Subjex Corporation and ShangHai Geason Digital Technology Co., Ltd., a Chinese corporation, jointly announced the signing of a joint venture agreement to form a new company called Subjex China to be headquartered in Shanghai.
Under the terms of the Agreement, existing assets, contracts, revenues and cash of ShangHai Geason Digital Technology will be put into the new company, along with up to 1 million shares of U.S. based Subjex Corporation (SBJX). The final value of cash and asset contribution will be more than $2,000,000 USD.
The equity split of the new company will be 50/50 between the owners of ShangHai Geason Digital Technology and Subjex Corporation. The new company is expected to be operational in first quarter 2004, after which ShangHai Geason Digital will cease to operate. Initially, Subjex China will have annual revenues exceeding $5,700,000 USD and will be profitable from inception. Management will be made up of both companies, and Subjex Corporation will hold two of the five board seats.
Additional terms state that Subjex China will combine the existing business models of the two companies and pay dividends to shareholders. Subjex Corporation has granted the new entity exclusive distribution rights for Subjex products and use of its trademarks within China. Subjex China will leverage its position with ShangHai Geason Digital Technology clients to sell SubjexCSR english version. Subjex China will contract Subjex Corporation to develop the Chinese version of its dialogue platform for an undisclosed sum. Subjex Corporation will maintain its trade secrets and code and will serve as the technology center for Subjex China, which will provide additional revenues for Subjex Corporation.