Item 2.01 Completion of Acquisition or Disposition of Assets.
On October 15, 2019,Vivic Corp ("Company") completed the acquisition of 100%
ownership of Guangzhou Monte Fino Yacht Co., Ltd., a Chinese limited liability
company ("Guangzhou Monte Fino").
Guangzhou Monte Fino holds the exclusive license to use the brand "Monte Fino"
in mainland China. Monte Fino is a famous yacht brand owned by Taiwan Kha Shing
Yacht Company, one of the leading yacht manufacturers in the world. Guangzhou
Monte Fino has acquired the rights to develop a yacht marina in Shanwei City,
Guangdong Province, China and has also developed and operated "Surf"(??),an
online yacht rental and leisure service platform in Guangzhou, China. Guangzhou
Monte Fino engaged in business in multiple Chinese provinces including
Guangdong, Fujian and Hainan, and it has received numerous awards at the famous
China Boat Show.
The acquisition of Guangzhou Monte Fino is a milestone for the Company's
business in mainland China. Guangzhou Monte Fino's operations will contribute
significantly to the main business of the Company, including marine tourism,
yacht rental and marina management.
Subsequent to the acquisition, Guangzhou Monte Fino will assume the continuing
operations of the post-acquisition entity, and its senior management acted as
the senior management of the post-acquisition entity. The acquisition is
considered as a re-capitalization of the company. Therefore, the assets,
liabilities and operating results of Guangzhou Monte Fino will be merged with us
from the date of acquisition.
We are a corporation established under the corporation laws in the State of
Nevada on February 16, 2017. Yoel Rosario Duran and Dmitriy Perfilyev were our
directors and officers. We mainly engaged in the tourism business. On December
27, 2018, Honetech Inc, a Samoa company, purchased 2,499,800 shares of common
stock of Company from Yoel Rosario Duran for the price of $151,984.80 and
1,999,800 shares of common stock of the Company from Dmitriy Perfilyev for the
price of $151,984.80 pursuant to the share purchase agreements entered on
December 21, 2018. Upon the consummation of these transactions, Hontech Inc
became the controlling shareholder of the Company. In connection with this
share purchase transaction, on December 21, 2018, the following new members have
been appointed to the board of directors and principal offices of the Company:
Wen-Chi Huang became Chairman of the Board and a Board Director.
Huilan Chen became Secretary of the Board, a Board Director and the Controller
of the Company.
Cheng-Hsing Hsu became a Board Director and the Chief Financial Officer of the
Company.
Yun-Kuang Kung became the Chief Executive Office of the Company.
Kuen-Horng Tsai became the Supervisor of the Board of Directors and a Board
Director.
Kun-Teng Liao became a Board Director.
Effective on December 21, 2018, Yoel Rosario Duran resigned from all positions
he held in the Company, including Chief Executive Officer, Chief Financial
Officer, President, Treasurer, and Board Director, and Dmitriy Perfilyev
resigned as the Secretary of the Company.
Starting December 27, 2018, accompanying the change of new management, we
expanded our main business operations to the research and development of yacht
manufacturing, tourism, pier, real estate operations and the application of new
energy saving technologies.
There are currently two main sectors in the Company's business:
1)In mainland China and Taiwan, we carried out the development, sales and
operation of new energy electric yachts and traditional power yachts, covering
the entire yacht industry chain. Through the Internet platform, we provided our
own proprietary and third-party yacht tourism products, covering the best
coastal tourism attractions in Taiwan and China including Hainan, Xiamen, and
Guangzhou.
2)For the global energy market, we developed a series of oil and gas
energy-saving products with new energy-saving technologies. This cross-century
energy-saving solution can be applied in various scenarios with oil and natural
gas as energy sources. This energy-saving innovative technology will also be
applied to new energy-saving ships and traditional boat reconstruction equipment
to save energy.
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On June 25, 2019, we formed Vivic Corporation (Hong Kong) Co., Ltd ("Vivic HK"),
a wholly owned subsidiary company in Hong Kong. We intended to use Vivic HK as
the primary entity to carry out the new business development in Hong Kong, Macau
and mainland China ("Target Areas"), coordinate the cooperation with other
business entities in Target Areas, and invest in the potential mergers and
acquisitions in Target Areas.
