Subaye Releases Shareholder Letter
Bulletin Board: SBAY)(the “Company”), has released a shareholder letter from
the Chief Executive Officer. The text of the shareholder letter is as follows:
Monday, November 9, 2009
CEO Letter to Shareholders
Dear Shareholders,
I am writing to you today to clarify the facts surrounding Subaye, Inc.’s
(the “Company”) decision to acquire the remaining approximate 31% of our
subsidiary, Subaye.com, Inc (the “Minority Interest”). The following details
provide a concise summary of why the Company and its Board of Directors felt
an acquisition of the Minority Interest was in the best interests of the
Company and its shareholders:
1. The Company believed a great deal of uncertainty surrounded the future
of the Company and the Minority Interest as a result of the fact that
the Company did not have full control over the Minority Interest and
certain significant decisions that would impact the Company's business
operations in the future could have been blocked or delayed in various
ways by the individuals who controlled the Minority Interest. This
transaction resolves that uncertainty and allows the Company to operate
its most promising business segment without the uncertainty of future
business decisions being blocked or delayed by the individuals who
controlled the Minority Interest.
2. The Company believed the value of the Minority Interest and its net
assets had been increasing at a substantial growth rate as compared to
the Company's other business segments and their respective net assets.
If the Company was to acquire the Minority Interest, the Company
believed the current consideration needed in order to complete the
acquisition of the Minority Interest would be substantially lower than
it would be should the acquisition have been completed in the future as
opposed to November 6, 2009.
3. The Company's stock price and trading volume as quoted on the United
States Over-the-Counter Bulletin Board reached recent highs and was
generally very strong in the past few months. The Company believed it
had a window of opportunity to work with the individuals controlling
the Minority Interest in order to consummate an acquisition during a
time when the Company's stock price and trading volume were stronger
than in recent history.
4. The Company was heavily indebted to its subsidiary, Subaye.com, Inc.,
as well as the subsidiaries of Subaye.com, Inc. when the acquisition of
the Minority Interest was completed. As a result of the acquisition,
the Company will be able to cancel those debts, which were in excess of
$6 million.
5. The Company has been and will be spending significant amounts of its
resources, including cash, in order to promote the Company's brand
names, namely "Subaye," and its products and services. The individuals
controlling the Minority Interest do not operate the Company or any of
its subsidiaries but have been benefiting from this spending and would
have continued to benefit from this spending as long as the Minority
Interest existed. The Company felt this scenario had to change and that
the Company and its shareholders should benefit fully from its
advertising, other spending efforts and ultimately from the increase in
value of the Company's net assets.
Each of the individuals comprising the Company’s management are
significant shareholders of the Company and receive a majority of their
compensation in the form of the Company’s common stock. The members of
management and also the largest shareholder of the Company had their ownership
interests significantly diluted along with the other shareholders of the
Company in order to complete this transaction. We hope that our shareholders
view this transaction favorably given the facts as they are presented above
and with the knowledge that those individuals who control this Company,
whether they be management, members of the Board of Directors or significant
shareholders, have all committed to this acquisition and believe it to be in
the best interests of the Company and its shareholders. This Company is poised
for significant growth in the coming years. We hope you will be with us to
enjoy that growth and reap the potential rewards of that growth by investing
in Subaye.
With regards,
Zhiguang Cai, Chief Executive Officer
This letter may contain certain “forward-looking statements” that are
based on the Company’s current expectations, assumptions, estimates and
projections about its business and industry. Various words, including, but not
limited to, “may,” “expects,” “plans,” “anticipates,” “intends,” “will or
would,” and similar expressions (modified as may be required by the context)
are intended to identify “forward-looking statements.” There can be no
assurance that any of such statements will accurately predict future events,
and actual results are subject to various risks and uncertainties that could
cause the Company’s actual results to differ significantly and materially from
those reflected in any forward-looking statements.
Safe Harbor Statement under the U. S. Private Securities Litigation Reform
Act of 1995:
This release contains forward-looking statements which express the current
beliefs and expectations of Subaye, Inc.’s management. Such statements are
subject to a number of known and unknown risks and uncertainties that could
cause Subaye, Inc.’s future results, performance or achievements to differ
significantly from the results, performance or achievements expressed or
implied by such forward-looking statements. Other important factors that may
cause actual results to differ materially from the forward-looking statements
are discussed in the “Risk Factors” section and other sections of Subaye,
Inc.’s Form 10-K for the year ended
the Securities and Exchange Commission. Forward-looking statements speak only
as of the date on which they are made and the Company undertakes no obligation
to update publicly or revise any forward-looking statement, whether as a
result of new information, future developments or otherwise.
About Subaye, Inc.
Subaye, Inc. (“Subaye” or the “Company”) is a leading provider of video
sharing services in
production, upload, storage, sharing and publishing onto more than 33 main
video sharing portal websites. Subaye also offers SaaS business solutions and
is in the process of developing what Subaye believes is the first online
shopping mall in the world that will utilize 3D imaging throughout the online
interface. Subaye platform consists of its websites, http://www.subaye.com ,
http://www.x381.com , http://www.goongreen.org , http://www.goongood.com and
the Subaye Alliance network, which is its network of third-party websites. The
Company’s http://www.subaye.com and http://www.x381.com websites are
generating revenue, while its other web-based businesses are under development
or offering free services to potential customers at this time. Subaye’s
services are designed to enable internet users to find and view videos online.
As of
Company’s video database consisted of over 89,000 profiles of corporate video
showcases. These showcases offer a cost-effective venue for small to mid-size
enterprises (“SMEs”) to advertise their products and services and establish
and enhance their corporate brands. The Company provides its users with easy
access to an index of over 3.0 million video clips, images and web pages.
For further information on Subaye, Inc., please visit
http://www.subaye.com/english or http://www.subaye-ir.com , the new investor
relations site which should be operational on
register to receive Subaye’s future press releases or request to be added to
the Company’s distribution list by contacting
jamesc@subaye.com . The distribution list should be active by
2009
Forward-Looking Statements
Certain statements contained herein constitute “forward-looking
statements” within the meaning of the Private Securities Litigation Reform Act
of 1995. These forward-looking statements are based on current expectations,
estimates and projections about Subaye, Inc.’s industry, management’s beliefs
and certain assumptions made by management. Readers are cautioned that any
such forward-looking statements are not guarantees of future performance and
are subject to certain risks, uncertainties and assumptions that are difficult
to predict. Because such statements involve risks and uncertainties, the
actual results and performance of the Company may differ materially from the
results expressed or implied by such forward-looking statements. Given these
uncertainties, readers are cautioned not to place undue reliance on such
forward-looking statements. Subaye, Inc.’s operations are conducted in
People’s Republic of China
considerations and significant risks not typically associated with companies
in
political, economic and legal environment and foreign currency exchange. The
Company’s results may be adversely affected by changes in the political and
social conditions in the PRC and by changes in governmental policies with
respect to laws and regulations, anti-inflationary measures, currency
conversion, remittances abroad, and rates and methods of taxation. Other
potential risks and uncertainties include but are not limited to the ability
to procure, properly price, retain and successfully complete projects, and
changes in products and competition. Unless otherwise required by law, the
Company also disclaims any obligation to update its view of any such risks or
uncertainties or to announce publicly the result of any revisions to the
forward-looking statements made here. Readers should review carefully reports
or documents the Company files periodically with the Securities and Exchange
Commission.
For further information, please contact:
At The Company
James Crane, Chief Financial Officer
P.R.C. Cell: +86-186-0125-0891
U.S. Office: +1-617-699-6325
SOURCE Subaye, Inc.