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EX-31.2 - UNI CORE HOLDINGS CORP | v211315_ex31-2.htm |
EX-32.1 - UNI CORE HOLDINGS CORP | v211315_ex32-1.htm |
EX-32.2 - UNI CORE HOLDINGS CORP | v211315_ex32-2.htm |
EX-31.1 - UNI CORE HOLDINGS CORP | v211315_ex31-1.htm |
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
_____________________
FORM
10-Q
(Mark
One)
|
x
|
QUARTERLY
REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
|
For
the quarterly period ended: December 31, 2010
|
¨
|
TRANSITION
REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
|
For
the transition period from _________________ to ________________
Commission
file number: 000-30430
Uni Core Holdings
Corporation
(Exact
name of registrant as specified in its charter)
Formerly
known as “Intermost Corporation”
Wyoming
|
87-0418721
|
(State
or other jurisdiction of
|
(IRS
Employer Identification Number)
|
Incorporation
or Organization)
|
|
Suite
5204, Central Plaza, 18 Harbour Road,
|
|
Wanchai,
Hong Kong
|
000000
|
(Address
of principal executive offices)
|
(Zip
Code)
|
852-2827-6898
(Registrant’s
Telephone Number, including area code)
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 x No ¨
Check
whether the issuer is a large accelerated filer, an accelerated filer, a
non-accelerated filer, or a smaller reporting company. See the
definitions of “large accelerated filer” and “smaller reporting company” in Rule
12b-2 of the Exchange Act.
Large
accelerated filer
|
o
|
Accelerated
Filer
|
¨
|
Non-accelerated
filer
|
o
|
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 o No x
Indicate
the number of shares outstanding of each of the issuer’s classes of common
stock, as of the latest practicable date: 703,406,873 shares of common
stock as of January 4, 2011.
TABLE
OF CONTENTS
|
PART
I. Financial Information
|
|||
Item
1.
|
Financial
Statements
|
||
Condensed
Consolidated Balance sheets (Unaudited) as of December 31, 2010
and June 30, 2010
|
2
|
||
Condensed
Consolidated Statements of Operations (Unaudited) for the three months
ended December 31, 2010 and December 31, 2009
|
4
|
||
Condensed
Consolidated Statements of Operations (Unaudited) for the six months ended
December 31, 2010 and December 31, 2009
|
5
|
||
Condensed
Consolidated Statements of Cash Flows (Unaudited) for the six months
ended December 31, 2010 and December 31, 2009
|
6
|
||
Notes
to Condensed Consolidated Financial Statements for the six months ended
December 31, 2010 and December 31, 2009
|
7
|
||
Item
2.
|
Management’s
Discussion and Analysis or Plan of Operation
|
13
|
|
Item
3.
|
Controls
and Procedures
|
26
|
|
PART
II. Other Information
|
|||
Item
1.
|
Legal
Proceedings
|
27
|
|
Item
2.
|
Unregistered
Sales of Equity Securities and Use of Proceeds
|
27
|
|
Item
3.
|
Defaults
Upon Senior Securities
|
27
|
|
Item
4.
|
Submission
of Matters to a Vote of Security Holders
|
27
|
|
Item
5.
|
Other
Information
|
27
|
|
Item
6.
|
Exhibits
|
27
|
|
Signatures
|
29
|
- 1
-
ITEM
1. FINANCIAL STATEMENTS.
UNI CORE
HOLDINGS CORPORATION AND SUBSIDIARIES
CONDENSED
CONSOLIDATED BALANCE SHEETS
Dec
31, 2010
|
June
30, 2010
|
|||||||
USD
|
USD
|
|||||||
ASSETS
|
||||||||
Current
assets
|
||||||||
Cash
and cash equivalents
|
$ | 2,267,700 | $ | 2,108,546 | ||||
Accounts
receivable, net
|
5,306,882 | 4,496,210 | ||||||
Deposits,
prepayment and other receivables
|
2,785,967 | 1,582,148 | ||||||
Amount
due from related company
|
365,627 | 413,929 | ||||||
Other
loan receivables
|
229,049 | 236,292 | ||||||
Inventory
|
2,435,731 | 2,435,369 | ||||||
Total
current assets
|
$ | 13,390,956 | $ | 11,272,494 | ||||
Unlisted
investment
|
949,873 | 949,873 | ||||||
Investment
in associated companies
|
1 | 1 | ||||||
Goodwill
|
11,157,681 | 11,157,681 | ||||||
Plant
and equipment, net
|
8,397,013 | 8,165,308 | ||||||
Intangible
assets, net
|
1,230,591 | 1,197,300 | ||||||
TOTAL
ASSETS
|
$ | 35,126,115 | $ | 32,742,657 | ||||
LIABILITIES
AND STOCKHOLDERS’ EQUITY
|
||||||||
Current
liabilities
|
||||||||
Accounts
payable
|
$ | 4,343,113 | $ | 3,509,165 | ||||
Accrued
liabilities and other payable
|
3,032,389 | 2,889,068 | ||||||
Customers
deposits
|
18,909 | 18,280 | ||||||
Advance
from a shareholder
|
426,938 | 337,658 | ||||||
Finance
leases
|
135,772 | 132,763 | ||||||
Advance
from a related company
|
5,449,242 | 5,527,978 | ||||||
Business
and other taxes payable
|
1,094 | 1,141 | ||||||
Total
current liabilities
|
$ | 13,407,457 | $ | 12,416,053 | ||||
TOTAL
LIABILITIES
|
$ | 13,407,457 | $ | 12,416,053 |
See
accompanying notes to consolidated financial statements
- 2
-
ITEM
1. FINANCIAL STATEMENTS.
UNI CORE
HOLDINGS CORPORATION AND SUBSIDIARIES
CONDENSED
CONSOLIDATED BALANCE SHEETS
Dec
31, 2010
|
June
30, 2010
|
|||||||
USD
|
USD
|
|||||||
Minority
interests
|
$ | 1,087,493 | $ | 1,229,502 | ||||
STOCKHOLDERS’
EQUITY
|
||||||||
Preferred
stock at $0.001 par value,
|
||||||||
5,000,000
shares authorized,
|
||||||||
Nil
(2009:Nil) shares issued and outstanding
|
- | - | ||||||
Common
stock at $0.001 par value,
|
||||||||
2,000,000,000
shares authorized,
664,031,873 shares issued and outstanding |
703,407 | 664,032 | ||||||
Additional
paid-in capital
|
57,012,681 | 54,050,181 | ||||||
Accumulated
deficit
|
(37,868,114 | ) | (36,120,023 | ) | ||||
Accumulated
other comprehensive income
|
783,191 | 502,912 | ||||||
$ | 20,631,165 | $ | 19,097,102 | |||||
TOTAL
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
$ | 35,126,115 | $ | 32,742,657 |
See
accompanying notes to consolidated financial statements
- 3
-
UNI CORE
HOLDINGS CORPORATION AND SUBSIDIARIES
CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)
Three
months ended Dec 31,
|
||||||||
2010
|
2009
|
|||||||
USD
|
USD
|
|||||||
Net
revenue
|
5,700,735 | 16,875 | ||||||
Cost
of revenues
|
(4,910,131 | ) | (6,063 | ) | ||||
Gross
profit
|
790,604 | 10,812 | ||||||
Costs
and expenses:
|
||||||||
Selling,
general and administrative expenses
|
(1,402,931 | ) | (914,050 | ) | ||||
Impairment
of goodwill
|
0 | 0 | ||||||
Exchange
differences
|
(248,835 | ) | (5,724 | ) | ||||
Amortization
of intangible assets
|
(4,692 | ) | (2,689 | ) | ||||
Total
costs and expenses
|
(1,656,458 | ) | (922,463 | ) | ||||
Loss
from operations
|
(865,854 | ) | (911,651 | ) | ||||
Interest
income
|
486 | 394 | ||||||
Interest
expenses
|
(136,222 | ) | 0 | |||||
Bad
debts recovery
|
16,521 | 0 | ||||||
Other
income (loss), net
|
(7,638 | ) | 16,828 | |||||
Loss
before income taxes, minority interests
|
||||||||
and
equity in earnings of associated companies
|
(992,707 | ) | (894,429 | ) | ||||
Income
taxes
|
0 | 0 | ||||||
Loss
before minority interests and equity in
|
||||||||
earnings
of associated companies
|
(992,707 | ) | (894,429 | ) | ||||
Minority
interests
|
14,116 | 84,813 | ||||||
Net
loss
|
(978,591 | ) | (809,616 | ) | ||||
Net
loss per common share-basic and diluted
|
(0.0015 | ) | (0.0036 | ) | ||||
Weighted
average number of common shares
outstanding-basic and diluted |
673,447,634 | 222,338,938 |
- 4
-
UNI CORE
HOLDINGS CORPORATION AND SUBSIDIARIES
CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)
Six
months ended Dec 31,
|
||||||||
2010
|
2009
|
|||||||
USD
|
USD
|
|||||||
Net
revenue
|
10,293,327 | 21,067 | ||||||
Cost
of revenues
|
(8,746,695 | ) | (6,292 | ) | ||||
Gross
profit
|
1,546,632 | 14,775 | ||||||
Costs
and expenses:
|
||||||||
Selling,
general and administrative expenses
|
(3,018,055 | ) | (1,139,641 | ) | ||||
Impairment
of goodwill
|
0 | 0 | ||||||
Exchange
differences
|
(285,485 | ) | (6,123 | ) | ||||
Amortization
of intangible assets
|
(6,145 | ) | (3,400 | ) | ||||
Total
costs and expenses
|
(3,309,685 | ) | (1,149,164 | ) | ||||
Loss
from operations
|
(1,763,053 | ) | (1,134,389 | ) | ||||
Interest
income
|
908 | 476 | ||||||
Interest
expenses
|
(220,616 | ) | 0 | |||||
Bad
debts recovery
|
30,583 | 0 | ||||||
Other
income (loss), net
|
33,446 | (16,970 | ) | |||||
Loss
before income taxes, minority interests
|
||||||||
and
equity in earnings of associated companies
|
(1,918,732 | ) | (1,150,883 | ) | ||||
Income
taxes
|
0 | 0 | ||||||
Loss
before minority interests and equity in
|
||||||||
earnings
of associated companies
|
(1,918,732 | ) | (1,150,883 | ) | ||||
Minority
interests
|
170,641 | 158,604 | ||||||
Net
loss
|
(1,748,091 | ) | (992,279 | ) | ||||
Net
loss per common share-basic and diluted
|
(0.0026 | ) | (0.0046 | ) | ||||
Weighted
average number of common shares
|
||||||||
outstanding-basic and
diluted
|
673,447,634 | 218,060,406 |
- 5
-
UNI CORE
HOLDINGS CORPORATION AND SUBSIDIARIES
CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
Six
months ended Dec 31,
|
||||||||
2010
|
2009
|
|||||||
USD
|
USD
|
|||||||
Cash
flows from operating activities
|
||||||||
Net
loss
|
(1,748,091 | ) | (992,279 | ) | ||||
Amortization
of intangible assets
|
2,940 | 3,401 | ||||||
Depreciation
|
366,670 | 29,988 | ||||||
Minority
interest
|
(170,641 | ) | 321,617 | |||||
Adjustments
to reconcile net loss to net cash provided by operating
activities:-
|
||||||||
