UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
WASHINGTON,
D.C. 20549
SCHEDULE
13E-3
RULE 13E-3
TRANSACTION STATEMENT UNDER SECTION 13(E)
OF
THE SECURITIES EXCHANGE ACT OF 1934
KID
CASTLE EDUCATIONAL CORPORATION
(Name of
the Issuer)
KID
CASTLE EDUCATIONAL CORPORATION
(Names of
Persons Filing Statement)
Common
Stock
(Title of
Class of Securities)
49375K109
(CUSIP
Number of Class of Securities)
Emma
Tseng
8th Floor,
No. 98 M
i
n Chuan Road
Hsien Tien, Taipei, Taiwan
ROC
Taipei,
Taiwan
(886)
2-2218-5996
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|
Carter
Mackley
K&L
Gates LLP
925
4
th
Avenue
Seattle,
Washington 98104-1158
(206)
623-7580
|
(Name,
Address and Telephone Numbers of Persons Authorized to Receive Notices and
Communications on Behalf of the Persons Filing Statement)
This
statement is filed in connection with (check the appropriate box):
A.
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x
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The
filing of solicitation materials or an information statement subject to
Regulation 14A (Sections 240.14a-1 through 240.14b-2), Regulation 14C
(Sections 240.14c-1 through 240.14c-101) or Rule 13e-3(c) (Section
240.13e-3(c)) under the Securities Exchange Act of 1934 (“the
Act”).
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B.
|
o
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The
filing of a registration statement under the Securities Act of
1933.
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Check the
following box if the soliciting materials or information statement referred to
in checking box (a) are preliminary copies:
x
Check the
following box if the filing is a final amendment reporting the results of the
transaction:
o
Calculation
of Filing Fee
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|
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$303,000
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$60.60
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*
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Calculated
by multiplying 0.0002 by the estimated aggregate cash payment of $303,000
to holders of fewer than 5,000 shares of the Issuer’s common stock.
The aggregate cash payment is equal to the product of the price of $0.18
per pre-split share and 1,683,333 pre-split shares, the estimated
aggregate number of shares held by such
holders.
|
o
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Check
the box if any part of the fee is offset as provided by
Section 240.0-11(a)(2) and identify the filing with which the
offsetting fee was previously paid. Identify the previous
filing by registration statement number, or the Form or Schedule and
the date of its filing.
|
Amount
Previously Paid:
Form or
Registration No.:
Filing
Party:
Date
Filed:
SCHEDULE
13E-3
This
Rule 13e-3 Transaction Statement is being filed in connection with the
concurrent filing by Kid Castle Educational Corporation (referred to herein as
“Kid Castle” or “Company” or “subject company” or “filing person”) with the
Securities and Exchange Commission (the “SEC” or the “Commission”) of an
Information Statement on Schedule 14C (the “Information Statement”) in
connection with action taken by a majority of the Company’s shareholders by
written consent dated June 17, 2009 (the “Shareholder Consent”).
Pursuant
to the Shareholder Consent, Kid Castle’s Articles of Incorporation will be
amended to effect a 5,000 for 1 reverse stock split of Kid Castle’s common stock
followed immediately by a 1 for 5,000 forward split. Pursuant to the
reverse split, cash will be paid to those shareholders who would, as a result of
the reverse stock split, hold less than one share of Kid Castle’s common stock
after the reverse split.
Item
1.
Summary Term Sheet.
The
information set forth in the Information Statement in the section titled
“SUMMARY TERM SHEET” is incorporated herein by reference.
Item
2.
Subject Company Information.
(a)
Name and Address.
The name
of the subject company is Kid Castle Educational Corporation. Kid
Castle is a Florida corporation with its executive offices located at 8th Floor,
No. 98 Min Chuan Road, Hsien Tien, Taipei, Taiwan, Republic of
China. Kid Castle’s telephone number is (011)
886-2-2218-5996.
(b)
Subject
Securities.
The
subject class of equity securities to which this Schedule 13E-3 relates is the
Company’s common stock, no par value per share, of which 30,000,000 shares were
outstanding as of June 17, 2009.
(c)
Trading Market and
Prices.
The
section of the Information Statement titled “INFORMATION ABOUT THE COMPANY —
Market Price of Common Stock” is incorporated herein by reference.
(d)
Dividends.
The
section of the Information Statement titled “INFORMATION ABOUT THE COMPANY —
Dividends” is incorporated herein by reference.
(e)
Prior Public
Offerings.
The
Company has not made any underwritten public offering of its common stock during
the past three years.
(f)
Prior Stock
Purchases.
The
Company has not purchased any subject securities during the two years preceding
the date of the filing of this Schedule 13E-3. On June 17, 2009, in
order to finance the costs of the Transaction and the operations of the Company
following the Transaction, Company CEO and director Min-Tan Yang purchased
5,000,000 shares of the Company’s common stock at $0.18 per share for an
aggregate purchase price of $900,000. The purchase of stock by Mr.