On July 6, 2019, Huilan Chen resigned and Cheng Lung Sung became the new
Secretary of the Company.
On July 11, 2019, we formed a wholly owned branch company in Taiwan ("VIVC
Taiwan") at 19 Jianping Third Street, Tainan City. VIVC Taiwan will be
responsible for the research, development and application of energy-saving
technologies, and the research and development of the manufacturing of electric
ships.
Corporate Structure:
Upon the acquisition of Guangzhou Monte Fino, our corporate structure is as
follows:
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Brief Description of the Business of Guangzhou Monte Fino
Guangzhou Monte Fino is committed to building a yacht wharf centered business
with multiple channels of revenues. It focuses on the wharf construction
operation, yacht R&D, brand promotion, marketing and resource integration. It
combines the online platform with numerous third party service providers to
deliver yacht based recreational and leisure packages and services. Guangzhou
Monte Fino was incorporated in Guangzhou on October 11, 2016 and has two
subsidiaries:
Guangzhou Haishangshengshi yacht co., LTD., focusing on yacht sales, yacht
rental, Internet platform development and operation;
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Guangzhou Jiaxin Yacht Co., Ltd. focusing on dock development, new energy yacht
research and development, yacht maintenance and other industry chain
undertakings.
Business and Services
Guangzhou Monte Fino's business operations mainly consist of:
Operation of the yacht wharf:
Acquire the right to the construction land of the yacht wharf, co-develop the
yacht wharf with local developers and operate the yacht wharf afterwards
Yacht sales: Guangzhou Monte Fino is the general agent of Monte Fino yacht brand
in mainland China. Monte Fino is a luxury yacht brand established for 30 years
with approximately 1200 luxury superyachts sold under its brand.
Yacht leasing: we operate yacht leasing business in Fujian, Guangdong and Hainan
and can also reach out to customers in other regions through Internet sharing
platform.
Internet platform development and operation: the company has developed an
Internet yacht platform with the brand of Surf ("Xianglang"). Through the
distribution mechanism, the company enrolled members and sold membership
subscription to expand yacht consumption customers. It provides marine tourism
products through the time share mechanism.
Yacht maintenance: provide yacht maintenance service for Chinese mainland
customers.
New energy yacht research and development: research and development through full
electric or hybrid electric yacht, reduce the cost of yacht tourism operation,
protect the earth environment, and reduce the use of yacht pollution.
Core Strengths
Our business has the following core strengths to meet the needs of our merchants
and consumers.
Industrial chain support of yacht factory. Through cooperation with various
yacht companies, and with the support of Taiwan Monte Fino, the Company has
supported its business development with a 40-year industry chain of yacht
manufacturing, maintenance, sales, operation, tourism and wharf management and
construction.
Closer to the mainland China market. As the Chinese yacht market has just
started, it is difficult for European and American yacht companies to establish
after-sales service network in a short period of time, and maintenance services
often cannot meet the needs of customers in real time. The Company is based in
Guangdong, Fujian and Hainan, which is closer to the consumer group in terms of
customer response, driving experience, after-sales maintenance and so on. After
perfecting the national marketing service network, we will be able to provide
all-round after-sales service for domestic yacht users.
Technology. In terms of technology, the Company has a sound R&D system for yacht
research and development, and at the same time, it cooperates with excellent
design companies in China and abroad, so that the products can always meet the
market demand. In terms of yacht manufacturing, the company has advanced 3d
printing manufacturing technology in yacht manufacturing, which can greatly
reduce the research and development cost and produce better results.
Outstanding cost performance. Compared with Europe and the United States and
other yacht manufacturing regions, the company's yacht products are very
outstanding cost-effective advantages. The quality and performance of the
company's yacht products reach or exceed the European and American yacht brands,
but in terms of price, it is roughly half to three-fifths of the international
brands'comparable products.
