SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

_________________

FORM 8-K/A

Amendment No. 2

CURRENT REPORT

Pursuant to Section 13 or 15(d) of

the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported):  August 2, 2010

REDTONE ASIA, INC.

(Exact name of Registrant as specified in Charter)

HOTGATE TECHNOLOGY, INC.

(Former name of Registrant)

Room 1602, Aitken Vanson Centre, 61 Hoi Yuen Rd., Kwun Tong, Hong Kong

(Address of principal executive offices, including zip code)

(852)2270-0688

 (Registrant’s telephone number, including area code)

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 (see General Instruction A.2. below):

£Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

£Soliciting material pursuant to Rule 14a-12(b) under the Exchange Act (17 CFR 240.14a-12(b))

£Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange

Act (17 CFR 240.14d-2(b))

£Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange

Act (17 CFR 240.13e-4(c))

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TABLE OF CONTENTS

PART I

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Note About Forward-Looking Statements

Certain statements in this report, other than purely historical information, including estimates, projections, statements relating to our business plans, objectives and expected operating results, and the assumptions upon which those statements are based, are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. These forward-looking statements generally are identified by the words “believe,” “project,” “expect,” “anticipate,” “estimate,” “intend,” “strategy,” “future,” “opportunity,” “plan,” “may,” “should,” “will,” “would,” “will be,” “will continue,” “will likely result,”  “possible,” and similar expressions. Forward-looking statements are based on current expectations and assumptions that are subject to risks and uncertainties which may cause actual results to differ materially from the forward-looking statements. A detailed discussion of these and other risks and uncertainties that could cause actual results and events to differ materially from such forward-looking statements is included in the section entitled “Risk Factors” (refer to Part I, Item 1A). We undertake no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise.

ITEM 2.01 COMPLETION OF ACQUISITION OF ASSETS

On August 2, 2010, Hotgate Technology, Inc. (the “Company”) entered into an Agreement for a Share Exchange (the “Agreement”) with REDtone Technology Sdn. Bhd. and REDtone International Berhad, both of which are incorporated in Malaysia.   Upon the closing of the transactions contemplated in the Agreement, the Company will acquire 100% ownership of REDtone Telecommunications (China) Limited (“REDtone China”). The transaction will hereafter be described as the “Share Exchange”).

Organizational Diagram Before Share Exchange

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Organizational Diagram Immediately After Share Exchange

Consideration to be paid by the Company shall be a total of 244,444,444 shares of its common stock  (following the reverse split set forth in item 8.01 below) in exchange for 100% ownership of REDtone China (such share exchange shall be referred to herein as the “Exchange”).  

The Exchange shall close within seven days of the date on which all the following conditions precedent in the Agreement have been satisfied or at any other date agreed upon by all parties:

1.

The approval of shareholders of the Company and REDtone International Berhad;

2.

If required, the approval of REDtone International Berhad’s Trustee; and

3.

If required, any other approval or consent from public authorities and third parties which the Company or REDtone International Berhad may be required to obtain.

The Agreement also provide for the implementation and completion of the capitalisation of the debts due from the Company to REDtone International Berhad which is to be satisfied by way of issuance and allotment of 13,147,197 shares of the Company’s common stock and the presentation of any required financial statements for the completion of the transaction as required by applicable law.

The Exchange shall take place pursuant to the terms and conditions of the Agreement and in accordance with applicable law.

On July 29, 2010, the Company’s majority shareholders approved a resolution to effect a one-for-twelve reverse stock split of the Company’s common stock.  The reverse stock split, which was previously approved by the Company’s Board of Directors and shareholders, took effect at 12:01 a.m. GMT on July 29, 2010.

As a result of the reverse stock split, every twelve shares of the Company’s issued and outstanding common stock was combined into one share of common stock, and the number of shares of the Company’s common stock outstanding  was reduced from approximately 297 million shares to 25 million shares.  The reverse stock split did not change the number of authorized shares of the Company’s common stock.  

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No fractional shares of common stock will be issued as a result of the reverse stock split.  Each fractional share that would otherwise result from the reverse stock split will be rounded up to one whole share of post-split common stock. The Company’s transfer agent, Action Stock Transfer Corp., will act as exchange agent for purposes of implementing the exchange of stock certificates.

A more detailed description of the business acquired is set forth below:

PART I

Business Overview

REDtone China was incorporated in Hong Kong under the Companies Ordinance of Hong Kong on 26 May 2005 as a private limited company under the name of REDtone Holding Pte Limited. It assumed its present name on 9 August 2005. The principal activity of REDtone China is that of investment holding while its subsidiaries are principally involved in research and development of telecommunication and network technology, marketing and distribution of discounted call services.

Given the potential of discounted calls services in PRC, REDtone China was incorporated by REDtone International Berhad, to replicate its business model in Malaysia for discounted call services to Public Republic of China (“PRC”) in February 2006. Growth in discounted call services in PRC was encouraging as discounted call solutions provide a cheaper mode of voice services for individual users and corporate clients for making nationwide and international calls.

REDtone China, via its subsidiary entered into a business collaboration agreement with China TieTong Telecommunications (Shanghai Branch Company) (“China TieTong”) to offer long distance domestic and international discounted call packages to mobile phone and fixed line subscribers in Shanghai. China TieTong has established a high-speed backbone optical transmission network of 52,000 kilometres over the years, covering most of the cities in PRC.

Under the business collaboration, China TieTong provides the network access for discounted calls while REDtone China provides the necessary support for sales and marketing, customer care, technical system and other related matters for China TieTong’s consumer and corporate voice services in Shanghai and acting as TieTong’s sole distributor.

