Form 8-K release 1-21-11 (Trademark Agreement)
This is an interesting development. It actually appears that CHCG is doing something. I'm anxious to see how their new business model to open franchise stores is working out. We probably won't find out until the very last day possible (following an extension of the filing date) on April 15th... maybe March 31st if we're lucky. This company appears to be enroute to the Pink Sheets, but hopefully they can survive and surprise us all in 2011-2012. Last time I checked, they only have 2 or 3 franchise stores open and haven't fully removed their store-in-store business model. Here's the 8K posting with important parts bolded:
China 3C Group's Subsidiary, Zhejiang Yong Xing Digital Technology Co. Ltd. (“Zhejiang”), entered into a Registered Trademark Transfer Agreement (the “Transfer Agreement”) with Hangzhou Letu Digital Products Trade Co., Ltd. (“Hangzhou”), a PRC company, pursuant to which Hangzhou transferred to Zhejiang its registered trademark, “Lotour.” The registered term of the trademark expires on July 6, 2020. The total consideration for the purchase of the trademark is RMB 2,280,000 (or approximately $345,600), which shall be paid to Hangzhou in the form of 1.08 million shares of the Company’s common stock, using a price of $0.32 per share. Zhejiang’s payment is required to be made within one month after January 17, 2011, the day the Transfer Agreement became effective. Pursuant to the terms of the Transfer Agreement, Hangzhou entrusted its legal representative, Weiping Wang, to act as the beneficiary, to hold such shares on its behalf and deliver all future investment proceeds to be received from such shares (including cash dividend, bonus or other forms of distribution of proceeds) to Hangzhou.
The description of the Transfer Agreement is not complete and is qualified in its entirety by reference to the full text of the Transfer Agreement, a copy of which is filed herewith as Exhibit 10.1 and is incorporated by reference into this Item 1.01.
On January 20, 2011, Zhejiang entered into a Design and Development Engagement Agreement (the “Development Agreement”) with Shenzhen Kangdewei Electronics Co., Ltd. (“Kangdewei”), a PRC company, pursuant to which Zhejiang engaged Kangdewei to design and develop an electronic book product under the brand name “Lotour.” Kangdewei is required to provide Zhejiang with 100 sets of the electronic book prototype for Zhejiang to inspect and test the market.
The total consideration for the design and development of the electronic book product is RMB 3,160,000 (or approximately $480,000), which shall be paid to Kangdewei in the form of 1.6 million shares of the Company’s common stock, using a price of $0.30 per share. Zhejiang’s payment is required to be made upon the delivery of the 100 sets of the electronic book prototype. Pursuant to the terms of the Development Agreement, Kangdewei entrusted Yong Lian to act as the beneficiary, hold such shares on its behalf and deliver all future investment proceeds to be received from such shares (including cash dividend, bonus or other forms of distribution of proceeds) to Kangdewei. The term of the Development Agreement is from January 20, 2011 to July 19, 2011.
The description of the Development Agreement is not complete and is qualified in its entirety by reference to the full text of the Development Agreement, a copy of which is filed herewith as Exhibit 10.2 and is incorporated by reference into this Item 1.01.
