Attached files
| file | filename |
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| EX-2.1 - SHARE EXCHANGE AGREEMENT - Cinnabar Ventures Inc | f8k030210ex2i_cinnabar.htm |
| EX-99.1 - FINANCIAL STATEMENTS - Cinnabar Ventures Inc | f8k030210ex99i_cinnabar.htm |
| EX-99.2 - PRO FORMA FINANCIAL STATEMENTS - Cinnabar Ventures Inc | f8k030210ex99ii_cinnabar.htm |
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
8-K
CURRENT
REPORT
Pursuant
to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date
of Report (Date of earliest event reported): March 2, 2010
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Cinnabar
Ventures Inc.
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(Exact
name of registrant as specified in its
charter)
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Nevada
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333-145443
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98-0585450
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(State or other
jurisdiction of incorporation)
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(Commission
File Number)
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(IRS
Employer Identification
Number)
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17595
S. Tamiami Trail, Suite 300
Fort
Myers, FL 33908
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(Address
of Principal Executive Office) (Zip Code)
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239-561-3827
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(Registrant’s
telephone number, including area code)
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(Former
name or former address, if changed since last
report)
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Check the
appropriate box below if the Form 8-K filing is intended to simultaneously
satisfy the filing obligation of the registrant under any of the following
provisions:
o Written
communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
o Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
o Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b))
o Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c))
Item 1.01
Entry into a Material Definitive Agreement
As more
fully described in Item 2.01 below, we acquired a computer consulting
company in accordance with a Share Exchange Agreement, dated March 2, 2010 (the
“Share Exchange
Agreement”), by and among Cinnabar Ventures Inc. (“we,” “Cinnabar” or the
“Company”),
Advanced Network Solutions, Inc. dba Rent-a-Genius, (“ANS”) and the
shareholders of ANS (the “ANS
Shareholders”). The closing of the transaction (the “Closing”) took place
on March 2, 2010 (the “Closing
Date”). On the Closing Date, pursuant to the terms of the
Share Exchange Agreement, we acquired all of the outstanding shares of ANS (the
“ANS Common
Stock”) from the ANS Shareholders. In exchange for the ANS
Common Stock, the Company issued 150,000 shares of the Company’s common stock
(the “Exchange
Shares”) to the ANS Shareholders, representing approximately 0.66% of the
issued and outstanding common stock of the Company (the “Common Stock”) post
closing (the “Merger”).
Pursuant
to the Share Exchange Agreement, ANS became a wholly-owned subsidiary of the
Company. The directors of the Company have approved the Share Exchange Agreement
and the transactions contemplated under the Share Exchange Agreement. The ANS
Shareholders have approved the Share Exchange Agreement and the transactions
contemplated thereunder.
Item 2.01 Completion
of Acquisition or Disposition of Assets
On March
2, 2010, the Company acquired ANS in accordance with the Share Exchange
Agreement. On the Closing Date, pursuant to the terms of the Share
Exchange Agreement, Cinnabar acquired 100% of the ANS Common Stock from the ANS
Shareholders. In exchange for the ANS Common Stock, the Company
issued the Exchange Shares to the ANS Shareholders, representing approximately
0.66% of the issued and outstanding Common Stock of the
Company. Through its acquisition of ANS, Cinnabar acquired rights to
100% of the assets of ANS.
Business
Summary
ANS is a
professional services company that provides reliable hardware, software, service
and support to its clients. It serves its clients as a trusted ally, providing
them with the loyalty of a business partner and the economics of an outside
vendor. Networks and programs are customized for clients based on their needs.
Most of our information systems are mission critical, so we give our clients the
assurance that we will be there when they need us.
ANS began
in 1997 under the name “Advanced Network Solutions.” ANS is a computer
consulting company which installs, maintains and upgrades computer networks and
provides the necessary hardware and software to its customers. ANS has customers
nationwide and has also developed customized training courses for clients. Gross
Revenues for 2009 were in excess of $235,000 and Gross Profits were in excess of
$135,000.
