dividend per share equal to any dividends per share declared on shares of Man Sang Nevada’s common stock before any payment to holders of the common stock. | time and of such an amount as they think fit if they are satisfied, on reasonable grounds, that immediately after the distribution, the value of Man Sang BVI’s assets exceeds its liabilities and Man Sang BVI is able to pay its debts as they fall due. | |||
Rights of Purchase and Redemption | Under Nevada law, if provided in the articles of incorporation or in a board resolution, a corporation may purchase, redeem and dispose of its own shares, except that it may not purchase or redeem these shares subject to restrictions on the declaration and making of distributions as set forth above. If a corporation redeems its stock, immediately following any such redemption, the corporation must have outstanding one or more series, or one or more classes, which shares together must have full voting power and together are entitled to receive the net assets of the corporation upon dissolution of the corporation. | Under the BVI Companies Act and the amended and restated articles of association of Man Sang BVI, the directors may, on behalf of our company, subject to a resolution of members (including the written consent of all the members whose shares are to be purchased, redeemed or otherwise acquired), purchase, redeem or otherwise acquire any of our company’s own shares for such consideration as they consider fit, and either cancel or hold such shares as treasury shares. The directors may dispose of any shares held as treasury shares on such terms and conditions as they may from time to time determine. Shares may be purchased | ||
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may purchase or redeem any of its shares that are redeemable pursuant to the articles of incorporation or by a board resolution which are entitled upon any distribution of assets to a preference over another class of its stock if these shares will be retired upon acquisition or redemption, thereby reducing the capital stock of the corporation. | or otherwise acquired in exchange for newly issued shares. | |||
Preemptive Rights | Under Nevada law, a shareholder is not entitled to preemptive rights to subscribe for additional issues of stock or any security convertible into stock of the corporation unless they are specifically granted in the articles of incorporation. Such preemptive rights are specifically denied in Man Sang Nevada’s restated articles of incorporation, as amended. | The amended and restated articles of association of Man Sang BVI do not contain specific preemptive rights. The BVI Companies Act prescribes preemptive rights in respect of the shares of an international company incorporated under the BVI International Business Companies Act and automatically re-registered as a business company pursuant to the BVI Companies Act which preemptive rights do not apply to Man Sang BVI as its amended and restated memorandum and articles of association did not expressly provide that those provisions would apply. | ||
Amendment of Organizational Instruments | Under Nevada law, unless the articles of incorporation requires a greater vote, an amendment to the articles of incorporation requires: | The amended and restated memorandum of association of Man Sang BVI provides that Man Sang BVI may only amend its amended and restated memorandum of association and articles of association by an ordinary resolution of members. | ||
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entitled to vote thereon as a class. | ||||
Stock Class Rights | Under Nevada law, any change to the rights of holders of shares or any series of preferred shares of a company would require an amendment to the company’s articles of incorporation unless such right is specifically denied in the company’s articles of incorporation. | The amended and restated memorandum of association of Man Sang BVI provides that if any time the authorized shares are divided into different classes or series of shares, the rights attached to any class or series (unless otherwise provided by the terms of issue of the shares of that class or series) may, whether or not our company is being wound up, be varied with the consent in writing of the holders of not less than one-half of the issued shares of that class and of the holders of one-half of the issued shares of any other class or series of shares which may be affected by such variation. | ||
Shareholders’ Votes on Certain Transactions | Generally, under Nevada law, unless the articles of incorporation provides for the vote of a larger portion of the stock held by the shareholders, completion of a liquidation, consolidation, sale, lease or exchange of all of a corporation’s assets or a dissolution requires: | Under the BVI Companies Act, subject to any limitations or provisions to the contrary in its amended and restated memorandum and articles of association, approval by a resolution of members is required for: | ||
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• a plan of merger or consolidation; and | ||||
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and restated articles of association or the BVI Companies Act. | ||||
Rights of Inspection | Nevada law allows any shareholder of record for at least six months preceding the demand to inspect, or any person holding, or authorized by those holding, at least 5% of all of the corporation’s outstanding shares, upon five days written demand, may inspect and make copies during usual business hours, in person or by an agent or attorney, of the following: | Under the BVI Companies Act, a member of a business company may, on giving written notice to a company, inspect the company’s memorandum and articles, the register of members, the register of directors and the minutes of meetings and resolutions of members and of those classes of members of which he is a member. | ||
Standard of Conduct for Directors | Nevada law does not set forth extensive provisions describing the standard of conduct of a director. Directors are required to exercise their powers in good faith and with a view to the interests of the corporation. The scope of the fiduciary duties of directors is determined by the courts of the State of Nevada when presented with the issue, and often with reference to decisions by the courts of the State of Delaware. In general, directors have a duty to act without self-interest, on a well-informed basis and in a manner they | Under the BVI Companies Act, our directors have a duty to act honestly, in good faith and with a view to our best interests. Our directors also have a duty to exercise the care, diligence and skills that a reasonably prudent person would exercise in comparable circumstances. In fulfilling their duty to Man Sang BVI, our directors must ensure compliance with our amended and restated memorandum and articles of association. A shareholder has the right to seek damages if a duty owed by our directors is breached. | ||
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reasonably believe to be in the interest of the corporation. | ||||
Size of the Board of Directors | Under Nevada law, the board of directors must have at least one director who is a natural person of at least 18 years of age and who does not need to be a U.S. citizen. Man Sang Nevada’s board of directors currently consists of five directors. The number of directors is established from time to time by resolution of the board of directors. | Under the BVI Companies Act, a business company must have at least one director. | ||
Classification of the Board of Directors | Under Nevada law, the articles of incorporation or bylaws may provide for the classification of the board of directors in order to stagger the terms of the directors. The term “classified board” generally means the specification of selected board seats for a term of more than one year (but not more than three years), with different classes of board seats coming up for election each year. Man Sang Nevada’s amended and restated bylaws do not provide for the classification of its board of directors, but rather provides for the election of all of Man Sang Nevada’s directors at each annual meeting. | The directors of Man Sang BVI are not divided into classes. Each director shall hold office for the term, not exceeding three years, as may be specified in the resolution appointing him or until his earlier death, resignation or removal. | ||
