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EX-32.1 - EX-32.1 - ASIA GLOBAL HOLDINGS CORP.v196520_ex32-1.htm
EX-31.1 - EX-31.1 - ASIA GLOBAL HOLDINGS CORP.v196520_ex31-1.htm

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 

 
FORM 10-K
  

 
x  ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934

For the fiscal year ended September 30, 2009

OR

o  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934

For the transition period from              to             

Commission File Number 000-50788
 
 
ASIA GLOBAL HOLDINGS CORP.

(Exact name of registrant as specified in its charter)

Nevada
 
75-3026459
(State or other jurisdiction of
Incorporation or organization)
 
(IRS Employer Identification No.)

Room 901, Haleson Building
 
1 Jubilee Street
 
Central, Hong Kong
 

(Address of principal executive offices)

Telephone (+852) 2850 7680  Fax (+852) 2850 7588
(Issuer's telephone number, including area code)
 
Securities registered pursuant to Section 12(b) of the Act: None.

Securities registered pursuant to Section 12(g) of the Act: Common Stock ($0.001 par value)

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in   Rule 405 of the Securities Act. x No Yes  ¨

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Exchange Act.  x   No Yes ¨

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes ¨    No x

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of “accelerated filer and large accelerated filer” in Rule 12b-2 of the Exchange Act.

Large accelerated filer  ¨            Accelerated filer  ¨          Non-accelerated filer  ¨    
Smaller reporting company x

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes ¨  No x

As of September 30, 2009, the aggregate market value of the registrant’s common stock held by non-affiliates of the registrant was approximately $_543,192 based on the closing sale price as reported on the Over-the-Counter Bulletin Board.   As of September 30, 2009 and July 26, 2010, there were 242,138,400  shares of common stock outstanding.

DOCUMENTS INCORPORATED BY REFERENCE

None

 
 

 

EXPLANATORY NOTE

Effective December 21, 2009, Asia Global Holdings Corp. (the “Company”) changed its fiscal year from December 31 to September 30, to align the Company’s fiscal year with the fiscal year of its operating subsidiary, Ultra Professional Limited (“UPL”), which was acquired by the Company in a stock exchange transaction as of September 29, 2009.  As of September 30, 2009, the Company sold its wholly-owned subsidiary Sino Trade-Intelligent Development Corp., Limited.   These transactions were reported on Form 8-K, filed on November 19, 2009, with the acquisition of UPL being accounted for as a reverse acquisition and recapitalization of the Company by UPL as the accounting acquirer (legal acquiree), and the Company being treated as the accounting acquiree (legal acquirer).

As a result of these transactions, the Company is deemed to be a continuation of the business of UPL.  See Note 1 to the audited financial statements included in this Report.  This Annual Report on Form 10-K includes financial information for the period from inception of UPL (January 2, 2009) to September 30, 2009, and the financial statements for the (former) two fiscal periods ended December 31, 2008.  Other information is provided in accordance with the requirements of Form 10-K.

 
2

 

TABLE OF CONTENTS

PART I
     
ITEM 1.
 
Business
4
ITEM 1A.
 
Risk Factors
5
ITEM 1B.
 
Unresolved Staff Comments
8
ITEM 2.
 
Properties
8
ITEM 3.
 
Legal Proceedings
8
ITEM 4.
 
Submission of Matters to a Vote of Security Holders
9
       
PART II
     
ITEM 5.
 
Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities
9
ITEM 6.
 
Selected Financial Data
9
ITEM 7.
 
Management's Discussion and Analysis of Financial Condition and Results of Operations
11
ITEM 7A.
 
Quantitative and Qualitative Disclosures About Market Risk
15
ITEM 8.
 
Financial Statements and Supplementary Data
16
ITEM 9.
 
Changes In and Disagreements with Accountants on Accounting and Financial Disclosure
17
ITEM 9A(T).
 
Controls and Procedures
17
ITEM 9B.
 
Other Information
17
       
PART III
     
ITEM 10.
 
Directors and Executive Officers of the Registrant
17
ITEM 11.
 
Executive Compensation
19
ITEM 12.
 
Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
22
ITEM 13.
 
Certain Relationships and Related Transactions
23
ITEM 14.
 
Principal Accountant Fees and Services
23
       
PART IV
     
ITEM 15
 
Exhibits, Financial Statement Schedules
23
       
SIGNATURES
     

 
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INFORMATION REGARDING FORWARD-LOOKING STATEMENTS

This Annual Report on Form 10-K contains forward-looking statements. These statements relate to future events or our future financial performance. These statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance, or achievements expressed or implied by forward-looking statements. In some cases, you can identify forward-looking statements by terminology such as "may," "will," "should," "expect," "plan," "anticipate," "believe," "estimate," "predict," "potential" or "continue," the negative of such terms or other comparable terminology. These statements are only predictions. Actual events or results may differ materially.

Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements. Moreover, neither we nor any other person assumes responsibility for the accuracy and completeness of the forward-looking statements. We undertake no duty to update any of the forward-looking statements after the date of this report to conform such statements to actual results or to changes in our expectations.

Readers are also urged to carefully review and consider the various disclosures made by us which attempt to advise interested parties of the factors which affect our business, including without limitation the disclosures made in PART I. ITEM 1A:. Risk Factors and PART II. ITEM 6 "Management's Discussion and Analysis or Plan of Operation" included herein.

PART I

Item 1. Business

History and Overview

Asia Global Holdings Corp. ("AAGH" or the "Company") was incorporated in the state of Nevada on February 1, 2002 under the name Longbow Mining Inc.   Effective May 12, 2004, we changed our name to BonusAmerica Worldwide Corporation. On June 6, 2006, we changed our name to Asia Global Holdings Corp.  From June 2006 through September 30, 2009, our business was providing advertising services to small and medium size manufacturers (primarily located in Southern China) of products for export to the United States.   Operations were conducted through direct and indirect subsidiaries, including Sino Trade-Intelligent Development Corp., Limited (“Sino Trade”), Idea Asia Limited, China Media Power Limited, and Wah Mau Corporate Planning Development Co., Ltd.  Idea Asia and Wah Mau were wholly owned subsidiaries of Sino Trade. CMP was a 60%-owned subsidiary of Idea Asia.

In 2008, revenue declined by 53.4% from $10,664,613 in 2007 to $4,968,145 in 2008 primarily resulting from decreased advertising sales due to the global economic downturn in the last quarter of 2008.  As the global financial crisis worsened in 2009, our client base was severely impacted, resulting in revenues of $36,603 for the six months ended June 30, 2009, and no revenues for the three months ended June 30, 2009.

After management changes in 2008 and early 2009, there was a change in control of AAGH on September 28, 2009, when Michael Mak, a former officer and director, and principal shareholder of AAGH, and his 100% owned affiliate Stanford International Holding Corporation, sold 33,500,000 common shares of the Company, and 250,000 shares of Series A preferred stock of the Company, to Sina Dragon Holdings Limited, for US$10,000.00 cash paid to Mr. Mak and Stanford International Holding.  The shares then represented 36.5% of the voting rights of the outstanding common stock on September 28, 2009 (the preferred stock has voting rights as if converted into common stock – see Part III, Item 11, “Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters”).  Sina Dragon, a private Hong Kong investment company, is 100% owned by Mr. Stanley Lai, who is its sole officer and director.   Mr. Ping Shun Lai (brother of Mr. Stanley Lai) was appointed as a director and officer of the Company.

 
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On September 29, 2010, AAGH acquired Ultra Professional Limited (“UPL”), by issuing 100 million common shares (restricted under Rule 144) to the sole shareholder of UPL (Mr. Kwong-Lim Liang).  .  UPL was incorporated in the British Virgin Islands as a BVI Business Company under the BVI Business Companies Act, 2004, on January 2, 2009, and commenced business in July 2009.  Its principal business is the provision of advertising consultation services in Hong Kong and the People’s Republic of China.  UPL commenced operation in July 2009.  On September 29, 2009, the Company entered into an agreement for the purchase of all the outstanding shares of common stock of Ultra Professional Ltd. (a company incorporated under the laws of the British Virgin Islands), by issuing 100 million common shares of the Company to the sole shareholder of Ultra Professional (Mr. Kwong-Lim Liang).  The acquisition was closed as of September 29, 2009.  Prior to his acquisition of the Company shares, Mr. Liang was not an affiliate of the Company.  Following the acquisition of UPL, Mr. Kwong-Lim Liang was appointed a director of AAGH.  His 100 million shares represent 34.2% of the common stock voting rights,  See Part III, Item 11 “Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters.”

Business

Ultra Professional (established in 2009 and based in Hong Kong) provides consulting services to foreign and local (PRC) companies seeking to begin or re-organize advertising programs in the PRC.  Mr. Kwong-Lim Liang, former owner of UPL and a director of AAGH, has 20 years of experience in structuring advertising contracts for foreign and PRC import and export businesses.  All business advertising in the PRC must comply with local and central government regulations as to content and means of publication.  Ultra Professional uses Mr. Liang’s extensive contacts and experience with government officials to help clients organize and maintain advertising programs that are compliant.

Ultra Professional’s services are billed to clients on an individual project basis, either on a fixed cost whole project basis, or by installments as a project completes each phase of the project.   Ultra Professional also may enter into joint ventures with selected clients to set up advertising agencies in the PRC. Currently, UPL is also conducting discussion with other companies regarding business co-operation on Apple mobile applications and related products and technologies.

Item 1A. Risk Factors

Risks Related to the Company

Our business is a small enterprise with negative working capital as of September 30, 2009.

UPL commenced operations in July 2009.  For the period from its inception in January 2009 through September 30, 2009, UPL had revenues of $57,692 (all from just two customers) and recorded net income of $5,388, with an accumulated deficit of $(278,182).   At September 30, 2009, AAGH had negative working capital of $(36,812), and owed $57,485 to related parties (Sina Dragon Holdings Ltd. and Mr. Kwong-Lim Liang, president of UPL and a director of AAGH.

We will continue to be dependent on financial support from Sina Dragon Holdings and Mr. Kwong-Lim Liang until such time, if ever, as UPL becomes a successful business with sufficient revenue to support AAGH’s operations.  We have no plans or arrangements in place to raise third-party capital to expand UPL, and there is no assurance adequate capital can be raised.

Through September 30, 2009, we had two customers, and our business could be adversely affected if we do not increase the number of customers and increase revenues.

For the period from commencing operations in July 2009, through September 30, 2009, we recorded revenues from only two customers, with which we do not have long term contracts.  Reliance on few customers poses risks to the business.  If we are not successful in increasing the customer base, loss of one or both customers would adversely impact the Company.

 
5

 

We face formidable competition in our business.

There are a number of companies that provide consulting services similar to those available through UPL.  Some of the competitors are international organizations with many employees, extensive client lists, and a broad range of services including creation and publication of advertising campaigns,  The persistence of the global economic recession has adversely impacted the smaller businesses we target as potential clients.  As a result of these factors, there is more competition focused on fewer clients.  UPL’s relationship with government personnel overseeing advertising in the PRC may not be sufficient to outweigh UPL’s substantial competitive weaknesses.
 
Changes in general economic conditions could have a material impact on our business.