Accounts
receivables
|
(683,837 | ) | 0 | |||||
Inventories
|
61,038 | |||||||
Deposits,
prepayments and other receivables
|
(1,143,905 | ) | (1,529,598 | ) | ||||
Accounts
payable
|
731,608 | 0 | ||||||
Accrued
liabilities
|
68,940 | (13,109 | ) | |||||
Customer
deposits
|
158 | 1,655 | ||||||
Deferred
revenue
|
0 | 225 | ||||||
Business
taxes and government surcharges payable
|
(76 | ) | 23 | |||||
Net
cash generated from/(used in) operating activities
|
(2,515,196 | ) | (2,178,077 | ) | ||||
Cash
flows from investing activities
|
||||||||
Acquisition
of plant and equipment
|
(388,677 | ) | (5,276 | ) | ||||
Acquisition
of intangible assets
|
(2,424 | ) | ||||||
Short-term
loan
|
13,079 | 0 | ||||||
Net
cash used in investing activities
|
(378,022 | ) | (5,276 | ) | ||||
Cash
flows from financing activities
|
||||||||
Advances
from related parties
|
137,216 | 0 | ||||||
Bank
loan
|
(216,783 | ) | 0 | |||||
Net
proceeds from issuance of common stock
|
3,000,000 | 2,545,000 | ||||||
Net
cash generated from/(used in) financing activities
|
2,920,433 | 2,545,000 | ||||||
Cash
and cash equivalents
|
||||||||
Net
increase (decrease)
|
27,215 | 361,647 | ||||||
Accumulated
other comprehensive loss
|
131,939 | (39 | ) | |||||
Balance
at beginning of period
|
2,108,546 | 575,523 | ||||||
Balance
at end of period
|
2,267,700 | 937,131 | ||||||
Supplemental
cash flow information:
|
||||||||
Interest
received
|
908 | 0 | ||||||
Interest
expenses
|
(220,616 | ) | 0 |
The
accompanying notes are an integral part of these condensed consolidated
financial statements
- 6
-
NOTES TO
CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
SIX
MONTHS ENDED DEC 31, 2010 AND 2009
1. ORGANIZATION
AND BASIS OF PRESENTATION
The
condensed consolidated financial statements include the accounts of Uni Core
Holdings Corporation (formerly known as Intermost Corporation) (the "Company")
and its majority-owned subsidiaries, of which the Company has the ability to
exercise control and direct operations and the minority interests do not possess
participatory rights. All material intercompany balances and transactions have
been eliminated on consolidation.
The
condensed consolidated financial statements have been prepared in accordance
with generally accepted accounting principles in the United States of
America.
The
condensed consolidated financial statements are unaudited, but in the opinion of
management of the Company, contain all adjustments, which include normal
recurring adjustments, necessary to present fairly the financial position at
December 31, 2010, the results of operations for the three months ended December
31, 2010 and 2009, and the cash flows for the three months ended December 31,
2010 and 2009. The balance sheet as of June 30, 2010 is derived from the
Company’s audited financial statements included in the Company’s Annual Report
on Form 10-K for the fiscal year ended June 30, 2010.
Certain
information and footnote disclosures normally included in financial statements
that have been prepared in accordance with generally accepted accounting
principles have been condensed or omitted pursuant to the rules and regulations
of the Securities and Exchange Commission, although management of the Company
believes that the disclosures contained in these financial statements are
adequate to make the information presented therein not misleading. For further
information, refer to the financial statements and the notes thereto included in
the Company’s Annual Report on Form 10-K for the fiscal year ended June 30,
2010, as filed with the Securities and Exchange Commission.
The
preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities, disclosure of contingent
assets and liabilities at the date of the financial statements, and the reported
amounts of revenues and expenses during the reporting period. Actual results
could differ from those estimates.
The
results of operations for the three months ended December 31, 2010 are not
necessarily indicative of the results of operations to be expected for the full
fiscal year ending June 30, 2010.
2. NET
INCOME (LOSS) PER COMMON SHARE
Statement
of Financial Accounting Standards No. 128, “Earnings per Share,” requires
presentation of basic earnings per share (“Basic EPS”) and diluted earnings per
share (“Diluted EPS”). Basic earnings (loss) per share is computed by dividing
earnings (loss) available to common stockholders by the weighted average number
of common shares outstanding (including shares reserved for issuance) during the
period. Diluted earnings per share gives effect to all dilutive potential common
shares outstanding during the period. The Company did not have any potentially
dilutive securities outstanding during the three months ended December 31, 2010
and 2008. Accordingly, basic and diluted earnings per share are the same for all
periods presented.
3. FOREIGN
CURRENCY TRANSLATION
The
Company maintains its books and records in Renminbi (“Rmb”), the currency of the
People’s Republic of China (the “PRC”). The Rmb is the Company's functional
currency, as the Company's business activities are located in the PRC and
denominated in Rmb. Translation of amounts into United States dollars ("US$")
has been made at the rate of Rmb6.6118 to US$1.00. The translation of the
financial statements of subsidiaries whose functional currencies are other than
Rmb into Rmb is performed for balance sheet accounts using closing exchange
rates in effect at the balance sheet date and for revenue and expense accounts
using an average exchange rate during each reporting period. The gains or losses
resulting from translation are included in stockholders' equity separately as
accumulated other comprehensive loss.
Transactions
in currencies other than functional currencies during the period are translated
into the respective functional currencies at the applicable rates of exchange
prevailing at the time of the transactions. Monetary assets and liabilities
denominated in currencies other than functional currencies are translated into
the respective functional currencies at the applicable rates of exchange in
effect at the balance sheet date. Exchange gains and losses are included in the
statement of operations. On July 21, 2005, Rmb was revalued from Rmb8.28 to
Rmb8.11 for US$1 following the removal of the peg to the US dollar and pressure
for the United States. The Rmb continuously appreciated to Rmb6.7813 for US$1 at
June 30, 2010. And the Rmb further appreciated to Rmb6.6118 for US$1 at this
quarter ended December 31, 2010.
- 7
-
The Rmb
is not readily convertible into US$ or other foreign currencies. Translation of
amounts from Rmb into US$ is for the convenience of readers. No representation
is made that the Rmb amounts could have been, or could be, converted into US$ at
that rate or at any other rate.
For the
purposes of financial statements presentation, the United States dollars
equivalents of the all numbers are translated at the rate of USD$1 to
Rmb6.66118.
4. STOCK-BASED
COMPENSATION
The
Company may periodically issue shares of common stock for services rendered or
for financing costs. Such shares are valued based on the market price of the
shares on the transaction date.
The
Company may periodically issue stock options to employees and stock options or
warrants to non-employees in non-capital raising transactions for services and
for financing costs.
ASC 718
"Compensation - Stock Compensation" formerly SFAS No. 123 prescribes accounting
and reporting standards for all stock-based compensation plans, including
employee stock options, restricted stock, employee stock purchase plans and
stock appreciation rights which may be classified as either equity or
liabilities. The Company should determine if a present obligation to settle the
share-based payment transaction in cash or other assets exists. A present
obligation to settle in cash or other assets exists if: (a) the option to settle by
issuing equity instruments lacks commercial substance or (b) the present obligation is
implied because of an entity's past practices or stated policies. If a present
obligation exists, the transaction should be recognized as a liability;
otherwise, the transaction should be recognized as equity.
The
Company accounts for stock-based compensation issued to non-employees and
consultants in accordance with the provisions of ASC 505-50 "Equity -Based
Payments to Non-Employees" which codified SFAS 123 and the Emerging Issues Task
Force consensus in Issue No. 96-18 ("EITF 96-18"), "Accounting for Equity
Instruments that are Issued to Other Than Employees for Acquiring or in
Conjunction with Selling, Goods or Services". Measurement of share-based payment
transactions with non-employees shall be based on the fair value of whichever is
more reliably measurable: (a) the goods or services received; or (b) the equity
instruments issued. The fair value of the share-based payment transaction should
be determined at the earlier of performance commitment date or performance
completion date.
