SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 and 15(d) of the
Securities and Exchange Act of 1934
Date of Report (date of earliest event reported) August 30, 1996
ANTARES RESOURCES CORPORATION
(Exact name of Registrant as specified in Charter)
New York 0-3926 13-1950459
(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification
Number)
2345 Friendly Road, Fernandina Beach, FL 32034
(Address of principal executive office) (Zip Code)
Registrant's telephone number, including area code: (904) 261-8607
Page 1 of 11 pages.
Item 5. Other Events.
Effective August 30, 1996, Antares Resources Corporation (the
"Company") entered into a letter agreement with United Kina
Breweries Limited and related parties ("Kina"), a privately held
Bermuda corporation, whereby the Company has agreed in principle to
acquire all of the issued and outstanding shares of Kina, in
exchange for issuance by the Company of previously unissued
"restricted" common stock. The relevant terms of the proposed
transaction require the Company to (i) undertake a "reverse split"
of its common stock, whereby 1 share of common stock will be issued
in exchange for ten (10) shares of common stock; and (ii) issue to
the Kina shareholders an aggregate of 33,500,000 "restricted"
common shares (post split), representing approximately 93% of the
Company's then outstanding common stock, in exchange for all of the
issued and outstanding shares of Kina. Additional shares shall be
issued to unrelated parties in consideration for finder fees
arising from the relevant transaction.
Kina is a holding company which includes 7 joint ventures,
each of which is a brewing company and is engaged in the
manufacturing, distributing and marketing of beer in the People's
Republic of China. On an unaudited basis and prepared in
accordance with International Accounting Standards (and assuming a
conversion ratio of 8.3 RMB to $1 US), Kina has approximately $164
million in total assets and $90 million in net assets. During its
fiscal year ended December 31, 1995, it had gross revenues of
approximately $94 million and generated profits of approximately
$6.6 million. As part of the terms of the Letter Agreement, Kina
is undertaking a financial audit in accordance with Generally
Accepted Accounting Principles, which audited financial statements
will be included in a subsequent Form 8-K to be filed after closing
of the transaction described herein, in accordance with the
provisions of the Securities Exchange Act of 1934, as amended.
The proposed share exchange is subject to satisfaction of
certain conditions, including among other matters completion of due
diligence activities, the approval of the transaction by all of the
Kina shareholders, closing of a $4 million proposed private
placement of the Company's securities and receipt by the Company of
audited and unaudited financial statements. When the transaction
with Kina is consummated, the present officers and directors of the
Company are expected to resign their respective positions with the
Company, to be replaced by the present management of Kina. A copy
of the letter agreement between the Company and Kina is attached
hereto as Exhibit 2.0 and incorporated herein as if set forth.
Further, simultaneous with the Closing of the transaction with
Kina, the Company intends to sell its subsidiary companies, Empire
Energy, Inc., Southern Trailers Manufacturing, Inc. and Cherokee
Sun Corporation to existing management in exchange for redemption
of an aggregate of 450,000 (post reverse split) shares of their
2
individual common stock of the Company, assumption of all
liabilities, termination of each of the existing employment
agreements and execution of releases and general indemnification
agreements.
Item 7. Financial Statements, Pro Forma Financial Information and
Exhibits.
(c) Exhibits.
2.0 Letter Agreement between the Company and United Kina
Breweries Limited
3
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, the Registrant has duly caused this report to be signed on
its behalf of the undersigned thereunto duly authorized.