Our results of operations could be impacted by changes in overall economic conditions that impact consumer spending within China and the United States. Future economic conditions such as employment levels, consumer confidence, business conditions, stock market volatility, interest and tax rates, and unexpected changes in PRC government regulation of both internal and foreign business enterprises, could reduce demand for UPL’s advertising consulting services.

Acquisitions may harm our financial results.

Historically, acquisitions have been part of our growth and may continue to be part of our growth in the future. Our acquisitions may be of entire companies, certain assets of companies, controlling interests in companies or of minority interests in companies where we intend to invest as part of a strategic alliance. If we are not successful in integrating companies that we acquire or are not able to generate adequate sales from the acquired entities, our business could be materially and adversely affected.

Risks Related to Doing Business in China

Certain important certificates, permits, and licenses are subject to PRC governmental control and renewal, and the failure to obtain renewal would adversely impact our business.

Doing business in the PRC is subject to compliance with numerous permits and licenses.  Our licences and permits, and those required of SZIG, must be complied with and renewed periodically.  During the application or renewal process, businesses will be evaluated and re-evaluated by the appropriate governmental authorities and must comply with the prevailing standards and regulations, which may change from time to time. In the event that we or SZIG are not able to obtain or renew the certificates, permits and licenses, all or part of our and/or SZIG’s PRC operations may be suspended by the government, which would have a material adverse effect on our business and financial condition. Furthermore, if escalating compliance costs associated with governmental standards and regulations restrict or prohibit any part of our or SZIG’s operations, it may adversely affect our results of operations and profitability.

Uncertainties with respect to the PRC legal system could limit the legal protections available to you and us.

We conduct substantially all of our business through our operating subsidiary in the PRC, which is a wholly foreign owned enterprise in China, and, as such, it is generally subject to laws and regulations applicable to foreign invested enterprises in China. The PRC legal system is based on written statutes, and prior court decisions may be cited for reference but have limited precedential value. Since 1979, a series of new PRC laws and regulations have significantly enhanced the protections afforded to intellectual property rights and various forms of foreign investments in China. However, since these laws and regulations are relatively new and the PRC legal system continues to rapidly evolve, the interpretations of many laws, regulations and rules are not always uniform and enforcement of these laws, regulations and rules involve uncertainties, which may limit legal protections available to you and us. In addition, any litigation in China may be protracted and result in substantial costs and diversion of resources and management attention.

 
6

 

As our operating subsidiary, and all of our assets, are located outside the United States, it will be extremely difficult to acquire jurisdiction and enforce liabilities against the Company and our officers, directors and assets based in China.

Although the Company is a Nevada corporation, all our officers and directors reside outside of the United States. and all our assets will be located outside the United States. As a result, it may be difficult or impossible to effect service of process within the United States upon our directors or officers and our subsidiary, or enforce against any of them court judgments obtained in United States’ courts, including judgments relating to United States federal securities laws. In addition, there is uncertainty as to whether the courts of the PRC would recognize or enforce judgments of United States’ courts obtained against us predicated upon the civil liability provisions of the securities laws of the United States, or be have jurisdiction to hear original actions brought in the United States predicated upon the securities laws of the United States. Furthermore, because all of our assets are located in the PRC, it would also be extremely difficult to access those assets to satisfy an award entered against us in United States court.

The loss of services of Mr. Kwong-Lim Liang would adversely affect our business.

Because all operations as of the date of this Report are conducted at our subsidiary UPL, our success depends entirely upon the continued services of Mr. Kwong-Lim Liang, president of UPL and a director of AAGH.  Although UPL, intends to employ additional persons and retain consultants from time to time, Mr. Kwong-Lim Liang’s experience with PRC government policies is key to advancing the business.  It would be difficult, if not impossible, to find a replacement if he were unable to continue in service.

In order to continue to operate efficiently and to grow our business, we will need to attract and retain qualified personnel and manage our costs, which we may be unable to do.

Our success depends on our ability to attract and retain qualified technical, sales and marketing, customer support, and managerial personnel. We hope to expand our total workforce and will need to attract qualified personnel in order to grow our business.  We may not be able to attract, integrate and retain the numbers and types of candidates that we desire.  Even if we are successful in attracting new staff, we may not be able to increase revenue quickly enough to offset the costs of the additional personnel. Any of these contingencies could cause our business to suffer.
If we are unable to attract, train and retain qualified search staff, we may not remain competitive and could lose business and our customers, which could have an adverse effect on revenue.

Future currency fluctuations and restrictions on currency exchange may adversely affect our business, including limiting our ability to convert Chinese renminbi into foreign currencies and, if Chinese renminbi were to decline in value, reducing our revenues in U.S. dollar terms.

Our reporting currency is the U.S. dollar and our operations in China and Hong Kong use their respective local currencies as their functional currencies. The majority of our revenues derived and expenses incurred are in currencies other than the U.S. dollar. We are subject to the effects of exchange rate fluctuations with respect to any of these currencies. We can offer no assurance that these will be stable against the U.S. dollar or any other foreign currency.

The income statements of our operations are translated into U.S. dollars at the average exchange rates in each applicable period. To the extent the U.S. dollar strengthens against foreign currencies, the translation of these foreign currencies denominated transactions results in reduced revenues, operating expenses and net income for our international operations. Similarly, to the extent the U.S. dollar weakens against foreign currencies, the translation of these foreign currency denominated transactions results in increased revenues, operating expenses and net income for our international operations. We are also exposed to foreign exchange rate fluctuations as we convert the financial statements of our foreign subsidiaries into U.S. dollars in consolidation. If there is a change in foreign currency exchange rates, the conversion of the foreign subsidiaries' financial statements into U.S. dollars will lead to a translation gain or loss which is recorded as a component of other comprehensive income. In addition, we have certain assets and liabilities that are denominated in currencies other than the relevant entity's functional currency. Changes in the functional currency value of these assets and liabilities create fluctuations that will lead to a transaction gain or loss. We have not entered into agreements or purchased instruments to hedge our exchange rate risks, although we may do so in the future. The availability and effectiveness of any hedging transactions may be limited and we may not be able to successfully hedge our exchange rate risks.

 
7

 

Our stock price has been historically volatile and may continue to be volatile, which may make it more difficult for you to resell shares when you want at prices you find attractive.

The trading price of our shares has been and may continue to be subject to considerable daily fluctuations. During the twelve months ended December 31, 2008, the closing sale prices of our ordinary shares on the Over-the-Counter Bulletin Board ranged from $0.018 to $0.143 per share and from $0.0012 to $0.031 for the nine months ended September 30, 2009. To a large extent, this volatility and trending down in stock prices has reflected AAGH’s changing business results.  However, in addition, smaller companies generally have seen stock prices and trading volumes diminish since early 2008, and the market prices for China-related and Internet-related companies in particular, have experienced extreme volatility that often has been unrelated to the operating performance. These broad market and industry fluctuations may continue  to adversely affect the price of our shares, independently of operating results.

We may be classified as a passive foreign investment company, which could result in adverse U.S. tax consequences to U.S. investors.

Based upon the nature of our income and assets, we may be classified as a passive foreign investment company, or PFIC, by the United States Internal Revenue Service for U.S. federal income tax purposes. This characterization could result in adverse U.S. tax consequences to you. For example, if we are a PFIC, our U.S. investors will become subject to increased tax liabilities under U.S. tax laws and regulations and will become subject to more burdensome reporting requirements. The determination of whether or not we are a PFIC is made on an annual basis, and those determinations depend on the composition of our income and assets, including goodwill, from time to time. Although in the past we have operated our business and in the future we intend to operate our business so as to minimize the risk of PFIC treatment, you should be aware that certain factors that could affect our classification as PFIC are out of our control. For example, the calculation of assets for purposes of the PFIC rules depends in large part upon the amount of our goodwill, which in turn is based, in part, on the then market value of our shares, which is subject to change. Similarly, the composition of our income and assets is affected by the extent to which we spend the cash we have raised on acquisitions and capital expenditures. In addition, the relevant authorities in this area are not clear and so we operate with less than clear guidance in our effort to minimize the risk of PFIC treatment. Therefore, we cannot be sure whether we are not and will not be a PFIC for the current or any future taxable year. In the event we are determined to be a PFIC, our stock may become less attractive to U.S. investors, thus negatively impacting the price of our stock.

We have a two shareholders who can substantially influence the outcome of all matters voted upon by  shareholders and whose interests may not be aligned with yours.

Sina Dragon Holdings Ltd., and Mr. Kwong-Lim Liang (formerly the sole shareholder of UPL, and now a director of AAGH), contol 28.6% and 34.2% of the voting rights on the common stock.  Though they do not constitute a “group” for SEC reporting purposes, and are not affiliated with each other, together they are able to substantially influence all matters requiring the approval of  shareholders, including the election of directors and the approval of significant corporate transactions such as acquisitions. This concentration of ownership could delay, defer or prevent a change in control or otherwise impede a merger or other business combination that the Board of Directors or other shareholders may view favorably.
Item 1B. Unresolved Staff Comments

Not applicable.

Item 2. Properties

We currently occupy a small office space in Hong Kong located at Room 901, Haleson Building, 1, Jubilee Street, Central, Hong Kong, for rent of $423 on a month-to-month basis.

Item 3. Legal Proceedings

We are not involved in any material pending legal proceedings at this time, and management is not aware of any contemplated proceeding by any governmental authority.

 
8

 

Item 4. Submission of Matters to a Vote of Security Holders.

During the fiscal year ended September 30, 2009, there were no matters submitted to the security holders for a vote.

PART II.

ITEM 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities.

Since July 17, 2006, our common stock has been traded on the Over-the-Counter Bulletin Board under the symbol “AAGH.OB”.  As of August 2, 2010, there were: (i) 914 shareholders of record, without giving effect to determining the number of shareholders who hold shares in "street name" or other nominee status; (ii) no outstanding options to purchase shares of common stock; and (iii) 242,138,400 shares of common stock and 250,000 shares of preferred stock (convertible into 50,000,000 shares of common stock), issued and outstanding.

The following table sets forth, for the fiscal quarters indicated (based on a fiscal year ending September 30), the high and low closing prices as reported by the Over-the-Counter Bulletin Board. These quotations reflect inter-dealer prices, without retail mark-up, mark-down or commission, and may not represent actual transactions.

Sales Price
 
 
High
   
Low
 
Fiscal 2008
           
First Quarter
  $ 0.315     $ 0.07  
Second Quarter
  $ 0.097     $ 0.055  
Third Quarter
  $ 0.064     $ 0.031  
Fourth Quarter
  $ 0.05     $ 0.018  
                 
Fiscal 2009
               
First Quarter
  $ 0.05     $ 0.018  
Second Quarter
  $ 0.031     $ 0.01  
Third Quarter
  $ 0.025     $ 0.0026  
Fourth Quarter
  $ 0.009     $ 0.0012  

Dividend Policy

Common Stock.

We have never paid cash dividends and have no plans to do so in the foreseeable future. Our future dividend policy will be determined by our Board of Directors and will depend upon a number of factors, including our financial condition and performance, our cash needs and expansion plans, income tax consequences, and the restrictions that applicable laws and our credit arrangements then impose.

Preferred Stock.

The Series A Preferred Convertible Stock does not pay dividends.

Recent Sales of Unregistered Securities

During the fiscal year ended September 30, 2009, we issued 100 million common shares to the former shareholder of UPL, a resident of Hong Kong.  These shares were issued as restricted securities under the Securities Act of 1933.  AAGH claims the exemption available under Section 4(2) of the Act.