ANS’s
revenues are a combination of hardware/software sales, installation charges,
network monitoring, server hosting. Typical markups on hardware and software are
5-25% and labor charges range from $65 - $150 per
hour. ANS’s hardware and software charges are generally
lower than the market price because of low overhead costs and good relationships
with the dealers. ANS’s labor charges are competitive with the
market.
ANS sees
the need to expand rapidly in the Southwest Florida market to take advantage of
the lack of competition and growing demand for technology. ANS is not, however,
limited to the Southwest Florida market, as it already has national
customers.
Products
and Services Offered
ANS
specializes in Microsoft Back Office products, such as Window Servers, Microsoft
Exchange, Microsoft SQL Server, and MS System Management Server.
Development
Services
Programmers
will create custom applications for clients using Microsoft tools, such as,
Visual Basic, C++, MS Access, and Visual J. Programmers will work with other ANS
staff and the client as a team to define the systems requirements of the
applications, and to review the goals as the project progresses. ANS’s delivery
services follow the Microsoft Solutions Framework approach and range from system
conversions all the way through implementation.
2
ANS also
provides a full range of Internet Application Development services, ranging from
targeted enhancements of Internet-related BackOffice services to at-the-edge
front-end applications using VBScript, ActiveX controls, and Internet Explorer
3.0. ANS designs and implements complete web sites, including HTML coding using
FrontPage and Microsoft Word Internet Assistant, integration with SQL Server
using the Internet Data Connector (IDC), ISAPI programming and VB Scripting. ANS
has custom mail solutions, writing MAPI, FFAPI, or DAPI programs to meet
customer specifications.
Project
Consulting
ANS’s
consulting services range from the initial planning phases to operations and
maintenance. ANS specializes in installing Microsoft BackOffice leading edge
systems into our customers’ enterprise networks to address today’s critical
business problems and provide innovative capabilities for future
requirements. We frequently use software developers to design
creative solutions to enhance the roll-out/ migration process and to empower the
users of the BackOffice capabilities. We find that this cross-disciplinary
approach results in a richer solution for our clients. Our broad range of
experience allows us to provide you with the integral design, installation,
configuration, and support needed for your critical communications requirements.
Project consulting offers a client company a way to harness our specific
qualities and use our expertise to solve specific problems, and develop and/or
implement plans. Project consulting is billed on a per project and per milestone
basis.
Hardware
Sales
ANS
offers clients brand-name computers and peripherals. Through quantity discounts
with our vendors, we are able to pass on substantial savings to our
clients.
Maintenance
Contracts
ANS
offers clients monthly and annual contracts for network maintenance to replace
client IT staff. This works well for smaller companies who do not
need full time service or for companies with multiple locations that need
regular support.
Competition
ANS’s
competition comes in several forms: In-house information systems departments,
management consulting firms, and other Microsoft computer services firms. The
competition may be based locally near the client, or anywhere
nationwide.
In-House
Competition
The most
significant competition for our consulting services is in fact companies
choosing to do systems installation and custom programming in-house. Their own
Information Systems departments do this as a part of their regular business
functions. Our key advantage in competition with in-house development
is that those staffs are already overloaded with responsibilities and they don’t
have the time or the expertise for additional responsibilities in new
projects. ANS’s staff will have the expertise of cutting edge
technology, directly through its partnership with Microsoft, to offer the latest
solutions to these companies. Also, if the companies with in-house departments
wish to learn more about the latest Microsoft technologies, they may benefit
from our training classes and certifications.
Management
Consulting Firms
High-Level
Management consulting firms, such as Accenture and Price Waterhouse, are
essentially generalists who take their name-brand management consulting into
specialty areas. Their other main weakness is that their management structure
has partners selling new jobs and inexperienced associates delivering the work.
ANS competes against them as experts in specific fields and with the guarantee
that ANS’s clients will have top-level people doing the actual
work.
Microsoft
Providers and Partners
There are
other companies in ANS’s area and nationwide that will also be specializing in
the latest Microsoft technologies and developing a relationship with Microsoft.
ANS will differentiate itself by serving wider geographical areas to better
serve ANS’s clients and by continuous in-house training of ANS’s own
staff. In addition, ANS will provide one-stop shopping for ANS’s
clients by coordinating all aspects of a project from the hardware and software
purchasing to on-going maintenance of systems.