While the branding of discounted consumer voice service namely “E-Secretary” belongs to CTT, Redtone China is handling the marketing campaigns, developing retailing networks to promote sales, provide billing support,  selling of prepaid air-time and associated commission scheme structure design based on sold air-time, prepaid money collection, sold air-time account management and customer care support, all done with the help of our E-Purse System and call centre owned and operated by REDtone China.  REDtone China is the key contributor for “E-Secretary” business model minus the backbone transmission network infrastructure owned by CTT.  REDtone China does not provide any direct communication services.

REDtone China has grown rapidly in the last 4 years since commencing operations, under which REDtone China’s infrastructure network capacity has grown to approximately 437E1 allowing average transmissions of 100,000,000 minutes per month.  REDtone China is primarily offering its discounted call services to the consumer market. The discounted call for consumer market, which is offered as a prepaid telecommunication service, generates average cash of approximately RMB9 million per month with the current average gross revenue per month standing at about RMB8 million per month. REDtone China has approximately 1 million active customers in the discounted call for consumer market segment. As for the postpaid telecommunication services for the corporate market, it is generating an average gross revenue per month of approximately RMB1 million per month.

REDtone China proposes to venture into new businesses which will ride on its existing technology, operating platform, marketing channels and customer base. REDtone China is seeking service expansion into prepaid value reload for 2G and 3G mobile users in Shanghai and other potential cities in PRC.  

This new service will offer fast and convenient “paperless” reload facilities to all reload agencies in Shanghai.  In addition, the reload services are easier to manage and convenient compared to traditional paper-based value-card printing, distribution and control. This new service is expected to be launched by the third quarter of 2010.

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Products and Services

REDtone China offer the following services to customers:

1.

Discounted call services for consumers (“EMS”)

2.

Discounted call services for corporate customers

3.

Reload services for prepaid mobile

Discounted Call Solutions for consumers (“EMS”)

This is an innovative prepaid call service that offers an effective solution to help consumers to manage their telecommunications costs. This service was introduced in January 2006. Unlike conventional discount service, this service comes with unique features that help users save time and effort and control costs.

REDtone China partner with China Tie Tong  and China Unicom in Shanghai for the provision of discounted call services to approximately 1,000,000 actives customers with the support of approximately 4,000 active channel agencies.  

The following are the benefits of EMS:

(a)

Maximum savings, 24 hours daily - users enjoy maximum savings off phone charges for local, nationwide, long distance and mobile phone calls, 24 hours a day;

(b)

One account manages 20 lines - the service supports up to 20 phone numbers (fixed and mobile lines) to operate from one single account, namely, users can register home, business and mobile lines. Instead of having to keep track of several accounts, users can manage them all conveniently through just one consolidated account;

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(c)

Free and easy registration process - there is a self-registration process through REDtone gateway where the system takes users though a step-by-step voice-guided menu and the service is activated instantly. In addition, users can add or delete phone numbers from the account any time;

(d)

Easy dialing – no personal identification number (“PIN”) required. There is no lengthy PIN to remember. Users just need to dial the nearest REDtone gateway followed by the destination number;

(e)

Quick and easy reloads - topping up the account is simple and hassle-free with REDtone Reload Cards through an auto-reload facility. The REDtone Reload Cards are available from authorised distributors nationwide. As for the auto-reload through credit card facility, the account is automatically topped up whenever it reaches a preset threshold. REDtone will notify users by way of SMS to users’ mobile phone of each auto-reload transaction;

(f)

Secure authentication - the REDtone gateway identifies users via Caller-ID and not by PIN to prevent abuse of account; and

(g)

Internet Bill Presentment - Bill presentment for this service is through the Internet whereby customers may view and print their bills themselves up to the previous day’s transactions. Customers may also make billing enquiries by dialing the given hotlines to the Group’s customer care team.

EMS business has seen steady growth over the years from 2007 to 2010 as follows:

a)

Unsold air time, being the airtime sold to agencies, has grown steadily from an average of RMB2.2mil per month in FYE2007 to RMB5.6mil per month in FYE2008 (growth of 159% year on year), and increase further to RMB6.6mil per month in FYE2009 (growth of 18%).  In FYE2010, the average unsold air-time reached RMB7.1mil per month represents growth of 8% year on year.

b)

Sold air-time, being airtime sold to end users, increase gradually from RMB2.3mil per month in FYE2007 to RMB6.6mil per month in FYE 2008 (growth of 189% year on year),and increase further to RMB7.7mil per month average in FYE2009(growth of 17% ).  In FYE2010, the average sold air-time reached RMB8.2mil per month represents growth of 6% year on year.

c)

End users EMS utilisation grows from RMB1.8mil/month in FYE2007 to RMB7.9mil per month in FYE2010 (total growth of 338%). The year on year growth from FYE2007 to FYE2010 was 233%, 21% and 7% respectively.

d)

 Generating comfortable net operating cash inflow of approximately RMB9mil per year

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Business flow of EMS

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Discounted call services for corporate customers

This is a post paid discounted call services targeting large companies and corporations with high long distance phone bills. We partner with China Tie Tong, China Telecom, China Mobile and China Unicom in Shanghai to provide discounted IP call services to more than 1,620 actives corporate clients.   

Business flow of Discounted call for Corporate segment

Reload for 2G and 3G Prepaid mobile

Riding on our existing customer base and technology platform, we have recently expanded into Prepaid Value Reload for 2G and 3G Mobile users in Shanghai in August 2010. The reload prepaid mobile will be used to make phone calls, surf internet and to download games. Under this service, REDtone China acts as the distributor for three major telecommunication service providers in Shanghai namely China Mobile and China Unicom and China Telecom.  The distinct advantage of REDtone China providing this service as compare to other distributor is that we able to tap on our existing platform and technology, marketing channel and customer base with minimal start-up cost.

Our objectives in providing this service are as follow:

ü

Target to be one of the largest distributor for prepaid mobile reload service in Shanghai. ..

ü

Focus on offering a more comprehensive mobile reload solution to our customers. Our service is convenience and it is a paperless top up (via SMS/ IVR/Web).