Item 6. Selected Financial Data.

The following tables summarize certain selected financial information of AAGH for the period presented. The financial information as of September 30, 2009 and the period from January 2, 2009 (inception of UPL) to September 30, 2009 should be considered with the information for such period under “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and our consolidated financial statements and the related notes thereto included in this Report.

 
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The tables as of and for the years ended December 31, 2007 and 2008 present information for AAGH’s fiscal year ended December 31, while tables as of and for the period ended September 30, 2009 present information for the new fiscal year, with UPL as the accounting acquirer and AAGH as the legal acquirer.

   
Year Ended Dec 31
 
   
2007
   
2008
 
             
Revenue
  $ 10,783,574     $ 4,968,145  
Cost of sales
  $ -4,450,861     $ -4,107,219  
Gross profit
  $ 6,332,713     $ 860,926  
Depreciation and amortization
  $ -195,960     $ -210,359  
Selling and distribution expenses
  $ -1,423,005     $ -2,177,927  
General and administrative expenses
  $ -7,427,293     $ -2,002,332  
Other income
  $ 18,017     $ 19,976  
Interest expense
  $ -77,260     $ -87,677  
Loss before income taxes and minority interest
  $ -1,936,016     $ -3,597,393  
Income tax expense
  $ -810,609     $ 638,440  
Loss from discontinued operations
  $ -3,161,920     $ -258,386  
Net loss attributable to the Shareholders of the Company
  $ -5,908,545     $ -3,217,339  
Loss per Share — basic (US$)
  $ -0.06     $ -0.02  
Loss per Share — diluted (US$)
  $ -0.06     $ -0.02  

   
Year Ended Dec 31,
 
   
2007
   
2008
 
Balance Sheet Data
           
Cash and cash equivalents
  $ 846,907     $ 261,053  
Total current assets
  $ 4,976,551     $ 559,353  
Total assets
  $ 5,348,259     $ 566,955  
Short-term borrowings
  $ 1,578,078     $ 692,503  
Total current liabilities
  $ 2,958,293     $ 1,515,192  
Total stockholders’ equity (deficit)
  $ 2,159,203     $ -948,237  

   
January 2, 2009 (Inception of UPL)
to Sept. 30, 2009
 
       
Revenue
  $ 57,692  
Cost of revenue
  $ -17,949  
Gross profit
  $ 39,743  
Operating Expenses (selling, general and administrative)
  $ -31,206  
         
Income before  income taxes
  $ 8,537  
Income tax expense
  $ -3,149  
         
Net income
    5,388  
         
Net income per share – Basic and diluted
  $ 0.00  
Weighted average shares outstanding  -Basic and diluted
    239,761,741  

   
New Fiscal Year Ended Sept. 30, 2009
 
       
Balance Sheet Data
     
Cash and cash equivalents, and accounts receivable
  $ 58,693  
Total current assets
  $ 58,693  
Total assets
  $ 59,711  
Amounts due to director, and shareholder
  $ 57,485  
Total current liabilities
  $ 95,505  
Total stockholders’ (deficit)
  $ -35,794  
Accumulated (deficit)
  $ -278,182  

 
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Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations.

The information in this discussion contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements involve risks and uncertainties, including statements regarding our capital needs, business strategy and expectations. Any statements contained herein that are not statements of historical facts may be deemed to be forward-looking statements. In some cases, you can identify forward-looking statements by terminology such as "may", "will", "should", "expect", "plan", "intend", "anticipate", "believe", "estimate", "predict", "potential" or "continue", the negative of such terms or other comparable terminology. Actual events or results may differ materially. We disclaim any obligation to publicly update these statements, or disclose any difference between its actual results and those reflected in these statements. The information constitutes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995.

Overview and Future Plan of Operations

In 2008 the Company generated all its revenue from the media and advertising business. In March 2008 the Company discontinued production of the Who Wants To Be A Millionaire? TV show and largely scaled down the TV entertainment business.  In 2008 revenue declined by 53.4% from $10,664,613 in 2007 to $4,968,145 in 2008 primarily resulting from decreased advertising sales due to the global economic downturn starting from the fourth quarter of 2008. The Company experienced a loss of $3,217,339 in 2008.  Business conditions worsened in 2009, to the point that no revenues were recorded for the three months ended June 30, 2009.

On September 29, 2009, we acquired a small but profitable advertising consulting business (Ultra Professional Limited) in a stock exchange transaction, and the next day (September 30, 2010) sold the subsidiary Sino Trade for nominal consideration,   These transactions have positioned AAGH for possible future growth, by eliminating Sino Trade and its various subsidiaries which were generating considerable losses, and changing business direction to the business advertising consulting sector in Hong Kong and the PRC.

Results of Operations for the Period from UPL’s inception (January 2, 2009) through September 30, 2009

In the period from July 2009 (commencement of operations) through September 30, 2009, UPL recorded net after tax income of $5,388 on revenues of $57,692 and cost of revenue of $17,949  Operating expenses of $31,206 were comprised of audit fee of $25,000  and rental fee of $1,269.

Financial Condition
At September 30, 2009, AAGH owed $6,203 to Mr. Kwong-Lim Liang for a non-interest bearing loan he made to UPL, and an additional $51,282 loaned to AAGH by Sina Dragon Limited to pay for AAGH general and administrative expense incurred in the period from January 2, 2009 through September 30, 2009.

Additional loans from Sina Dragon may be needed to continue operations as UPL increases business activities, and to fund AAGH’s costs of SEC reporting and other general and administrative cost items.  However, Sina Dragon has made no commitment to advance additional funds.

Results of Operations for the Twelve Months Ended December 31, 2008 and December 31, 2007

During the twelve months ended December 31, 2008, we experienced a net loss of $3,217,339 attributable primarily to a significant decrease in revenue. During this period we generated all of our revenues from our media & advertising business.

Revenue

In 2008, our revenues declined by 53.4% from $10,664,613 in 2007 to $4,968,145 in 2008 primarily resulting from decreased advertising sales due to global economic downturn starting from the fourth quarter of 2008.

 
11

 

Cost of Sales

Cost of sales were $4,107,219 representing 82.7% of our total revenue of $4,968,145 for the twelve month period ended December 31, 2008 as compared to $3,495,128, also 32.8% of total revenue of $10,664,613 for the twelve month period ended December 31, 2007. The increase in cost of sales as a percentage of total revenue is attributed to a significant decrease in revenue returned against comparable selling efforts.

Selling, General and Administrative Expenses

Selling, general and administrative expenses decreased $4,655,640 to $4,390,618 for the twelve month period ended December 31, 2008 as compared to $9,046,258 for the twelve month period ended December 31, 2007. The decrease in expenses during the twelve month period ended December 31, 2008 was primarily attributable to a reduction in consulting in professional fees of $5,312,222.

Depreciation, Amortization of Intangible Assets, and Impairment Loss of Property, Plant and Equipment

In 2008 we experienced non-cash expenditures of $210,359 from depreciation of fixed assets and amortization as compared to $195,960 in 2007, an increase of 7%. Also we made an impairment loss on long live assets including equipments, customer list and database of $761,062 after the impairment test under SFAS No. 142.

Other Income (Expense)

Total other income (expense) for both periods presented was immaterial and consisted of the following:

   
2008
   
2007
 
             
Other income
    12,821       149  
Interest income
  $ 7,155     $ 17,868  
Interest expense
  $ (87,677 )   $ (77,260 )
Total other expense
  $ (67,701 )   $ (59,243 )

Net Income/Loss

Net loss for 2008 was $3,217,339 compared to net loss of $5,908,545 in 2007. Loss is primarily attributed to significant decrease in revenue in 2008.

Trends, Events, and Uncertainties

Demand for our services and products will be dependent on, among other things, market acceptance of our concept and general economic conditions, which are cyclical in nature. Our business operations may be adversely affected by our competitors and prolonged recessionary periods. We are in the process of seeking additional financing to accelerate our business plan. There is no assurance additional financing will be available, or if available, that it will be available on reasonable terms. Even if we do obtain such financing, there is no assurance that we will be able to generate profitable operations.

Liquidity and Capital Resources for the Twelve Month Period Ended December 31, 2008 and 2007

Cash flows from operating activities

We experienced positive cash flows provided by operations in the amount of $260,911 for the twelve month period ended December 31, 2008, primarily due to net loss from continuing operations of $2,958,953 offset by non-cash items of impairment charges of $766,217, decrease in accounts receivable of $2,875,582 and decrease in income tax payable of $424,016.
 
 
12

 

For the twelve month period ended December 31, 2007 we experienced positive cash flows provided by operations in the amount of $3,071,989, primarily due to net loss from operations of $2,746,625 offset by non-cash charges such as depreciation and amortization of $195,960, common stock issued for services of $5,293,825, stock-based compensation to an executive of $260,877 and changes in operating assets such as an increase in accounts receivable of $484,079 coupled with decrease in our accounts payable and accrued expenses of $359,686.

Net cash used in discontinued operations was $187,574 for the twelve month period ended December 31, 2008, while net cash used in discontinued operations was $1,446,039 for the twelve month period ended December 31, 2007.

Cash flows from investing activities

Net cash flows used in investing activities for 2008 was $314,200 primarily representing the expenditure on intangible assets of $585,076.

For 2007 net cash flows used in investing activities was $1,030,407 primarily representing the purchase of property, plant and equipment in the amount of $889,542.

Cash flows from financing activities

Net cash flows used in financing activities for 2008 was $589,350 representing the repayments of secured bank loan of $847,953 partially offset by repayment from related parties of $394,897.

For 2007 net cash flows provided by financing activities was $1,437,008 representing repayment from related parties of $562,074 and net funds advanced under banking agreements of $737,456.

Liquidity

Our growth plans may require additional funding from outside sources. We intend to pursue discussions with existing shareholders, third party financing sources and potential lenders to ensure access to funds as required. Our future liquidity will depend on our revenue growth and our ability to sell our products and services at positive gross margins and control our operating expenses. Over the coming twelve months, we expect to spend approximately $500,000 for operating expenses. These capital needs must be met from external sources of financing.

The accompanying consolidated financial statements contemplate continuation of the Company as a going concern. Due to the Company’s current year net loss of approximately $3,217,339 substantial doubt to continue as a going concern is raised and realization of a major portion of the assets in the accompanying consolidated balance sheet is dependent upon the continued operations of the Company, which in turn is dependent upon the Company's ability to meet its financing requirements and the success of its future operations.

Management believes the Company has the ability to continue as a going concern only if it can meet its financing requirements through external sources of financing. Management plans to continue reviewing all aspects of its business and make adjustments as needed to those considered unprofitable. The Company must meet its financing requirements through external sources of financing or the Company cannot continue to operate as a going concern. The consolidated financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amount and classification of liabilities or any other adjustment that might be necessary should the Company be unable to continue as a going concern.

On a long-term basis, our liquidity will be dependent on establishing profitable operations, receipt of revenues, additional infusions of capital and additional financing. If necessary, we may raise capital through an equity or debt offering. The funds raised from this offering will be used to develop and execute our business plan. However, there can be no assurance that we will be able to obtain additional equity or debt financing in the future, if at all. If we are unable to raise additional capital, our growth potential will be adversely affected.
 