ANTARES RESOURCES CORPORATION
(Registrant)
By:/s/ William W. Perry, III
William W. Perry III,
President
Dated: September 6, 1996
4
ANTARES RESOURCES CORPORATION
EXHIBIT 2 TO FORM 8-K
LETTER AGREEMENT BETWEEN
ANTARES RESOURCES CORPORATION
AND
UNITED KINA BREWERIES LIMITED
5
ANTARES RESOURCES CORPORATION
2345 Friendly Road
Fernandina Beach, FL 32034
August 29, 1996
VIA TELEFAX
Board of Directors
United Kina Breweries Limited
Attention: Ms. Victoria Lam, Chief Executive Officer
Re: Plan of Reorganization Between Antares
Resources Corporation and United Kina
Breweries Limited and related entities
Dear Ms. Lam:
This letter is intended to express the general terms of the Plan of
Reorganization to be formalized between Antares Resources
Corporation, a New York corporation ("ARC") and United Kina
Breweries Limited, a Bermuda corporation and related entities
(hereinafter jointly referred to as "Kina"). The objective of our
discussions has been the execution and consummation of applicable,
formal Agreement(s) between ARC and Kina (the "Exchange
Agreements") which, among other things, would provide for the
various matters set forth below.
1. Plan of Reorganization and Reorganization of the Companies.
The board of directors of ARC and Kina have completed an initial
evaluation of the business plan, financial statements and other
relevant corporate documents of the other and have concluded that
a reorganization of Kina and ARC, whereby ARC would issue shares of
its "restricted" Common Stock in the amount of 33,500,000 (post
reverse split), which shall represent ownership equal to
approximately 93% of ARC's outstanding shares (not including those
shares to be issued in favor of Bridgewater Capital Corp.
referenced in Paragraph 8, hereinbelow, or those shares to be
issued as part of a private placement of ARC stock, as referenced
in Paragraph 5(A) hereinbelow) in exchange for 100% of the then
outstanding securities of Kina would be in the best interest of
both companies. It is the intent of the parties hereto that the
proposed reorganization of Kina and ARC be effected as a tax-free
exchange pursuant to Section 368 of the Internal Revenue Code of
1986, as amended.
2. Terms of Reorganization.
(A) ARC Capitalization. ARC's total authorized capital stock
consists of 200,000,000 shares of Common Stock, par value $0.001
per share and 5,000,000 shares of Preferred Stock, par value $0.01
6
Ms. Victoria Lam
August 29, 1996
Page 2
per share. Prior to the Closing Date, as defined hereinbelow, the
Board of Directors of ARC shall undertake a reverse split of the
ARC issued and outstanding Common Stock, whereby 1 share of Common
Stock shall be issued in exchange for every 10 shares of Common
Stock presently issued and outstanding, in order to establish the
number of issued and outstanding common shares, including common
shares reserved for issuance underlying outstanding common stock
purchase warrants, to be 2,500,000. As of the Closing Date, as
defined herein, there will be no more than 2,500,000 common shares
issued and outstanding and reserved for issuance (except that said
number of common shares may be increased by no more than 5%) and
126,000 shares of Series B Convertible Preferred Stock issued and
outstanding, convertible upon receipt by ARC of notice of the same
into an aggregate 25,200 shares of common stock (post reverse
split), held by the then existing securities holders of ARC and not
including any shares of common stock issuable to Bridgewater
Capital, as described hereinbelow in Paragraph 8. The shares of
common stock underlying the Series B Convertible Preferred Stock
are subject to "piggyback" registration rights.
(B) Kina Capitalization. Kina's total authorized capital
consists of 1,200,000 Common Shares, $0.01 par value per share. As
of the date of this letter agreement, all 1,200,000 common shares
authorized have been issued and are outstanding.
(C) Special Board and Shareholder Meetings.
(i) Prior to Closing, the Board of Directors of Kina will, if
required or deemed advisable by Kina, call a special meeting of
the Kina Shareholders for the purposes of ratifying the
transaction proposed herein and shall take all additional action
necessary to cause the intent of this letter to be unanimously
adopted and ratified.
(ii) Prior to Closing, the Board of Directors of ARC shall
approve and ratify the terms of the transaction proposed herein
and take all action necessary to effectuate the proposed
transaction.
