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REGAL GROUP EXECUTES SHARE EXCHANGE AGREEMENT WITH
LEADING RFID TECHNOLOGY COMPANY IN CHINA
PHOENIX, AZ -- July 15, 2010 - Regal Group, Inc. ("Regal" or the "Company")
(OTCBB: RGLG) announced that it has finalized a Share Exchange Agreement with
UHF Logistics Ltd ("UHF"), a Hong Kong-incorporated company whose operating
subsidiaries are leading developers of RFID (Radio Frequency Identification)
solutions for supply chain applications, parkade management, the pig breeding
industry, and anti-theft and secured access applications in China. The Company
had previously announced in a news release dated April 22, 2010, that it had
entered into a letter of intent with UHF. The transaction is still subject to
certain closing conditions.
Under the terms of the Share Exchange Agreement, Regal will issue and certain of
its shareholders will sell an aggregate of 26,500,000 shares of its common
stock, or approximately 45% of the equity of the Company, on a post-transaction
basis, to certain shareholders and senior management of UHF or its operating
subsidiaries in exchange for 100% of the common stock of UHF. The effectiveness
of the Share Exchange Agreement is subject to the fulfillment of customary
closing conditions, including the receipt of the necessary regulatory approvals,
receipt by the Company of legal opinions from Chinese counsel opining on the
legality of the proposed transaction, as well as receipt by the Company of
audited financial statements of UHF and its operating subsidiary, prepared in
accordance with GAAP and audited by an independent auditor registered with the
Public Company Accounting Oversight Board in the United States.
The Share Exchange Agreement also provides that for a period of one (1) year,
12,000,000 shares of the Company's common stock issued pursuant thereto shall be
held in escrow and shall be released subject to certain escrow conditions set
forth in the agreement.
"We are pleased to have reached this next milestone in our effort to acquire
UHF" commented Eric Wildstein, Chief Executive Officer of Regal Group, Inc.
Added Wildstein, "UHF is a leading technology company focused on uncovering
innovation opportunities in the supply chain sector and on developing long term
growth drivers in other growing market sectors, including the ubiquitous
Internet of Things space." Commenting further, Wildstein noted that "Automatic
identification and data collection technologies continue to revolutionize how
business is conducted globally, from the emergence of wireless mobile computing
to RFID (radio frequency identification). We believe that once closed, Regal
will own one of the leading developers of RFID solutions in China that will
strategically position the Company at an important juncture in China's rapidly
growing and highly valued "Internet of Things" industry."
Mr. Sammul Su, founder of UHF Logistics' operating subsidiaries in China,
commented: "I believe this pending acquisition by Regal will significantly
benefit our customers, partners, and employees. As a subsidiary of a US public
company, our access to capital will enable us to achieve our objectives in the
RFID space." Added Su: "We believe that the RFID market in China is poised to
take advantage of government-led RFID programs. I anticipate that continued and
expanded central government support of the RFID industry in the coming years
will make it a mainstream industry sector by the year 2013. I believe that our
acquisition by Regal Group will provide us with an additional competitive
advantage to capitalize on this fast growing market with new foreign management
expertise and capital. Through our collaboration, we can accelerate the
development of next-generation technology to achieve high-performance, cost
efficient hardware and software solutions, while maintaining our focus on
providing technology innovation to our clients."
The completion of the proposed transaction is still subject to certain closing
conditions.
China RFID Industry Outlook
According to IDTechEx, the global RFID market achieved rapid growth in 2007, and
total market value reached US$4.96 billion. Spending on RFID in East Asia was
approximately US$2.7 billion in 2007, of which US$1.9 billion was spent in China
due to the peak delivery of national identification cards in China prior to the
2008 Olympics.
In 2009, the RFID market grew to US$5.56 billion, having almost tripled in five
years and up from US$5.25 billion in 2008. This spending figure includes tags,
readers and software/services for RFID cards, labels, fobs and all other form
factors. The majority of this spending is on RFID cards and their associated
services -- totalling US$2.99 billion. The largest database of RFID projects in
the world is the IDTechEx RFID Knowledgebase, which currently has 3900 projects
in 111 countries. According to a report on "RFID Forecasts, Players and
Opportunities 2009 - 2019" by Raghu Das and Dr. Peter Harrop, the market for
RFID is growing and a large amount of this value is due to government-led RFID
programs, such as those for transportation, national ID (contactless cards and
passports), military and animal tagging. It further reported that China and
the USA spend the most money on RFID and it is projected that China will soon
overtake the UK in number of projects.