13

 
Critical Accounting Policies
 
The financial statements are prepared in accordance with accounting principles generally accepted in the U.S., which requires us to make estimates and assumptions in certain circumstances that affect amounts reported in the accompanying financial statements and related footnotes. In preparing these financial statements, management has made its best estimates and judgments of certain amounts included in the financial statements, giving due consideration to materiality. We do not believe there is a great likelihood that materially different amounts would be reported related to the accounting policies described below. However, application of these accounting policies involves the exercise of judgment and use of assumptions as to future uncertainties and, as a result, actual results could differ from these estimates.

Revenue recognition

In accordance with the SEC’s Staff Accounting Bulletin No. 104, “Revenue Recognition”, the Company recognizes revenue when persuasive evidence of an arrangement exists, transfer of title has occurred or services have been rendered, the selling price is fixed or determinable and collectibility is reasonably assured.

Accounts receivable and provision for bad debts

Accounts receivable, net of provision for bad debts, are presented at net realizable value. The Company periodically records a provision for bad debts based on management’s judgment resulting from an evaluation of the collectibility of accounts receivable by assessing, among other factors, our customer’s willingness or ability to pay, repayment history, general economic conditions, and the ongoing relationship with our customers. The total amount of this provision is determined by first identifying the receivables of customers that are considered to be a higher credit risk based on their current overdue accounts, difficulties in collecting from these customers in the past, and their overall financial condition. For each of these customers, the Company estimates the extent to which the customer will be able to meet its financial obligations and records a provision that reduces our trade receivable for that customer to the amount that is reasonably believed will be collected. Additional provisions may be required in the future if the financial condition of our customers or general economic conditions deteriorate, thereby reducing net earnings.

Impairment of long-lived assets

We review property, plant and equipment and puchased intangible assets for impairment whenever events or changes in circumstances indicate the carrying value of an asset may not be recoverable. Our asset impairment review assesses the fair value of the assets based on the future cash flows the assets are expected to generate. An impairment loss is recognized when estimated undiscounted future cash flows expected to result from the use of the asset plus net proceeds expected from disposition of the asset (if any) are less than the carrying value of the asset. When an impairment is identified, the carrying amount of the asset is reduced to its estimated fair value. Deterioration of our business in a geographic region or within a business segment in the future could also lead to impairment adjustments as such issues are identified. The accounting effect of an impairment loss would be a charge to earnings, thereby reducing our net earnings.

Accounting for stock-based compensation

The Company adopted SFAS No. 123  (revised  2004), "Share-Based  Payment" ("SFAS  123(R)"), on January 1, 2006, which requires the measurement and recognition of compensation  expense for all share-based awards made to employees and directors, including employee stock options and shares issued through its employee stock purchase plan, based on estimated fair values. Prior to the adoption of SFAS 123(R), the Company accounted for stock-based compensation using the intrinsic value method prescribed in Accounting Principles Board ("APB") Opinion No.25, "Accounting for Stock Issued to Employees." Under the intrinsic value method that was used to account for stock-based awards prior to January 1, 2006, which had been allowed under the original provisions of SFAS 123, compensation expense was recorded on the date of grant if the current market price of the underlying stock exceeded the exercise price. Any compensation expense was recorded on a straight-line basis over the vesting period of the grant. The adoption of this standard had a significant impact to the Company's accompanying consolidated financial statements since the Company entered into an employment agreement included stock-based compensation awards with its former President, Michael Mak, who was also the Company’s former Chief Executive Officer and former interim Chief Financial Officer, on August 18, 2006. Except for the above, the adoption of this standard had no impact to the Company’s financial position, results of operations or cash flows as the Company's previous stock-based compensation awards expired prior to January 1, 2006, and there have been no grants during the current year. The accounting effect of recording compensation expense is a charge to earnings, thereby reducing our net earnings.

 
14

 
 
Taxes on earnings

We record a valuation allowance to reduce our deferred tax assets to the amount that is more likely than not to be realized. We have considered future market growth, forecasted earnings, future taxable income and the mix of earnings in the jurisdictions in which we operate in determining the need for a valuation allowance. In the event we determine that we would not be able to realize all or part of our net deferred tax assets in the future, an adjustment to the deferred tax assets would be charged to earnings in the period such determination is made. Likewise, if we later determine that it is more likely than not that the net deferred tax assets would be realized, the previously provided valuation allowance would be reversed.

Item 7A. Quantitative and Qualitative Disclosures About Market Risk.

Interest Rate Risk

We are exposed to interest rate risk primarily with respect to our short-term bank loans. Although the interest rates are fixed for the terms of the loans, the terms are typically twelve months and interest rates are subject to change upon renewal. There were no material changes in interest rates for short-term bank loans during the fiscal year ended December 31, 2008.  A hypothetical 1.0% increase in the annual interest rates for all of our credit facilities at approximately $423,000 would decrease net income before provision for income taxes by approximately $4,000 for the fiscal year ended December 31, 2008.  Management monitors the banks’ interest rates in conjunction with our cash requirements to determine the appropriate level of debt balances relative to other sources of funds. We have not entered into any hedging transactions in an effort to reduce our exposure to interest rate risk.

Foreign Exchange Risk

While our reporting currency is the U.S. Dollar, all of our consolidated revenues and consolidated costs and expenses are denominated in Renminbi. All of our assets are denominated in RMB except for cash. As a result, we are exposed to foreign exchange risk as our revenues and results of operations may be affected by fluctuations in the exchange rate between U.S. Dollars and RMB. If the RMB depreciates against the U.S. Dollar, the value of our RMB revenues, earnings and assets as expressed in our U.S. Dollar financial statements will decline. We have not entered into any hedging transactions in an effort to reduce our exposure to foreign exchange risk.

Inflation

Inflationary factors such as increases in the cost of our product and overhead costs may adversely affect our operating results. Although we do not believe that inflation has had a material impact on our financial position or results of operations to date, a high rate of inflation in the future may have an adverse effect on our ability to maintain current levels of gross margin and selling, general and administrative expenses as a percentage of net revenues if the selling prices of our products do not increase with these increased costs.
 
 
15

 

Item 8. Financial Statements and Supplementary Data.

ASIA GLOBAL HOLDINGS CORP.
(Successor of Ultra Professional Limited)

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS
 
   
Page
     
Report of Independent Registered Public Accounting Firm
 
F-1
     
Consolidated Balance Sheet as of September 30, 2009
 
F-2
     
Consolidated Statements of Operations for the period from January 2, 2009 (Inception) to September 30, 2009
 
F-3
     
Consolidated Statements of Cash Flows for the period from January 2, 2009 (Inception) to September 30, 2009
 
F-4
     
Consolidated Statement of Stockholders’ Equity for the period from January 2, 2009 (Inception) to September 30, 2009
 
F-5
     
Notes to Consolidated Financial Statements for the period from January 2, 2009 (Inception) to September 30, 2009
 
F-6 - F-14
 
 
16

 

 
 
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The Board of Directors and Stockholders of
Asia Global Holdings Corp.
(Successor of Ultra Professional Limited)

We have audited the accompanying consolidated balance sheet of Asia Global Holdings Corp. and its subsidiary (“the Company”) as of September 30, 2009 and the related consolidated statements of operations and comprehensive loss, cash flows and stockholders’ deficit for the period from January 2, 2009 (Inception) to September 30, 2009. The financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements based on our audit.

We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audits 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 includes 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 audit provides a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of September 30, 2009 and the results of operations and cash flows for the period from January 2, 2009 (Inception) to September 30, 2009 and in conformity with accounting principles generally accepted in the United States of America.

/s/ ZYCPA Company Limited
 
 
ZYCPA Company Limited
Certified Public Accountants
 
Hong Kong, China
November 22, 2010
 

 
 
F-1

 
 
ASIA GLOBAL HOLDINGS CORP.
(Successor of Ultra Professional Limited)
CONSOLIDATED BALANCE SHEET
AS OF SEPTEMBER 30, 2009
(Currency expressed in United States Dollars (“US$”), except for number of shares)

   
September 30, 2009
 
ASSETS
     
Current assets:
     
Cash and cash equivalents
  $ 1,001  
Accounts receivable
    57,692  
         
Total current assets
    58,693  
         
Non-current assets:
       
Plant and equipment
    1,018  
         
TOTAL ASSETS
  $ 59,711  
         
LIABILITIES AND STOCKHOLDERS’ DEFICIT
       
Current liabilities:
       
Accounts payable and accrued liabilities
    34,872  
Income tax payable
    3,148  
Amount due to director
    6,203  
Amount due to a stockholder
    51,282  
         
Total current liabilities
    95,505  
         
Total liabilities
    95,505  
         
Commitment and contingencies
       
         
Stockholders’ deficit:
       
Series A, convertible preferred stock, $0.001 par value; 500,000 shares authorized; 250,000 shares issued and outstanding shares as of September 30, 2009
    250  
Common stock, $0.001 par value; 300,000,000 shares authorized; 242,138,400 shares issued and outstanding as of September 30, 2009
    242,138  
Accumulated deficit
    (278,182 )
         
Total stockholders’ deficit
    (35,794 )
         
TOTAL LIABILITIES AND STOCKHOLDERS’ DEFICIT
  $ 59,711  

See accompanying notes to consolidated financial statements.

 
F-2

 

ASIA GLOBAL HOLDINGS CORP.
(Successor of Ultra Professional Limited)
CONSOLIDATED STATEMENT OF OPERATIONS
FOR THE PERIOD FROM JANUARY 2, 2009 (INCEPTION) TO SEPTEMBER 30, 2009
(Currency expressed in United States Dollars (“US$”), except for number of shares)

   
Period from January
2, 2009 (Inception) to
September 30, 2009
 
       
Revenues, net
  $ 57,692  
         
Cost of revenue
    (17,949 )
         
Gross profit
    39,743  
         
Operating expenses:
       
Selling, general and administrative
    (31,206 )
         
Total operating expenses
    (31,206 )
         
INCOME BEFORE INCOME TAXES
    8,537  
         
Income tax expense
    (3,149 )
         
NET INCOME
  $ 5,388  
         
Net income per share – Basic and diluted
  $ 0.00  
         
Weighted average shares outstanding – Basic and Diluted
    239,761,741  

See accompanying notes to consolidated financial statements.

 
F-3

 

ASIA GLOBAL HOLDINGS CORP.
(Successor of Ultra Professional Limited)
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE PERIOD FROM JANUARY 2, 2009 (INCEPTION) TO SEPTEMBER 30, 2009
(Currency expressed in United States Dollars (“US$”))

   
Period from January
2, 2009 (Inception) to
September 30, 2009
 
Cash flows from operating activities:
     
Net income
  $ 5,388  
Adjustments to reconcile net income to net cash used in operating activities:
       
Depreciation
    28  
Change in operating assets and liabilities:
       
Accounts receivable
    (57,692 )
Accounts payable and accrued liabilities
    34,872  
Income tax payable
    3,148  
         
Net cash used in operating activities
    (14,256 )
         
Cash flows from investing activities:
       
Purchase of property, plant and equipment
    (1,046 )
         
Net cash used in investing activities
    (1,046 )
         
Cash flows from financing activities:
       
Advance from a director
    6,203  
Advance from a stockholder
    10,100  
         
Net cash provided by financing activities
    16,303  
         
NET CHANGE IN CASH AND CASH EQUIVALENTS
    1,001  
         
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD
    -  
         
CASH AND CASH EQUIVALENTS, END OF PERIOD
  $ 1,001  
         
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
       
Cash paid for income taxes
  $ -  
Cash paid for interest
  $ -  

See accompanying notes to consolidated financial statements.