In
accordance with ASC 718, the cost of stock options and warrants issued to
non-employees is measured at the grant date based on the fair value of the
award. The fair value of the stock-based award is determined using the
Black-Scholes option-pricing model. The resulting amount is charged to expense
on the straight-line basis over the period in which the Company expects to
receive benefit, which is generally the vesting period.
Stock
options issued to non-employee directors at fair market value will be accounted
for under the intrinsic value method.
The
Company did not have any stock options outstanding during the period ended
December 31, 2010 (2009: Nil). Accordingly, no pro forma financial disclosure is
provided herein.
5. RECENT
ACCOUNTING PRONOUNCEMENTS
In 2010,
the FASB issued ASC Update ("ASU") No.2010-01, Equity (Topic 505): Accounting for
Distributions to Shareholders with Components of Stock and Cash. This
update clarify that the stock portion of a distribution to shareholders that
allows them to elect to receive cash or stock with a potential limitation on the
total amount of cash that all shareholders can elect to receive in the aggregate
is considered a share issuance that is reflected in earnings per share
prospectively and is not a stock dividend. This ASU codified the consensus
reached in EITF Issue No. 09-E "Accounting for Stock Dividends, Including
Distributions to Shareholders with Components of Stock and Cash". ASU 2010-01 is
effective for interim and annual periods ending on or after December 15, 2009,
and should be applied on a retrospective basis. The adoption of this update did
not have any material impact on the Company's financial
statements.
- 8
-
In
2010,the FASB issued ASC Updated ("ASU") No. 2010-02, Consolidation (Topics 810) -
Accounting and Reporting for Decreases in Ownership of a Subsidiary - A Scope
Clarification This updated provides guidance for noncontrolling interests
and changes in ownership interests of a subsidiary. An entity is required to
deconsolidate a subsidiary when the entity ceases to have a controlling
financial interest in the subsidiary. Upon deconsolidation of a subsidiary, an
entity recognizes a gain or loss on the transaction and measures any retained
investment in the subsidiary at fair value. The gain or loss includes any gain
or loss associated with the difference between the fair value of the retained
investment in the subsidiary and its carrying amount at the date the subsidiary
is deconsolidated. In contrast, an entity is required to account for a decrease
in its ownership interest of a subsidiary that does not result in a change of
control of the subsidiary as an equity transaction. The adoption of this update
did not have any material impact on the Company's financial
statements.
In 2010,
the FASB issued ASC Update ("ASU") No.2010-13, Compensation - Stock Compensation
(Topic 718): Effect of Denominating the Exercise Price of a Share-Based Payment
Award in the Currency of the Market in Which the Underlying Equity Security
Trades. This update is to codify the consensus reached in EITF Issue No.
09-J, "Effect of Denominating the Exercise Price of a Share-Based Payment Award
in the Currency of the Market in Which the Underlying equity Security Trades"
The amendments to the Codification clarify that an employee share-based payment
award with an exercise price denominated in the currency of a market in which a
substantial portion of the entity's equity shares trades should not be
considered to contain a condition that is not a market, performance, or services
condition. Therefore, an entity would not classify such an award as a liability
if it otherwise qualifies as equity. The adoption of this update did not have
any material impact on the Company's financial statements.
In 2010,
the FASB issued ASC Update ("ASU") No.2010-21, Accounting for Technical Amendments
to Various SEC Rules and Schedules. This update amends various SEC
paragraphs in the FASB Accounting Standards Codification pursuant to SEC Final
Rule, "Technical Amendments to Rules Forms, Schedules and Codification of
Financial Reporting Policies". The adoption of this update did not have any
material impact on the Company's financial statements.
In 2010,
the FASB issued ASC Update ("ASU") No.2010-22, Accounting for Various Topics.
This update amends various SEC paragraphs in the FASB Accounting Standards
Codification based on external comments received and the issuance of Staff
Accounting Bulletin (SAB) No. 112 which amends or rescinds portion of certain
SAB topics. SAB 112 was issued to bring existing SEC guidance into conformity
with ASC 805 "Business Combination" and ASC 810 "Consolidation". The adoption of
this update did not have any material impact on the Company's financial
statements.
6. CERTAIN
SIGNIFICANT RISKS AND UNCERTAINTIES
Country
Risk - The Company is subject to the consideration and risks of operating in the
People's Republic of China (the "PRC"). These include risks associated with the
political and economic environment, foreign currency exchange and the legal
system in the PRC. The economy of the PRC differs significantly from the
economies of the "western" industrialized nations in such respects as structure,
level of development, gross national product, growth rate, capital reinvestment,
resource allocation, self-sufficiency, rate of inflation and balance of payments
position, among others. Only recently has the PRC government encouraged
substantial private economic activities. The Chinese economy has experienced
significant growth in the past several years, but such growth has been uneven
among various sectors of the economy and geographic regions. Actions by the PRC
government to control inflation have significantly restrained economic expansion
in the recent past. Similar actions by the PRC government in the future could
have a significant adverse effect on economic conditions in PRC.
Many laws
and regulations dealing with economic matters in general and foreign investment
in particular have been enacted in the PRC. However, the PRC still does not have
a comprehensive system of laws, and enforcement of existing laws may be
uncertain and sporadic.
- 9
-
The
Company’s primary sources of revenues and cash flows are derived from its
business operations in the PRC. The Company’s business activity is with
customers in the PRC. The PRC economy has, for many years, been a
centrally-planned economy, operating on the basis of annual, five-year and
ten-year state plans adopted by central PRC governmental authorities, which set
out national production and development targets. The PRC government has been
pursuing economic reforms since it first adopted its "open-door" policy in 1978.
There is no assurance that the PRC government will continue to pursue economic
reforms or that there will not be any significant change in its economic or
other policies, particularly in the event of any change in the political
leadership of, or the political, economic or social conditions in, the PRC.
There is also no assurance that the Company will not be adversely affected by
any such change in governmental policies or any unfavorable change in the
political, economic or social conditions, the laws or regulations, or the rate
or method of taxation in the PRC.
As many
of the economic reforms that have been or are being implemented by the PRC
government are unprecedented or experimental, they may be subject to adjustment
or refinement, which may have adverse effects on the Company. Further, through
state plans and other economic and fiscal measures such as the leverage of
exchange rate, it remains possible for the PRC government to exert significant
influence on the PRC economy.
The
Company's financial instruments that are exposed to concentration of credit risk
consist primarily of cash and cash equivalents. Cash and cash equivalents are
maintained with government-owned banks in the PRC with high credit
ratings. Accordingly, the Company believes that no significant credit
risk exists.
On
January 1, 1994, the PRC government introduced a single rate of exchange of
Renminbi ("Rmb") against United States Dollar (“US$”) as quoted daily by the
People’s Bank of China (the "Unified Exchange Rate"). On July 21, 2005, the Rmb
was revalued from Rmb8.28 to Rmb8.11 for US$1 following the removal of the peg
to the US dollar and pressure from the United States. The Peoples Bank of China
also announced that the Renminbi would be pegged to a basket of foreign
currencies, rather than being strictly tied to the US dollar and would trade
within a narrow 0.3% band against this basket of currencies, which is dominated
by the US dollar, Euro, Japanese Yen and South Korean Won, with a smaller
proportion made up of the British pound, Thai Baht and Russian Ruble. No
representation is made that the Rmb amounts have been, or could be, converted
into US dollars at that rate. This quotation of exchange rates does not imply
free convertibility of Rmb to other foreign currencies. All foreign exchange
transactions continue to take place either through the Bank of China or other
banks authorized to buy and sell foreign currencies at the exchange rate quoted
by the People's Bank of China. Approval of foreign currency payments by the
People's Bank of China or other institutions requires submitting a payment
application form together with suppliers' invoices, shipping documents and
signed contracts.
Restrictions
on the Payment of Dividends - PRC law requires net profits after taxes to be
used to set-off any losses carried forward before any distribution of profits
may be made. Furthermore, PRC law imposes a Mandatory Provident Reserve on all
businesses. Under this law, a business must set aside 10% of its distributable
profits as a mandatory reserve before a distribution of profits may occur. Once
the business accumulates a mandatory reserve equal to 50% of its capitalization,
no further accumulation of the reserve is required.
Industry
Risk - The Company operates in business segments which are characterized by
rapid technological advances, changes in customer requirements, and evolving
regulatory requirements and industry standards. Any failure by the Company to
anticipate or to respond adequately to technological changes in its industry
segments, changes in customer requirements or changes in regulatory requirements
or industry standards, could have a material adverse effect on the Company's
business and operating results.
7. INCOME
TAXES
The
Company and its subsidiaries are subject to income taxes on an entity basis on
income arising in, or derived from, the tax jurisdiction in which they
operate.
The
Company is subject to the United States federal tax at a rate of
33%.
Intermost
Limited, China Equity Platform Holding Group Limited and Leader Palace
International Limited, the Company's subsidiaries incorporated under the
International Business Companies Act of the British Virgin Islands, are exempted
from payment of the British Virgin Islands income taxes.
Intermost
(H.K.) Limited, the Company's subsidiary incorporated in Hong Kong, is subject
to Hong Kong profits tax at a rate of 16.5%.