Yang was reviewed and approved by the Independent Committee in conjunction with
its overall review and approval of the Transaction. See section in the
Information Statement titled “SPECIAL FACTORS — Potential Conflicts of Interests
of our Officers and Directors,”
which is incorporated
herein by reference.
Item
3.
Identity and Background of Filing Person.
(a)
Name and Address.
The
filing person, Kid Castle, is also the subject company, with its address and
telephone number provided in Item 2 above. The names of our officers
and directors are:
Directors
Suang-Yi
Pai
Min-Tan
Yang
Ming-Tsung
Shih
Robert
Theng
Ping
Hsiung Wang
Officers
Min-Tan
Yang Chief Executive Officer
Suang-Yi
Pai Acting Chief
Financial Officer
The
address of each director and executive officer of the Company is c/o Kid Castle
Educational Corporation, 8th Floor, No. 98 Min Chuan Road, Hsien Tien, Taipei,
Taiwan, Republic of China.
(b)
Business and Background of
Entities.
None.
(c)
Business and Background of Natural
Persons.
The
section titled “INFORMATION ABOUT THE COMPANY — Information Concerning the Board
of Directors and Executive Officers” set forth in the Information Statement is
incorporated herein by reference.
Neither
the Company nor any of its directors or executive officers, to the Company’s
knowledge, has been convicted in a criminal proceeding during the past five
years (excluding traffic violations or similar misdemeanors) nor have they been
a party to any judicial or administrative proceeding during the past five years
(except for matters that were dismissed without sanction or settlement) that
resulted in a judgment, decree or final order enjoining the person from future
violations of, or prohibiting activities subject to, federal or state securities
laws, or a finding of any violation of federal or state securities
laws.
Each of
the Company’s officers and directors is a citizen of the Republic of
Taiwan.
Item
4.
Terms of the Transaction.
(a)
Material Terms.
The
information set forth in the Information Statement under “SUMMARY TERM SHEET”
and “SPECIAL FACTORS” is incorporated herein by reference.
(b)
Purchases.
No
securities will be purchased from any officer, director or affiliate of the
Company in connection with the Transaction.
(c)
Different Terms.
The
information set forth in the Information Statement under “SUMMARY TERM SHEET —
The Transaction,” “— Effects of the Transaction,” “— Determination of
Shareholders of Record,” “— Payment to Cashed Out Shareholders,” and “— Material
Federal Income Tax Consequences;” and SPECIAL FACTORS — Effects of the
Transaction,” “— Fairness of the Transaction,” and “— Material Federal Income
Tax Consequences” is incorporated herein by reference.
(d)
Appraisal Rights.
The
information set forth in the Information Statement under “SPECIAL FACTORS — No
Appraisal or Dissenters’ Rights” is incorporated herein by
reference.
(e)
Provisions for Unaffiliated Security
Holders.
The
Company has not made any special provisions to make corporate records available
or grant unaffiliated security holders counsel or appraisal services at the
expense of the filing person.
(f)
Eligibility for Listing or
Trading.
Not
applicable.
Item
5.
Past
Contacts, Transactions, and Negotiations and Agreements.
(a)
Transactions.
None.
(b)
Significant Corporate
Events.
On June
17, 2009, in order to finance the costs of the Transaction and the operations of
the Company following the Transaction, Company CEO and director Min-Tan Yang
purchased 5,000,000 shares of the Company’s common stock at $0.18 per share for
an aggregate purchase price of $900,000. The purchase of stock by Mr.
Yang was reviewed and approved by the Independent Committee in conjunction with
its overall review and approval of the Transaction. See section in the
Information Statement titled “SPECIAL FACTORS — Potential Conflicts of Interests
of our Officers and Directors,”
which is incorporated
herein by reference. The Subscription Agreement relating to Mr.
Yang’s purchase is attached as Exhibit A to the Company’s Current Report on From
8-K filed with the Commission on June 18, 2009.
(c)
Negotiations or
Contracts.
None.
(e)
Agreements Involving Kid Castle’s
Securities
.
None
Item
6.
Purposes of the Transaction and Plans or Proposals.
(b)
Use of Securities
Acquired.
The
fractional shares cancelled in exchange for cash payments pursuant to the
transaction will return to the pool of authorized but unissued shares of the
Company.
(c)
Plans.
The
information set forth in the Information Statement under “SUMMARY TERM SHEET —
Purpose of and Reasons for the Transaction,” “— Effects of the Transaction;” and
“SPECIAL FACTORS — Purpose of and Reasons for the Transaction,” “— Effects of
the Transaction,” “— OTC Bulletin Board; Pink Sheets Quotation,” “— Fairness of
the Transaction,” and “— Plans for the Company after the Transaction” is
incorporated herein by reference.