 
F-4

 

ASIA GLOBAL HOLDING CORP.
(Successor of Ultra Professional Limited)
CONSOLIDATED STATEMENT OF STOCKHOLDERS’ EQUITY
FOR THE PERIOD FROM JANUARY 2, 2009 (INCEPTION) TO SEPTEMBER 30, 2009
(Currency expressed in United States Dollars (“US$”), except for number of shares)

   
Series A, Convertible Preferred
Stock
   
Common Stock
   
Accumulated
   
Total stockholders’
 
   
No. of shares
   
Amount
   
No. of shares
   
Amount
   
deficit
   
equity
 
                                     
Balance as of January 2, 2009 (Inception)
    -     $ -       100,000,000     $ 100,000     $ (99,900 )   $ 100  
                                                 
Shares effectively issued to former AAGH shareholders as part of the September 29, 2009 recapitalization
    250,000       250       142,138,400       142,138       (183,670 )     (41,282 )
                                                 
Net income for the period
    -       -       -       -       5,388       5,388  
                                                 
Balance as of September 30, 2009
    250,000     $ 250       242,138,400     $ 242,138     $ (278,182 )   $ (35,794 )

See accompanying notes to consolidated financial statements.

 
F-5

 
 
ASIA GLOBAL HOLDINGS CORP.
(Successor of Ultra Professional Limited)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE PERIOD FROM JANUARY 2, 2009 (INCEPTION) TO SEPTEMBER 30, 2009
(Currency expressed in United States Dollars (“US$”))

1.
ORGANIZATION AND BUSINESS BACKGROUND

Asia Global Holdings Corp. (the “Company” or “AAGH”) was incorporated in the State of Nevada on February 1, 2002 as Longbow Mining Inc. On May 12, 2004, the Company changed its name to “BonusAmerica Worldwide Corporation”. On June 6, 2006, the Company further changed its current company name to “Asia Global Holdings Corp.”

On September 29, 2009, the Company entered into an agreement for the purchase of all the outstanding shares of common stock of Ultra Professional Limited (“UPL”, a company incorporated under the laws of the British Virgin Islands), by issuing 100,000,000 shares of common stock of the Company to the sole shareholder of UPL. This share exchange transaction resulted in the shareholder of UPL obtaining a majority voting interest in the Company.

On September 30, 2009, the Company entered into and closed agreement to sell its wholly-owned subsidiary, Sino Trade-Intelligent Development Corp., Limited (a corporation organized under the laws of the Hong Kong Special Administrative Region), to Ms. Jie Xu, for US$1. This transaction was negotiated at arm-length. Ms. Jie Xu is not an affiliate of any of the Company’s shareholders.

After the consummation of the share exchange and disposal transactions, UPL’s shareholder held approximately 34% of the voting rights as a major shareholder in the combined entity.

UPL was incorporated in the British Virgin Islands as a BVI Business Company under the BVI Business Companies Act, 2004, on January 2, 2009. Its principal business is engaged in the provision of advertising consultation service in Hong Kong and the People’s Republic of China and commenced operation in July 2009.

The stock exchange transaction has been accounted for as a reverse acquisition and recapitalization of the Company whereby UPL is deemed to be the accounting acquirer (legal acquiree) and the Company to be the accounting acquiree (legal acquirer). The Company is deemed to be a continuation of the business of UPL.

Accordingly, the accompanying consolidated financial statements include the following:

(1)         the balance sheet consists of the net assets of the accounting acquirer at historical cost and the net assets of the accounting acquiree at historical cost;

(2)         the financial position, results of operations, and cash flows of the accounting acquirer for all periods presented as if the recapitalization had occurred at the beginning of the earliest period presented and the operations of the accounting acquiree from the date of stock exchange transaction.

Asia Global Holdings Corp. and its subsidiary are hereinafter referred to as (the “Company”).
 
2.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

·
Basis of presentation

These accompanying consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America (“US GAAP”).

·
Use of estimates

In preparing these consolidated financial statements, management makes estimates and assumptions that affect the reported amounts of assets and liabilities in the balance sheets and revenues and expenses during the period reported. Actual results may differ from these estimates.

 
F-6

 

ASIA GLOBAL HOLDINGS CORP.
(Successor of Ultra Professional Limited)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE PERIOD FROM JANUARY 2, 2009 (INCEPTION) TO SEPTEMBER 30, 2009
(Currency expressed in United States Dollars (“US$”))

·
Cash and cash equivalents

Cash and cash equivalents are carried at cost and represent cash on hand, demand deposits placed with banks or other financial institutions and all highly liquid investments with an original maturity of three months or less as of the purchase date of such investments.

·
Accounts receivable and allowance for doubtful accounts

Accounts receivable are recorded at the invoiced amount and do not bear interest. The allowance for doubtful accounts is the Company’s best estimate of the amount of probable credit losses in the existing accounts receivable. The Company determines the allowance based on historical write-off experience of the Company. The Company reviews its allowance for doubtful accounts on a regular basis. All other balances are reviewed on a specific basis based on the aging of receivables, payment history, the customer’s current credit worthiness and the economic environment. Account balances are charged off against the allowance after all means of collection have been exhausted and the potential for recovery is considered remote. The Company does not have any off-balance-sheet credit exposure related to its customers.

As of September 30, 2009, the Company did not record any amount of the allowance for doubtful accounts.

·
Plant and equipment

Plant and equipment are stated at cost less accumulated depreciation and accumulated impairment losses, if any. Depreciation is calculated on the straight-line basis over the following expected useful lives from the date on which they become fully operational:

   
Depreciable life
Office equipment
 
3 to 5 years

Expenditure for maintenance and repairs is expensed as incurred. The gain or loss on the disposal of plant and equipment is the difference between the net sales proceeds and the carrying amount of the relevant assets and is recognized in the statement of operations.

Depreciation expense for the period from January 2, 2009 (Inception) to September 30, 2009 was $28.

·
Impairment of long-life assets

Long-lived assets primarily include plant and equipment. In accordance with the provisions of ASC Topic 360-10-5, “Impairment or Disposal of Long-Lived Assets” (ASC 360-10-5), the Company reviews its long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of the assets may not be fully recoverable. If the total of the expected undiscounted future net cash flows is less than the carrying amount of the asset, a loss is recognized for the difference between the fair value and carrying amount of the asset. There has been no impairment as of September 30, 2009.

·
Revenue recognition

In accordance with ASC Topic 605, “Revenue Recognition”, the Company recognizes revenue when persuasive evidence of an arrangement exists, delivery has occurred, the sales price is fixed or determinable, and collectibility is reasonably assured.

The Company derives its revenue from the provision of advertising consultation service, based upon the customers’ specification. The service contracts are billed either on a fixed-fee basis or on a time-and-material basis. Generally, the Company recognizes revenue as services are performed and accepted by the customer.

 
F-7

 

ASIA GLOBAL HOLDINGS CORP.
(Successor of Ultra Professional Limited)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE PERIOD FROM JANUARY 2, 2009 (INCEPTION) TO SEPTEMBER 30, 2009
(Currency expressed in United States Dollars (“US$”))

·
Cost of revenue

Cost of revenue includes subcontracting fee, printing and material costs that are attributable to the rendering the service to the customers.

·
Advertising expense

Advertising costs are expensed as incurred under ASC Topic 720-35, “Advertising Costs”. The Company incurred no such cost for the period from January 2, 2009 (Inception) to September 30, 2009.

·
Income taxes

The Company adopts ASC Topic 740, “Income Taxes” regarding accounting for uncertainty in income taxes prescribes the recognition threshold and measurement attributes for financial statement recognition and measurement of tax positions taken or expected to be taken on a tax return. In addition, the guidance requires the determination of whether the benefits of tax positions will be more likely than not sustained upon audit based upon the technical merits of the tax position. For tax positions that are determined to be more likely than not sustained upon audit, a company recognizes the largest amount of benefit that is greater than 50% likely of being realized upon ultimate settlement in the financial statements. For tax positions that are not determined to be more likely than not sustained upon audit, a company does not recognize any portion of the benefit in the financial statements. The guidance provides for de-recognition, classification, penalties and interest, accounting in interim periods and disclosure.

For the period from January 2, 2009 (Inception) to September 30, 2009, the Company did not have any interest and penalties associated with tax positions. As of September 30, 2009, the Company did not have any significant unrecognized uncertain tax positions.

The Company conducts major businesses in Hong Kong and is subject to tax in its own jurisdiction. As a result of its business activities, the Company will file separate tax returns that are subject to examination by the foreign tax authority.

·
Foreign currencies translation

Transactions denominated in currencies other than the functional currency are translated into the functional currency at the exchange rates prevailing at the dates of the transaction. Monetary assets and liabilities denominated in currencies other than the functional currency are translated into the functional currency using the applicable exchange rates at the balance sheet dates. The resulting exchange differences are recorded in the statement of operations.

The reporting currency of the Company is the United States Dollars ("US$"). The Company maintains its books and records in its local currency, Hong Kong Dollars ("HK$"), which is functional currency as being the primary currency of the economic environment in which the entity operates. The Company adopts ASC Topic 830-30, “Translation of Financial Statement, to translate the financial statement into US$ from HK$, using the exchange rate on the balance sheet date as to assets and liabilities. Revenues and expenses are translated at average rates prevailing during the period. The gains and losses resulting from translation of financial statements of foreign subsidiary are recorded as a separate component of accumulated other comprehensive income within the statement of stockholders’ equity. For the period from January 2, 2009 (Inception) to September 30, 2009, the impact of foreign currencies translation is insignificant and no comprehensive income or loss is recorded.

·
Related parties

Parties, which can be a corporation or individual, are considered to be related if the Company has the ability, directly or indirectly, to control the other party or exercise significant influence over the other party in making financial and operating decisions. Companies are also considered to be related if they are subject to common control or common significant influence.

 
F-8

 
 
ASIA GLOBAL HOLDINGS CORP.
(Successor of Ultra Professional Limited)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE PERIOD FROM JANUARY 2, 2009 (INCEPTION) TO SEPTEMBER 30, 2009
(Currency expressed in United States Dollars (“US$”))

·
Segment reporting

ASC Topic 280, “Segment Reporting” establishes standards for reporting information about operating segments on a basis consistent with the Company’s internal organization structure as well as information about geographical areas, business segments and major customers in financial statements. The Company operates in one reportable operating segment in Hong Kong.

·
Fair value measurement

ASC Topic 820-10, “Fair Value Measurements and Disclosures ("ASC 820-10") establishes a new framework for measuring fair value and expands related disclosures. Broadly, ASC 820-10 framework requires fair value to be determined based on the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants. ASC 820-10 establishes a three-level valuation hierarchy based upon observable and non-observable inputs. These tiers include: Level 1, defined as observable inputs such as quoted prices in active markets; Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable; and Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions.

For financial assets and liabilities, fair value is the price the Company would receive to sell an asset or pay to transfer a liability in an orderly transaction with a market participant at the measurement date. In the absence of active markets for the identical assets or liabilities, such measurements involve developing assumptions based on market observable data and, in the absence of such data, internal information that is consistent with what market participants would use in a hypothetical transaction that occurs at the measurement date.