ü

Prepaid model generating good cashflow reserve.  We target a monthly top up value of approximately RMB10mil per month from the year 2011 onwards.

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Currently, China Mobile and China Unicom have an estimated 10 million prepaid mobile users in Shanghai. With our existing technology and system, this service offer a fast and convenient “paperless” and automatic reload facility to all reload agency in Shanghai.  Our system is a major attraction to both telecommunication service providers and reload agency as it makes the reload process easier to manage and convenient as compared with traditional paper-based which include, value-card printing, distribution and storage control.  

Once this service model is establish in Shanghai, similar model will be replicated in other major cities in China.       

Business flow of Reload Services

Customers and Markets

REDtone China has built a strong foundation and an intangible asset in its customer base especially in Shanghai. There are more than 1,000,000 consumers and 1,600 major corporate customers. These reference sites are helpful for us to market our services.

Currently, we conduct our business in Shanghai, China. We plan to expand our market share and presence in China in the coming three years by replicating our successful business model in other provinces in China.

  We believe China will be our fastest growing market. We plan to invest significant resources to expand our market share and presence in China in the coming three years

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Sales and Marketing

REDtone China will continue its tradition of leveraging on capable partners to market its services and products in order to grow its business quickly. Innovative schemes are designed to attract and retain partners to achieve our sales goals. These partners would include distributors and agents. We believe that these channels are effective in bringing our services and products to customers because of their network of contacts and market knowledge.

The existing REDtone China’s sale partners have been with us since the start of our EMS business in 2006.  We provide product training and customer care support, develop incentive system and motivation programme to our partners in order to enhance the quality of our service and to make our products relevant and attractive for the market.

Business Strategies for Future Growth

We have identified a number of initiatives to drive our future growth, as outlined below:

1.

Expand our Presence in China

Currently, REDtone China business is only in Shanghai. Our group is well on its way to grow its business beyond Shanghai by replicating its successful proprietary telecommunications service business model in other provinces and even other countries.

REDtone’s expansion is executed with relatively low capital expenditure requirements as it fabricates its own equipment and software, and does not require investing in basic infrastructure thus allowing it to scale its business without incurring huge investment costs.

Based on May 2010 statistics published by company website of China Mobile, China Unicom and China Telecom, there is over 780 million mobile phone subscribers in China. This will provides tremendous growth potential for the Group.

2.

Synergistic expansion into related value added services -  Prepaid Mobile reload

Riding on existing customer base and E-Purse technology platform, REDtone China extends its services into prepaid mobile reload for 2G and 3G Mobile users in Shanghai and other potential major cities.  This service covers all three major telecommunication service providers in Shanghai namely China Mobile and China Unicom and China Telecom.  The distinct advantage of having this service is to tap on our ready platform and technology and its existing marketing channel and customer base with minimal start-up cost.

With estimated over 10 million prepaid mobile users in Shanghai for China Mobile and China Unicom, this service will offer fast and convenient “paperless” reload facilities to all reload agency in Shanghai.  The attraction to both telecommunication service providers as well as reload downstream resellers is that such service will help making their reload services easier to manage and convenient as compared with traditional paper-based value-card printing, distribution and storage control issue.  

Once this service model established its footing in Shanghai, similar model can be replicated in other cities in China.       

3.

 Introduction of  New Products and Services

We believe our continuous product innovation, understanding of our customers’ needs and good customer service will continue to bring us success. Hence, we are committed to researching, designing and developing products and services that will continue to meet the demands of our customers. In addition to new products and updates, we also continue to review our revenue model by closely monitoring market trends and discussing trends with our clients and users.

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Competition

The telecommunications industry in China is dominated by three state-run corporations, i.e. China Telecom Corporation Limited, China Mobile Communications Corporation and China United Network Communications Group Co., Ltd, all of whom has 3G licenses and engaged fixed-line and mobile business in China. 

We see competition from:

(i)

Direct Telecommunication Operators namely China Telecom Corporation Limited, China Mobile Communications Corporation and China United Network Communications Group Co., Ltd. These companies may adopt a more aggressive pricing on their local and international calls and have direct impact on our discounted call services for corporate segment.

Likewise, if these operators offer very competitive rates for domestic, long distance and international calls, it could pose a substitution threat to our EMS services.

(ii)

Other Discounted Service Providers

The discounted service providers such as Super E-Secretary operate domestic calls and the tool to compete is to provide discount on long distance calls. This company despite being a small player (less than 15% market share) in Shanghai discounted consumer call market may cause the price disruption when they compete on price aggressively.

(iii)

Other Mobile air-time reload service providers

Other players like Smartpay, Defeng and YiQiao offers similar mobile air-time reload services in Shanghai.   They have entered into this reload services earlier than us but we command slightly better price advantage and better system support for paperless mobile reload in comparison with conventional paper-based reload model.  

We believe our competitive advantage is derived from the following strengths:

(a)

Competitive Pricing

We, being one of the leading alternative voice service providers in Shanghai in terms of market share, could command the economies of scale to achieve lower minutes cost and lower operating cost per minute.  Additional cost advantage is the low capital investment with self developed technology.

By having advantage of longer market presence, credibility and dominant market share, we can afford to price its products and services competitively while maintaining healthy gross margins.

(b)

Superior Technology and Competent Technical Support

We use superior call routing technology and techniques, such as its own invention, the Smart Call System, for large corporate customers. As the products are developed in-house, we know the products well and are competent in supporting customers. Customers can expect hassle-free implementation of the products and services.

(c)

Innovation

Innovation which is embodied in all the products and services is the key to the competitive advantage of our operations. In addition, innovation also helps us to truly serve the needs of the customers and to provide value-added services and products to the customers.   