(D) Share Exchange. Subject to the approval of the terms and
conditions contained herein by the ARC Board of Directors and Kina
shareholders on or before September 15, 1996 (the "Closing" or the
"Closing Date"), Kina shall consummate a reorganization with ARC by
the Kina shareholders exchanging all of the issued and outstanding
Kina Stock owned by them for an aggregate of 33,500,000
"restricted" Common Shares of ARC (post reverse split), with ARC
emerging as the parent company and Kina as a wholly owned
subsidiary thereof.
7
Ms. Victoria Lam
August 29, 1996
Page 3
(E) Officers and Directors. At Closing, the present officers
and directors of ARC shall deliver to Kina their respective letters
of resignation, along with certified minutes of the ARC Board of
Directors accepting such resignation and appointing to the ARC
Board those persons designated by Kina to be officers and directors
of ARC.
3. Financial Condition of ARC. Except as provided herein, as
of the Closing Date, ARC balance sheet will reflect assets of no
less than $1,000,000. There will be no liabilities.
4. Financial Condition of Kina. Kina hereby represents and
warrants that its audited balance sheet dated December 31, 1995 and
unaudited financial statements dated June 30, 1996 will be
consistent with the financial condition as previously represented
by Kina to ARC and will not contain any material negative changes.
5. Conditions to Closing.
(A) Closing. The Closing of the transaction herein shall
take place on or before September 15, 1996, or such other date as
the parties hereto may so agree in the future, but as soon as
practical after the following conditions, in addition to other
customary conditions, have been satisfied: (i) ARC's Board of
Directors has approved the transaction; (ii) the reorganization has
been approved by Kina's shareholders in accordance with the laws of
Bermuda; and (iii) $4 million in subscriptions for shares of ARC
common stock will have been subscribed and held in escrow, pending
Closing of the transaction described herein, wherein an aggregate
of approximately 1,143,000 shares of common stock shall be sold by
Bridgewater Capital Corp. and all of the other terms and conditions
contained in that certain letter agreement by and between Kina and
Bridgewater Capital Corp have been satisfied in full. A copy of
said agreement is attached hereto as Exhibit "A". Failure to cause
this agreement to close within the time parameters established
herein shall result in the termination of this agreement.
The Closing shall take place in Orange County, California at the
offices of Bridgewater Capital Corporation, or such other location
as the parties may so agree. At the discretion of the parties
hereto, Closing may also occur via telephonic means.
(B) To Be Provided by Kina. As soon as possible, but in
no event later than as required by law, in addition to those items
which may be required to be delivered pursuant to the terms of the
applicable Exchange Agreements, Kina shall provide to the present
Board of Directors of ARC the following:
8
Ms. Victoria Lam
August 29, 1996
Page 4
i) a financial audit of its books as of December 31, 1995 and
unaudited financial statements and consolidated pro forma
financial statements for those interim periods required to be
provided the SEC under Regulation SB or SK, promulgated under the
Securities Act of 1933, as amended which shall be prepared in
accordance with Generally Accepted Accounting Principles. The
audited financial statements shall be provided by an independent,
SEC Certified Public Accountant and such audit shall demonstrate
balance sheet information consistent with the financial
information provided to ARC by Kina prior to Closing; and
ii) an investment letter in a form acceptable to counsel to ARC,
duly executed by each Kina shareholder, acknowledging that each
such shareholder is exchanging their respective securities of
Kina for their pro rata applicable number of ARC Common Shares,
that such shares to be acquired by each Kina shareholder are
solely for their account and for investment and they have no
plan, intention, contract, understanding, agreement or
arrangement with any person to sell, assign, pledge, hypothecate
or otherwise transfer to any person such shares, or any portion
thereof.
(C) Non-Delivery. Failure by Kina to provide those items
described hereinabove in Paragraph 4 shall render this proposed
transaction voidable at the discretion of the present Board of
Directors of ARC.
(D) Representations of ARC. ARC hereby represents that, as
of the Closing Date, (i) it will be a reporting company pursuant to
the Securities Exchange Act of 1934, as amended, (ii) it shall be
current in all filings required to be tendered to the Securities
and Exchange Commission ("SEC") pursuant to the Securities Exchange
Act of 1934, as amended, including but not limited to, filings on
Forms 8-K, 10-K, 10-KSB, 10-Q and/or 10-QSB; and (iii) its common
stock will be traded on Nasdaq Small Cap operated by the NASD.
