Stock Room

[Jang-A-Lang]

This is the BDC status info, which is all at:

http://www.sec.gov/Archives/edgar/data/1160598/000126246307000012/fccn14a.htm

Would be highly recommended to make a read through before investing in this company.IMO

In consideration of the 1940 Act compliance concerns, and the planned future operations of the Company, the Board has evaluated and discussed the feasibility of the Company continuing as a BDC. The Board believes that given the changing nature of the Company’s business and investment focus in international companies, the regulatory regime governing BDC’s is no longer appropriate and will hinder the Company’s future growth. In addition, given the Commission’s view of past non-compliance with the 1940 Act, the Company is concerned that it may not satisfy the Commission that the Company is in full compliance with the 1940 Act. Management is of the opinion that, absent the compliance requirements imposed by the 1940 Act, the Company would otherwise be in compliance with the Securities Act of 1933 (“Securities Act”) and all other Securities laws. Given that the Company has divested itself of all portfolio investments, and Management’s position that the Company will not seek to make any new investments, the Board believes that the Company will not be required to be regulated under the 1940 Act once it withdraws its BDC election.




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The Company’s Board of Directors unanimously approved the proposal to authorize the Company’s unelection as a BDC as soon as practicable so that it may begin conducting business as an operating company rather than a BDC subject to the 1940 Act. If the stockholders approve this proposal to permit the Company to withdraw its BDC election, the withdrawal will become effective upon receipt by the SEC of the Company’s application for withdrawal. The Company does not anticipate filing the application of withdrawal until it can be reasonably certain that the Company will not be deemed to be an investment company without the protection of its BDC election. After the Company’s application for withdrawal of its BDC election is filed with the SEC, the Company will no longer be subject to the regulatory provisions of the 1940 Act applicable to BDC’s generally, including regulations related to insurance, custody, composition of its Board, affiliated transactions and any compensation arrangements. However, the Company will continue to be subject to any enforcement action by the Commission for any violation of the 1940 Act. If the stockholders approve this Proposal, and the Board does not withdraw the Company’s election to be treated as a BDC within six (6) months from the date of such approval, then the Company will present the matter to the stockholders again for approval prior to filing a withdrawal application. In addition, if at any time a material change affects the Company, including a change in the Company’s capitalization, prior to the withdrawal being completed, a new proxy will be sent to the Company’s shareholders with a description of the changes, and a new shareholder vote will be requested.




The Company has undertaken several steps to meet the requirements for withdrawal of its election to be treated as a BDC, including: (i) preparing a plan of operations in contemplation of such a change to the status for the Company and (ii) consulting with outside counsel as to the requirements for withdrawing its election as a BDC and exemption or exclusion from being deemed an “investment company” under the 1940 Act. As of the date hereof, the Company believes that the Company meets the requirements for filing an application to withdraw its election to be treated as a BDC.




The 1940 Act requires that BDC’s invest in eligible portfolio companies as a predicate for conducting business as a BDC. Between June 30, 2006 and December 31, 2006, the Company disposed of all of its portfolio assets and is now effectively without operations. In December 2006, the Company executed a letter of intent with Aero Exhaust, Inc., a privately-held company, the effect of which will result in Aero becoming the successor issuer to the Company. The Company believes that consummating this transaction while still reporting under the 1940 Act would create additional 1940 Act violations. On January 12, 2007, the Company executed a definitive agreement with Aero Exhaust, Inc. which calls for a share exchange of common stock between the Company and Aero Exhaust, Inc. Under the terms of the definitive agreement, the Company can exchange up to 95% of its total capital stock for up to 100% of the total capital stock of Aero Exhaust, Inc. The specific share amounts will be determined at closing, which is anticipated to take place once the Company is current with its financial statement filings and Aero Exhaust, Inc. has completed an audit of its historical financial statements, presently anticipated for the second quarter of 2007. At the time of closing Aero Exhaust, Inc. will become a wholly owned subsidiary of the Company.