Close communication with our front line resellers will enable us to gather market intelligence and assist us in strategy formulation that is relevant to market needs

(d)

Value Added Services

For the telecommunications services provided by us, customers would also benefit from value added services in our convenient reload, customer care services and support, e-billings and others.

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Regulatory Matters

REDtone China does not provide direct telecommunication services in PRC. REDtone China acts as a distributor for CTT. REDtone China has a business licence issued by PRC’s State Administration for Industry and Commerce to carry out the distribution services. REDtone China does not require a telecommunication licence to carry out its distribution activities.  

We do not anticipate having to expend significant resources to comply with any governmental regulations applicable to our operations. We are subject to the laws and regulations which are generally applicable to business operations, such as business licensing requirements, income taxes and payroll taxes.

However, the telecommunications industry is highly regulated in China. PRC laws and regulations will be modified and updated from time to time by the China government. In addition, many PRC laws and regulations are subject to extensive interpretive power of governmental agencies and commissions, and there is substantial uncertainty regarding the future interpretation and application of these laws or regulations.

Intellectual Property and Research and Development

The Company has no registered patents, trademarks or copyrights and no applications for patents, trademarks or copyrights are pending.

The Company utilized intellectual property pursuant to an agreement signed between REDtone Technology Sdn Bhd, Kerry Properties (Shanghai) Limited and REDtone Telecommunications (China) Ltd on 11 August 2005 in respect of the acquisition of the software with regards to the Customer billing, commission management, top-up management, traffic management, cardless system and gateway interface system suite.

The Company did not incur any research and development expenses in the fiscal year ended May 31, 2010.

Employees

As of 31 August 2010, we had forty four (44) employees including fourteen (14) in management, twenty two (22) in Research & Development, technical support and customer care, four (4) in sales and marketing and four (4) in finance and administration. None of our employees are represented by labor unions or subject to collective bargaining agreements. We believe our employee relations are good and have no employee related dispute recorded over the years.

Risks Related to Our Business

Operational/Business Risk

We are principally involved in the provision of telecommunications services and solutions and office communication solutions. As such, we are subject to certain operational and business risk factors inherent in the telecommunications industry. The operational risks include, inter-alia, changes in conditions such as deterioration in prevailing market conditions, changes in labour, increase in labour cost and raw material costs and continued supply of electricity which is essential for the smooth operations of its telecommunications network(s). The business risks include, inter-alia, network disruption in respect of the provision of the telecommunications services and Although we seek to mitigate these operational and business risks through, inter-alia, efficient cost control, maintaining a diversified range of customers and suppliers, having good relationships with the customers, suppliers and employees of the Company and having contractual agreements for projects undertaken, there can be no assurance that any change to these factors will not have a material adverse effect on our business and financial performance.

Competition

We are in a very competitive and rapidly changing telecommunications industry and its future success will depend on its ability to increase its market share in its markets. As we are competing against well established telecommunications companies which offer related services which include, inter-alia, China Telecom, China Unicom and China Mobile on their pricing strategies, technological advances, advertising campaigns, strategic partnerships and other initiatives. The increasing competition in this telecommunications industry has had, and is expected to continue to have, a significant

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impact on our business and financial performance. Competition is expected to increase with the emergence of new entrants into its markets. We believe that the provision of telecommunications services complemented with our innovative will provide the Group with a competitive edge and differentiate us from its competitors.

Although we seek to mitigate these risks, there can be no assurance that our competitors will not develop technologies and products that are more effective than those developed by us. We have a very clear strategy to replicate the business in other provinces in China.

 Dependence on key personnel

The technology industry is a growing and fast changing sector and management and operation of the business requires the employment of highly skilled knowledge workers, whether in technology or non-technology related fields. Our management recognises and believes that our continuing success depends to a significant extent on the abilities and continuing efforts of its existing Executive Directors, Chief Executive Officers and key personnel. The labour market for skilled personnel in this field is highly competitive. We recognise that our success depends to a significant extent upon, amongst others, our ability to attract new personnel and retain its existing skilled personnel. We seek to mitigate this risk factor by offering its employees competitive salary/remuneration and benefits packages. There can be no assurance that the measures taken/to be taken will be successful and that any change in our existing skilled personnel will not have a material effect on our business and operations

Adverse Changes to the terms of business collaboration agreement with China TieTong

We currently have business collaboration agreements with China TieTong. The agreement provides for renewability and is subject to changes in the terms of the agreements on renewal. We will endeavour to seek and renew the agreement on terms favourable to us. There can be no assurance that any adverse changes to the terms of the agreement (for example, from failure to reach commercially acceptable terms) would not result in higher interconnection expenses. However, as we have emerged as a significant service provider, China TieTong may views this as a business opportunity to continue and further strengthen their working relationship with us.

Although individual members of our management team have experience as officers of publicly-traded companies, much of that experience came prior to the adoption of the Sarbanes-Oxley Act.

It may be time consuming, difficult and costly for us to develop and implement the internal controls and reporting procedures required by the Sarbanes-Oxley Act. We may need to hire additional financial reporting, internal controls and other finance staff in order to develop and implement appropriate internal controls and reporting procedures. If we are unable to comply with the Sarbanes-Oxley Act’s internal controls requirements, we may not be able to obtain the independent auditor certifications that Sarbanes-Oxley Act requires publicly-traded companies to obtain.

If we need additional financing, the funding may not be available on satisfactory terms or at all.

We may seek to raise additional capital through public or private equity offerings, debt financings or additional corporate collaboration and licensing arrangements. To the extent we raise additional capital by issuing equity securities, our stockholders may experience dilution. To the extent that we raise additional capital by issuing debt securities, we would incur substantial interest obligations, may be required to pledge assets as security for the debt and may be constrained by restrictive financial and/or operational covenants. Debt financing would also be superior to your interest in bankruptcy or liquidation. To the extent we raise additional funds through collaboration and licensing arrangements, it may be necessary to relinquish some rights to our technologies or product candidates, or grant licenses on unfavorable terms.