Within the RFID industry, a major part of the growth has come from existing
applications such as security/access control, automobile immobilization, animal
tracking and toll collection. However, according to a recent article in the
Security World Magazine, emerging applications in security-based solutions,
contactless payments, and supply chain management are in late testing stages and
are expected to present significant new market opportunities. In particular, use
of RFID technology in conjunction with contactless payment cards and Wi-Fi has
emerged as a substantial opportunity for RFID vendors.
In November 2009, Primer Wen Jiabao of China emphasized his country's focus on
the key technology of "the Internet of Things and Sensor Network" and during
September 2009, RFID was listed in the "Direction of Investment for Reformation
and Technical Progress of Electronic Information Industry" by the National
Development and Reform Commission of China. It is anticipated that the Chinese
RFID market will continue to grow rapidly in the years to come in light of
encouragement sustained by the Chinese Central Government.
FURTHER INFORMATION:
Please feel free to call Investor Communications toll-free on 1-888-367-3077.
ABOUT REGAL GROUP, INC.
Regal Group, Inc. (formerly, Regal Life Concepts, Inc.) is a publicly traded
company with headquarters in Phoenix, Arizona. Regal is strategically
positioning itself in key industry sectors in China, including the wine
industry, where Regal has made a strategic investment in AWA Wine, and is
investigating further opportunities in Asia. Regal trades on the NASDAQ OTC BB
under the ticker symbol: RGLG.
ABOUT UHF LOGISTICS LTD.
UHF is a HK-incorporated holding company, which, through its wholly owned
Chinese operating subsidiaries, is focused on the development, marketing and
implementation of UHF RFID products and solutions in China since 2006.
FORWARD-LOOKING STATEMENTS & RISKS
Statements in this news release that are not historical facts are forward-
looking statements that are subject to risks and uncertainties. Words such as
"expects", "intends", "plans", "may", "could", "should", "anticipates",
"likely", "believes" and words of similar import also identify forward-looking
statements. Forward-looking statements are based on current facts and analyses
and other information that are based on forecasts of future results, estimates
of amounts not yet determined and assumptions of management, including, but not
limited to, the Company's belief that Regal can identify and successfully
negotiate business prospects in Asia, and that the Company can successfully
operate such prospects. Actual results may differ materially from those
currently anticipated due to a number of factors and risks beyond the reasonable
control of the Company.
In addition to the risks associated with forward-looking statements, statements
in this news release are subject to additional risks, which include, among
others, the corporate disclosure, governance and regulatory requirements of the
Peoples' Republic of China (the "PRC"), and PRC regulations relating to, among
others, cross-border mergers and acquisitions, product liability and currency
exchange rates. Even if the proposed transaction is completed, which cannot be
guaranteed, anticipated synergies or other intended benefits of the transaction
may not be realized, and the prospects of the combined entity will remain
subject to all the general risks associated with the RFID industry, the public
securities markets and risks related to doing business in China, such as the
PRC's economic, political and social environment, and matters relating to PRC
taxes, repatriation of profit and currency conversion, acquisition and
appropriation of land use rights, foreign investments, permits and business
licenses, employment contracts, government intervention, shareholders' rights
and enforcement of judgments, as well as the developing PRC legal system. The
Company cautions that the foregoing list of material risks is not exhaustive.
When relying on the Company's forward-looking statements and information to make
decisions, investors and others should carefully consider the foregoing factors
and other uncertainties and potential events. Additional information on risks
and other factors that may affect the business and financial results of the
Company can be found in filings of the Company with the U.S. Securities and
Exchange Commission. The Company undertakes no obligation to publicly revise
these forward-looking statements to reflect events or circumstances that arise
after the date hereof.
Contact:
Regal Group, Inc.
Investor Communications
Toll-Free: 1-888-367-3077