3
Future
Services
In the
future, ANS will broaden its coverage by expanding into additional markets
(especially Latin America and Europe). Marketing strategies will target Spanish
speaking clients and clients that need to integrate systems across international
borders.
Marketing
Strategy
ANS will
be focusing on medium to large growing companies in need of expert Microsoft
Information Systems. Once our relationship with Microsoft as a Business Partner
is established, some of our new clients will be referrals from Microsoft
Corporation. Our marketers will work in unison with Microsoft to promote their
products and comply with Microsoft’s marketing strategy. To strengthen this
relationship, our marketing staff, and other staff as well, will be trained by
Microsoft at the Microsoft corporate office.
Marketing
tools that will be used to gain recognition in the Miami area include: a Grand
Opening / Open House, advertisements in professional magazines, trade journals
and newspapers. Representatives will also distribute marketing information at
industry trade shows. On occasion, free informational seminars will be offered
to the public to introduce new Microsoft products and their
features.
Operations
The
Operations team has a Project Manager to oversee each of its revenue producing
areas: Training, Development, and Information Systems. In addition, a
Purchasing Manager coordinates all hardware and software purchases and
negotiates pricing with vendors.
Item
3.02 Unregistered Sales of Equity Securities
Pursuant
to the Share Exchange Agreement, on March 2, 2010, we issued 150,000 shares of
our Common Stock to the ANS Shareholders in exchange for 100% of the outstanding
shares of ANS. Such securities were not registered under the
Securities Act. These securities qualified for exemption under
Section 4(2) of the Securities Act since the issuance securities by us did not
involve a public offering. The offering was not a “public offering” as defined
in Section 4(2) due to the insubstantial number of persons involved in the deal,
size of the offering, manner of the offering and number of securities offered.
We did not undertake an offering in which we sold a high number of securities to
a high number of investors. In addition, these shareholders had the necessary
investment intent as required by Section 4(2) since they agreed to and received
share certificates bearing a legend stating that such securities are restricted
pursuant to Rule 144 of the Securities Act. This restriction ensures that these
securities would not be immediately redistributed into the market and therefore
not be part of a “public offering.” Based on an analysis of the above factors,
we have met the requirements to qualify for exemption under Section 4(2) of the
Securities Act for this transaction.
4
Item
9.01 Financial Statements and Exhibits.
(a)
FINANCIAL STATEMENTS OF BUSINESS ACQUIRED
The
audited financial statements for Advanced Network Solutions, Inc. for the years
ended December 31, 2009 and 2008, have been prepared and filed with this Current
Report as Exhibit 99.1.
(b)
PRO FORMA FINANCIAL INFORMATION
The
following pro forma financial information is filed as Exhibit 99.2 to this
Current Report and is incorporated herein by reference:
1) Pro Forma Condensed Combined Balance
Sheets as of November 30, 2009
2) Pro Forma Condensed Combined
Statements of Operations as of November 30, 2009
3) Pro Forma Condensed Combined Balance
Sheets as of May 31, 2009
4) Pro Forma Condensed Combined
Statements of Operations as of May 31, 2009
5) Notes to Pro Forma Condensed
Combined Financial Statements as of November 30, 2009 and May 31, 2009
(c)
SHELL COMPANY TRANSACTIONS
N/A
(d)
EXHIBITS
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2.1
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Share
Exchange Agreement, by and among Cinnabar Ventures Inc., Advanced Network
Solutions, Inc. and the shareholders of Advanced Network Solutions, Inc.,
dated March 2, 2010.
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99.1
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Audited
financial statements for Advanced Network Solutions, Inc. listed in Item
9.01(a).
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99.2
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Pro
Forma Financial Information of Cinnabar Ventures Inc., listed in Item
9.01(b).
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5
SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, the Registrant has
duly caused this Current Report to be signed on its behalf by the undersigned
hereunto duly authorized.
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CINNABAR
VENTURES INC.
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Date:
March 4, 2010
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By:
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/s/
Richard Granville
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Richard
Granville
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Chief
Executive Officer
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