·
Financial instruments

Cash and cash equivalents, accounts receivable, accounts payable and accrued liabilities, income tax payable and amount due to a director and a stockholder, are carried at cost which approximates fair value. Any changes in fair value of assets or liabilities carried at fair value are recognized in other comprehensive income for each period.

·
Recent accounting pronouncements

The Company has reviewed all recently issued, but not yet effective, accounting pronouncements and does not believe the future adoption of any such pronouncements may be expected to cause a material impact on its financial condition or the results of its operations.

In September 2009, Accounting Standards Codification (“ASC”) became the source of authoritative U.S. GAAP recognized by the Financial Accounting Standards Board (“FASB”) for nongovernmental entities, except for certain FASB Statements not yet incorporated into ASC. Rules and interpretive releases of the SEC under federal securities laws are also sources of authoritative U.S. GAAP for registrants. The discussion below includes the applicable ASC reference.

The Company adopted ASC Topic 810-10, “Consolidation” (formerly SFAS No. 160, “Noncontrolling Interests in Consolidated Financial Statements – an amendment of ARB No. 51”) effective January 2, 2009. Topic 810-10 changes the manner of presentation and related disclosures for the noncontrolling interest in a subsidiary (formerly referred to as a minority interest) and for the deconsolidation of a subsidiary. The adoption of these sections did not have a material impact on the Company’s consolidated financial statements.

 
F-9

 

ASIA GLOBAL HOLDINGS CORP.
(Successor of Ultra Professional Limited)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE PERIOD FROM JANUARY 2, 2009 (INCEPTION) TO SEPTEMBER 30, 2009
(Currency expressed in United States Dollars (“US$”))

ASC Topic 815-10, “Derivatives and Hedging” (formerly SFAS No. 161, “Disclosures about Derivative Instruments and Hedging Activities”) was adopted by the Company effective January 2, 2009. The guidance under ASC Topic 815-10 changes the manner of presentation and related disclosures of the fair values of derivative instruments and their gains and losses.

In April 2009, the FASB issued an update to ASC Topic 820-10, “Fair Value Measurements and Disclosures” (“ASC 820-10) (formerly FASB Staff Position No. SFAS 157-4, “Determining Fair Value When the Volume and Level of Activity for the Asset or Liability Have Significantly Decreased and Identifying Transactions That Are Not Orderly”). The standard provides additional guidance on estimating fair value in accordance with ASC 820-10 when the volume and level of transaction activity for an asset or liability have significantly decreased in relation to normal market activity for the asset or liability have significantly decreased and includes guidance on identifying circumstances that indicate if a transaction is not orderly. The Company adopted this pronouncement effective April 1, 2009 with no impact on its consolidated financial statements.

In April 2009, the FASB issued FSP SFAS No. 107-1, “Disclosures about Fair Value of Financial Instruments” (“ASC 825-10”). ASC 825-10 requires fair value of financial instruments disclosure for interim reporting periods of publicly traded companies as well as in annual financial statements. ASC 825-10 is effective for interim periods ending after June 15, 2009 and was adopted by the Company in the second quarter of 2009. There was no material impact to the Company’s consolidated financial statements as a result of the adoption of ASC 825-10.

In April 2009, the FASB issued FSP APB No. 28-1, “Interim Financial Reporting” (“ASC 825-10”). ASC 825-10 requires the fair value of financial instruments disclosure in summarized financial information at interim reporting periods. ASC 825-10 is effective for interim periods ending after June 15, 2009 and was adopted by the Company in the second quarter of 2009. There was no material impact to the Company’s consolidated financial statements as a result of the adoption of ASC 825-10.

In June 2009, the FASB finalized SFAS No. 167, “Amending FASB interpretation No. 46(R)”, which was included in ASC Topic 810-10-05 “Variable Interest Entities”. The provisions of ASC Topic 810-10-05 amend the definition of the primary beneficiary of a variable interest entity and will require the Company to make an assessment each reporting period of its variable interests. The provisions of this pronouncement are effective January 1, 2010. The Company is evaluating the impact of the statement on its consolidated financial statements.

In July 2009, the FASB issued SFAS No. 168, “The Hierarchy of Generally Accepted Accounting Principles”. SFAS 168 codified all previously issued accounting pronouncements, eliminating the prior hierarchy of accounting literature, in a single source for authoritative U.S. GAAP recognized by the FASB to be applied by nongovernmental entities. SFAS 168, now ASC Topic 105-10 “Generally Accepted Accounting Principles”, is effective for financial statements issued for interim and annual periods ending after September 15, 2009. The adoption of this pronouncement did not have an effect on the Company’s consolidated financial statements.

In August 2009, the FASB issued an update of ASC Topic 820, “Measuring Liabilities at Fair Value”. The new guidance provides clarification that in circumstances in which a quoted price in an active market for the identical liability is not available, a reporting entity is required to measure fair value using prescribed techniques. The Company adopted the new guidance in the third quarter of 2009 and it did not materially affect the Company’s financial position and results of operations.

In October 2009, the FASB issued Accounting Standards Update (“ASU”) No. 2009-13, “Revenue Recognition (Topic 605): Multiple-Deliverable Revenue Arrangements (a consensus of the FASB Emerging Issues Task Force)” which amends ASC 605-25, “Revenue Recognition: Multiple-Element Arrangements.” ASU No. 2009-13 addresses how to determine whether an arrangement involving multiple deliverables contains more than one unit of accounting and how to allocate consideration to each unit of accounting in the arrangement. This ASU replaces all references to fair value as the measurement criteria with the term selling price and establishes a hierarchy for determining the selling price of a deliverable. ASU No. 2009-13 also eliminates the use of the residual value method for determining the allocation of arrangement consideration. Additionally, ASU No. 2009-13 requires expanded disclosures. This ASU will become effective for us for revenue arrangements entered into or materially modified on or after April 1, 2011. Earlier application is permitted with required transition disclosures based on the period of adoption. The Company is currently evaluating the application date and the impact of this standard on its consolidated financial statements.

 
F-10

 

ASIA GLOBAL HOLDINGS CORP.
(Successor of Ultra Professional Limited)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE PERIOD FROM JANUARY 2, 2009 (INCEPTION) TO SEPTEMBER 30, 2009
(Currency expressed in United States Dollars (“US$”))

In January 2010, the FASB issued Accounting Standards Update No. 2010-06, “Fair Value Measurements and Disclosures”, (ASU 2010-06) which provides amendments to ASC 820, “Fair Value Measurements and Disclosures” that require new disclosures regarding (1) transfers in and out of Levels 1 and 2 fair value measurements and (2) activity in Level 3 fair value measurements. Additionally, ASU 2010-06 clarifies existing fair value disclosures about the level of disaggregation and about inputs and valuation techniques used to measure fair value. The guidance in ASU 2010-06 is effective for interim and annual reporting periods beginning after December 15, 2009, except for disclosures about purchases, sales, issuances, and settlements in the roll forward activity in Level 3 fair value measurements which are effective for fiscal years beginning after December 15, 2010, and for interim periods within those fiscal years. The adoption of this ASU did not have a material effect on the Company’s consolidated financial statements.
 
3.
ACCOUNTS RECEIVABLE

The majority of the Company’s sales are on open credit terms and in accordance with terms specified in the contracts governing the relevant transactions. The Company evaluates the need of an allowance for doubtful accounts based on specifically identified amounts that management believes to be uncollectible. If actual collections experience changes, revisions to the allowance may be required. Based upon the aforementioned criteria, management has determined that no allowance for doubtful accounts is required for the period from January 2, 2009 (Inception) to September 30, 2009.
 
4.
AMOUNT DUE TO DIRECTOR

As of September 30, 2009, amount due to a director of $6,203, Mr. Kwong-Lim Liang represented temporary advances, which were unsecured, interest free and repayable on demand. The imputed interest on this amount is not significant.
 
5.
AMOUNT DUE TO STOCKHOLDER

As of September 30, 2009, amount due to a stockholder of $51,282, Sina Dragon Holdings Limited represented temporary advances, which were unsecured, interest free and repayable on demand. The imputed interest on this amount is not significant.
 
6.
STOCKHOLDERS’ EQUITY

On September 29, 2009, the Company approved to issue 100,000,000 shares of common stock for share exchange transaction.

As of September 30, 2009, the number of authorized and outstanding shares of the Company’s common stock was 300,000,000 shares and 242,138,400 shares, respectively.

 
F-11

 

ASIA GLOBAL HOLDINGS CORP.
(Successor of Ultra Professional Limited)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE PERIOD FROM JANUARY 2, 2009 (INCEPTION) TO SEPTEMBER 30, 2009
(Currency expressed in United States Dollars (“US$”))

7.
NET INCOME PER SHARE

Basic net income per share is computed using the weighted average number of common stock outstanding during the period. Diluted net income per share is computed using the weighted average number of common stock outstanding and common stock equivalents during the period. Pursuant to stock exchange transaction on September 29, 2009, the weighted average number of common shares issued and outstanding was adjusted to account for the effects of the stock exchange transaction as more fully described in Note 1.

The following table sets forth the computation of basic and diluted net income per share for the period from January 2, 2009 (Inception) to September 30, 2009:
   
Period from January 2,
2009 (Inception) to
September 30, 2009
 
Basis and diluted net income per share calculation
     
Numerator:
     
- Net income in computing basic and diluted net income per share
  $ 5,388  
         
Denominator:
       
Weighted average shares outstanding – Basic and diluted
    239,761,741  
         
Net income per share – Basic and diluted
  $ 0.00  
 
8.
INCOME TAXES

For the period from January 2, 2009 (Inception) to September 30, 2009, the local (United States) and foreign components of income (loss) before income taxes were comprised of the following:

   
Period from January 2,
2009 (Inception) to
September 30, 2009
 
Tax jurisdictions from:
     
– Local
  $ (10,000 )
– Foreign
    18,537  
         
Income (loss) before income taxes
  $ 8,537  
 
Provision for income taxes consisted of the following:

   
Period from January 2,
2009 (Inception) to
September 30, 2009
 
Current:
     
– Local
  $ -  
– Foreign
    3,149  
         
Deferred:
       
– Local
    -  
– Foreign
    -  
         
Provision for income taxes
  $ 3,149  
 
F-12

 
ASIA GLOBAL HOLDINGS CORP.
(Successor of Ultra Professional Limited)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE PERIOD FROM JANUARY 2, 2009 (INCEPTION) TO SEPTEMBER 30, 2009
(Currency expressed in United States Dollars (“US$”))
 
The effective tax rate in the years presented is the result of the mix of income earned in various tax jurisdictions that apply a broad range of income tax rates. During the period from January 2, 2009 (Inception) to September 30, 2009, the Company has a subsidiary that operates in Hong Kong and is subject to tax in the jurisdictions in which it operates, as follows:

United States of America

AAGH is registered in the State of Nevada and is subject to United States of America tax law.

Hong Kong

UPL is subject to the Hong Kong Profits Tax Laws at the statutory rate of 16.5% on the assessable income for the periods presented.

