CyberAmerica Sells Raw Land.
Issue: July 21, 2000
Business Editors
SALT LAKE CITY--(BUSINESS WIRE)--July 21, 2000
CyberAmerica Corp. (OTC BB: CYAA) ("CYAA") Friday announced that it has purchased 2.85 million restricted shares of Chattown.com Network Inc. (CTWN) from World Alliance Consulting Inc.(World Alliance is a 100 percent owned company of Allen Wolfson).
In return, CYAA agreed to transfer all of its interest or its subsidiaries' interest in the following companies:
Oasis International Corp. Diversified Holdings V Inc.
Adobe Hills Ranch II, LLC Diversified Land & Cattle Co.
Diversified Holdings II Inc. Great Basin Water Corp.
Diversified Holdings III Inc. Lexington 3 Mile East Terrace
Lexington 4 Mile East Terrace Mountain Estates Inc.
Mountain Estates Inc Lexington One Mile East Little
Pigeon Mountain Estates Inc
All of these companies own parcels of raw mostly undeveloped land in Elko County, Nev. or Box Elder County, Utah. The transfer of these companies will serve to remove non-performing raw land assets from CYAA's books while replacing them with stock in a company which CYAA believes is a good investment.
The value of the transferred companies is $857,912 or less than 10 percent of CYAA's book value of fixed assets. The stock received is valued, as of July 18, 2000 (transfer date), at $1,514,062 or $.53125 per share. Consequently the company will book a gain on the sale of assets of approximately $656,150 in the third quarter.
However, due to the nature of stock investments, this gain could be eliminated by a downturn in the market or this stock.
CYAA feels this deal not only accomplishes a shift of non-performing assets to potentially high performing assets, but also serves to reduce negative cash flows by $332,500 annually and interest expense by approximately $207,000 over the next 12 months.
CYAA recognizes this as the second step in eliminating Wolfson, who was to play a significant role in developing the raw land, as a control person and limit his role as a consultant to the company. The first step in this process was to buyback a large percentage of his CYAA stock (see press release dated July 11, 2000) and reduce his CYAA holdings below 10 percent.
For more detailed information on the transferred companies and the real estate they own, see "Item 2. Description of Property" in CYAA's Dec. 31, 1999 form 10KSB. CYAA continues to look forward to streamlining its operations, evaluate each holding, and develop properties and business lines that show promise for the future.
CyberAmerica strongly suggests that the above information be read in conjunction with its Form 10-KSB for Dec. 31, 1999, Form 10-QSB for the quarter ended March 31, 2000, and Form 8K filed on July 20, 2000. The above documents can be viewed at www.sec.gov.
A number of statements contained in this press release are forward-looking statements which are made pursuant to the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995.
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