Item
7.
Purposes, Alternatives, Reasons and Effects.
(a)
Purposes.
The
information set forth in the Information Statement under “SUMMARY TERM SHEET —
Purpose of and Reasons for the Transaction;” and “SPECIAL FACTORS — Purpose of
and Reasons for the Transaction” is incorporated herein by
reference.
(b)
Alternatives.
The
information set forth in the Information Statement under “SPECIAL FACTORS —
Purpose of and Reasons for the Transaction” and “— Alternatives to the
Transaction” is incorporated herein by reference.
(c)
Reasons.
The
information set forth in the Information Statement under “SUMMARY TERM SHEET —
Purpose of and Reasons for the Transaction;” and “SPECIAL FACTORS — Purpose of
and Reasons for the Transaction,” “— Background of the Transaction,” “—
Alternatives to the Transaction,” and “— Fairness of the Transaction” is
incorporated herein by reference.
(d)
Effects.
The
information set forth in the Information Statement under “SUMMARY TERM SHEET —
The Transaction,” “— Effects of the Transaction,” and “— Material Federal Income
Tax Consequences;” and “SPECIAL FACTORS — Purpose and Reasons for the
Transaction,” “— Effects of the Transaction,” “— OTC Bulletin Board; Pink Sheets
Quotation,” “— Conduct of the Company’s Business After the Transaction,” and “—
Material Federal Income Tax Consequences” is incorporated herein by
reference.
Item
8.
Fairness of the Transaction.
(a)
Fairness.
The
Company reasonably believes that the Transaction is fair to unaffiliated
security holders. No director dissented to or abstained from voting
on the Transaction.
(b)
Factors Considered in Determining
Fairness.
The
sections entitled “SPECIAL FACTORS — Fairness of the Transaction,” “—Purposes of
and Reasons for the Transaction; Independent Committee Deliberations,” and
“—Purposes of and Reasons for the Transaction; Board of Directors Deliberations”
are incorporated herein by reference.
(c)
Approval of Security
Holders.
The
Transaction is not structured so that the approval of at least the majority of
unaffiliated security holders is required.
(d)
Unaffiliated
Representative.
The
directors who are not employees of the Company (which directors form the
Independent Committee) did not retain an unaffiliated representative to act
solely on behalf of the unaffiliated security holders for purposes of
negotiating the terms of the Transaction. The Independent Committee
reviewed the Transaction with respect to fairness to unaffiliated shareholders,
and relied on the valuation analysis of Polaris Securities, which is
unaffiliated with the Company. The information set forth in the
Information Statement under “SUMMARY TERM SHEET — Independent Committee and
Fairness;” and “SPECIAL FACTORS — Purposes of and Reasons for the Transaction,”
“— Valuation Report of Polaris Securities,” and “— Fairness of the Transaction”
is incorporated herein by reference.
(e)
Approval of
Directors.
The
Transaction was approved by a majority of the Company’s directors who are not
employees of the Company. See also the information set forth in the
Information Statement under “SUMMARY TERM SHEET — Independent Committee and
Fairness;” and “SPECIAL FACTORS — Fairness of the Transaction,” and “—Valuation
Report of Polaris Securities,” which sections are incorporated herein by
reference.
(f)
Other
Offers.
None.
Item
9.
Reports, Opinions, Appraisals and Negotiations.
(a)
Report, Opinion or
Appraisal.
The Board
of Directors and the Independent Committee received the report of Polaris
Securities Co., Ltd dated June 6, 2009, regarding the fair value of the
Company’s common stock for purposes of evaluating the fairness of the
consideration to be given for the cashed out shareholders in the
Transaction.
(b)
Preparer and Summary of Report,
Opinion or Appraisal.
The
information set forth in the Information Statement under “SPECIAL FACTORS
—Valuation Report of Polaris Securities” is incorporated herein by
reference.
(c)
Availability of
Documents.
The full text of the fairness opinion of Polaris
Securities Co., Ltd dated June 6, 2009, is included as Exhibit A to the
Information Statement. A copy of the fairness opinion is also
available for inspection and copying at the Company’s principal executive
offices, 8th Floor, No. 98 Min Chuan Road, Hsien Tien, Taipei, Taiwan, Republic
of China.
Item
10.
Source
and Amounts of Funds or Other Consideration.
(a)
Source of Funds.
The
information set forth in the Information Statement under “SUMMARY TERM SHEET —
Financing for the Transaction;” “QUESTIONS AND ANSWERS ABOUT THE TRANSACTION —
What is the total cost of the Transaction to the Company?” and “SPECIAL FACTORS
— Source of Funds and Expenses” is incorporated herein by
reference.