For the period from January 2, 2009 (Inception) to September 30, 2009, UPL generated an operating income of $18,537 for income tax purposes. A reconciliation of income before income taxes to the effective income tax rate as follows:
   
Period from January 2,
2009 (Inception) to
September 30, 2009
 
       
Income before income taxes
  $ 18,537  
Statutory income tax rate
    16.5 %
Income tax expense at statutory tax rate
    3,059  
         
Non-deductible items
    90  
         
Income tax expense
  $ 3,149  
 
No provision for deferred tax assets or liabilities has been made, since the Company had no material temporary differences between the tax bases of assets and liabilities and their carrying amounts.
 
9.
CONCERNTRATIONS OF RISK

The Company is exposed to the following concentrations of risk:

(a)         Major customers

For the period from January 2, 2009 (Inception) to September 30, 2009, the customer who accounts for 10% or more of the Company’s revenues is presented as follows:

   
Period ended September 30, 2009
   
September 30, 2009
 
   
Revenues
   
Percentage
of revenues
   
Trade accounts
receivable
 
                   
Customer A
  $ 32,051       56 %   $ 32,051  
Customer B
    25,641       44 %     25,641  
                         
Total:
  $ 57,692       100 %   $ 57,692  
 
F-13

 
ASIA GLOBAL HOLDINGS CORP.
(Successor of Ultra Professional Limited)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE PERIOD FROM JANUARY 2, 2009 (INCEPTION) TO SEPTEMBER 30, 2009
(Currency expressed in United States Dollars (“US$”))
 
(b)         Major vendors

For the period from January 2, 2009 (Inception) to September 30, 2009, one vendor represented more than 10% of the Company’s purchases.

(c)         Credit risk

No financial instruments that potentially subject the Company to significant concentrations of credit risk. Concentrations of credit risk are limited due to the Company’s large number of transactions are on the cash basis.
 
10.
COMMITMENTS AND CONTINGENCIES

The Company currently does not have any formal rent agreements on office premises and pays the rent expense at a fixed sum on a monthly basis. The Company incurred rent expense of $1,269 for the period from January 2, 2009 (Inception) to September 30, 2009.
 
 
F-14

 

Item 9.  Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

Not applicable.

Item 9A.  Controls and Procedures

Not applicable.

Item 9A(T),  Controls and Procedures

Evaluation of Disclosure Controls and Procedures

In accordance with the rules required by the SEC for information required to be disclosed, in this annual report, the Company’s management evaluated, with the participation of the Company’s Chief Executive Officer and Chief Financial Officer, the effectiveness and the operation of the Company’s disclosure controls and procedures. Based upon their evaluation of these disclosure controls and procedures, Chief Executive Officer and Chief Financial Officer have concluded that the Company’s disclosure controls and procedures were effective for accumulating recording, processing, summarizing and communicating, to the Company’s management, to ensure timely decisions regarding disclosure information needed within the time periods specified in the SEC rules and forms.

Management’s Report on Internal Control over Financial Reporting

Our management is responsible for establishing and maintaining adequate internal control over financial reporting as such term is defined in Exchange Act Rule 13a - 15(f). Our internal control system was designed to provide reasonable assurance to our management and the Board of Directors regarding the preparation and fair presentation of published financial statements. All internal control systems, no matter how well designed have inherent limitations. Therefore, even those systems determined to be effective can provide only reasonable assurance with respect to financial statement preparation and presentation. Our management assessed the effectiveness of our internal control over financial reporting as of September 30, 2009. In making this assessment, our management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission ("COSO") in Internal Control - Integrated Framework - Guidance for Smaller Public Companies (the COSO criteria). Based on our assessment we believe that, as of September 30, 2009 (the end of our new fiscal year), our internal control over financial reporting is effective based on those criteria.

This report does not include an attestation report by our independent registered public accounting firm, regarding internal control over financial reporting.  Management’s report was not subject to attestation by the Company’s independent registered public accounting firm pursuant to temporary rules of the SEC that permits the Company to only provide management’s report in this Form 10-K.

Changes in Internal Control over Financial Reporting

There were no changes in our internal control over financial reporting that occurred during the year ended September 30, 2009 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART III.

Item 10. Directors, Executive Officers and Corporate Governance.

DIRECTORS AND EXECUTIVE OFFICERS

Our directors and officers, as of the date this Report is filed, are set forth below. The directors hold office for their respective term and until their successors are duly elected and qualified. Vacancies in the existing Board are filled by a majority vote of the remaining directors. The officers serve at the will of the Board of Directors.
 
17

 
Name
 
Age
 
Position
 
Director Since
             
Ping Shun Lai
 
63
 
Chief Executive Officer, Interim
 
Sept. 29, 2009
       
Financial Officer and Director
   
             
Kwong-Lim Liang
 
69
 
Director
 
November 16, 2009

Mr. Ping Shun Lai was appointed the Chief Executive Officer, Interim Financial Officer, and a Director of AAGH as of September 28, 2009, in connection with the change of control of AAGH resulting from Sina Dragon Holdings Limited purchase of a block of common and preferred stock from a Mr. Mak, a former officer and director.  Mr. Ping-Shun Lai has more than 40 years of experience in running manufacturing operations in Hong Kong and the People’s Republic of China, and has established relationships with high-level personnel within different Ministries of the PRC.  Since 1999, he has been a consultant and director for Teams Uniform Specialist Co., Ltd., a privately-held garment manufacturing company based in Hong Kong.

Mr. Kwong-Lim Liang was appointed to the Board of Directors following AAGH’s acquisition of Ultra Professional on September 30, 2009.   Mr. Liang was a director of Ultra Professional and its sole shareholder, and continues to serve UPL as its President.  He has 20 years of experience in structuring advertising contracts for foreign and PRC import and export businesses.  Since 1999, Mr. Liang has been director and a principal owner of Nina Ltd., a Hong Kong based private trading company.  He is a brother of Mr. Stanely Lai, sole owner of Sina Dragon Holdings Limited.

 (a) Significant Employees

Other than our officers, there are no employees who are expected to make a significant contribution to our corporation.

(b) Family Relationships

Our directors currently have terms which will end at our next annual meeting of the stockholders or until their successors are elected and qualify, subject to their prior death, resignation or removal. Officers serve at the discretion of the Board of Directors. There are no family relationships among any of our directors and executive officers. There are no family relationships among our officers, directors, or persons nominated for such positions.

LEGAL PROCEEDINGS

No officer, director, or persons nominated for these positions, and no promoter or significant employee of our corporation, has been involved in legal proceedings that would be material to an evaluation of our management.

AUDIT COMMITTEE

Our Board of Directors does not have a separate audit committee. The Board has determined that it does not have a member of its Board that qualifies as an "audit committee financial expert" as defined in Item 407(d)(5)(ii) of Regulation S-K, and is "independent" as the term is used in Item 407(d) of Regulation S-K.

We believe that the members of our Board of Directors are collectively capable of analyzing and evaluating our financial statements and understanding internal controls and procedures for financial reporting. However, the Company is considering appointing an independent qualified financial expert as well as an additional independent professional to its Board of Directors in order to strengthen and improve its internal disclosure controls and procedures. We are also in the process of searching for qualified candidates to serve as our Chief Financial Officer and/or on our audit committee and as an audit committee financial expert.

CODE OF ETHICS

We are in the process of preparing a code of ethics that applies to our principal Chief Executive Officer, Chief Financial Officer, principal accounting officer or controller, or persons performing similar functions.

18

 
COMPLIANCE WITH SECTION 16 OF THE SECURITIES EXCHANGE ACT OF 1934

Section 16(a) of the Securities Exchange Act of 1934, as amended, requires our directors and executive officers and beneficial holders of more than 10% of our common stock to file with the Commission initial reports of ownership and reports of changes in ownership of our equity securities. As of the date of this Report, Sina Dragon Holdings Limited, Mr. Ping-Shun Lai and Mr. Kwong-Lim Liang have not filed Forms 3 to report beneficial ownership in the Company’s stock.

Item 11. Executive Compensation

COMPENSATION DISCUSSION AND ANALYSIS

Background and Compensation Philosophy

Our board of directors consists of two individuals:  (1) Mr. Ping-Shun Lai, Chief Executive Officer and Interim Chief Financial Officer; and (2) Mr. Kwong-Lim Liang.  Our board of directors have historically determined the compensation to be paid to executive officers based on our financial and operating performance and prospects, the level of compensation paid to similarly situated executives in comparably sized companies, and contributions made by the officers’ to our success.  Each of the named officers will be measured by a series of performance criteria by the board of directors, or the compensation committee when it is established, on a yearly basis.  Such criteria will be set forth based on certain objective parameters such as job characteristics, required professionalism, management skills, interpersonal skills, related experience, personal performance and overall corporate performance.

Our board of directors have not adopted or established a formal policy or procedure for determining the amount of compensation paid to our executive officers.

As our executive leadership and board of directors grow, our board of directors may decide to form a compensation committee charged with the oversight of executive compensation plans, policies and programs.

Elements of Compensation

The Company has not paid compensation to its officers since 2007, and does not expect to begin paying compensation until such time as operations warrant.
Base Salary

The yearly base salary of our former CEO Mr. Michael Mak for the years of 2008 and 2007 was $60,000 of which $0 was paid in 2007 and $0 was paid in 2008. Mr. John Leper and Mr. Hin Lee Kwong received no salary in 2008, 2007 or 2009; these individuals ceased service in 2009.

Mr. Ping-Shun Lai has served as president since September 2009, and has not been paid any compensation for service.

Discretionary Bonus

We have not provided our executive officers with any discretionary bonuses but our board of directors may consider the necessity of such scheme in the future based on our financial and operating performance and prospects, the level of compensation paid to similarly situated executives in comparably sized companies and contributions made by the officers’ to our success .

 Equity Incentives

We have not established equity based incentive program and have not granted stock based awards as a component of compensation, apart from the common stock award of approximately 2,000,000 shares of restricted common stock and an award of 500,000 shares of series A convertible preferred stock to our former CEO Mr. Michael Mak as an employment signing bonus in 2007.  In the future, we may adopt and establish an equity incentive plan pursuant to which awards may be granted if our board of directors determines that it is in the best interests of our stockholders and the Company to do so.
 
19

 
Retirement Benefits

Our executive officers are not presently entitled to company-sponsored retirement benefits.

Perquisites

We have not provided our executive officers with any material perquisites and other personal benefits and, therefore, we do not view perquisites as a significant or necessary element of our executive’s compensation.

Deferred Compensation

We do not provide our executives the opportunity to defer receipt of annual compensation.

The following table sets forth information for the period indicated with respect to the persons who served as our CEO, CFO and other most highly compensated executive officers who served on our board of directors.

SUMMARY COMPENSATION TABLE
 
Name and
Position
 
Year*
  
Salary
($)
  
Bonus
Shares ($)
  
  
Stock
Awards
($)
  
  
Option
Awards
($)
  
  
Non-Equity
Incentive Plan
Compensation
($)
  
  
Nonqualified
Deferred
Compensation
Earnings ($)
  
  
All Other 
Compensation
($)
  
  
Total
($)
  
                                                                   
Ping-Shun Lai, CEO & CFO
 
2009
     
      0
 
    
     
     
     
     
     
 
                                                                   
Michael Mak, Former CEO & CFO
 
2009
   
    0
 
   
     
     
     
     
     
 
    
2008
     
     0
 
   
     
     
     
     
     
 
    
2007
   
60,000 
   
260,877
(1)     
     
     
     
     
     
320,877
 
                                                                   
John Leper, Former CEO
 
2008
   
0
   
82,500
(2)
   
0
     
0
     
0
     
0
     
0
     
82,500
 
   
2007
   
0
   
0
      
0
     
0
     
0
     
0
     
0
     
0
 

*
For fiscal years ended December 31, 2008 and 2007, and for the nine months in the new fiscal year ended September 30, 2009.