If the market does not accept our other new products or upgrades to existing products that we launch from time to time, our operating results and financial condition would be materially adversely affected.  

From time to time, we plan on launching new products and upgrades to existing products.  Our future success with our next generation product offerings will depend on our ability to accurately determine the functionality and features required by our customers, as well as the ability to enhance our products and deliver them in a timely manner. We cannot predict the present and future size of the potential market for our next generation of products, and we may incur substantial costs to enhance and modify our products and services in order to meet the demands of this potential market.

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If we experience delays in product development or the introduction of new products or new versions of existing products, our business and sales will be negatively affected.  

There can be no assurance that we will not experience delays in connection with our current product development or future development activities.  If we are unable to develop and introduce new products, or enhancements to existing products in a timely manner in response to changing market conditions or customer requirements, it may materially and adversely affect our operating results and financial condition.  Because we have limited resources, we must effectively manage and properly allocate and prioritize our product development efforts.  There can be no assurance that these efforts will be successful or, even if successful, that any resulting products will achieve customer acceptance.

We have only limited protection of our proprietary rights and technology.  

Our success is heavily dependent upon our proprietary technology. We rely on a combination of the protections provided under applicable copyright, trademark and trade secret laws, confidentiality procedures and licensing arrangements, to establish and protect our proprietary rights. As part of our confidentiality procedures, we generally enter into non-disclosure agreements with our developers, distributors and marketers.  Despite these precautions, it may be possible for unauthorized third parties to copy certain portions of our products or to reverse engineer or obtain and use information that we regard as proprietary, to use our products or technology without authorization, or to develop similar technology independently. Moreover, the laws of some other countries do not protect our proprietary rights to the same extent as do the laws of the United States. Furthermore, we have no patents and existing copyright laws afford only limited protection.  There can be no assurance that we will be able to protect our proprietary software against unauthorized third party copying or use, which could adversely affect our competitive position.

We have never paid cash dividends and are not likely to do so in the foreseeable future.

We have never declared or paid any cash dividends on our common stock. We currently intend to retain any future earnings for use in the operation and expansion of our business. We dos not expect to pay any cash dividends in the foreseeable future but will review this policy as circumstances dictate.

Risks Associated With Doing Business In China and Asia

There are substantial risks associated with doing business in China and Asia, as set forth in the following risk factors.

Our operations and assets in China are subject to significant political and economic uncertainties.

Changes in PRC laws and regulations, their interpretation, or the imposition of confiscatory taxation, restrictions on currency conversion, imports and sources of supply, devaluations of currency or the nationalization or other expropriation of private enterprises could have a material adverse effect on our business, results from operations and financial condition. Under current leadership of the PRC, the Chinese government has been pursuing economic reform policies that encourage private economic activity and greater economic decentralization. There is no assurance, however, that the Chinese government will continue to pursue these policies, or that it will not significantly alter these policies from time to time without notice.

Our business is largely subject to the uncertain legal environment in China and your legal protection could be limited.

The Chinese legal system is a civil law system based on written statutes. Unlike common law systems, the Chinese legal system is a system in which precedents set in earlier legal cases are not generally used. The overall effect of legislation enacted over the past 20 years has been to enhance the protections afforded to foreign invested enterprises in China. However, these laws, regulations and legal requirements are relatively recent and evolving rapidly, and their interpretation and enforcement involve various uncertainties. These uncertainties could limit the legal protections available to foreign investors, such as the right of foreign invested enterprises to hold business licenses and permits. In addition, all of our executive officers and directors are not residents of the U.S., and most of the assets of these persons are located outside the U.S. As a result, it could be difficult for investors to serve process on these individuals in the U.S., or to enforce a judgment obtained in the U.S. against the Company or any of these persons.

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The Chinese governments exert substantial influence over the manner in which we must conduct our business activities which could have an adverse effect on our ability to operate in China

China has only recently permitted provincial and local economic autonomy and private economic activities. The Chinese governments continue to exercise substantial control over virtually every sector of the economy through regulation and state ownership. Our ability to operate may be harmed by changes in laws and regulations, including those relating to taxation, import and export tariffs, environmental regulations, land use rights, property and other matters. We believe our operations in China are in material compliance with all applicable legal and regulatory requirements. However, the central or local governments of these jurisdictions may impose new, stricter regulations or interpretations of existing regulations that would require additional expenditures and efforts to ensure our compliance with such regulations or interpretations.

Accordingly, government actions in the future, including any decision not to continue to support recent economic reforms and to return to a more centrally planned economy could have a significant effect on economic conditions in China.  Additionally, regional or local variations in the implementation of economic policies, could have a significant effect on economic conditions in particular regions of China, and could require us to divest ourselves of any interest we then hold in Chinese properties or joint ventures.

Future inflation in China may inhibit our ability to conduct business in China.

In recent years, the Chinese economy has experienced periods of rapid expansion and high rates of inflation. These factors have led to the adoption by the Chinese government, from time to time, of various corrective measures designed to restrict the availability of credit or regulate growth and contain inflation. High inflation may in the future cause the Chinese government to impose controls on credit and/or prices, or to take other action, which could inhibit economic activity in China, and thereby harm the market for our products.

Restrictions on currency exchange may limit our ability to receive and use our revenues effectively.

The substantial portion of our revenues will be settled in RMB, and any future restrictions on currency exchanges may limit our ability to use revenue generated in RMB to fund any future business activities outside China or to pay dividends or other payments in U.S. dollars. Although the Chinese government introduced regulations in 1996 to allow greater convertibility of the RMB for current account transactions, significant restrictions still remain, including the restriction that foreign-invested enterprises may only buy, sell or remit foreign currencies after providing valid commercial documents at banks in China authorized to conduct foreign exchange business. In addition, conversion of RMB for capital account items, including direct investment and loans, is subject to governmental approval in China, and companies are required to open and maintain separate foreign exchange accounts for capital account items. We cannot be certain that the Chinese regulatory authorities will not impose more stringent restrictions on the convertibility of the RMB.