Election of Directors | Directors are currently elected at an annual meeting of shareholders at which a quorum is present, in person or by proxy, by a plurality vote and hold office until the succeeding annual meeting. | Man Sang BVI’s amended and restated articles of association is consistent with the bylaws of Man Sang Nevada with respect to the election of directors. | ||
Removal of Directors | Nevada law provides that a director may be removed with or without cause by the holders of not less than two-thirds of the voting power of the shares entitled to vote at an election of directors, except that: | Under the BVI Companies Act, a director may be removed from office with or without cause by a resolution of members of the company. The amended and restated articles of association of Man Sang BVI provides that a director may be removed from office with cause by an ordinary resolution of members and without cause by a special resolution of members. The amended and restated articles of association of Man Sang BVI provides that “cause” shall mean a conviction for a criminal offense involving dishonesty or engaging in conduct which brings the director or Man Sang BVI into |
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shareholders owning sufficient shares to prevent the director’s election to office at the time of removal. | disrepute and which results in material financial detriment to Man Sang BVI. | |||
Vacancies on the Board of Directors | Under Nevada law, unless otherwise provided in the articles of incorporation, the following vacancies may be filled by a vote of a majority of the directors then in office, even though less than a quorum: | The amended and restated articles of association of Man Sang BVI provide that the directors may at any time appoint any person to be a director to fill a vacancy or as an addition to the board. | ||
Board Quorum and Vote Requirements | Pursuant to Man Sang Nevada’s amended and restated bylaws, at any meeting of Man Sang Nevada’s board of directors, the presence of a majority of the whole board of directors, at least one of which must be either Mr. Cheng Chung Hing, Ricky or Mr. Cheng Tai Po, constitutes a quorum for the transaction of business. The act of the majority of the directors present at a meeting at which a quorum is present constitutes an act of the board of directors. | Man Sang BVI’s amended and restated articles of association provides that the quorum necessary for the transaction of business at a meeting of directors is a majority of directors of whom at least one must be either Mr. Cheng Chung Hing, Ricky or Mr. Cheng Tai Po. | ||
Place of Directors Meetings | Pursuant to Man Sang Nevada’s amended and restated bylaws, all meetings of the board of directors must be held either at the principal office of Man Sang Nevada or at such other place, within or outside of the State of Nevada, as specified in the notice of the meeting. | Man Sang BVI’s amended and restated articles of association provides that the directors of our company shall meet at such times and in such manner and places within or outside the British Virgin Islands as they may determine to be necessary or desirable. | ||
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Liability of Directors and Officers | Except as specifically provided in the Nevada Revised Statutes, or if the articles of incorporation or an amendment thereto provide for greater individual liability, a director or officer is not individually liable to the corporation or its shareholders for any damages as a result of any act or failure to act in his capacity as a director or officer unless: | Under British Virgin Islands law, a director of a business company, in performing his functions is entitled to rely on the share register which the BVI Companies Act requires the company to keep, the books of accounts and records kept in accordance with the same Act and financial statements and other information prepared, and on expert advice given by an employee of the company or an expert whom the director believes to be competent and reliable. No provision in the amended and restated memorandum of association or amended and restated articles of association of Man Sang BVI or in any agreement entered into by Man Sang BVI relieves a director of Man Sang BVI from the duty to act in accordance with the amended and restated memorandum or articles or from any personal liability arising from his management of the business and affairs of Man Sang BVI. | ||
Indemnification of Directors and Officers | Nevada law provides that a corporation may indemnify any officer or director who is made, or threatened to be, a party to any threatened, pending or completed suit or proceeding on account of being a director, officer or employee of the corporation against expenses, including attorney’s fees, judgments, fines and amounts paid in settlement actually and reasonably incurred by that person in connection with the defense or settlement of the action, provided he (1) is not liable for a breach of his fiduciary duties, or (2) acted in good faith and in a manner which he reasonably believed to be in or not opposed to the best interests of the corporation, and had no reason to believe his conduct was unlawful. If the officer or director was successful on the merits then he must be indemnified. By means of a determination of the stockholders, or a majority vote by the directors representing a quorum consisting of directors who were not parties to the suit or proceeding, the corporation | British Virgin Islands law does not limit the extent to which a company’s articles of association may provide for indemnification of officers and directors, except to the extent any such provision may be held by the British Virgin Islands courts to be contrary to public policy, such as to provide indemnification against civil fraud or the consequences of committing a crime. |
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may advance the expenses as they are incurred prior to a final disposition provided the officer or director enters into an undertaking to repay the amount if a court decides he is not entitled to indemnification. | or are threatened to be made a party by reason of their acting as Man Sang BVI’s directors, officers or liquidators. To be entitled to indemnification, these persons must have acted honestly, in good faith and in the best interest or not opposed to the interest of the company, and must have had no reasonable cause to believe their conduct was unlawful. This standard of conduct is generally the same as permitted under the Nevada Revised Statutes for a Nevada corporation. | |||
Shareholder Derivative and Class Action Suits | Under Nevada law, a shareholder may bring a derivative action on behalf of our company to enforce the rights of our company. An individual also may commence a lawsuit separately or bring a class action suit on behalf of such individual and other similarly situated shareholders where the | We are not aware of any reported class action having been brought in a British Virgin Islands court, however, reported derivative actions have been brought. The High Court of the British Virgin Islands may, on the application of a shareholder of a company, grant leave to that | ||
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requirements for maintaining a class action under Nevada law have been met. A person may generally institute and maintain such suits only if such person was a shareholder at the time of the transaction which is the subject of the derivative suit or became a shareholder by operation of law from one who was a shareholder at the time of the transaction. Nevada law also requires that the derivative plaintiff must make a demand on the board of directors to assert the claim or take suitable actions, and the demand to be refused by the board, before the suit may be prosecuted by the derivative plaintiff, unless such demand would be futile (and if futile, the derivative plaintiff must make clear the reasons why such demand would be futile). | shareholder to bring proceedings in the name and on behalf of that company, or intervene in proceedings to which the company is a party for the purpose of continuing, defending or discontinuing the proceedings on behalf of the company. In determining whether to grant leave, the High Court of the British Virgin Islands must take into account (1) whether the shareholder is acting in good faith; (2) whether the derivative action is in the interests of the company taking account of the views of the company’s directors on commercial matters; (3) whether the proceedings are likely to succeed; (4) the costs of the proceedings in relation to the relief likely to be obtained; and (5) whether an alternative remedy to the derivative claim is available. | |||