Flexibility of customization. The company has a strong ability to produce
products according to customers' specific requirements. According to the
consumption environment of the target market, it can carry out different
interior design and
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decoration for the same type of ship, and regardless of Chinese and
international customers, it can understand the production process of the yacht
at any time, timely adjust the function design.
Merchant/user scale. We want to include products from mass market merchants,
such as food and beverages, as part of our products and services. We believe
that by adopting a blockchain driven incentive model, simple to complex
transactions will be more effectively extended to the mass market.
Brand. We believe that one of the benefits of our brand is that Monte Fino, as a
luxury yacht brand, has been established for many years and has good quality
control and customer reviews, as well as good customer reviews on the internet
platform. A good brand image will help our ecosystem gain more users,
distributors and merchants.
Sales and Marketing
Brand awareness. We raise the profile of our company, products, and services
directly through the following platforms: mobile applications, social media
platforms, in-person promotions, events, and cross-working with business
partners.
·Mobile applications: consumers access our products through our mobile platform.
Businesses promote their products through the same platform.
·Social media platforms: we promote our products and ecosystem on various social
media platforms, including trill, purchase, local BBS, and WeChat Moments.
·Face to face: notify potential users by word of mouth.
·Business partners: we actively seek brand partners to cross-promote our brands,
products and services.
·Recommendation and distributor: we actively encourage the development of
distributor and subsidiary communities, which will encourage the sale of our
products and services.
Offline marketing.
·Ground promotion: use shopping malls, squares, hotels and other channels to
obtain customers and traffic.
·Membership: development through member recommendation.
·Alliance: promote brands and products by cooperating with other industries
without competition.
Markets and Regions-Greater China includes Taiwan and Hong Kong
The yacht industry in mainland China started in the 1950s, but before the
development slowed down, really into the development is nearly a decade,
especially in recent years is the most rapid development of China's yacht
manufacturing industry, become the world's most attention to the yacht emerging
market. In 1978, when ten of the world's major car companies visited Shanghai,
few people believed that Chinese people could afford a car. Now almost every
family has a car. The yacht industry will be the same as the auto industry 20
years ago. It is estimated that the next 5-10 years will be an acceleration
period and a golden period for the development of China's yacht industry. The
output value of China's yacht industry is expected to reach 200 billion yuan in
the next few years, and 1.5 million people will be employed.
According to international practice, when GDP per capita reaches $3,000, the
yacht economy starts to sprout; When reaching 5000 dollars, people begin to pay
attention to the pursuit of leisure and enjoyment in life, and the consumers who
can afford it begin to buy yachts. And when the per capita GDP exceeds 6000 us
dollars, the yacht industry will also enter the high-speed development stage.
Neither Italy, France, the United Kingdom, the United States and the
Netherlands, nor "upstarts" such as Taiwan, Australia, Japan, Singapore, the
Arab states, or even Thailand, have grown much beyond this trajectory. With the
per capita GDP of the Yangtze river delta, the pearl river delta and the
developed coastal areas around the sea now above us $8,000, the yacht industry
on the Chinese mainland should have entered a stage of unstoppable rapid
development. aiwan's GDP per capita exceeded us $25,000 in 2018, and the number
of yachts registered in Taiwan increased by 50% in the past three years,
reaching 568 in total, despite the liberalization of government policies and the
increase of berths. There is still a huge market potential, and the growth of
domestic demand for yachts is also expected.
On the consumption side, Hurun wealth report 2010 shows that there are 875,000
multimillionaires and 55,000 billionaires in mainland China, half of whom are
. . .
Item 9.01 Financial Statements and Exhibits.
Financial statements of business acquired.
The Audited Consolidated Financial Statements and Unaudited Consolidated
Financial Statements of Guangzhou Monte Fino are filed as Exhibit 99.1to this
current report and are incorporated herein by reference.
Financial statements of business acquired.
The unaudited Consolidated Financial Statements and Unaudited Consolidated
Financial Statements of Guangzhou Monte Fino are filed as Exhibit 99.2 to this
current report and are incorporated herein by reference.
Pro forma financial information.
Unaudited Pro Forma Financial Statements are filed as Exhibit 99.2 to this
current report and are incorporated herein by reference.
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