The value of our securities will be affected by the foreign exchange rate between U.S. dollars and RMB and other local currencies.

The value of our common stock will be affected by the foreign exchange rate between U.S. dollars and RMB, and between those currencies and other currencies in which our sales may be denominated. For example, to the extent that we need to convert U.S. dollars into RMB for our operational needs and should the RMB appreciate against the U.S. dollar at that time, our financial position, the business of the company, and the price of our common stock may be harmed. Conversely, if we decide to convert our RMB into U.S. dollars for the purpose of declaring dividends on our common stock or for other business purposes and the U.S. dollar appreciates against the RMB, then the U.S. dollar equivalent of our earnings from our subsidiaries in China would be reduced.

As a smaller reporting company, the Company is not required to provide the disclosure required by this item.

Our operation is located at 15A,E –F, Sanhe Plaza, No: 121, YanPing Road, Shanghai, People Republic of China. Our office is used for sales and marketing, research and development, customer support, technical support and administrative functions. All of the facilities are leased. We believe our facilities are adequate for our current needs.

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We are not a party to and none of our property is subject to any material pending or threatened legal, governmental, administrative or judicial proceedings.

As at the date of this report, no matter was submitted to a vote of the Company’s security holders.

The Company’s Articles of Incorporation provide that the Company has the authority to issue 300,000,000 shares of common stock at par value of $0.0001 per share. As of the date of this report, we had 24,723,683 outstanding shares of Common Stock.

Our common stocks are quoted on the OTCBB under the symbol “HTGT”. We have not had any active trading in our stock as of the date of this report.

The Company has never paid any cash dividends on its stock and any plan to pay any cash dividends in the foreseeable future will depend on the Company performance.

 Equity Compensation Plans

The Company does not have any equity compensation plans in place as of the date of this report, and had no options, warrants or other convertible securities outstanding as of that date.

Sales of Unregistered Securities

For the period from 1 June 2010 to the date of this report, the Company sold unregistered securities to stockholders who acknowledges and understands that the certificates representing the shares has not been registered under the Securities Act 1933, as amended (“The Act”) and are restricted securities as that term is defined in Rule 144 under the Act, and requires written release from either the issuing Company or their attorney prior to legend removal.   These securities may not be resold unless the requirement of paragraph (i) of Rule 144 are met.

* The figure is before the one-for-twelve reverse stock split

(1) These securities may not be resold unless the requirements of paragraph (i) of Rule 144 are met

As a smaller reporting company, the Company is not required to provide the disclosure required by this item.

Overview

We are formerly an information and communication technology (ICT) application provider in China and Asia specializing in internet connectivity, internet value-added services, wireless solutions and voice services for the hospitality industry. Due to the economic crisis and severe market competition, the operation of the company has been drastically downsized in FY2010.

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In line with the management’s decision to seek new profitable business, the Company has on August 2, 2010, entered into an Agreement for a Share Exchange (the “Agreement”) with REDtone Technology Sdn. Bhd. and REDtone International Berhad, both of which are incorporated in Malaysia.   Upon the closing of the transactions contemplated in the Agreement, the Company will acquire 100% ownership of REDtone Telecommunications (China) Limited (“REDtone China”). REDtone China has subsidiaries in Shanghai which are principally involved in the business of offering discounted call services to consumers and corporate segment and reload services for prepaid mobile.

Results of Operations

Financial Presentation

The following sets forth a discussion and analysis of REDtone China’s financial condition and results of operations for the two financial years ended (“FYE”) May 31, 2010 and 2009. The following discussion contains forward-looking statements. Our actual results may differ significantly from the results discussed in such forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, those discussed in “Item 1A — Risk Factors” of this Form 8-K/A.

Net cash provided by operations during the FYE 2010 amounted to $1,222,927 as compared to $1,097,455 for FYE 2009, representing a increase of 11% due to increase in sales.

Net cashflow used in investing activities for FYE 2010 amounted to $1,579,015. This is mainly due to increase in advances made to a related company of non-trade nature amounting to approximately to $1,179,487.    

Net cashflow provided by financing activities for FYE May 31, 2010 amounted to $48,393 mainly due to collection on behalf of a related company.   

Working Capital

Our working capital was a positive of $2,020,138 as at May 31, 2010 as compared to $1,341,639 as at May 31, 2009

With the high cash reserve, the Company is in active search for good potential investment opportunities to generate better returns for its cash reserve.

As at May 31, 2010, we had stockholders’ surplus of $8,087,333, total assets of $11,065,886 and total liabilities of $2,978,553.  For FYE May 31, 2010, we recorded total comprehensive income of $1,409,941.  

We do not anticipate any material capital expenditures for our existing operations for the next twelve (12) months.

We do not believe that inflation has had a material effect on our results of operations. However, there can be no assurances that our business will not be affected by inflation in the future.

We have no off balance sheet arrangements.

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Critical Accounting Policies and Estimates

Revenue Recognition.  

Revenue represents the invoiced value of services rendered and receivable during the year. Revenue is recognized when all of the following criteria are met:

a)

Persuasive evidence of an arrangement exists,

b)

Delivery has occurred or services have been rendered,

c)

The seller’s price to the buyer is fixed or determinable, and

d)

Collectability is reasonably assured

In addition, the Company adopted the following policy for revenue recognition for its major products and services:

(1)

Discounted call services for consumer (EMS) as follow:

(a)

Collaboration with CTT – we will recognize the revenue when airtime is utilize by the consumer and the computation is base on the gross profit sharing ratio as per the collaboration agreement with CTT; and

(b)

Collaboration with other telecommunication providers – we will recognize the revenue when airtime is utilized by the consumer and the value recognize is the call charges gross value.