6. Expenses. Each party hereto shall be responsible for
payment of their own legal, accounting and any other out-of-pocket
expenses reasonably incurred in connection with this transaction,
whether or not this transaction is consummated.
7. Confidentiality. Upon the signing of this Agreement, ARC and
Kina will provide to each other full access to their books and
records and will furnish financial and operating data and such
other information with respect to their business and assets as may
reasonably be requested from time to time. If the proposed
transaction is not consummated, all parties shall keep confidential
9
Ms. Victoria Lam
August 29, 1996
Page 5
any information (unless ascertainable from public filings or
published information), obtained concerning the other's operations,
assets and business.
8. Finders Fees.
(A) ARC shall be responsible for payment of a finders' fee to
Intercapital Holdings, Inc., which shall be satisfied in full by
issuance of shares of ARC common stock, which shares are part of
the 2,500,000 common shares represented by ARC to be issued and
outstanding on the Closing Date, as represented in Paragraph 2(A),
above.
(B) Kina hereby acknowledges that it is obligated to tender a
finders' fee to Bridgewater Capital Corporation ("BCC"). Relevant
thereto, simultaneous with the Closing herein, BCC shall be issued
at Closing an aggregate of 1,500,000 shares of ARC common stock
(post reverse split) as satisfaction of finders' fee obligations
owed to BCC by Kina applicable hereto. The shares of common stock
issuable to BCC shall possess "piggyback" registration rights.
(C) The parties hereto hereby acknowledge and agree that the
aforesaid obligations constitute the sole obligations owed by the
parties applicable to finders' fees. Each party hereby warrants
and shall further warrant in such Closing documents that all of
their respective obligations to pay any finders fees have been, or
will be, paid and further, shall indemnify and hold harmless the
other party from such obligation.
9. Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original but all of
which together shall constitute one and the same instrument.
10. Jurisdiction. It is the intention of the parties that the
laws of the State of New York govern the determination of the
validity of this Agreement, the construction of its terms and the
interpretation of the rights and duties of the parties.
11. Notices. Any notice relevant herein shall be deemed to have
been sufficiently served for all purposes if delivered personally
to the party to whom the same is directed, or, if sent, by deposit
with the United States mail, certified mail, return receipt
requested postage prepaid, at such party's address listed
hereinabove, or to such other address as shall be furnished in
writing by any party to the other. any such notice shall be deemed
to be given three (3) days after deposited in the U.S. mail.
12. Further Action. Each party shall execute and deliver such
10
Ms. Victoria Lam
August 29, 1996
Page 6
papers, documents and instruments, and perform such acts as are
necessary or appropriate to implement the terms hereof and the
intent of the parties hereto.
13. Amendments. This Agreement may only be amended by the
mutual consent of all the parties hereto which Amendment shall be
in writing, duly executed by the parties.
14. Enforceable Agreement; Compliance with Applicable Laws.
This Agreement shall constitute an enforceable agreement between
the parties until such time as the more complete agreement is
executed by the parties. All matters referred to in this Agreement
are conditioned upon compliance with federal and state securities
laws and other applicable laws.
15. Termination. This Letter Agreement shall terminate and
expire and be no longer in force and effect if the acquisition
proposed herein has not been closed on or before September 15,1
996, unless such date is extended in writing by the parties hereto.
If the foregoing accurately reflects your understanding of the
terms and conditions of our agreement please so indicate by signing
below as designated.
Yours truly,
ANTARES RESOURCES CORPORATION
By: /s/ William W. Perry
William W. Perry, President
APPROVED AND ACCEPTED this 30th day of August, 1996.
UNITED KINA BREWERIES LIMITED
By: /s/ Victoria Lam
Victoria Lam, Chief Executive Officer