Anti-takeover Measures | Under Nevada law, directors generally have a duty to act without self-interest, on a well-informed basis and in a manner they reasonably believe to be in the interests of the corporation and its shareholders. | Under British Virgin Islands law, the directors of a business company must exercise their powers in good faith for a proper purpose and in the best interests of the company as a whole. It is important for a determination to be made that it is possible for a reasonable board of directors, in good faith, to reach the conclusion that an anti- takeover measure which has the potential to discriminate against a minority of the members is nonetheless for the benefit of the company as a whole. It is likely that the courts would consider whether the board of directors had any ulterior motive in implementing anti-takeover proposals and whether particular shareholders had been singled out in any discriminatory way. | ||
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(2) the board of directors action taken to impede the exercise of shareholders rights was reasonable in relation to the threat posed. | ||||
Transactions with Directors | The Nevada Revised Statutes provide that no contract or transaction between a corporation and one or more of its directors or officers, or between a corporation and any other corporation, partnership, association, or other organization in which one or more of its directors or officers, are directors or officers, or have a financial interest, shall be void or voidable solely for this reason, or solely because the common or interested director or officer is present at, or participates in, the meeting of the board or committee of the board which authorizes the contract or transaction, or signs a written consent authorizing the contract or transaction, or solely because any such director’s or officer’s votes are counted for such purpose, if: (a) the material facts as to the director’s or officer’s relationship or financial interest as to the contract or transaction are disclosed or are known to the board of directors or a committee of the board, and the board or committee of the board in good faith authorizes the contract or transaction by the affirmative votes of a majority of the disinterested directors, even though the disinterested directors may be less than a quorum; (b) the material facts as to the director’s or officer’s relationship or financial interest as to the contract or transaction are disclosed or are known to the shareholders entitled to vote thereon, and the contract or transaction is approved in good faith by the vote of the shareholders holding a majority of the voting power; or (c) the contract or transaction is fair as to the corporation as of the time it is authorized, approved or ratified, by the board of directors, a committee of the board or the shareholders. | Under the BVI Companies Act, a director of a business company is not required to disclose an interest if: | ||
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be counted in determining the presence of a quorum at a meeting of the board of directors or of a committee of the board which authorizes the contract or transaction. | ||||
Interested Shareholder Transactions | The Nevada Revised Statutes provide generally that a Nevada corporation is prohibited from engaging in mergers, dispositions of 5% or more of the aggregate value of its assets or the disposition of assets representing 10% or more of the earning power or net income of the corporation, certain issuances of stock and other transactions (“business combinations”) with a person that owns 10% or more of the voting power of the outstanding voting shares of the corporation (an “interested shareholder”) for a period of three years after the interested shareholder first held 10% or more of the voting power of the outstanding shares. These restrictions on transactions involving an interested shareholder do not apply to (a) a combination approved by the board of directors before that person first became an interested shareholder, (b) a combination with an interested shareholder that resulted in that person becoming an interested shareholder that was approved by the board of directors before that person became an interested shareholder, or (c) a combination that was approved, no earlier than three years after the date that person first became an interested shareholder, by the affirmative vote of holders of at least a majority of the voting power (other than stock owned by the interested shareholder) at a meeting called for that purpose. | The British Virgin Islands has no comparable statute. However, Man Sang BVI has included in its amended and restated memorandum and articles of association provisions consistent with the provisions of the Nevada Revised Statutes governing interested shareholder transactions. | ||
Corporate Transactions | Generally, under the Nevada Revised Statutes, approval of mergers and consolidations and sales, leases or exchanges of all of the property or assets of a corporation requires the affirmative vote of the holders of a majority of the outstanding shares entitled to vote. | Under the laws of the British Virgin Islands, two or more companies may merge or consolidate in accordance with Section 170 of the BVI Companies Act. A merger means the merging of two or more constituent companies into one of the constituent companies, and a consolidation means the uniting of two or more constituent companies into a new company. In order to merge or consolidate, the |
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directors of each constituent company must approve a written plan of merger or consolidation which must be authorized by a resolution of shareholders. | ||||
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consolidation has been approved by the directors and authorized by a resolution of the shareholders, articles of merger or consolidation are executed by each company and filed with the Registrar of Corporate Affairs in the British Virgin Islands. | ||||
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dissenting shareholder to purchase his shares at a specified price that the company determines to be their fair value. The company and the shareholder then have 30 days to agree upon the price. If the company and a shareholder fail to agree on the price within the 30 days, then the company and the shareholder shall each designate an appraiser and these two appraisers shall designate a third appraiser. These three appraisers shall fix the fair value of the shares as of the close of business on the day before the shareholders approved the transaction without taking into account any change in value as a result of the transaction. | ||||
Reporting Requirements | As a domestic issuer, Man Sang Nevada is required file with the SEC, among other reports and notices: (1) an annual report onForm 10-K within 90 days after the end of each fiscal year; (2) quarterly reports onForm 10-Q within 45 days after the end of each of the first three quarters of the fiscal year; and (3) current reports onForm 8-K upon the occurrence of specified corporate events. In addition, as a domestic issuer, Man Sang Nevada is subject to proxy rules which impose certain disclosure and procedural requirements for proxy solicitations under Section 14 of the Exchange Act, and Regulation FD, which addresses certain restrictions on the selective disclosure of material information. Furthermore, Man Sang Nevada’s officers, directors and 10% stockholders are subject to the reporting and “short- swing” profit recovery provisions of Section 16 of the Exchange Act and the rules thereunder with respect to their purchases and sales of Man Sang Nevada ordinary shares. | As a foreign private issuer, Man Sang BVI’s reporting requirements will be limited to filing or furnishing with the SEC (1) an annual report on Form 20-F within six months after the end of each fiscal year prior to its fiscal year ending March 31, 2012, and within four months after the end of each fiscal year thereafter and (2) reports on Form 6-K with respect to any material information which is required to be publicly disclosed in the British Virgin Islands or regarding information distributed or required to be distributed by Man Sang BVI to its shareholders. In addition, Man Sang BVI will also furnish reports to the SEC on Form 6-K with respect to the interim reports filed by Man Sang International Limited for the first six months of Man Sang International Limited’s financial year, not later than three months after the end of this six-month period, as required by the listing rules of the Stock Exchange of Hong Kong Limited. As a foreign private issuer, Man Sang BVI will be exempt from certain rules and requirements under the Exchange Act that would otherwise apply if it were a company incorporated in Nevada, including: |