The Company’s
key consolidated subsidiaries organized in the
PRC (IMOT Information Technology (Shenzhen)
Ltd., ChinaE.com E-Commerce Co. Ltd., ChinaE.com Technology
(Shenzhen) Ltd., ChinaE.com Investment Consultant (Shenzhen) Ltd. and Intermost
Focus Advertising Company Ltd.) are subject to PRC enterprise income taxes at a
rate of 15%.
- 10
-
8. CONCENTRATION
The
Company had entered into a joint venture agreement with other PRC investors on
February 19, 2009 to spin off the subsidiaries and investments in operating
equity exchange. The PRC investors will form a new company to hold
these subsidiaries and investments and seek an independent listing of the new
company on a US exchange. The name of the new company is China Equity
Platform Holding Group Limited. When the spin off process is completed, the
Company will get 53.4% –common stock of the newly formed company. The spin off
process is still under processing and waiting for the approval from U.S.
Securities and Exchange Commission. The subsidiary and associate companies will
be spin off are listed as following:
ChinaE.com
Technology (Shenzhen) Company Limited
ChinaE.com
Investment Consultant (Shenzhen) Company Limited
ChinaE.com
E-commerce Company Limited
Intermost
Focus Advertising Company Limited
Shenzhen
International Hi-Tech Property Right Exchange Centre
Hainan
Special Economic Zone Property Rights Exchange Centre
9. SEGMENT
INFORMATION
The
Company adopted SFAS No. 131, “Disclosures About Segments of an Enterprise and
Related Information,” in respect of its operating segments. The
Company currently operates in two principle business segments which are:
E-Commerce solutions and Consulting. E-Commerce Solutions comprises revenue from
web-site development contracts and maintenance contracts. The
Consulting segment comprises services rendered for provision of information on
property exchange matters.
Each
segment is managed separately because each business requires different
technology and marketing strategies. The Company evaluates performance based on
operating earnings of the respective business units. The accounting policies of
the segments are the same as those described in the summary of significant
accounting policies. The corporate assets include primarily cash and cash
equivalents and deposits and other receivables. There were no significant
intercompany transactions during any of the reported periods. In determining
operating income (loss) by reportable segment, general corporate expenses and
other income and expense items of a non-operating nature are not considered; as
such items are not allocated to the Company's segments. Management believes that
the following table presents the useful information to the chief operation
decision makers for measuring business performance and financing needs
etc. Segment information for the six months period ended
December 31, 2010 is as follows:
(a) Net
revenues:
Six Months Ended December 31,
2010
|
||||||||
Net revenues by major
categories
|
Rmb’000
|
US$’000
|
||||||
Sales
of paper products
|
67,408 | 10,025 | ||||||
E-commerce
solutions - website design and development
|
22 | 3 | ||||||
Consulting
|
1,779 | 265 | ||||||
69,209 | 10,293 |
All net
revenues were generated in PRC.
- 11
-
(b) Net
loss before equity in earnings of associated companies:
Six Months Ended December 31,
2010
|
||||||||
Rmb’000
|
US$’000
|
|||||||
Sales
of paper products
|
(7,411 | ) | (1,102 | ) | ||||
E-commerce
solutions - website design and
development
|
(1,016 | ) | (151 | ) | ||||
Consulting
|
(1,333 | ) | (198 | ) | ||||
Corporate
|
(1,994 | ) | (297 | ) | ||||
(11,754 | ) | (1,748 | ) |
(c)
Assets:
As of December 31, 2010
|
||||||||
Rmb’000
|
US$’000
|
|||||||
Sales
of paper products
|
130,089 | 19,675 | ||||||
E-commerce
solutions - website design and development
|
11,412 | 1,726 | ||||||
Consulting
|
11,826 | 1,789 | ||||||
Corporate
|
80,972 | 11,936 | ||||||
234,299 | 35,126 |
Substantially
all of the Company's identifiable assets are located in the PRC.
(d) Other
items:
Six Months Ended December 31,
2010
|
||||||||
Rmb’000
|
US$’000
|
|||||||
Depreciation:
|
||||||||
Sales
of paper products
|
2,390 | 356 | ||||||
E-commerce
solutions - website design and development
|
72 | 11 | ||||||
Corporate
|
3 | 0 | ||||||
2,465 | 367 |
There was
fixed expenditure for fixed assets $389K during the six months ended December
31, 2010.
- 12
-
ITEM
2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF
OPERATION.
Certain
statements contained in this Form 10-Q constitute 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. Such
forward-looking statements herein are based on current expectations that involve
a number of risks and uncertainties. Such forward-looking statements are based
on assumptions that there will be no material adverse change in our operations
or business, that we will meet success in marketing and selling our products,
and that we will be able to continue to attract and retain skilled employees
necessary for our business, among other things. The foregoing
assumptions are based on judgments with respect to, among other things,
information available to our, future economic, competitive and market conditions
and future business decisions. All of these assumptions are difficult
or impossible to predict accurately and many are beyond our control.
Accordingly, although we believe that the assumptions underlying the
forward-looking statements are reasonable, any such assumption could prove to be
inaccurate and therefore there can be no assurance that the results contemplated
in the forward-looking statements will be realized. There are a number of risks
presented by our business and operations, which could cause our financial
performance to vary markedly from prior results, or results contemplated by the
forward-looking statements. Such risks include failure of the our technology or
products to work as anticipated, failure to develop commercially viable products
or services from our technology, delays or failure in financing efforts, delays
in or lack of market acceptance, failure to recruit adequate personnel, and
problems with protection of intellectual property, among others. The words
“believe,” “estimate,” “expect,” “intend,” “anticipate” “should”, “could”,
“may”, “plan” and similar expressions and variations thereof identify some of
these forward-looking statements. Management decisions, including budgeting, are
subjective in many respects and periodic revisions must be made to reflect
actual conditions and business developments, the impact of which may cause us to
alter our capital investment and other expenditures, which may also adversely
affect our results of operations. In light of significant uncertainties inherent
in forward-looking information included in this Quarterly Report on Form 10-Q,
the inclusion of such information should not be regarded as a representation by
us that our objectives or plans will be achieved. We undertake no obligation to
revise or publicly release the results of any revision to these forward-looking
statements.
Overview
We
believe that the People’s Republic of China represents an exciting emerging
world market whose role in the global economy is, despite recent global economic
slowdown, increasing steadily. China’s economic growth rate, measured
by its gross domestic product, has consistently been higher than 7% over the
past 10 years. This economic growth is attributable to many factors,
including investment in the country’s infrastructure, increased privatization of
businesses and an abundant source of labor. Currently, we offer
products and services to businesses and consumers located primarily in
China. Our plan is to take advantage of China’s economic growth to
expand our existing businesses and, possibly, in the future, to sell our
products and services outside of China. We also have begun to acquire
diverse businesses that are not dependent on, or directly related to, each
other. We believe that diversification is a good hedge against the
collapse of a single industry, such as the global collapse of the technology
industry that occurred in 2000. We expect that any acquisitions we
make will improve our financial condition, although we cannot guarantee any such
result.
Amidst
global economic slowdown we continue to diversify our business, not only so that
we will no longer be dependent on one market for revenue, but also so that we
will be poised to take advantage of future economic
recovery. Generally, the issuance of our common stock represents some
or all of the purchase price we pay for an acquired business. We
believe that the continued active trading of our common stock will be important
to the principals of target companies and future acquisitions may be dependent
on the active trading of our common stock. However, our common stock
has not been actively traded and, if our common stock continues to trade with
limited volume and at current levels we may not be able to make acquisitions as
planned.
Risks
Associated with Doing Business in China
There are
significant risks in operating in the Peoples’ Republic of China (the “PRC”).
These include risks associated with the political and economic environment,
foreign currency exchange and the legal system in the PRC. The
economy of PRC differs significantly from the economies of the industrialized
nations of the west in such respects as structure, level of development, gross
national product, growth rate, capital reinvestment, resource allocation,
self-sufficiency, rate of inflation and balance of payments position, among
others. Only recently has the PRC government encouraged substantial private
economic activities. The Chinese economy has experienced significant growth in
the past several years, but such growth has been uneven among various sectors of
the economy and geographic regions. Actions by the PRC government to control
inflation have significantly restrained economic expansion in the recent past.
Similar actions by the PRC government in the future could have a significant
adverse effect on economic conditions there.
- 13
-
Many laws
and regulations dealing with economic matters in general and foreign investment
in particular have been enacted in the PRC. However, the PRC still
does not have a comprehensive system of laws, and enforcement of existing laws
may be uncertain and sporadic. Our primary sources of revenues and
cash flows are derived from our business operations in the PRC. The
PRC economy has, for many years, been a centrally-planned economy, operating on
the basis of annual, five-year and ten-year state plans adopted by central PRC
governmental authorities, which set out national production and development
targets. The PRC government has been pursuing economic reforms since it first
adopted its "open-door" policy in 1978. There is no assurance that the PRC
government will continue to pursue economic reforms or that there will not be
any significant change in its economic or other policies, particularly in the
event of any change in the political leadership of, or the political, economic
or social conditions in, the PRC. There is also no assurance that the Company
will not be adversely affected by any such change in governmental policies or
any unfavorable change in the political, economic or social conditions, the laws
or regulations, or the rate or method of taxation in the PRC.
As many
of the economic reforms that have been or are being implemented by the PRC
government are unprecedented or experimental, they may be subject to adjustment
or refinement, which may have adverse effects on the Company. Further, through
state plans and other economic and fiscal measures such as the leverage of
exchange rate, it remains possible for the PRC government to exert significant
influence on the PRC economy. The Company's financial instruments that are
exposed to concentration of credit risk consist primarily of cash and cash
equivalents. Cash and cash equivalents are maintained with government-owned
banks in the PRC with high credit ratings.
