Oriole expands agreement with Succeed Technology
Oriole Systems Inc OOL
Shares issued 20,740,597 Jun 14 close $0.40
Tue 15 Jun 99 News Release
Ms. Marie Shields reports
Oriole Systems' agreement with Succeed Technology Ltd. has been expanded
from serving e-commerce customers initially only in China to serving
customers throughout Asia. Also, the agreement commits Oriole and STL to
use their best efforts to have STL obtain reporting status. In addition,
the company would like to provide further information about Mr. Ip's quote
to indicate that his previous reference to cash flow should have been
classified as revenue.
On June 10, 1999, (see Stockwatch June 11, 1999), Oriole and STL announced
in Hong Kong, the signing of a share purchase agreement whereby Oriole
acquires a 51-per-cent controlling interest in STL, based on a memorandum
of understanding signed in Vancouver, B.C., on April 29, 1999. The
agreement remains subject to regulatory approval.
The first customer for Oriole's e-commerce project is expected to be the
Beijing International Gem Trading Center. IGTC is a consortium of
approximately 100 Chinese wholesale businesses selling high-end jewellery
products, including gold, jade, silver, emeralds, rubies, sapphires, pearls
and other precious and semi-precious stones. Current sales exceed
$1-million (U.S.) per day.
On May 20, 1999, STL signed a memorandum of understanding to market IGTC
gems and jewellery exclusively for a minimum of two years over the
Internet. STL will receive compensation from each transaction, as well as
from product advertising and electronic marketing. The transaction fee
consists of a small listing fee to cover costs and a success fee related to
sales.
Stephen Ip, president of Succeed Technology Ltd., notes, "Although no one
can predict the impact of the Internet on sales, if we assume a modest
5-per-cent increase in sales for IGTC, the revenue for this project for STL
and Oriole over two years would be approximately $36.5-million (U.S.)." All
sales will flow through STL and be reported as revenue to Oriole on a
consolidated basis (in accordance with U.S. GAAP for a 51-per-cent
subsidiary). From revenues, STL will purchase the gems exclusively from
IGTC and will purchase Internet products and services from Oriole, its
business partners and others for such requirements as hosting, networks and
advertising. |