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under the Exchange Act; | ||||
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• | To approve the dissolution and liquidation of Man Sang Nevada and the adoption of the agreement and plan of liquidation among Man Sang Nevada and Man Sang BVI, whereby Man Sang Nevada will effectively change its place of incorporation from Nevada to the British Virgin Islands by dissolving Man Sang Nevada and distributing to all of its stockholders all of Man Sang Nevada’s property and assets, which consist entirely of Man Sang BVI ordinary shares and preferred shares, on a share-for-share basis, following which (1) Man Sang BVI and its subsidiaries will continue to conduct the business conducted by Man Sang Nevada and its subsidiaries, (2) Man Sang BVI ordinary shares will replace Man Sang Nevada common stock on the NYSE Amex, (3) all current officers and directors of Man Sang Nevada will maintain equivalent positions in Man Sang BVI and (4) Man Sang BVI will contractually assume all rights, title, obligations and liabilities of Man Sang Nevada. Although the dissolution and liquidation will result in the elimination of Man Sang Nevada as the holding company of our group, the number of Man Sang BVI ordinary shares and preferred shares you will own will be the same as the number of shares of Man Sang Nevada common stock and preferred stock you own immediately prior to the completion of the liquidation, and your relative economic ownership and voting rights will remain unchanged; and | |
• | To transact such other business as may properly come before the special meeting or any adjournment or postponement thereof. |
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• | First, you may send a written notice to the Secretary of Man Sang Nevada at Man Sang Nevada’s principal executive offices, stating that you would like to revoke your proxy of an earlier date. This notice must be received prior to the special meeting. | |
• | Second, you may complete and submit a new, later-dated proxy. The latest dated proxy actually received by the company prior to the special meeting will be the one that is counted, and all earlier proxies will be revoked. | |
• | Third, you may attend the special meeting and vote in person. Simply attending the meeting, however, will not revoke your proxy. At the special meeting, the chairman of the meeting will announce instructions for you to follow if you wish to revoke your proxy and vote in person at the meeting. |
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Consolidated Financial Statements | ||||
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Year Ended March 31, | ||||||||||||||||
2009 | 2009 | 2008 | 2007 | |||||||||||||
US$ | HK$ | HK$ | HK$ | |||||||||||||
(Dollars in thousands except share data) | ||||||||||||||||
Net sales — Pearl operations | 40,603 | 316,703 | 405,444 | 398,279 | ||||||||||||
— Real estate operations | 2,107 | 16,435 | 228,247 | — | ||||||||||||
Total net sales | 42,710 | 333,138 | 633,691 | 398,279 | ||||||||||||
Cost of sales | (27,952 | ) | (218,030 | ) | (352,195 | ) | (285,580 | ) | ||||||||
Gross profit | 14,758 | 115,108 | 281,496 | 112,699 | ||||||||||||
Rental income, gross | 3,410 | 26,596 | 6,802 | 4,225 | ||||||||||||
Expenses from rentals | (3,218 | ) | (25,097 | ) | (5,956 | ) | (5,888 | ) | ||||||||
192 | 1,499 | 846 | (1,663 | ) | ||||||||||||
Selling, general and administrative expenses | (19,091 | ) | (148,905 | ) | (118,430 | ) | (84,134 | ) | ||||||||
Operating (loss) income | (4,141 | ) | (32,298 | ) | 163,912 | 26,902 | ||||||||||
Equity in loss of an affiliate | (7 | ) | (54 | ) | (7 | ) | — | |||||||||
Interest income | 1,288 | 10,043 | 17,872 | 9,394 | ||||||||||||
Gain on sale of a real estate investment | 109 | 854 | 10,485 | — | ||||||||||||
Other than temporary decline in fair value of marketable securities | (660 | ) | (5,148 | ) | — | — | ||||||||||
Other income | 606 | 4,724 | 3,693 | 28,981 | ||||||||||||
(Loss) Income before income taxes and minority interests | (2,805 | ) | (21,879 | ) | 195,955 | 65,277 | ||||||||||
Income taxes benefit (expense) | 401 | 3,132 | (75,267 | ) | (6,776 | ) | ||||||||||
Minority interests | 987 | 7,694 | (80,753 | ) | (30,536 | ) | ||||||||||
Net (loss) income | (1,417 | ) | (11,053 | ) | 39,935 | 27,965 | ||||||||||
Other comprehensive income, net of taxes: | ||||||||||||||||
Foreign currency translation adjustments | 13 | 105 | 8,169 | 661 | ||||||||||||
Unrealized holding gain (loss) on marketable securities arising during the year | (276 | ) | (2,157 | ) | 54 | 360 | ||||||||||
Reclassification adjustment for other than temporary decline in fair value of marketable securities included in net income for the year | 266 | 2,078 | — | — | ||||||||||||
Reclassification adjustment for realized gain upon sale of marketable securities included in net income for the year | — | — | (374 | ) | (1,632 | ) | ||||||||||
Other comprehensive income, net of taxes | 3 | 26 | 7,849 | (611 | ) | |||||||||||
Comprehensive (loss) income | (1,414 | ) | (11,027 | ) | 47,784 | 27,354 | ||||||||||
Basic earnings per common share | (0.20 | ) | (1.71 | ) | 6.16 | 4.31 | ||||||||||
Diluted earnings per common share | (0.20 | ) | (1.71 | ) | 5.94 | 4.23 | ||||||||||
Weighted average number of shares of common stock outstanding: | ||||||||||||||||
— basic earnings per share | 6,382,582 | 6,382,582 | 6,382,582 | 6,382,582 | ||||||||||||
— diluted earnings per share | 6,382,582 | 6,382,582 | 6,382,582 | 6,382,582 | ||||||||||||
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March 31, | ||||||||||||
2009 | 2009 | 2008 | ||||||||||
US$ | HK$ | HK$ | ||||||||||
(Dollars in thousands | ||||||||||||
except share data) | ||||||||||||
ASSETS | ||||||||||||
Current assets: | ||||||||||||
Cash and cash equivalents | 63,224 | 493,146 | 603,657 | |||||||||
Restricted cash | 2,179 | 17,000 | — | |||||||||
Marketable securities | 2,387 | 18,619 | 5,411 | |||||||||
Accounts receivable, net of allowance for doubtful accounts of HK$44,197 and HK$17,124 in 2009 and 2008, respectively | 12,647 | 98,649 | 165,436 | |||||||||
Completed properties held for sale | 20,004 | 156,033 | 158,101 | |||||||||
Inventories, net | 5,377 | 41,942 | 49,395 | |||||||||
Prepaid expenses | 1,395 | 10,883 | 8,114 | |||||||||
Receivable from sale of financial assets contracts | 5,078 | 39,608 | — | |||||||||
Deposits and other receivables, net of allowance for doubtful accounts of HK$2,918 and HK$2,918 in 2009 and 2008, respectively | 2,861 | 22,320 | 29,975 | |||||||||
Deposits on acquisition of land for development | 6,595 | 51,436 | 50,551 | |||||||||
Income taxes receivable | 505 | 3,937 | 5,630 | |||||||||
Total current assets | 122,252 | 953,573 | 1,076,270 | |||||||||
Property, plant and equipment, net | 8,954 | 69,840 | 107,497 | |||||||||
Real estate investment, net | 54,748 | 427,037 | 409,695 | |||||||||
Property under development | 25,811 | 201,328 | 123,767 | |||||||||
Investment in an affiliate | 7 | 52 | 104 | |||||||||
Deferred tax assets | — | — | 505 | |||||||||
Goodwill | 8,179 | 63,799 | 63,799 | |||||||||
Total assets | 219,951 | 1,715,629 | 1,781,637 | |||||||||
LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||||||
Current liabilities: | ||||||||||||
Secured debts — current portion | 11,590 | 90,400 | 33,300 | |||||||||
Accounts payable | 14,098 | 109,964 | 123,928 | |||||||||
Accrued payroll and employee benefits | 1,192 | 9,295 | 9,838 | |||||||||
Receipt in advance | 21,573 | 168,273 | 181,859 | |||||||||
Loan from minority interests | 14,654 | 114,300 | 114,300 | |||||||||
China tax payable | 1,848 | 14,417 | 14,409 | |||||||||
Other accrued liabilities | 3,693 | 28,807 | 18,502 | |||||||||
Income taxes payable | 8,783 | 68,507 | 71,266 | |||||||||
Total current liabilities | 77,431 | 603,963 | 567,402 | |||||||||
Secured debts | 13,038 | 101,700 | 166,500 | |||||||||
Deferred tax liabilities | 534 | 4,173 | 8,283 | |||||||||
Minority interests | 77,032 | 600,843 | 623,475 | |||||||||