On
January 1, 1994, the PRC government introduced a single rate of exchange of
Renminbi (“Rmb”) against United States Dollar ("US$") as quoted daily by the
People's Bank of China (the “Unified Exchange Rate”). On July 21, 2005 Rmb was
revalued from Rmb 8.28 to Rmb8.11 for US$1 following the removal of the peg to
the US dollar and pressure for the United States. The Peoples Bank of China also
announced that the Renminbi would be pegged to a basket of foreign currencies,
rather than being strictly tied to the US dollar and would trade within a narrow
0.3% band against this basket of currencies, which is dominated by the US
dollar, Euro, Japanese Yen and South Korean Won, with a smaller proportion made
up of the British pound, Thai Baht and Russian Ruble. No representation is made
that the Rmb amounts have been, or could be, converted into US$ at that rate.
This quotation of exchange rates does not imply free convertibility of Rmb to
other foreign currencies. All foreign exchange transactions continue to take
place either through the Bank of China or other banks authorized to buy and sell
foreign currencies at the exchange rate quoted by the People's Bank of China.
Approval of foreign currency payments by the People's Bank of China or other
institutions requires submitting a payment application form together with
suppliers’ invoices, shipping documents and signed contracts.
Restriction
on the Payment of Dividends - PRC law requires net profits after taxes to be
used to set-off any losses carried forward before any distribution of profits
may be made. Furthermore, PRC law imposes a Mandatory Provident Reserve on all
businesses. Under this law, a business must set aside 10% of its distributable
profits as a mandatory reserve before a distribution of profits may occur. Once
the business accumulates a mandatory reserve equal to 50% of its capitalization,
no further accumulation of the reserve is required.
Certain
Factors Affecting Future Operating Results
The
Company’s operating results have been, and will continue to be, affected by a
wide variety of factors that could have a material adverse effect on revenues
and profitability during any particular period. Some of these factors
include:
|
·
|
the
Company's ability to successfully implement its current business
plans;
|
|
·
|
whether
the Company will be able to obtain additional capital, if necessary, to
support its operations;
|
|
·
|
whether
the Company will be able to find joint venture prospects or acquisition
prospects with which to enhance its
business;
|
|
·
|
whether
the Company can successfully integrate acquisitions that it makes into its
business;
|
|
·
|
the
level and rate of acceptance of the Company's products and services by
consumers in China;
|
- 14
-
|
·
|
continued
economic growth in China;
|
|
·
|
entry
of new competition (including established companies from outside China and
companies with substantially greater resources) into the Company's
market;
|
|
·
|
fluctuations
in the level of demand for services or
products;
|
|
·
|
rescheduling
or cancellation of orders by
customers;
|
|
·
|
competitive
pressures on selling prices;
|
|
·
|
rapid
changes in technology, which could result in the Company's technology
becoming obsolete;
|
|
·
|
dependence
upon key employees;
|
|
·
|
availability
and cost of computer technicians;
|
|
·
|
loss
of any of the Company's major
customers;
|
|
·
|
the
Company's ability to introduce new products and services on a timely
basis;
|
|
·
|
new
product and service introductions by the Company's
competitors;
|
|
·
|
fluctuations
in exchange rates; and
|
|
·
|
adverse
changes in the general economic, social or political conditions in the
PRC.
|
Critical
Accounting Policies
Management’s
discussion and analysis of results of operations and financial condition are
based upon the Company’s consolidated financial statements. These
statements have been prepared in accordance with the generally accepted
accounting principles as used in the United States of America. These
principles require management to make certain estimates, judgments and
assumptions that affect the reported amounts of assets, liabilities, revenues
and expenses, and related disclosure of contingent assets and
liabilities. On an on-going basis, we evaluate our estimates based on
historical experience and various other assumptions that are believed to be
reasonable under the circumstances, the results of which form the basis for
making judgments about the carrying values of assets and liabilities that are
not readily apparent from other sources. Actual results may differ from these
estimates under different assumptions or conditions.
The
following critical accounting policies affect the more significant judgments and
estimates used in the preparation of the Company's consolidated financial
statements.
Revenue
Recognition
The
Company recognizes revenue in accordance with SEC Staff Accounting Bulletin No.
101, “Revenue Recognition in Financial Statements”. The Company recognizes
revenue when the significant risks and rewards of ownership have been
transferred to the customer pursuant to PRC law, including factors such as when
persuasive evidence of an arrangement exists, delivery has occurred, the sales
price is fixed or determinable, sales and value-added tax laws have been
complied with, and collectability is probable.
Revenue
from web-site development contracts is recognized based on the terms of the
contract. The Company uses either the percentage of completion when the contract
is long-term or the completed contract method when the contract is short-term to
recognize such revenue. Contracts are short-term in nature and require
acceptance by the customer pursuant to the respective contracts are accounted
for under the completed contract method. Revenues are allocated to the elements
of the contract based on the fair values of the elements. Provisions for
estimated contract losses are recognized in the year the loss becomes probable
and can be reasonably estimated.
- 15
-
Revenue
from maintenance contracts is recognized on a straight-line basis over the term
of the maintenance contract, generally twelve months. The unearned portion of
maintenance revenue is classified as deferred revenue and amortized over the
life of the contract.
Revenue
represents the invoiced value of goods sold recognized upon the delivery of
goods to customers. Revenue is recognized when all of the following criteria are
met:
-
Persuasive evidence of an arrangement exists;
-
Delivery has occurred or services have been rendered;
- The
seller’s price to the buyer is fixed or determinable; and
-
Collection is reasonably assured.
Inventories
Inventories
consist of finished goods and raw materials, and are stated at the lower of cost
or market value. Substantially all inventory costs are determined using the
weighted average basis. Finished goods are comprised of direct materials, direct
labor and an appropriate proportion of overhead. The management regularly
evaluates the composition of its inventory to identify slow-moving and obsolete
inventories to determine if additional write-downs are required.
Accounts
Receivable
Accounts
receivable is carried at the net invoiced value charged to
customer. The Company records an allowance for doubtful accounts to
cover estimated credit losses. Management reviews and adjusts this allowance
periodically based on historical experience and its evaluation of the
collectability of outstanding accounts receivable. The Company evaluates the
credit risk of its customers utilizing historical data and estimates of future
performance.
Goodwill
Goodwill
represents the excess of the purchase price over the fair value of the net
tangible and identifiable intangible assets acquired in a business combination.
In accordance with Accounting Standards Codification ASC 350 “Intangibles -
Goodwill and Other” formerly Statement of Financial Accounting Standards
("SFAS") No. 142, "Goodwill and Other Intangible Assets", goodwill is no longer
subject to amortization. Rather, goodwill is subject to at least an annual
assessment for impairment, applying a fair-value based test. Fair value is
generally determined using a discounted cash flow analysis. See Note 4 for
goodwill impairment details.
Accounting
for the Impairment of Long-Lived Assets
Impairment
of Long-Lived Assets is evaluated for impairment at a minimum on an annual basis
whenever events or changes in circumstances indicate that the carrying amount of
an asset may not be recoverable in accordance with ASC 360-10 “Impairments of
Long-Lived Assets” formerly SFAS No. 144, "Accounting for the Impairment or
Disposal of Long-Lived Assets". An asset is considered impaired if its carrying
amount exceeds the future net cash flow the asset is expected to generate. If an
asset is considered to be impaired, the impairment to be recognized is measured
by the amount by which the carrying amount of the asset exceeds its fair market
value. The recoverability of long-lived assets is assessed by determining
whether the unamortized balances can be recovered through undiscounted future
net cash flows of the related assets. The amount of impairment, if any, is
measured based on projected discounted future net cash flows using a discount
rate reflecting the Company's average cost of capital.
- 16
-
Income
Taxes
The
Company uses the accrual method of accounting to determine and report its
taxable income and tax credit in the year in which they are
available. The Company has implemented ASC 740 “Income Taxes”
formerly SFAS No. 109,
Accounting for Income Taxes.
Income
tax liabilities computed according to the United States, People’s Republic of
China (PRC), Taiwan (ROC) and Hong Kong SAR tax laws are provided for the tax
effects of transactions reported in the financial statements and consists of
taxes currently due plus deferred taxes related primarily to differences between
the basis of fixed assets and intangible assets for financial and tax
reporting. The deferred tax assets and liabilities represent the
future tax return consequences of those differences, which will either be
taxable or deductible when the assets and liabilities are recovered or
settled. Deferred taxes also are recognized for operating losses that
are available to offset future income taxes. A valuation allowance is
created to evaluate deferred tax assets if it is more likely than not that these
items will either expire before the Company is able to realize that tax benefit,
or that future realization is uncertain.
Results
of Operations - Three Months Ended December 31, 2010 and 2009
All
amounts shown below are presented in US$. As used below, the letter “K”
appearing immediately after a dollar amount denotes that it has been rounded to
the nearest $1,000.
Net
Revenues
Net
revenues for the three months ended December 31, 2010 consisted primarily from
ChinaE.com Tech and ChinaE.com Investment Consultants, which provide e-commerce
solutions and consultancy services. The term "e-commerce solutions" includes
web-site design and development and web-hosting.