As this is a prepaid product, there is an expiry date for the product sold. If the airtime is not utilize by the expiry date, which is currently one year from the activation date, it will be deemed expired and recognize as revenue based on the remaining gross value of the expired prepaid product.

(2)

Discounted call services for corporate as follow:

(a)

Collaboration with CTT –the revenue recognize is the commission earn from distributing the discounted call services to corporate customer; and

(b)

Collaboration with other telecommunication providers – we will recognize the revenue when airtime is utilized by the consumer and the value recognize is the call charges gross value.

(3)

Reload services for prepaid mobile – revenue recognize is the commission earn

Recent Accounting Pronouncements.

The Company does not expect the adoption of any recent accounting pronouncements which are further elaborated in Note 3 (o) of Notes to Consolidated Financial Statements will have any material impact on its financial statements.

As a smaller reporting company, the Company is not required to provide disclosure required by this item.

The Company’s audited financial statements and the notes thereto appear in Part IV, Item 15, of this report.

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ITEM 10. DIRECTORS, EXECUTIVE OFFICERS, AND CORPORATE GOVERNANCE

The following table sets forth as of the date hereof, except as otherwise noted, the names, ages and positions held with respect to each director, executive officer, and significant employee expected to make a significant contribution to the Company:

Mr. Chuan Beng Wei took office as Director with the Company on July 2008.   In 1996, he founded Redtone Telecommunications Sdn Bhd which later became a subsidiary of Redtone International Bhd (“Redtone”), a company specializing in value-added telecommunications services.  Redtone is listed on the ACE market of Bursa Malaysia.  He served as the Managing Director of Redtone and was in charge of business development and strategic management. Mr. Wei began his career with Agilent Technologies (M) Sdn Bhd in 1989 and performed duties as a System Engineer and Major Account Manager. In 1995, he founded TQC Consultants (IT Division) Sdn Bhd, a software development and system integration company.  Mr. Wei is also a Council Member and the chairperson for Communication Special Interest Group for The Association of Computer and Multimedia Malaysia and the Vice President for the Kuala Lumpur/Selangor Darul Ehsan Telecommunication Association. He holds a Bachelor’s Degree in Electrical Engineering from the University of Technology in Malaysia and a Diploma in Management from the Malaysia Institute of Management.

Mr. Wei was also the interim CEO from April 13, 2009 to May 3, 2010.  Ms. Yan Suan Sah, the existing CFO of the Company assumes the role of CEO with effect from May 3, 2010.

Michael Yang, age 62, is a director of the Company. Since 1994, Mr. Yang has been the managing director of Zephyr Capital, an investment and management consulting company with clients in Australia, Malaysia, Hong Kong, China and other Asia countries. He is also a director of a number of companies including PHI Bhd., Cash Bhd. and EB Capital Bhd   Mr. Yang started his career in 1975 with Amanah-Chase Merchant Bank Bhd, the Malaysian merchant banking arm of Chase Manhattan Bank (now known as JP Morgan Chase) where he served as a General Manager and head of corporate banking. Mr. Yang holds a Master’s Degree in Business Administration from Cranfield University in the United Kingdom, a Bachelor of Economics degree (with honors) from the University of Malaya, Malaysia and a Diploma in Marketing from the Institute of Marketing in the United Kingdom.

Mr. Bik Soon Lau obtained his first-class honors degree in electrical engineering from the University of Technology in Malaysia.  He joined REDtone International Berhad (“REDtone”) in 2008, as an executive director.  Between 2005 and 2008, Mr. Lau was the country manager for Hitachi Data Systems Malaysia.  There, he strengthened the organization, strengthened the company’s channel partners, and helped the company grow their Malaysian business.  Mr. Lau has over 14 years of experience in the ICT and telecommunications industry.  In his career, he has held numerous other positions, including sales director, partner sales manager, enterprise division account manager, business development manager, systems engineer, and research and design engineer.  He has held these positions with organizations such as Cisco Systems, Sun Microsystems, Compaq Computer, TQC Consultant (IT Division) Sdn Bhd, and Motorola Penang. During his tenure with these organizations, he received various Partner Management Excellence awards as well as many accolades as a high achiever in sales.  

Mr. Zainal Amanshah Bin Zainal Arshad, age 43, obtained his bachelor’s degree in 1989 in electrical engineering from the University of Kent in the United Kingdom.  In 2000, he joined REDtone Telecommunications Sdn Bhd as the Executive Director responsible for call center solutions, system integration services, and discounted call business for the Malaysian market.  He is also REDtone Chief Executive Officer.  Prior to joining REDtone, Mr. Zainal worked for several local and multinational companies, including: Unisys Malaysia, NCR Malaysia Sdn Bhd, Solsis (M) Sdn Bhd,

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Xylog Business Solutions Sdn Bhd, and Lotus Consulting Malaysia. Currently, Mr. Zainal works in both the business development and government sectors.  He is also currently serving as a director for Malaysian Access Forum Berhad.     

Mr. Chee Keong Lee , age 37, a Malaysian Chartered Accountant, obtained his Bachelor’s Degree in Accounting from University of Malaya in 1998. He began his career with Big 5 International Accounting firm in 1998 as Associate Consultant responsible for Corporate Finance and Corporate Restructuring for companies facing financial distress.   

Mr. Lee has more than ten years of experience in in manufacturing industries and had held various positions from finance manager to financial controller with companies in Vietnam, Malaysia and China.  In 2005, he joined VS Technologies (Zhuhai) Co., Ltd., an Electronic Manufacturing Service Company, as a finance and admin manager overseeing full spectrum of finance and administrative functions.  In 2007, he joined Eurotec Electronics (Zhongshan) Co., Ltd., an European manufacturing company based in Guangdong Province as the Financial Controller.  In this position, his main responsibilities includes financial review, costing analysis, tax planning and treasury functions.  From February 2009, he joined Redtone Telecommunications (China) Ltd., a subsidiary of the Company at the position of Financial Controller.  He is entrusted with the responsibilities of financial reporting, business analysis, investment appraisal, tax planning and liaison with bankers and auditors. 