Commitments and contingencies (note 11 & 12) | — | — | — | |||||||||
Stockholders’ equity: | ||||||||||||
Series A preferred stock US$0.001 par value — authorized, issued and outstanding 100,000 shares in 2009 and 2008 (entitled in liquidation to US$2,500 (HK$19,500)) | — | 1 | 1 | |||||||||
Series B preferred stock US$0.001 par value — authorized 100,000 shares; no shares outstanding | — | — | — | |||||||||
Common stock of par value US$0.001 — authorized 31,250,000 shares; issued and outstanding, 6,382,582 shares in 2009 and 2008 | 6 | 49 | 49 | |||||||||
Additional paid-in capital | 15,024 | 117,184 | 117,184 | |||||||||
Retained earnings | 35,201 | 274,568 | 285,621 | |||||||||
Accumulated other comprehensive income | 1,685 | 13,148 | 13,122 | |||||||||
Total stockholders’ equity | 51,916 | 404,950 | 415,977 | |||||||||
Total liabilities and stockholders’ equity | 219,951 | 1,715,629 | 1,781,637 | |||||||||
F-4
Table of Contents
Year Ended March 31, | ||||||||||||||||
2009 | 2009 | 2008 | 2007 | |||||||||||||
US$ | HK$ | HK$ | HK$ | |||||||||||||
(Dollars in thousands except share data) | ||||||||||||||||
Cash flow from operating activities | ||||||||||||||||
Net (loss) income | (1,417 | ) | (11,053 | ) | 39,935 | 27,965 | ||||||||||
Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||||||||||
Allowance for doubtful debts | 3,523 | 27,478 | (5,303 | ) | 1,551 | |||||||||||
Inventory write down | 732 | 5,708 | 19,386 | 7,327 | ||||||||||||
Depreciation and amortization | 2,645 | 20,633 | 11,569 | 8,299 | ||||||||||||
Equity in loss of an affiliate | 7 | 54 | 7 | — | ||||||||||||
Gain on sale of real estate investment | (109 | ) | (854 | ) | (10,485 | ) | — | |||||||||
(Gain) Loss on sale of property, plant and equipment | (177 | ) | (1,389 | ) | (30 | ) | 399 | |||||||||
Minority interest | (986 | ) | (7,694 | ) | 80,753 | 30,536 | ||||||||||
Realized loss (gain) on sale of marketable securities | 445 | 3,470 | (2,257 | ) | (4,769 | ) | ||||||||||
Other than temporary decline in fair value of marketable securities | 660 | 5,148 | — | — | ||||||||||||
Stock compensation expense | — | — | 1,290 | 5,317 | ||||||||||||
Changes in operating assets and liabilities, net of effects from sale of subsidiaries: | ||||||||||||||||
Accounts receivable | 5,383 | 41,997 | (58,955 | ) | (11,142 | ) | ||||||||||
Completed properties held for sale | 385 | 3,001 | — | — | ||||||||||||
Inventories | 264 | 2,063 | (22,586 | ) | 2,855 | |||||||||||
Prepaid expenses | (346 | ) | (2,700 | ) | (4,575 | ) | 2,267 | |||||||||
Deposits and other receivables | 1,014 | 7,908 | (13,276 | ) | (2,544 | ) | ||||||||||
Income taxes receivable | 217 | 1,693 | (4,010 | ) | (363 | ) | ||||||||||
Deferred tax assets | 65 | 505 | (251 | ) | 768 | |||||||||||
Accounts payable | (2,093 | ) | (16,327 | ) | 104,086 | 8,226 | ||||||||||
Accrued payroll and employee benefits | (72 | ) | (560 | ) | 957 | (1,000 | ) | |||||||||
Receipt in advance | (2,165 | ) | (16,884 | ) | 98,434 | — | ||||||||||
Other accrued liabilities | 1,315 | 10,259 | (4,099 | ) | (1,061 | ) | ||||||||||
China tax payable | 1 | 8 | 14,409 | — | ||||||||||||
Income taxes payable | (354 | ) | (2,759 | ) | 68,870 | 347 | ||||||||||
Deferred tax liabilities | (527 | ) | (4,110 | ) | 8,472 | 259 | ||||||||||
Net cash provided by operating activities | 8,410 | 65,595 | 322,341 | 75,237 | ||||||||||||
Cash flow from investing activities | ||||||||||||||||
Restricted cash | (2,179 | ) | (17,000 | ) | — | — | ||||||||||
Receivable from matured investment | (5,078 | ) | (39,608 | ) | — | — | ||||||||||
Purchase for property under development | (9,850 | ) | (76,830 | ) | (465,695 | ) | — | |||||||||
Purchase of property, plant and equipment | (1,098 | ) | (8,567 | ) | (7,333 | ) | (8,893 | ) | ||||||||
Purchase of marketable securities | (13,074 | ) | (101,975 | ) | (13 | ) | — | |||||||||
Acquisition of 6% controlling interest in CPJC, net of cash acquired | — | — | 75,396 | — | ||||||||||||
Acquisition and advance to an affiliate | — | — | (112 | ) | (84,895 | ) | ||||||||||
Proceeds from sale of property, plant and equipment | 685 | 5,345 | 32 | 268 | ||||||||||||
Proceeds from sale of real estate investment | 1,790 | 13,963 | 25,000 | — | ||||||||||||
Proceeds from sale of marketable securities | 10,251 | 79,955 | 4,250 | 9,405 | ||||||||||||
Net cash used in investing activities | (18,553 | ) | (144,717 | ) | (368,475 | ) | (84,115 | ) | ||||||||
Cash flow from financing activities | ||||||||||||||||
Increase in secured debts | 2,897 | 22,598 | 66,600 | — | ||||||||||||
Loan from minority stockholders | — | — | 35,100 | |||||||||||||
Net proceeds from issuance of common shares by a subsidiary | — | — | 290,370 | 759 | ||||||||||||
Dividend paid by a subsidiary | (2,809 | ) | (21,910 | ) | (21,280 | ) | ||||||||||
Repayment of secured debts | (4,346 | ) | (33,898 | ) | (22,200 | ) | — | |||||||||
Return of capital to stockholders | — | — | (12,446 | ) | — | |||||||||||
Net cash (used in) provided by financing activities | (4,258 | ) | (33,210 | ) | 336,144 | 759 | ||||||||||
Net (decrease) increase in cash and cash equivalents | (14,401 | ) | (112,332 | ) | 290,010 | (8,119 | ) | |||||||||
Cash and cash equivalents at beginning of year | 77,392 | 603,657 | 296,969 | 304,753 | ||||||||||||
Exchange adjustments | 233 | 1,821 | 16,678 | 335 | ||||||||||||
Cash and cash equivalents at end of year | 63,224 | 493,146 | 603,657 | 296,969 | ||||||||||||
Supplementary disclosures of cash flow information: | ||||||||||||||||
Cash paid during the year for: | ||||||||||||||||
Interest and finance charges (Capitalized) | 2,144 | 16,726 | 13,041 | — | ||||||||||||
Income taxes paid, net | 175 | 1,364 | 6,374 | 5,182 | ||||||||||||
F-5
Table of Contents
Accumulated | ||||||||||||||||||||||||||||||||||||||||
Series A | Series B | Additional | Other | Total | ||||||||||||||||||||||||||||||||||||
Preferred Stock | Preferred Stock | Common Stock | Paid-In | Retained | Comprehensive | Stockholders’ | ||||||||||||||||||||||||||||||||||
Shares | Amount | Shares | Amount | Shares | Amount | Capital | Earnings | Income | Equity | |||||||||||||||||||||||||||||||
HK$ | HK$ | HK$ | HK$ | HK$ | HK$ | HK$ | ||||||||||||||||||||||||||||||||||
(Dollars in thousands except share data) | ||||||||||||||||||||||||||||||||||||||||
Balance at March 31, 2006 | 100,000 | 1 | — | — | 6,382,582 | 49 | 67,598 | 217,364 | 5,884 | 290,896 | ||||||||||||||||||||||||||||||
Issuance of common stock by a subsidiary | — | — | — | — | — | — | (517 | ) | — | — | (517 | ) | ||||||||||||||||||||||||||||
Stock compensation expense | — | — | — | — | — | — | 2,626 | — | — | 2,626 | ||||||||||||||||||||||||||||||
Share options of a subsidiary lapsed | — | — | — | — | — | — | (357 | ) | 357 | — | — | |||||||||||||||||||||||||||||
Translation adjustment | — | — | — | — | — | — | — | — | 661 | 661 | ||||||||||||||||||||||||||||||
Unrealized holding gain on marketable securities | — | — | — | — | — | — | — | — | (1,272 | ) | (1,272 | ) | ||||||||||||||||||||||||||||
Net income | — | — | — | — | — | — | — | 27,965 | — | 27,965 | ||||||||||||||||||||||||||||||
Balance at March 31, 2007 | 100,000 | 1 | — | — | 6,382,582 | 49 | 69,350 | 245,686 | 5,273 | 320,359 | ||||||||||||||||||||||||||||||
Issuance of common stock by a subsidiary | — | — | — | — | — | — | (4,436 | ) | — | — | (4,436 | ) | ||||||||||||||||||||||||||||
Stock compensation expense | — | — | — | — | — | — | 573 | — | — | 573 | ||||||||||||||||||||||||||||||
Deemed receipt from shareholders | — | — | — | — | — | — | 64,143 | — | — | 64,143 | ||||||||||||||||||||||||||||||
Return of capital to shareholders | — | — | — | — | — | — | (12,446 | ) | — | — | (12,446 | ) | ||||||||||||||||||||||||||||
Translation adjustment | — | — | — | — | — | — | — | 8,169 | 8,169 | |||||||||||||||||||||||||||||||
Unrealized holding gain on marketable securities | — | — | — | — | — | — | — | 54 | 54 | |||||||||||||||||||||||||||||||
Reclassification adjustment for realized gain upon sale of marketable securities included in net income for the year | (374 | ) | (374 | ) | ||||||||||||||||||||||||||||||||||||
Net income | — | — | — | — | — | — | — | 39,935 | — | 39,935 | ||||||||||||||||||||||||||||||
Balance at March 31, 2008 | 100,000 | 1 | — | — | 6,382,582 | 49 | 117,184 | 285,621 | 13,122 | 415,977 | ||||||||||||||||||||||||||||||
Translation adjustment | — | — | — | — | — | — | — | — | 105 | 105 | ||||||||||||||||||||||||||||||
Unrealized holding loss on marketable securities | — | — | — | — | — | — | — | — | (2,157 | ) | (2,157 | ) | ||||||||||||||||||||||||||||