(1)
Bonus awards represented 2,000,000 shares of restricted common stock payable to the Company’s former President, Mr. Michael Mak as a signing bonus to be earned over one year as part of a compensation package upon the execution of the employment agreement
   
(2)
Bonus shares represented 1,000,000 shares of restricted common stock issued to the Company’s former Chief Executive Officer, Mr. John Leper.  
 
20

 
SERVICE AGREEMENTS WITH DIRECTORS AND EXECUTIVE OFFICERS

On October 29, 2008, the Company accepted the resignation of Michael Mak as the Company’s Chief Executive Officer, Chief Financial Officer and as a Director. Previously, on August 18, 2006, we entered into an Employment Agreement with Mr. Michael Mak which was terminated upon his resignation.  Prior to the acceptance of Mr. Mak’s resignation, the Board of Directors appointed John Leper, Chairman of the Board of Directors, Chief Executive Officer and Chief Financial Officer. The Board also appointed Hin Lee Kwong as Secretary and as a Director of the Board.

We do not have an employment agreement with Mr. Ping-Shun Lai, our sole officer.

BONUSES AND DEFERRED COMPENSATION

We do not have any deferred compensation or retirement plans.  We do not have a compensation committee; all decisions regarding compensation are determined by our entire board of directors.

OPTION GRANTS IN THE LAST FISCAL YEAR

We did not grant any options or stock appreciation rights to our named executive officers or directors in 2009.  

INDEMNIFICATION OF DIRECTORS AND EXECUTIVE OFFICERS

Our bylaws provide for the indemnification of our present and prior directors and officers or any person who may have served at our request as a director or officer of another corporation in which we own shares of capital stock or of which we are a creditor, against expenses actually and necessarily incurred by them in connection with the defense of any actions, suits or proceedings in which they, or any of them, are made parties, or a party, by reason of being or having been director(s) or officer(s) of us or of such other corporation, in the absence of negligence or misconduct in the performance of their duties. This indemnification policy could result in substantial expenditure by us, which we may be unable to recoup.

Insofar as indemnification by us for liabilities arising under the Securities Exchange Act of 1934 may be permitted to our directors, officers and controlling persons pursuant to provisions of the Amended Articles of Incorporation and Bylaws, or otherwise, we have been advised that in the opinion of the SEC, such indemnification is against public policy and is, therefore, unenforceable. In the event that a claim for indemnification by such director, officer or controlling person of us is in the successful defense of any action, suit or proceeding is asserted by such director, officer or controlling person in connection with the securities being offered, we will, unless in the opinion of our counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by us is against public policy as expressed in the Act and will be governed by the final adjudication of such issue.

At the present time, there is no pending litigation or proceeding involving a director, officer, employee or other agent of ours in which indemnification would be required or permitted. We are not aware of any threatened litigation or proceeding which may result in a claim for such indemnification.

Compensation of Directors

Members of our Board of Directors receive no compensation for service.

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Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters.

Security Ownership - Certain Beneficial Owners

Beneficial ownership is shown as September 30,2009 for shares held by (i) each person or entity known to us to be the beneficial owner of more than 5% of our issued and outstanding shares of common stock based solely upon a review of filings made with the Commission and our knowledge of the issuances by us, (ii) each of our directors, (iii) our Chief Executive Officer and our three other most highly compensated officers whose compensation exceeded $100,000 during the fiscal year ended December 31, 2008, or the Named Executive Officers, and (iv) all of our current directors and executive officers as a group. Unless otherwise indicated, the persons listed below have sole voting and investment power.
 
Security Ownership - Certain Beneficial Owners and Management

       
Amount
       
       
And
   
Percentage
 
       
Nature of
   
of Class
 
       
Beneficial
   
Beneficially
 
Beneficial Owner (including address)
 
Title of class
 
Ownership
   
Owned(1)(2)
 
                 
Sina Dragon Holdings Limited
               
Room 901, 9F, Haleson Building, 1 Jubilee Street,
               
Central, Hong Kong
 
Common
    33,500,000       13.8 %
   
Preferred
    250,000       100.0 %
Kwong-Lim Liang, Director
 
Common
    100,000,000       41.3 %
901 Haleson Bldg., 1 Jubilee Street
                   
Central, Hong Kong
                   
                     
Ping-Shun Lai, CEO,CFO,Director
        -0-       -0-  
                     
Officers and Directors
 
Common
    33,500,000       41.3 %
as a Group (two persons)
                   
(1)
On September 28, 2009, Michael Mak (and his 100% owned affiliate Stanford International Holding Corporation) sold 33,500,000 common shares of the Company, and 250,000 shares of Series A preferred stock of the Company, to Sina Dragon Holdings Limited, for an aggregate of US$10,000.00 cash paid to Mr. Mak and Stanford International Holding.  The shares were sold as restricted securities.

The common shares represent 13.8% of the total 242,138,400 outstanding common shares at September 30, 2009.  However, the 250,000 shares of Series A preferred stock is convertible into 50,000,000 shares of common stock.  Accordingly, the purchased shares together represent 28.6% of the voting rights of shareholders, as the holders of preferred and common shares vote together on all matters presented to shareholders (as provided  in the Designation of Preferred Shares (Exhibit 3.1 to the Form 8-K filed on October 27, 2006)), and the holder of the preferred shares is entitled to vote the shares as if converted to common stock.  The formula for determining the votes which the holder of preferred shares is entitled to cast is set forth in the Designation.

(2)
Mr. Kwong-Lim Liang owns 100,000,000 shares, representing 41.3% of the outstanding common stock.  However, due to the special voting rights of the Series A Preferred Stock held by Sina Dragon Holdings, Mr. Kwong-Lim Liang’s common stock holds only 34.2% of the total voting rights of holders of common and preferred stock combined.

Changes in Control

There are no arrangements, known to the Registrant, including any pledge by any person of securities of the Registrant which may at a subsequent date result in a change in control of the Registrant.

Securities Authorized for Issuance Under Equity Compensation Plans

None.

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Item 13. Certain Relationships and Related Transactions, and Director Independence

Amounts Due From/To Affiliate

As of September 30, 2009, $51,282 was owed to Sina Dragon Holdings Limited and $6,203 was owed to Mr. Kwong-Lim Liang for advances made in the period from January 2, 2009 to September 30, 2009.  These loans do not bear interest and are due on demand.

Director Independence

At this time, the Company has no directors that meet the requirements as “independent” (as defined by Item 407(a)(1) of Regulation S-K).

Item 14. Principal Accountant Fees and Services.

The following is a summary of the fees billed to us by HLB Hodgson Impey Cheng (“HLB”), the Company’s former auditors, Clancy and Co., P.L.L.C. ("Clancy" for the services rendered during the year ended December 31, 2007) and the Company's current auditors, ZYCPA Company Limited (formerly Zhong Yi (Hong Kong) C.P.A. Company Limited) ("ZYCPA") for professional services rendered for the period from January 2, 2009 to September 30, 2009, and for the (former) fiscal years ended December 31, 2008 and 2007:

   
2009
   
2008
   
2007
             
Service
 
ZYCPA
   
ZYCPA
   
ZYCPA
   
HLB
   
Clancy
 
Audit Fees
  $ 12,820     $ 40,000     $ 70,000       32,000     $ 16,750  
                                         
Audit Related
                    3,500       5,000          
Fees
                                       
                                         
Tax Fees
                                       
                                         
All Other Fees
                                       
                                         
TOTAL
  $ 12,820     $ 40,000     $ 73,500       37,000     $ 16,750  

Audit fees consist of the aggregate fees billed for services rendered for the audit of our annual financial statements, the reviews of the financial statements included in our Forms 10-Q and for any other services that are normally provided by our independent auditors in connection with our statutory and regulatory filings or engagements.

Audit related fees consist of the aggregate fees billed for professional services rendered for assurance and related services that reasonably related to the performance of the audit or review of our financial statements that were not otherwise included in Audit Fees.

Tax fees consist of the aggregate fees billed for professional services rendered for tax compliance, tax advice and tax planning. These services include assistance regarding federal, state and local tax compliance and consultation in connection with various transactions and acquisitions.

All other fees consist of the aggregate fees billed for products and services provided by our independent auditors and not otherwise included in Audit Fees, Audit Related fees or Tax Fees.

 Item 15. Exhibits, Financial Statement Schedules.
 
(a) Financial Statements

The financial statements are set forth under Item 8 of this Annual Report on Form 10-K. Financial statement schedules have been omitted since they are either not required, not applicable, or the information is otherwise included.

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(b) Exhibits

2.1*
Articles of Incorporation filed with the Nevada Secretary of State on February 1, 2002 (Exhibit 3.1 to Registration Statement on Form SB-2 filed with the Commission on April 25, 2002)

2.2*
First Amendment to Articles of Incorporation filed with the Nevada Secretary of State on May 20, 2004 (Exhibit 3.1 to Form 8-K/A filed with the Commission on May 26, 2004)

2.3*
Second Amendment to Articles of Incorporation filed with the Nevada Secretary of State on June 9, 2006 (Exhibit 3.1 to Form 8-K filed with the Commission on July 31, 2006)

2.4*
Third Amendment to Articles of Incorporation filed with the Nevada Secretary of State on August 22, 2006 (Exhibit 3.1 to Form 8-K filed with the Commission on September 13, 2006)

2.5*
Bylaws (Exhibit 3.4 to Registration Statement on Form SB-2 filed with the Commission on April 25, 2002)

2.6*
Amended Bylaws (Exhibit 3.2 to Form 10Q-SB filed with the Commission on February 19, 2003)

3.1*
Form of Stock Certificate (Exhibit 4.1 to Registration Statement on Form SB-2 filed with the Commission on April 25, 2002)
   
10.1
Common Stock Purchase Agreement (acquisition of Ultra Professional Ltd., dated September 29, 2009)(1)
   
10.2
Common Stock Purchase Agreement (disposition of Sino Trade Intelligent Development Corp. Limited, dated September 30, 2009)(2)

31.1
Certification of Chief Executive Officer and Chief Financial Officer pursuant to 13a-14 and 15d-14 of the Exchange Act (filed herewith)

32.1
Certification of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. ss. 1350 (filed herewith)

* Previously Filed
(1)
Incorporated by reference from exhibit 10.1 to the Form 10-Q filed on  November 19, 2009
(2)
Incorporated by reference form the exhibit 10.2 to the Form 10-Q filed on November 19, 2009.

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this amended report to be signed on its behalf by the undersigned, thereunto duly authorized.
 
 
ASIA GLOBAL HOLDINGS CORP.
     
   
/s/ Mr. Ping-Shun Lai
   
MR. PING-SHUN LAI, Chief Executive Officer
   
(Principal executive officer)
     
   
/s/ Mr. Ping-Shun Lai
   
MR. PING-SHUN LAI, Chief Financial Officer
   
(Principal Financial Officer)
 
Dated: November 30, 2010
 
 
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