The
following table reflects the total net revenues and percentage of net revenues
by major category for the periods indicated:
3
months ended December 31
|
||||||||||||||||
2010
|
2010
|
2009
|
2009
|
|||||||||||||
USD'000
|
%
|
USD'000
|
%
|
|||||||||||||
Sales
of paper products
|
5,435 | 95 | % | - | - | % | ||||||||||
E-commerce
solutions - website design and development
|
1 | 0 | % | 13 | 74 | % | ||||||||||
Consulting
|
265 | 5 | % | 4 | 26 | % | ||||||||||
5,701 | 100 | % | 17 | 100 | % |
Total net
revenues increased to $5,701K during the three months ended December 31, 2010,
as compared to $17K during the three months ended December 31, 2009. The
increase in total net revenues was primarily due to the revenue from the sales
of paper products which was generated from the subsidiary, APT Paper Group
Limited which was acquired in June 2010.
- 17
-
Cost of
Revenues
The
following table reflects the principal components of cost of revenues and the
percentage of net revenues represented by each component for the periods
indicated:
3
months ended December 31
|
||||||||||||||||
2010
|
2010
|
2009
|
2009
|
|||||||||||||
USD'000
|
%
|
USD'000
|
%
|
|||||||||||||
Direct
materials
|
3,661 | 64 | % | - | - | |||||||||||
Direct
labor
|
512 | 10 | % | - | - | |||||||||||
Manufacturing
overhead
|
588 | 10 | % | - | - | |||||||||||
Depreciation
|
76 | 1 | % | - | - | |||||||||||
Others
|
73 | 1 | % | 6 | 36 | % | ||||||||||
4,910 | 86 | %- | 6 | 36 | % |
The
increase in costs of revenues for the three months ended December 31, 2010
compared with 2009 was due to the acquisition of APT Paper Group Limited. Costs
of revenues consist principally of the production cost of paper products for the
three months ended December 31, 2010. The costs of revenues for the period
consist of principally direct material cost, direct labor, manufacturing
overhead, depreciation, and other costs including travel employee benefits and
office expenses.
Selling,
General and Administrative Expense
Selling,
general and administrative (“SG&A”) expense consists principally of sales
commissions, advertising, other marketing expenses, rental expenses, salaries
for administrative and sales staff, and corporate overhead.
The
following table reflects the principal components of SG&A expense and the
percentage of net sales represented by each component for the periods
indicated:
3
months ended December 31
|
||||||||||||||||
2010
|
2010
|
2009
|
2009
|
|||||||||||||
USD'000
|
%
|
USD'000
|
%
|
|||||||||||||
Sales
& Marketing salaries & commissions
|
310 | 5 | % | 35 | 205 | % | ||||||||||
Advertising
& other sales & marketing expenses
|
211 | 4 | % | 8 | 48 | % | ||||||||||
Rentals
|
305 | 5 | % | 35 | 207 | % | ||||||||||
Administrative
salaries
|
332 | 6 | % | 115 | 681 | % | ||||||||||
Consultancy
fee
|
151 | 3 | % | 645 | 3820 | % | ||||||||||
Corporate
overhead
|
94 | 2 | % | 76 | 455 | % | ||||||||||
1,403 | 25 | % | 914 | 5417 | % |
The
principal components of SG&A during the three months ended December 31, 2010
were sales and marketing salaries and commissions, other marketing expenditures,
administrative salaries and benefits, and other corporate expenses, which
includes legal and professional fees, general office expenses, traveling
expenses, general employee benefit expense, depreciation consultancy fees, and
allowance for bad and doubtful accounts.
For the
three months ended December 31, 2010, SG&A expense increased by 54% to
$1,403K, as compared to $914K for the three months ended December 31,
2009.
- 18
-
The
increased in SG&A was mainly come from the newly acquired subsidiaries, APT
Paper Group Limited and its subsidiaries.
Income
Taxes
There was
no income tax for both the three months ended December 31, 2010 and the three
months ended December 31, 2009.
Minority
Interest
Minority
interests reflect the minority shareholders' proportionate interests in the net
loss of the group operating losses of China Equity Platform Holding Group
Limited.
Net
Income (Loss)
The
Company had net loss of $979K during the three months ended December 31, 2010,
as compared to a net loss of $810K during the three months ended December 31,
2009.
Results
of Operations - Six Months Ended December 31, 2010 and 2009
All
amounts shown below are presented in US$. As used below, the letter “K”
appearing immediately after a dollar amount denotes that it has been rounded to
the nearest $1,000.
Net
Revenues
Net
revenues for the six months ended December 31, 2010 consisted primarily from
ChinaE.com Tech and ChinaE.com Investment Consultants, which provide e-commerce
solutions and consultancy services. The term "e-commerce solutions" includes
web-site design and development and web-hosting.
The
following table reflects the total net revenues and percentage of net revenues
by major category for the periods indicated:
6
months ended December 31
|
||||||||||||||||
2010
|
2010
|
2009
|
2009
|
|||||||||||||
USD'000
|
%
|
USD'000
|
%
|
|||||||||||||
Sales
of paper products
|
10,025 | 97 | % | - | - | % | ||||||||||
E-commerce
solutions - website design and development
|
3 | 0 | % | 13 | 62 | % | ||||||||||
Consulting
|
265 | 3 | % | 8 | 38 | % | ||||||||||
10,293 | 100 | % | 21 | 100 | % |
Total net
revenues increased to $10,293K during the six months ended December 31, 2010, as
compared to $21K during the six months ended December 31, 2009. The increase in
total net revenues was primarily due to the revenue from the sales of paper
products which was generated from the subsidiary, APT Paper Group Limited which
was acquired in June 2010.
- 19
-
Cost of
Revenues
The
following table reflects the principal components of cost of revenues and the
percentage of net revenues represented by each component for the periods
indicated:
6
months ended December 31
|
||||||||||||||||
2010
|
2010
|
2009
|
2009
|
|||||||||||||
USD'000
|
%
|
USD'000
|
%
|
|||||||||||||
Direct
materials
|
6,282 | 61 | % | - | - | |||||||||||
Direct
labor
|
760 | 7 | % | - | - | |||||||||||
Manufacturing
overhead
|
1,289 | 13 | % | - | - | |||||||||||
Depreciation
|
341 | 3 | % | - | - | |||||||||||
Others
|
75 | 1 | % | 6 | 30 | % | ||||||||||
8,747 | 85 | % | 6 | 30 | % |
The
increase in costs of revenues for the six months ended December 31, 2010
compared with 2009 was due to the acquisition of APT Paper Group Limited. Costs
of revenues consist principally of the production cost of paper products for the
six months ended December 31, 2010. The costs of revenues for the period consist
of principally direct material cost, direct labor, manufacturing overhead,
depreciation, and other costs including travel employee benefits and office
expenses.
Selling,
General and Administrative Expense
Selling,
general and administrative (“SG&A”) expense consists principally of sales
commissions, advertising, other marketing expenses, rental expenses, salaries
for administrative and sales staff, and corporate overhead.
The
following table reflects the principal components of SG&A expense and the
percentage of net sales represented by each component for the periods
indicated:
6
months ended December 31
|
||||||||||||||||
2010
|
2010
|
2009
|
2009
|
|||||||||||||
USD'000
|
%
|
USD'000
|
%
|
|||||||||||||
Sales
& Marketing salaries & commissions
|
470 | 5 | % | 81 | 385 | % | ||||||||||
Advertising
& other sales & marketing expenses
|
381 | 4 | % | 19 | 88 | % | ||||||||||
Rentals
|
600 | 6 | % | 70 | 331 | % | ||||||||||
Administrative
salaries
|
628 | 6 | % | 187 | 887 | % | ||||||||||
Consultancy
fee
|
781 | 7 | % | 658 | 3123 | % | ||||||||||
Corporate
overhead
|
158 | 1 | % | 125 | 597 | % | ||||||||||
3,018 | 29 | % | 1,140 | 5410 | % |
The
principal components of SG&A during the six months ended December 31, 2010
were rentals, administrative salaries, consulting fees, sales and marketing
salaries and commissions, other marketing expenditures, administrative salaries
and benefits, and other corporate expenses, which includes legal and
professional fees, general office expenses, traveling expenses, general employee
benefit expense, depreciation consultancy fees, and allowance for bad and
doubtful accounts.
- 20
-
For the
six months ended December 31, 2010, SG&A expense increased by 165% to
$3,018K, as compared to $1,140K for the six months ended December 31,
2009.
The
increased of SG&A was mainly come from the newly acquired subsidiaries, APT
Paper Group Limited and its subsidiaries.
Income
Taxes
There was
no income tax for both the six months ended December 31, 2010 and the six months
ended December 31, 2009.
Minority
Interest
Minority
interests reflect the minority shareholders' proportionate interests in the net
loss of the group operating losses of China Equity Platform Holding Group
Limited.
Net
Income (Loss)
The
Company had net loss of $1,748K during the six months ended December 31, 2010,
as compared to a net loss of $992K during the six months ended December 31,
2009.
Liquidity
and Capital Resources – December 31, 2010
At
December 31, 2010, the Company had cash and cash equivalents of $2,268K and net
current liabilities of $17K, as compared to $937K of cash and cash equivalents
and $3,171K of working capital at December 31, 2009.
Net cash
used in operating activities was $2,515K and $2,178K for the six months ended
December 31, 2010 and December 31, 2009 respectively.
Net cash
used in investing activities was $378K and $5K for the six months ended December
31, 2010 and December 31, 2009 respectively, mainly consisting of an increase in
additions of fixed assets.
Net cash
generated from financing activities was $2,920K for six months ended December
31, 2010, was mainly the private placement of working capital of $3,000K from
third parties. Net cash generated from financing activities was $2,545K for the
six months ended December 31, 2009, was mainly the issuance of share capital for
the payment of consultancy fee to Star Fair Ventures Corp.