(b)
Conditions.
None.
(c)
Expenses.
The
information set forth in the Information Statement under “QUESTIONS AND ANSWERS
ABOUT THE TRANSACTION — What is the total cost of the Transaction to the
Company?”, “SPECIAL FACTORS — Effects of the Transaction” and “— Source of Funds
and Expenses” is incorporated herein by reference.
(d)
Borrowed Funds
. Not
applicable.
Item
11. Interest
in Securities of Kid Castle.
(a)
Securities
Ownership.
The
information set forth in the Information Statement under “INFORMATION ABOUT THE
COMPANY — Security Ownership of Certain Beneficial Owners” is incorporated
herein by reference.
(b)
Securities
Transactions.
None.
Item
12. Solicitation
or Recommendation.
(d)
Intent to Tender Vote in
Going-Private Transaction.
The
information set forth in the Information Statement under “SUMMARY TERM SHEET —
Effects of the Transaction,” “— Potential Conflicts of Interest;” and “SPECIAL
FACTORS — Effects of the Transaction,” “— Potential Conflicts of Interests of
our Officers and Directors” is incorporated herein by reference.
(e)
Recommendations of
Others.
The
information set forth in the Information Statement under “SUMMARY TERM SHEET —
Effects of the Transaction,” “—Potential Conflicts of Interest;” and “SPECIAL
FACTORS — Effects of the Transaction,” “— Potential Conflicts of Interests of
our Officers and Directors” is incorporated herein by reference.
Item
13. Financial
Statements.
(a)
Financial
Information.
The
Company’s audited financial statements for the fiscal years ended December 31,
2006, 2007 and 2008 are included in the Company’s Form 10-K for the period ended
December 31, 2008 filed with the Commission on March 17, 2009, which is
incorporated herein by reference. The Company’s unaudited financial
statements for the quarter ended March 31, 2009 are included in the Company’s
form 10-Q for the period ended March 31, 2009 filed with the commission on May
14, 2009, which is incorporated herein by reference.
(b)
Pro Forma
Information.
None.
Item
14.
Persons/Assets,
Retained, Employed, Compensated or Used.
(a)
Solicitations of
Recommendations.
Not
applicable. The Company did not solicit proxies or make any
recommendations to shareholders in connection with the Transaction.
(b)
Employees and Corporate
Assets.
No
expenses are involved in soliciting proxies or making recommendations as there
were no votes solicited. The Company’s Chief Executive Officer,
Acting Chief Financial Officer, and Corporate Secretary are the primary company
employees involved in preparing and reviewing the Information Statement, this
Schedule 13E-3, and other Transaction documents.
Item
15. Additional
Information.
(b)
Other Material
Information
All of
the information set forth in the Information Statement, the Company’s 2008
Annual Report on 10-K, and its first quarter report on 10Q is incorporated by
reference.
Item
16. Exhibits.
(a)(5)
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Information
Statement (incorporated herein by reference to the Information
Statement pursuant to section 14(c) of the Securities Exchange
Act of 1934 filed with the Securities and Exchange Commission on June 18,
2009).
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(c)
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Valuation
Report of Polaris Securities Co., Ltd dated June 6, 2009 (incorporated by
reference to Exhibit A to the Information
Statement).
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(d)
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Not
applicable.
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(e)
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Subscription
Agreement, dated June 17, 2009 between the Company and Min-Tan Yang for
the purchase of 5,000,000 shares of common stock (incorporated herein by
reference to Exhibit A to the Company’s Current Report on From 8-K filed
with the Commission on June 18
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(f)
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Not
applicable.
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(g)
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Not
applicable.
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Copies of
these documents may be inspected without charge at the Public Reference Room
maintained by the Securities and Exchange Commission at 450 Fifth Street, N.W.,
Washington, D.C. 20549, and copies of all or any part of these documents may be
obtained from the Securities and Exchange Commission upon payment of the
prescribed fee. Information regarding the operation of the Public Reference Room
may be obtained by calling the Securities and Exchange Commission at
1-800-SEC-0330. The Securities and Exchange Commission maintains a web site that
contains reports, proxy and information statements, and other information
regarding registrants that file electronically with the SEC. The address of the
site is www.sec.gov. The Company will also make copies of these documents
available upon written request to the Company’s headquarters. The Company’s
headquarters are located at 8th Floor, No. 98 Min Chuan Road, Hsien Tien,
Taipei, Taiwan, Republic of China.
* *
*
After due
inquiry and to the best of my knowledge and belief, I certify that the
information set forth in this statement is true, complete and
correct.
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KID
CASTLE EDUCATIONAL CORPORATION
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Dated: June
18, 2009
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/s/
Min-Tan Yang
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MIN-TAN
YANG
CHIEF
EXECUTIVE OFFICER
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