Reclassification adjustment for other than temporary decline in fair value of marketable securities included in net income for the year | — | — | — | — | — | — | — | — | 2,078 | 2,078 | ||||||||||||||||||||||||||||||
Reclassification adjustment for realized gain upon sale of marketable securities included in net income for the year | — | — | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||
Net (loss) income | — | — | — | — | — | — | — | (11,053 | ) | — | (11,053 | ) | ||||||||||||||||||||||||||||
Balance at March 31, 2009 | 100,000 | 1 | — | — | 6,382,582 | 49 | 117,184 | 274,568 | 13,148 | 404,950 | ||||||||||||||||||||||||||||||
— | — | 6 | 15,024 | 35,201 | 1,685 | 51,916 | ||||||||||||||||||||||||||||||||||
F-6
Table of Contents
1. | ORGANIZATION AND ACQUISITION AND DIVESTITURE |
F-7
Table of Contents
HK$ | ||||
Property, plant and equipment | 1,020 | |||
Inventories | 164 | |||
Accounts receivable | 370 | |||
Other current assets | 208 | |||
Cash and cash equivalents | 373 | |||
Accounts payable | (23 | ) | ||
Other accrued liabilities | (1,922 | ) | ||
190 | ||||
F-8
Table of Contents
2. | SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES |
F-9
Table of Contents
Leasehold land and buildings | 50 years, or less if the lease period is shorter | |
Plant and machinery | 4 to 5 years | |
Furniture and equipment | 4 years | |
Motor vehicles | 4 years |
F-10
Table of Contents
F-11
Table of Contents
For the Year Ended | For the Year Ended | For the Year Ended | ||||||||||||||||||||||||||||||||||
March 31, 2009 | March 31, 2008 | March 31, 2007 | ||||||||||||||||||||||||||||||||||
Earnings | Shares | EPS | Earnings | Shares | EPS | Earnings | Shares | EPS | ||||||||||||||||||||||||||||
HK$’000 | HK$ | HK$’000 | HK$ | HK$’000 | HK$ | |||||||||||||||||||||||||||||||
Basic EPS: | ||||||||||||||||||||||||||||||||||||
Net income | (11,053 | ) | 39,935 | 27,965 | ||||||||||||||||||||||||||||||||
Allocated to Series A preferred stock | 170 | (616 | ) | (431 | ) | |||||||||||||||||||||||||||||||
Net income available to common stockholders, adjusted | (10,883 | ) | 6,382,582 | (1.71 | ) | 39,319 | 6,382,582 | 6.16 | 27,534 | 6,382,582 | 4.31 | |||||||||||||||||||||||||
Effect of dilutive securities Stock options granted by a listed subsidiary | (4 | ) | (1,429 | ) | — | (537 | ) | — | ||||||||||||||||||||||||||||
Diluted EPS: | ||||||||||||||||||||||||||||||||||||
Net income available to common stockholders, including conversion | (10,887 | ) | 6,382,582 | (1.71 | ) | 37,890 | 6,382,582 | 5.94 | 26,997 | 6,382,582 | 4.23 | |||||||||||||||||||||||||
F-12
Table of Contents
F-13
Table of Contents
F-14
Table of Contents
3. | OTHER INCOME |
Year Ended March 31, | ||||||||||||
2009 | 2008 | 2007 | ||||||||||
HK$ | HK$ | HK$ | ||||||||||
Other income consists of the following: | ||||||||||||
Sale of scrapped inventories | — | — | 22,461 | |||||||||
Gain on sale of property, plant and equipment | 1,389 | 30 | — | |||||||||
Dividend income | 645 | 251 | 369 | |||||||||
Gain on sale of marketable securities | — | 2,257 | 4,769 | |||||||||
Government grant | 1,590 | — | — | |||||||||
Others | 1,100 | 1,155 | 1,382 | |||||||||
4,724 | 3,693 | 28,981 | ||||||||||
4. | INCOME TAXES |
Year Ended March 31, | ||||||||||||
2009 | 2008 | 2007 | ||||||||||
HK$ | HK$ | HK$ | ||||||||||
Hong Kong | 30,193 | 40,804 | 60,309 | |||||||||
Other regions in the PRC | (33,707 | ) | 157,544 | 6,514 | ||||||||
Corporate expense, net | (18,365 | ) | (2,393 | ) | (1,546 | ) | ||||||
(21,879 | ) | 195,955 | 65,277 | |||||||||
F-15
Table of Contents
Year Ended March 31, | ||||||||||||
2009 | 2008 | 2007 | ||||||||||
HK$ | HK$ | HK$ | ||||||||||
Current tax | ||||||||||||
Subsidiaries operating in: | ||||||||||||
Hong Kong | 1,720 | 1,515 | 4,448 | |||||||||
Other regions | (2,058 | ) | 68,132 | 719 | ||||||||
(338 | ) | 69,647 | 5,167 | |||||||||
Deferred tax | ||||||||||||
Subsidiaries operating in: | ||||||||||||
Hong Kong | 358 | 3,373 | 1,254 | |||||||||
Other regions | (3,152 | ) | 2,247 | 355 | ||||||||
(2,794 | ) | 5,620 | 1,609 | |||||||||
Total | (3,132 | ) | 75,267 | 6,776 | ||||||||
Year Ended March 31, | ||||||||||||
2009 | 2008 | 2007 | ||||||||||
HK$ | HK$ | HK$ | ||||||||||
Applicable U.S. federal tax rate | 34 | % | 34 | % | 34 | % | ||||||
Provision of income taxes at the applicable U.S. federal tax rate on income for the year | (7,439 | ) | 84,732 | 22,194 | ||||||||
Non-deductible expenses | 1,668 | 3,998 | 1,328 | |||||||||
Non-taxable income | (8,103 | ) | (10,118 | ) | (8,243 | ) | ||||||
Changes in valuation allowance | 6,044 | (10,041 | ) | 1,990 | ||||||||
International rate difference | 1,466 | (1,065 | ) | (10,617 | ) | |||||||
Others | 3,232 | 7,761 | 124 | |||||||||
(3,132 | ) | 75,267 | 6,776 | |||||||||
F-16
Table of Contents
March 31, | ||||||||
2009 | 2008 | |||||||
HK$ | HK$ | |||||||
Deferred tax assets: | ||||||||
Unremitted earnings ofnon-U.S. subsidiaries | 9,457 | 10,638 | ||||||
Operating loss carry forwards | 2,967 | 1,806 | ||||||
Unrealized profit on inventory | 5,146 | — | ||||||
Inventory reserve | 2,474 | — | ||||||
Valuation allowance | (18,095 | ) | (12,051 | ) | ||||
Net deferred tax assets | 1,949 | 393 | ||||||
Deferred tax liabilities: | ||||||||
Undistributed earnings from foreign subsidiaries | (1,400 | ) | (1,400 | ) | ||||
Land and building | (4,722 | ) | (6,771 | ) | ||||
(4,173 | ) | (7,778 | ) | |||||
Year Ended March 31, | ||||||||
2009 | 2008 | |||||||
HK$ | HK$ | |||||||
Non-current assets | — | 505 | ||||||
Non-current liabilities | (4,173 | ) | (8,283 | ) | ||||
(4,173 | ) | (7,778 | ) | |||||
F-17
Table of Contents
5. | INVENTORIES |
Year Ended March 31, | ||||||||
2009 | 2008 | |||||||
HK$ | HK$ | |||||||
Raw materials | 12,610 | 14,418 | ||||||
Work in progress | 3,306 | 8,650 | ||||||
Finished goods | 26,026 | 26,327 | ||||||
41,942 | 49,395 | |||||||
6. | STAFF RETIREMENT PLANS |
7. | PROPERTY, PLANT AND EQUIPMENT |
Year Ended March 31, | ||||||||
2009 | 2008 | |||||||
HK$ | HK$ | |||||||
Leasehold land and buildings | 83,387 | 132,076 | ||||||
Plant and machinery | 21,197 | 18,906 | ||||||
Furniture and equipment | 8,269 | 15,262 | ||||||
Motor vehicles | 6,911 | 6,390 | ||||||
119,764 | 172,634 | |||||||
Less: Accumulated depreciation | (49,924 | ) | (65,137 | ) | ||||
Net book value | 69,840 | 107,497 | ||||||
F-18
Table of Contents
8. | REAL ESTATE INVESTMENT |
Year Ended March 31, | ||||||||
2009 | 2008 | |||||||
HK$ | HK$ | |||||||
At cost: | ||||||||
Leasehold land and buildings | ||||||||
— Hong Kong | 38,276 | 17,622 | ||||||
— Other regions of the PRC | 416,203 | 404,818 | ||||||
454,479 | 422,440 | |||||||
Less: Accumulated depreciation | (27,442 | ) | (12,745 | ) | ||||
Net book value | 427,037 | 409,695 | ||||||
As of | ||||
March 31, 2009 | ||||
HK$ | ||||
Year ending March 31, | ||||
2010 | 20,178 | |||
2011 | 21,664 | |||
2012 and after | 3,599 | |||
45,441 | ||||
F-19
Table of Contents
9. | PROPERTY UNDER DEVELOPMENT |
Year Ended March 31, | ||||||||
2009 | 2008 | |||||||
HK$ | HK$ | |||||||
At cost: | ||||||||
Land held for development | 97,623 | 94,646 | ||||||
Construction cost | 103,705 | 29,121 | ||||||
201,328 | 123,767 | |||||||
10. | OTHER ACCRUED LIABILITIES |
Year Ended March 31, | ||||||||
2009 | 2008 | |||||||
HK$ | HK$ | |||||||
Accrued expenses | 22,843 | 11,743 | ||||||
Deposits received | — | 1,549 | ||||||
Purchase consideration for a business | 1,000 | 1,000 | ||||||
Others | 4,964 | 4,210 | ||||||
28,807 | 18,502 | |||||||
11. | COMMITMENTS |
As of | ||||
March 31, 2009 | ||||
HK$ | ||||
Year ending March 31, | ||||
2010 | 14,365 | |||
2011 | 10,188 | |||
2012 | 1,845 | |||
2013 | 943 | |||
2014 | 450 | |||
27,791 | ||||
F-20
Table of Contents
12. | CONTINGENCIES |
13. | CAPITAL STOCK |
F-21
Table of Contents
14. | STOCK OPTION PLANS |
F-22
Table of Contents
Number of | Exercise Prices (the Weighted | |||||||
MSIL | Average Exercise Price | |||||||
Options | in Parenthesis) | |||||||
Outstanding as of April 1, 2007 | 60,000,000 | HK$0.253, HK$0.233 and | ||||||
HK$0.500 (HK$0.267 | ) | |||||||
Exercised | (21,000,000 | ) | HK$0.253 and HK$0.233 | |||||
(HK$0.241 | ) | |||||||
Outstanding as of March 31, 2008 and March 31, 2009 | 39,000,000 | HK$0.253, HK$0.233 and | ||||||
HK$0.500 (HK$0.281 | ) | |||||||
Exercisable as of March 31, 2008 and March 31, 2009 | 39,000,000 | HK$0.253 and HK$0.233 and | ||||||
HK$0.500 (HK$0.281 | ) |
F-23
Table of Contents
MSIL Options Granted on | ||||||||||||