The
Company continues to evaluate various opportunities to improve the operating
performance of the Company’s businesses and to invest in or acquire other types
of businesses.
Principal
Commitments
At
December 31, 2010, the Company has operating lease agreements for office
premises, which are expiring in June 2035. The Company does not have any
material commitments for capital expenditures, or have any transactions,
obligations or relationships that could be considered off-balance sheet
arrangements.
The
Company has no long-term debt at December 31, 2010.
Subsequent
Event
The
Company had entered into a joint venture agreement with other PRC investors on
February 19, 2009 to spin off the subsidiaries and investments in operating
equity exchange. The PRC investors will form a new company to hold
these subsidiaries and investments and seek an independent listing of the new
company on a US exchange. The name of the new company is China Equity
Platform Holding Group Limited. When the spin off process is completed, the
Company will get 53.4% –common stock of the newly formed company. The spin off
process is still under processing and waiting for the approval from U.S.
Securities and Exchange Commission. The subsidiary and associate companies that
will be spin off are listed as following:
ChinaE.com
Technology (Shenzhen) Company Limited
ChinaE.com
Investment Consultant (Shenzhen) Company Limited
ChinaE.com
E-commerce Company Limited
Intermost
Focus Advertising Company Limited
- 21
-
Shenzhen
International Hi-Tech Property Right Exchange Centre
Hainan
Special Economic Zone Property Rights Exchange Centre
- 22
-
RISK
FACTORS
In
addition to other information in this Form 10-Q, including many risks presented
in our Management’s Discussion and Analysis, the following risk factors should
be carefully considered in evaluating our business since it operates in a highly
changing and complex business environment that involves numerous risks, some of
which are beyond our control. The following discussion highlights a
few of these risk factors, any one of which may have a significant adverse
impact on our business, operating results and financial condition. As
a result of the risk factors set forth below and elsewhere in this 10-Q, the
risks identified in our Annual Report on Form 10-K for the fiscal year ended
June 30, 2010, and the risks discussed in our other Securities and Exchange
Commission filings, actual results could differ materially from those projected
in any forward-looking statements.
We face
significant risks, and the risks described below may not be the only risks we
face. Additional risks that we do not know of or that we currently
consider immaterial may also impair our business operations. If any
of the events or circumstances described in the following risks actually occurs,
our business, financial condition or results of operations could be harmed and
the trading price of our common stock could decline.
Our
success depends on identifying and closing acquisitions of emerging and growing
businesses in China.
Our
success is largely dependent on our identifying good acquisition targets,
negotiating and structuring transactions that are beneficial to us, closing
those transactions, finding suitable management to operate those businesses and
successfully operate and grow the businesses we acquire.
We must work
cooperatively with governmental authorities.
We are
engaged in business in a country with a planned economy heavily influenced by
government activities and we must work cooperatively with a variety of national,
federal, regional, state, provincial, and local government authorities and
entities. The economy of China differs significantly from the
economies of the “western” industrialized nations in such respects as structure,
level of development, gross national product, growth rate, capital reinvestment,
resource allocation, self-sufficiency, rate of inflation and balance of payments
position, among others. Only recently has the Chinese government
encouraged substantial private economic activities. The Chinese
economy has experienced significant growth in the past several years, but such
growth has been uneven among various sectors of the economy and geographic
regions. Actions by the Chinese government to control inflation have
significantly restrained economic expansion in the recent
past. Similar actions by the Chinese government in the future could
have a significant adverse effect on economic conditions in China and the
results of operations of the Company.
If we deliver
products with defects, our credibility will be harmed and the sales and market
acceptance of our products will decrease.
Our
product and services are complex and may at times contain errors, defects and
bugs. If we deliver products with errors, defects or bugs, our
credibility and the market acceptance and sales of our products would be
harmed. Further, if our products contain errors, defects or bugs, we
may be required to expend significant capital and resources to alleviate such
problems. We may agree to indemnify our customers in some
circumstances against liability arising from defects in our products. Defects
could also lead to liability, and, as a result of product liability lawsuits
against us or against our customers. We carry product and information liability
and errors and omissions insurance, but in the event that we are required to
defend more than a few such actions, or in the event that we are found liable in
connection with such an action, our business and operations may be severely and
materially adversely affected.
We compete with
large companies.
We
operate in a highly competitive industry. Although we believe that
some of our technology is unique, can be protected, and, if adopted, will confer
benefits that will be otherwise unavailable for some time, we face very large
competitors with greater resources who may adopt various strategies to block or
slow our market penetration, thereby straining our more limited
resources. We are aware of efforts by competitors to introduce doubt
about our financial stability as we compete to make sales and win customers and
business. Large competitors may also seek to hinder our operations
through attempts to recruit key staff with exceptionally attractive terms of
employment, including signing bonuses, or by offer of highly competitive terms
to potential or newly acquired customers.
- 23
-
We will need to
continue our product development efforts.
We
believe that our market will be characterized by increasing technical
sophistication. We also believe that our eventual success will depend
on our ability to continue to provide increased and specialized technical
expertise. There is no assurance that we will not fall
technologically behind competitors with greater resources. Although
we believe that we enjoy a lead in our product development, and are hopeful that
our patents provide some protection, we will likely need significant additional
capital in order to continue to enjoy such a technological lead over competitors
with more resources.
If we are unable
to protect our intellectual property, our competitive position would be
adversely affected.
We may
rely on patent protection, as well as trademark and copyright law, trade secret
protection and confidentiality agreements with our employees and others to
protect our intellectual property. Despite our precaution,
unauthorized third parties may copy our products and services or reverse
engineer or obtain and use information that we regard as
proprietary. We have filed eleven patent applications with the United
States Patent and Trademark Office and intend to file more. Six
patents have been granted; however, we do not know if the remaining applications
will be granted or whether we will be successful in prosecuting any future
patents. In addition, the laws of some foreign countries do not
protect proprietary rights to the same extent, as do the laws of the United
States. Our means of protecting our proprietary rights may not be
adequate and third parties may infringe or misappropriate our patents,
copyrights, trademarks and similar proprietary rights. If we fail to
protect our intellectual property and proprietary rights, our business,
financial condition and results of operations would suffer. We
believe that we do not infringe upon the proprietary rights of any third party,
and no third party has asserted an infringement claim against us. It
is possible, however, that such a claim might be asserted successfully against
us in the future. We may be forced to suspend our operations to pay
significant amounts to defend our rights, and a substantial amount of the
attention of our management may be diverted from our ongoing business, all of
which would materially adversely affect our business.
We focus on the
research and development of our proprietary technologies and the marketing of
our first product.
We
believe that these technologies are the basis for marketable commercial
products. However, there can be no assurance of this, and it is
possible that our proprietary technologies and products will have no commercial
benefit or potential. In addition, from our inception to the present,
we have not recognized any substantial operating revenues.
We depend on our
key personnel and may have difficulty attracting and retaining the skilled staff
we need to execute our growth plans.
Our
success will be dependent largely upon the efforts of our management
team. The loss of key staff could have a material adverse effect on
our business and prospects. To execute our plans, we will have to
attract and retain current employees. Competition for highly skilled employees
with technical, management, marketing, sales, product development and other
specialized training is intense. We may not be successful in
retaining such qualified personnel. Specifically, we may experience increased
costs in order to retain skilled employees. If we are unable to retain
experienced employees as needed, we would be unable to execute our business
plan.
We may face rapid
technological change.
The
market for our products and services may be characterized by rapidly changing
technologies, extensive research and the introduction of new products and
services. We believe that our future success will depend in part upon our
ability to continue to enhance our existing products and to develop, manufacture
and market new products and services. As a result, we expect to continue to make
a significant investment in engineering, research and
development. There can be no assurance that we will be able to
develop and introduce new products and services or enhance our initial products
in a timely manner to satisfy customer needs, achieve market acceptance or
address technological changes in our target markets. Failure to develop products
and services and introduce them successfully and in a timely manner could
adversely affect our competitive position, financial condition and results of
operations.
- 24
-
If we experience
rapid growth, we will need to manage such growth well.
We may
experience substantial growth in the size of our staff and the scope of our
operations, resulting in increased responsibilities for
management. To manage this possible growth effectively, we will need
to continue to improve our operational, financial and management information
systems, will possibly need to create entire departments that do not now exist,
and hire, train, motivate and manage a growing number of staff. Due
to a competitive employment environment for qualified technical, marketing and
sales personnel, we expect to experience difficulty in filling our needs for
qualified personnel. There can be no assurance that we will be able
to effectively achieve or manage any future growth, and our failure to do so
could delay product development cycles and market penetration or otherwise have
a material adverse effect on our financial condition and results of
operations.
We could face
information and product liability risks and may not have adequate
insurance.
Our
products may be used in connection with critical business applications. We may
become the subject of litigation alleging that one or more of our products are
ineffective or disruptive in our treatment of data, or with regard to critical
business information. Thus, we may become the target of lawsuits from
injured or disgruntled businesses or other users. In the event that
we are required to defend more than a few such actions, or in the event that it
is found liable in connection with such an action, our business and operations
may be severely and materially adversely affected.
Future
profitability is not guaranteed.
We have
not recognized any substantial operating revenues to date. Assuming
we can attract sufficient financing, and revenues increase, there is no
assurance that our plans will be realized or that we will achieve break-even
status or profitability in the future.
Changes to
financial accounting standards may affect our results of operations and cause us
to change business practices.