Number and Terms of Office of Directors

A Board of Directors, consisting of at least one (1) person shall be chosen annually by the Stockholders at their meeting to manage the affairs of the company. The Directors' term of office shall be one year, and Directors may be re-elected for successive annual terms.  There is no family relationship between any of our executive officers and directors.

The following table sets forth, for the fiscal years ended May 31, 2010 and 2009, certain information regarding the compensation earned by the Company’s named executive officers. Where columns have been omitted from the Summary Compensation Table below, it is because no such compensation was paid to the named executive officer during the 2010 or 2009 fiscal years

Director Compensation

The Company has not paid its directors any compensation for their services on the Board of Directors. The Company intends to maintain this policy in the future.

Compensation Committee Interlocks and Insider Participation

As a smaller reporting company, the Company is not required to provide the disclosure required by this item.

Compensation Committee Report

As a smaller reporting company, the Company is not required to provide the disclosure required by this item.

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The following table sets forth beneficial ownership information as at the date of this report: (i) each of the Company’s officers and directors, (ii) each person who is known by the Company to own beneficially more than 5% of the outstanding shares of common stock, and (iii) all of the Company’s officers and directors as a group. As at the date of this report, the Company had 24,723,683   shares of common stock outstanding.

(i)

Security Ownership of directors and executive officers: None

(ii)

Security ownership of certain beneficial owners:   

(iii)

Security ownership of officers and directors as a group:  None.

During the fiscal year ended May 31, 2010, there were no related transactions between the Company and the directors.

During the fiscal year ended 31 May 2009, a wholly owned subsidiary of the Company paid Mr Yang $18,058 in advisory fee pursuant to a service agreement.

Our board of directors has undertaken a review of the independence of each director and considered whether any director has a material relationship with us that could compromise his or her ability to exercise independent judgment in carrying out his or her responsibilities.  As a result of this review, our board of directors determined that none of the directors qualifies as “independent” in according with the applicable rules and regulations of the SEC. The Compay is considering adding one or more independent directors as a result of this internal review.  All directors are employed by the Company and own shares in the Company.

ITEM 14. SALES OF UNREGISTERED SECURITIES

Within the past three years, the Company has sold unregistered securities as listed in a schedule contained herein.  These shares were sold to stockholders who acknowledges and understands that the certificates representing the shares has not been registered under the Securities Act 1933, as amended (“The Act”) and are restricted securities as that term is defined in Rule 144 under the Act, and requires written release from either the issuing Company or their attorney prior to legend removal.

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Note: The above number of shares is before the effect of the one-for-twelve reverse stock split of the Company’s common stock.

The above securities may not be resold unless the requirements of paragraph (i) of Rule 144 are met

The following documents are filed as Exhibits to this Report:

10.1

Business Collaboration with China TieTong Telecommunications *

10.2

Intellectual property agreement signed between REDtone Technology Sdn Bhd, Kerry Properties (Shanghai) Limited and REDtone Telecommunications (China) Ltd (formerly known as REDtone Holding Pte Ltd.) on 11 August 2005 *

10.3

Business Collaboration Agreement with Smartpay (Collaboration with Smartpay enable our reload service to encompass China Mobile, China Unicom and China Telecom) *

10.4

Business Collaboration Agreement with China Unicom *

*    Previously filed with Form 8-K/A1 on May 13, 2011

The following documents are filed as a part of this Report:

1.

Independent Auditor’s Report – Madsen & Associates CPA’s, Inc.

2.

Financial Statements of the business acquired- REDtone Telecommunications (China) Limited

Audited Consolidated Balance Sheets for the financial year ended May 31, 2010 and May 31, 2009

Audited Consolidated Statements of Income and Comprehensive Income for the financial year ended May 31, 2010 and May 31, 2009

Audited Consolidated Statements of Changes in Stockholders’ Equity and Comprehensive Income for the financial year ended May 31, 2010 and May 31, 2009

Audited Consolidated Statements of Cash flows for the financial year ended May 31, 2010 and May 31, 2009

3.

Proforma Financial Information:  Hotgate Technology Inc. and Subsidiaries

Unaudited Proforma Combined Balance Sheet for the financial year ended May 31, 2010

Unaudited Proforma Combined Statements of Income and Comprehensive Income for the financial year ended May 31, 2010

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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and
Stockholders of Redtone Telecommunication (China) Limited

We have audited the accompanying consolidated balance sheets of Redtone Telecommunication (China) Limited as of May 31, 2010 and 2009, and the related consolidated statements of income and comprehensive income, stockholders’ equity, and cash flows for each of the years in the two-year period ended May 31, 2010. Redtone Telecommunication (China) Limited’s management is responsible for these consolidated financial statements. Our responsibility is to express an opinion on these consolidated financial statements based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. The company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audit included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the company’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the consolidated financial position of Redtone Telecommunication (China) Limited as of May 31, 2010 and 2009, and the consolidated results of its operations and its cash flows for each of the years in the two-year period ended May 31, 2010 in conformity with accounting principles generally accepted in the United States of America.

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REDTONE TELECOMMUNICATION (CHINA) LIMITED AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

As of May 31, 2010 and 2009

See accompanying notes to the consolidated financial statements.

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REDTONE TELECOMMUNICATION (CHINA) LIMITED AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME

For the Years Ended May 31, 2010 and 2009

See accompanying notes to the consolidated financial statements.

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REDTONE TELECOMMUNICATION (CHINA) LIMITED AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS’ EQUITY

AND COMPREHENSIVE INCOME

For the Years Ended May 31, 2010 and 2009