May 2, | September 18, | March 13, | ||||||||||
2006 | 2006 | 2007 | ||||||||||
Risk-free interest rate per annum | 4.660 | % | 4.025 | % | 4.030 | % | ||||||
Expected life | 5 years | 5 years | 5 years | |||||||||
Expected volatility | 21.83 | % | 35.25 | % | 60.91 | % | ||||||
Expected dividend yield | 0.00 | % | 0.00 | % | 0.00 | % |
F-24
Table of Contents
15. | ACQUISITION AND INVESTMENT IN AFFILIATES |
HK$ | ||||
Purchase price | (49,440 | ) | ||
Loan assignment | (10,560 | ) | ||
Cash received at time of acquisition | 135,396 | |||
75,396 | ||||
As at | ||||
April 12, | ||||
2007 | ||||
HK$ | ||||
Acquisition costs — direct | 49,440 | |||
Direct costs | 666 | |||
50,106 | ||||
Current assets | 190,402 | |||
Property, plant and equipment | 207,044 | |||
Total assets acquired | 397,446 | |||
Current liabilities | (269,236 | ) | ||
Deferred tax liabilities | (1,903 | ) | ||
Long term debt | (140,000 | ) | ||
Total liabilities assumed | (411,139 | ) | ||
Net liability assumed | (13,693 | ) | ||
Excess of cost over fair value of net assets acquired, Goodwill | 63,799 | |||
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Year Ended | ||||
March 31, 2008 | ||||
HK$ | ||||
Pro forma revenues, including rental income | 640,493 | |||
Pro forma net income | 39,341 | |||
Earnings per share — Basic pro forma | 6.16 | |||
Diluted pro forma | 5.84 | |||
16. | GOODWILL |
HK$ | ||||
Real Estate Operations | ||||
Balance as of March 31, 2008 and March 31, 2009 | 63,799 | |||
17 | SECURED DEBT |
HK$ | ||||
Year ended March 31, | ||||
2010 | 90,400 | |||
2011 | 101,700 | |||
192,100 | ||||
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18. | RELATED PARTY TRANSACTIONS |
19. | CONCENTRATIONS OF CREDIT RISK |
a. | Major customers |
Percentage of Accounts | ||||||||
Receivable March 31, | ||||||||
2009 | 2008 | |||||||
Five largest receivable balances | 37.1 | % | 32.5 | % |
Year Ended March 31, | ||||||||||||
2009 | 2008 | 2007 | ||||||||||
HK$ | HK$ | HK$ | ||||||||||
Balance at beginning of year | 17,124 | 22,436 | 22,265 | |||||||||
Addition (Reduction) of allowance charged to statement of income | 27,478 | (5,303 | ) | 1,551 | ||||||||
Direct write-off charged against allowance | — | (9 | ) | (1,380 | ) | |||||||
Translation | (405 | ) | — | — | ||||||||
Balance at end of year | 44,197 | 17,124 | 22,436 | |||||||||
b. | Deposits in financial institution |
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20. | FAIR VALUE MEASUREMENTS |
March 31, | March 31, | |||||||
2009 | 2008 | |||||||
HK$ | HK$ | |||||||
Publicly traded corporate equity securities listed in Hong Kong, net of other-than-temporary impairment | 16,962 | 3,560 | ||||||
Gross unrealized gains | 1,657 | 1,851 | ||||||
Fair value of marketable securities using inputs as level 1 | 18,619 | 5,411 | ||||||
March 31, | March 31, | |||||||
2009 | 2008 | |||||||
Sale proceeds at market price | 79,955 | 4,250 | ||||||
Specific identification cost of the securities, net of other-than-temporary decline value | (83,425 | ) | (1,993 | ) | ||||
Realized (loss) gain | (3,470 | ) | 2,257 | |||||
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21. | SEGMENT INFORMATION |
Year Ended March 31, | ||||||||||||
2009 | 2008 | 2007 | ||||||||||
HK$ | HK$ | HK$ | ||||||||||
Revenues from external customers: | ||||||||||||
Pearls | 316,703 | 405,444 | 398,279 | |||||||||
Real estate, including rental income | 43,031 | 235,049 | 4,225 | |||||||||
359,734 | 640,493 | 402,504 | ||||||||||
Operating (loss) income: | ||||||||||||
Pearls | (2,349 | ) | 39,824 | 28,565 | ||||||||
Real estate | (29,949 | ) | 124,088 | (1,663 | ) | |||||||
(32,298 | ) | 163,912 | 26,902 | |||||||||
Depreciation and amortization: | ||||||||||||
Pearls | 6,952 | 6,440 | 5,820 | |||||||||
Real estate | 12,793 | 4,211 | 1,561 | |||||||||
Corporate assets | 888 | 918 | 918 | |||||||||
20,633 | 11,569 | 8,299 | ||||||||||
Capital expenditure for segment assets: | ||||||||||||
Pearls | 8,531 | 6,881 | 8,929 | |||||||||
Real estate | 76,866 | 466,147 | — | |||||||||
85,397 | 473,028 | 8,929 | ||||||||||
Segment assets: | ||||||||||||
Pearls | 643,357 | 648,480 | 572,466 | |||||||||
Real estate | 1,020,942 | 1,090,346 | 60,979 | |||||||||
Corporate assets (note) | 51,330 | 42,811 | 45,664 | |||||||||
1,715,629 | 1,781,637 | 679,109 | ||||||||||
Long-lived assets: | ||||||||||||
Pearls | 35,336 | 46,108 | 154,674 | |||||||||
Real estate | 694,559 | 623,339 | 60,979 | |||||||||
Corporate assets | 32,161 | 35,920 | 36,838 | |||||||||
762,056 | 705,367 | 252,491 | ||||||||||
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Year Ended March 31, | ||||||||||||
2009 | 2008 | 2007 | ||||||||||
HK$ | HK$ | HK$ | ||||||||||
Net sales to unaffiliated customers: | ||||||||||||
Real Estate operations | ||||||||||||
PRC | 16,435 | 228,247 | — | |||||||||
Pearl operations | ||||||||||||
Hong Kong | 15,966 | 26,848 | 29,929 | |||||||||
North America | 69,945 | 104,185 | 114,076 | |||||||||
Europe | 152,957 | 168,616 | 155,015 | |||||||||
Asian countries, other than Hong Kong | 52,194 | 78,915 | 79,303 | |||||||||
Others | 25,641 | 26,880 | 19,956 | |||||||||
316,703 | 405,444 | 398,279 | ||||||||||
333,138 | 633,691 | 398,279 | ||||||||||
Year Ended March 31, | ||||||||||||
2009 | 2008 | 2007 | ||||||||||
HK$ | HK$ | HK$ | ||||||||||
Hong Kong | 653,294 | 555,298 | 484,882 | |||||||||
Other regions of the PRC | 1,062,335 | 1,226,339 | 194,227 | |||||||||
1,715,629 | 1,781,637 | 679,109 | ||||||||||
Year Ended March 31, | ||||||||||||||||||||||||
2009 | 2008 | 2007 | ||||||||||||||||||||||
HK$ | % | HK$ | % | HK$ | % | |||||||||||||||||||
Customer A | 47,789 | 15 | 66,097 | 10 | 63,765 | 16 | ||||||||||||||||||
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22. | QUARTERLY DATA (UNAUDITED) |
1st | 2nd | 3rd | 4th | |||||||||||||
Quarter | Quarter | Quarter | Quarter | |||||||||||||
HK$ | HK$ | HK$ | HK$ | |||||||||||||
2009 | ||||||||||||||||
Net sales | 89,353 | 110,223 | 78,260 | 55,302 | ||||||||||||
Gross profit | 36,560 | 40,370 | 26,974 | 11,204 | ||||||||||||
Operating income (loss) | 11,422 | 11,087 | (5,760 | ) | (49,047 | ) | ||||||||||
Net income (loss) | 4,199 | 5,006 | (3,423 | ) | (16,835 | ) | ||||||||||
Basic earnings per common share (in dollar) | 0.65 | 0.77 | (0.53 | ) | (2.60 | ) | ||||||||||
Diluted earnings per common share (in dollar) | 0.63 | 0.76 | N/A | N/A | ||||||||||||
2008 | ||||||||||||||||
Net sales | 100,652 | 109,407 | 108,616 | 315,016 | ||||||||||||
Gross profit | 35,062 | 38,161 | 34,002 | 121,014 | ||||||||||||
Operating income | 17,800 | 6,013 | (4,594 | ) | 91,436 | |||||||||||
Net income | 8,898 | 3,695 | 4,229 | 23,113 | ||||||||||||
Basic earnings per common share (in dollar) | 1.37 | 0.57 | 0.65 | 3.57 | ||||||||||||
Diluted earnings per common share (in dollar) | 1.30 | 0.54 | 0.62 | 3.51 |
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Page | ||||||
Accounting Matters | A-20 | |||||
Preliminary BVI Matters | A-20 | |||||
Public Announcements | A-20 | |||||
Further Assistance | A-20 | |||||
Cooperation of Third Parties | A-20 | |||||
CONDITIONS PRECEDENT | A-20 | |||||
Conditions to Each Party’s Obligation to Effect the Liquidation | A-20 | |||||
TERMINATION, AMENDMENT AND WAIVER | A-21 | |||||
Termination | A-21 | |||||
Effect of Termination | A-22 | |||||
Amendment | A-22 | |||||
Waiver | A-22 | |||||
Procedure for Termination, Amendment, Extension or Waiver | A-22 | |||||
GENERAL PROVISIONS | A-22 | |||||
Non-Survival of Representations and Warranties | A-22 | |||||
Notices | A-22 | |||||
Severability | A-23 | |||||
Entire Agreement; No Third-Party Beneficiaries | A-23 | |||||
Governing Law | A-23 | |||||
Headings | A-23 | |||||
Counterparts | A-23 | |||||
AFFILIATE LETTER | A-24 |
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DEFINITIONS
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(a) | if to Man Sang Holdings: |
Suite 2208, 22/F, Sun Life Tower
The Gateway, 15 Canton Road
Tsimshatsui
Kowloon, Hong Kong
Attention: Martin Pak
(b) | if to Man Sang BVI: |
Suite 2208, 22/F, Sun Life Tower
The Gateway, 15 Canton Road
Tsimshatsui
Kowloon, Hong Kong
Attention: Martin Pak
A-22
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14/F, Hutchison House
10 Harcourt Road
Central, Hong Kong
Attention: Brian Spires
By: | /s/ Cheng Chung Hing, Ricky |
Name: | Cheng Chung Hing, Ricky | |
Title: | Chairman |
By: | /s/ Cheng Chung Hing, Ricky |
Name: | Cheng Chung Hing, Ricky | |
Title: | Chairman |
A-23
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AFFILIATES OF MAN SANG HOLDINGS, INC.
