Hartcourt Companies, Inc., a U.S. corporation with subsidiaries in China and other jurisdictions, focused on the Chinese education market, announced that it has entered into a Plan of Reorganization and definitive Share Exchange Agreement with Sino-Canada Investment Group Inc., having one of its main subsidiaries in the British Virgin Islands.
Subject to the terms of the agreement, Hartcourt will effect a 1 for 80 reverse stock split, prior to issuing common stock shares worth approximately $33,623,963 to the Sino-Canada shareholders for $0.88 per share, in exchange for 100% of the issued and outstanding capital stock of Sino-Canada.
The aggregate purchase price and the actual number of shares to be issued are subject to potential purchase price adjustments at the closing. Pursuant to the definitive agreement, the Sino-Canada shareholders will receive 38,209,049 shares of Hartcourt common stock in exchange for their shares. The number of Hartcourt common stock shares issued in the transaction will be decreased in case if Sino-Canada’s working capital decreases by more than 5% at the closing date (compared to March 31, 2009), and will be increased if Hartcourt's total liabilities at closing exceeds $600,000, up to the maximum of 45,850,859 shares. Upon the closing, current shareholders of Sino-Canada are assumed to hold approximately 86% of the outstanding shares of common stock of Hartcourt.
Upon closing the transaction Hartcourt will change its name to Maple China Education Incorporated.
Sino-Canada is focused on the investment and management activities in the sphere of education. One of its main subsidiaries, Canadian Learning Systems Corporation, was incorporated in BVI in 2003, and provides exclusive management services to each of Sino-Canada schools and training centers. The BVI company charges part of schools’ annual profits as compensation for services provided.