We
prepare financial statements in conformity with U.S. generally accepted
accounting principles. These accounting principles are subject to
interpretation by the American Institute of Certified Public Accountants, the
Public Company Accounting Oversight Board, the SEC and various other bodies
formed to interpret and create appropriate accounting principles. A
change in those principles can have a significant effect on our reported results
and may affect our reporting of transactions completed before a change is
announced. Changes to those rules or the questioning of current
practices may adversely affect our reported financial results or the way we
conduct business. For example, accounting principles affecting many
aspects of our business, including rules relating to equity-related
compensation, have recently been revised. The Financial Accounting
Standards Board and other agencies finalized changes to U.S. generally accepted
accounting principles that required us, starting January 1, 2006, to record a
charge to earnings for employee stock option grants and other equity incentives.
We will have significant ongoing accounting charges resulting from option grant
and other equity incentive expensing that could reduce net income or increase
losses. In addition, since we historically used equity-related
compensation as a component of our total employee compensation program, the
accounting change could make the use of equity-related compensation less
attractive and therefore make it more difficult to attract and retain
employees.
There is a
limited market for our common stock.
Our
common stock is not listed on any exchange and trades in the over-the-counter
(the “OTC”) market in the United States. Additionally, one
stockholder holds a majority of our stock. As such, the market for
our common stock is limited and is not regulated by the rules and regulations of
any exchange in the United States or China. Further, the price of our common
stock and its volume in the OTC market may be subject to wide fluctuations. Our
stock price could decline regardless of our actual operating performance, and
stockholders could lose a substantial part of their investment as a result of
industry or market-based fluctuations. Our stock trades relatively
thinly. If a more active public market for our stock is not
sustained, it may be difficult for stockholders to sell shares of our common
stock. Because we do not anticipate paying cash dividends on our
common stock for the foreseeable future, stockholders will not be able to
receive a return on their shares unless they are able to sell
them. The market price of our common stock will likely fluctuate in
response to a number of factors, including but not limited to, the
following:
- 25
-
|
·
|
sales,
sales cycle and market acceptance or rejection of our
product;
|
|
·
|
economic
conditions within our industry;
|
|
·
|
our
failure to meet performance estimates or the performance estimates of
securities analysts;
|
|
·
|
the
timing of announcements by us or our competitors of significant products,
contracts or acquisitions or publicity regarding actual or potential
results or performance thereof; and
|
|
·
|
domestic
and international economic, business and political
conditions.
|
Failure to
maintain effective internal controls in accordance with Section 404 of the
Sarbanes-Oxley Act of 2002 could have a material adverse effect on our stock
price.
Section 404
of the Sarbanes-Oxley Act of 2002 and the related rules and regulations of the
SEC require annual management assessments of the effectiveness of our internal
control over financial reporting and a report by our independent registered
public accounting firm attesting to and reporting on these
assessments. If we fail to adequately maintain compliance with, or
maintain the adequacy of, our internal control over financial reporting, as such
standards are modified, supplemented or amended from time to time, we may not be
able to ensure that we can conclude on an ongoing basis that we have effective
internal control over financial reporting in accordance with Section 404 of
the Sarbanes-Oxley Act of 2002 and the related rules and regulations of the
SEC. If we cannot favorably assess, or our independent registered
public accounting firm is unable to provide an unqualified attestation report on
our assessment of the effectiveness of our internal control over financial
reporting, investor confidence in the reliability of our financial reports may
be adversely affected, which could have a material adverse effect on our stock
price.
ITEM
3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Pursuant
to Instruction (e) of Item 305 of Regulation S-K, a smaller reporting company
such as the Company is not required to provide the information required by Item
305 in response to this Item 3.
ITEM
4. CONTROLS AND PROCEDURES.
Evaluation
of Disclosure Controls and Procedures
We
maintain controls and procedures designed to ensure that we are able to collect
the information we are required to disclose in the reports we file with the SEC,
and to record, process, summarize and disclose this information within the time
periods specified by the SEC. Based on an evaluation of our
disclosure controls and procedures as of the end of the period covered by this
report conducted by management, the Chief Executive Officer and Chief Financial
Officer have concluded that these controls and procedures are not effective to
ensure that we are able to record, process, summarize and report the information
we are required to disclosure in the reports we file with the SEC within the
required time periods.
Management
is responsible for establishing and maintaining adequate internal control over
financial reporting as such term is defined in Rules 13a-15(f) or 15d-15(f)
under the Securities Exchange Act of 1934, as amended. Under the
supervision and with the participation of management, including the Chief
Executive Officer and Chief Financial Officer, we assessed the effectiveness of
our internal control over financial reporting as of December 31,
2010.
Changes
in Internal Controls
There
were no changes in the Company’s internal controls or in other factors that
could have significantly affected those controls subsequent to the date of the
Company’s most recent evaluation.
- 26
-
PART
II - OTHER INFORMATION
Item
1. Legal Proceedings
We had no
legal proceedings outstanding as at December 31, 2010.
Item
2. Unregistered Sales of Equity Securities and Use of
Proceeds.
Not
applicable.
Item
3. Defaults Upon Senior Securities.
Not
applicable.
Item
4. Submission of Matters to a Vote of Security Holders.
Not
applicable.
Item
5. Other Information.
Not
applicable.
Item
6. Exhibits
Exhibit
|
||
Number
|
Description of Exhibit
|
|
2.1
|
Articles
of Merger (1)
|
|
3.1
|
Articles
of Incorporation (1)
|
|
3.2
|
Bylaws
(1)
|
|
10.1
|
Cooperative
Agreement re: formation of Jiayin E-Commerce joint venture
(2)
|
|
10.2
|
Agreement
Regarding Transfer of Properties on 38th Floor, Guomao Building
(3)
|
|
10.3
|
Shareholding
Transfer Agreement dated May 23, 2003 between IMOT Information Technology
(Shenzhen) Ltd. and Shanghai Newray Business Development Co., Ltd.
(4)
|
|
10.4
|
Share
Transfer Agreement among IMOT Information Technology (Shenzhen) Ltd.,
Shenzhen Golden Anke Technology Co. Ltd., Intermost Corporation, Tu
Guoshen and Li Zhiquan (5)
|
|
10.5
|
Sale
and Purchase Agreement among IMOT Information Technology (Shenzhen) Ltd.,
Shanghai Fortune Venture Limited, North Shanghai Branch of Shanghai
Technology Property Right Exchange Center and Intermost Corporation
(6)
|
|
10.6
|
Distributorship
Agreement dated November 28, 2002 between KanHan Technologies Limited and
ChinaE.com Information Technology Ltd. (7)
|
|
10.7
|
Intermost
Corporation 2003 Equity Incentive Plan (8)
|
|
10.8
|
Joint
Venture Agreement among Intermost Corporation and Entities and/or
Individuals Collectively Referred to as “Investors.”(9)
|
|
14
|
Code
of Ethics (10)
|
- 27
-
16
|
Letter
on Change in Certifying Accountant (11)
|
|
31.1
|
Certification
of Chief Executive Officer Pursuant to Rule 13a-14(a) and
15d-14(a)*
|
|
31.2
|
Certification
of Chief Financial Officer Pursuant to Rule 13a-14(a) and
15d-14(a)*
|
|
32.1
|
Certification
Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of
the Sarbanes-Oxley Act of 2002*
|
|
32.2
|
Certification
Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of
the Sarbanes-Oxley Act of 2002*
|
(1)
|
Incorporated
by reference to the respective exhibits filed with the Registrant’s 10-KSB
Amendment filed with the SEC on October 15,
2004
|
(2)
|
Incorporated
by reference to the respective exhibits filed with Registrant’s
Registration Statement on Form 10-SB (Commission File No.
0-30430).
|
(3)
|
Incorporated
by reference to the respective exhibits filed with the Registrant’s
Quarterly Report on Form 10-QSB for the quarter ended March 31,
2000.
|
(4)
|
Incorporated
by reference to the exhibit filed with the Registrant’s Current Report on
Form 8-K filed with the SEC on June 9,
2003.
|
(5)
|
Incorporated
by reference to the exhibit filed with the Registrant’s Current Report on
Form 8-K filed with the SEC on August 17,
2004.
|
(6)
|
Incorporated
by reference to the exhibit filed with the Registrant’s Current Report on
Form 8-K filed with the SEC on April 26,
2004.
|
(7)
|
Incorporated
by reference to the exhibit filed with the Registrant’s Current Report on
Form 8-K filed with the SEC on February 14,
2003.
|
(8)
|
Incorporated
by reference to the exhibit filed with the Registrant’s Proxy Statement
filed with the SEC on January 6,
2004.
|
(9)
|
Incorporated
by reference to the exhibit filed with the Registrant’s 10-KSB with the
SEC on November 7, 2008.
|
(10)
|
Incorporated
by reference to the exhibit filed with the Registrant’s 10-KSB Amendment
filed with the SEC on October 25,
2004.
|
(11)
|
Incorporated
by reference to the exhibit filed with the Registrant’s Current Report on
Form 8-K filed with the SEC on March 8,
2004.
|
*
|
Filed
herewith.
|
- 28
-
SIGNATURES
In
accordance with Section 13 or 15(d) the Securities Exchange Act of 1934, the
registrant caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.
Date: February
12, 2011
|
UNI
CORE HOLDINGS CORPORATION
|
|
By:
|
/s/ Chia
Hsun Wu
|
|
Chia
Hsun Wu
|
||
Chief
Executive Officer
|
||
By:
|
/s/ Thomas
Lee
|
|
Thomas
Lee
|
||
Chief
Financial Officer
|
- 29
-