A-24
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A-25
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A-26
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of 2009, by
By: |
A-27
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Suite 2208-14, 22/F Sun Life Tower,
The Gateway, 15 Canton Road,
Tsimshatsui, Kowloon, Hong Kong
A-28
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Table of Contents
B-2
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B-3
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B-4
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B-5
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Suite 2208-14, 22/F Sun Life Tower
The Gateway, 15 Canton Road
Tsimshatsui
Kowloon, Hong Kong
B-6
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Facsimile No: (852) 2317 9913
Email Address: martinpak@man-sang.com
Suite 2208-14, 22/F Sun Life Tower
The Gateway, 15 Canton Road
Tsimshatsui
Kowloon, Hong Kong
Facsimile No: (852) 2317 9913
Email Address: martinpak@man-sang.com
14/F., Hutchison House
10 Harcourt Road
Hong Kong
Facsimile No: (852) 2845 0476
Email Address: brian.spires@bakernet.com
3773 Howard Hughes Parkway
Third Floor South
Las Vegas, Nevada 89169
Facsimile No: (702) 737 7705
Email Address: rbarrier@jonesvargas.com
B-7
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B-8
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By: | /s/ Cheng Chung Hing, Ricky |
Name: | Cheng Chung Hing, Ricky | |
Title: | Chairman |
By: | /s/ Cheng Chung Hing, Ricky |
Name: | Cheng Chung Hing, Ricky | |
Title: | Chairman |
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Name and Address of Stockholder | Total Number of Company Securities | |
Cafoong Limited c/o Man Sang Holdings, Inc. Suite 2208-14, 22/F, Sun Life Tower, The Gateway, 15 Canton Road, Tsimshatsui, Kowloon, Hong Kong | Common stock, 3,437,501 shares Series A Preferred Stock, 100,000 shares |
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INTERNATIONAL (B.V.I.) LIMITED AND CAFOONG LIMITED
C-1
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Name: Cheng Chung Hing, Ricky |
Title: |
By: | /s/ Cheng Chung Hing, Ricky |
By: | /s/ Cheng Chung Hing, Ricky |
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Item 20. | Indemnification of Directors and Officers |
Item 21. | Exhibits and Financial Statement Schedules |
Balance at | Charged/ | |||||||||||||||
beginning | (credited) | Deductions | Balance at end | |||||||||||||
Description | of the year | to expenses | Note(1) | of the year | ||||||||||||
Year ended March 31, 2009 | ||||||||||||||||
Allowance for doubtful debt | 20,042 | 27,073 | — | 47,115 | ||||||||||||
Deferred tax asset valuation allowance | 12,051 | 6,044 | — | 18,095 | ||||||||||||
Year ended March 31, 2008 | ||||||||||||||||
Allowance for doubtful debt | 26,201 | (5,303 | ) | (856 | ) | 20,042 | ||||||||||
Deferred tax asset valuation allowance | 2,010 | (10,041 | ) | — | 12,051 | |||||||||||
Year ended March 31, 2007 | ||||||||||||||||
Allowance for doubtful debt | 26,031 | 1,551 | (1,379 | ) | 26,201 | |||||||||||
Deferred tax asset valuation allowance | 2,622 | (612 | ) | — | 2,010 |
(1) | Bad debts write-offs |
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Life on | ||||||||||||||||||||||||||||||||||||||||
Gross Amount at Which | which | |||||||||||||||||||||||||||||||||||||||
Initial Cost to Company | Cost | Carried at Close of Period | Accumulated | depreciation | ||||||||||||||||||||||||||||||||||||
Land, | Capitalized | Land, | depreciation | At latest income | ||||||||||||||||||||||||||||||||||||
Building | Subsequent to | Building | and | Date of | Date | Statement | ||||||||||||||||||||||||||||||||||
Description | Encumbrance | Land | improvement | acquisition | Land | improvement | Total | Amortization | Construction | Acquired | is computed | |||||||||||||||||||||||||||||
HK$’000 | HK$’000 | HK$’000 | HK$’000 | HK$’000 | HK$’000 | HK$’000 | HK$’000 | |||||||||||||||||||||||||||||||||
Office Building | ||||||||||||||||||||||||||||||||||||||||
— Wing Tuck | — | — | 837 | — | — | 837 | 837 | 424 | 1982 | May 14, 1988 | 50 years | |||||||||||||||||||||||||||||
— 19/F Railway | 31,324 | — | 37,439 | — | — | 37,439 | 37,439 | 6,115 | 1995 | Feb 28, 2001 | 50 years | |||||||||||||||||||||||||||||
Industrial Building | ||||||||||||||||||||||||||||||||||||||||
— 20 Blocks of Man Hing | ||||||||||||||||||||||||||||||||||||||||
Industrial City | — | — | 42,279 | — | — | 42,279 | 42,279 | 10,396 | 1992-1994 | 1992-1994 | 50 years | |||||||||||||||||||||||||||||
Market Centre | ||||||||||||||||||||||||||||||||||||||||
— CP & J City | 230,764 | 96,599 | 277,325 | — | 96,599 | 277,325 | 373,924 | 10,507 | 2008 | 2008 | 50 years | |||||||||||||||||||||||||||||
262,088 | 96,599 | 357,880 | — | 96,599 | 357,880 | 454,479 | 27,442 | |||||||||||||||||||||||||||||||||
Year Ended March 31, | ||||||||||||
2009 | 2008 | 2007 | ||||||||||
HK$’000 | HK$’000 | HK$’000 | ||||||||||
Balancing at beginning of period | 422,440 | 75,290 | 75,290 | |||||||||
Addition during period : — | ||||||||||||
Acquisition | 48,824 | 365,807 | — | |||||||||
471,264 | 441,097 | 75,290 | ||||||||||
Deduction during period : — | ||||||||||||
Deposition of real estate | (16,785 | ) | (18,657 | ) | — | |||||||
Balance at end of period | 454,479 | 422,440 | 75,290 | |||||||||
Year Ended March 31, | ||||||||||||
2009 | 2008 | 2007 | ||||||||||
HK$’000 | HK$’000 | HK$’000 | ||||||||||
Balancing at beginning of period | 12,745 | 14,311 | 12,452 | |||||||||
Addition during period : — | ||||||||||||
charged to profit or loss | 18,321 | 2,576 | 1,859 | |||||||||
31,066 | 16,887 | 14,311 | ||||||||||
Deduction during period : — | ||||||||||||
Deposition of real estate | (3,624 | ) | (4,142 | ) | — | |||||||
Balance at end of period | 27,442 | 12,745 | 14,311 | |||||||||
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Item 22. | Undertakings |
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II-4
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By: | /s/ Cheng Chung Hing, Ricky |
Name | Title | |||
/s/ Cheng Chung Hing, Ricky Mr. Cheng Chung Hing, Ricky | President and Chairman of the Board of Directors and Chief Executive Officer | |||
/s/ Cheng Tai Po Mr. Cheng Tai Po | Vice-Chairman of the Board of Directors | |||
/s/ Lai Chau Ming, Matthew Mr. Lai Chau Ming, Matthew | Director | |||
/s/ Wong Gee Hang, Henry Mr. Wong Gee Hang, Henry | Director | |||
/s/ Tsui King Chung, Francis Mr. Tsui King Chung, Francis | Director | |||
/s/ Pak Wai Keung, Martin Mr. Pak Wai Keung, Martin | Chief Financial Officer (principal accounting officer) |
By: | /s/ Patrick O’Neill |
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Exhibit No. | Description | |||
2 | .1(1) | Agreement and Plan of Dissolution and Liquidation, dated as of July 24, 2009, by and between Man Sang Holdings, Inc. and Man Sang International (B.V.I.) Limited | ||
3 | .1 | Form of Amended and Restated Articles of Association of Man Sang International (B.V.I.) Limited | ||
3 | .2 | Amendment to the Certificate of Designation after Issuance of Class or Series (Pursuant to NRS78.1955) and amended text of the Certificate of Designation, Preferences and Rights of a Series of 100,000 Shares of Preferred Stock, $.001 Par Value, Designated Series A Preferred Stock | ||
4 | .1 | Man Sang Holdings, Inc. 2007 Stock Option Plan | ||
5 | .1 | Opinion of Conyers Dill & Pearman, as to the validity of the ordinary shares and preferred shares of Man Sang International (B.V.I.) Limited | ||
8 | .1 | Tax Opinion of PricewaterhouseCoopers Limited, as to certain U.S. tax matters | ||
8 | .2 | Tax Opinion of Conyers Dill & Pearman, as to certain British Virgin Islands tax matters (included as part of Exhibit 5.1) | ||
9 | .1(1) | Voting Agreement, dated as of July 24, 2009, among Man Sang International (B.V.I.) Limited and the stockholders of Man Sang Holdings, Inc., identified on the signature pages thereto | ||
10 | .1 | Form of Registration Rights Agreement, by and between Man Sang International (B.V.I.) Limited and each affiliate of Man Sang Holdings, Inc. | ||
10 | .2(1) | Letter Agreement among Man Sang Holdings, Inc., Man Sang International (B.V.I.) Limited and Cafoong Limited | ||
10 | .3 | Service Agreement, dated August 31, 2006, between Man Sang International Limited and Cheng Chung Hing | ||
10 | .4 | Service Agreement, dated August 31, 2006, between Man Sang International Limited and Cheng Tai Po | ||
10 | .5 | Service Agreement, dated August 31, 2006, between Man Sang International Limited and Yan Sau Man, Amy | ||
23 | .1 | Consent of Grant Thornton, Independent Registered Public Accounting Firm | ||
23 | .2 | Consent of Conyers Dill & Pearman (included in opinion filed as Exhibit 5.1) | ||
23 | .3 | Consent of PricewaterhouseCoopers Limited (included in opinion filed as Exhibit 8.1) | ||
23 | .4 | Consent of Jones Vargas | ||
23 | .5 | Consent of Baker & McKenzie | ||
99 | .1 | Form of Proxy Card |
(1) | Filed as an annex to the proxy statement/prospectus constituting a part of this registration statement. |
II-6