China Liaoning Dingxu Ecological Agriculture Development, Inc. - FORM 10-Q

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EXCEL - IDEA: XBRL DOCUMENT - China Liaoning Dingxu Ecological Agriculture Development, Inc.	Financial_Report.xls
EX-32.2 - CERTIFICATION - China Liaoning Dingxu Ecological Agriculture Development, Inc.	clad_ex322.htm
EX-31.2 - CERTIFICATION - China Liaoning Dingxu Ecological Agriculture Development, Inc.	clad_ex312.htm
EX-32.1 - CERTIFICATION - China Liaoning Dingxu Ecological Agriculture Development, Inc.	clad_ex321.htm
EX-31.1 - CERTIFICATION - China Liaoning Dingxu Ecological Agriculture Development, Inc.	clad_ex311.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

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

For the quarterly period ended September 30, 2012

TRANSITION REPORT PURSUANT TO SECTION 13 or 15(d) OF THE EXCHANGE ACT

For the transition period from ___________ to _____________

CHINA LIAONING DINGXU ECOLOGICAL AGRICULTURE DEVELOPMENT, INC.

(Exact name of small business issuer as specified in its charter)

Commission File No. 333-170480

Nevada		80-0638212
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

Room 2119 Mingyong Building, No. 60 Xian Road.

Shahekou District, Dalian, China 116021

(Address of Principal Executive Offices)

0086-13909840703

(Issuer’s telephone number)

Check whether the issuer (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 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 last 90 days. YES þ NO o

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). YES þ NO o

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

Large accelerated filer	o	Accelerated filer	o
Non-accelerated filer	o	Smaller reporting company	þ

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). YES o NO þ

State the number of shares outstanding of each of the issuer’s classes of common equity, as of the latest practicable date: 66,450,000 Shares of Common Stock, as of November 14, 2012.

Table of Contents

PART I - FINANCIAL INFORMATION

Item 1.	Financial Statements	3
Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	12
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	27
Item 4.	Controls and Procedures	27

PART II - OTHER INFORMATION

Item 1.	Legal Proceedings	29
Item 1A.	Risk Factors	29
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	29
Item 3.	Defaults Upon Senior Securities	29
Item 4.	Submissions of Matters to a Vote of Security Holders	29
Item 5.	Other Information	29
Item 6.	Exhibits	30

SIGNATURES		31

As used in this Form 10-Q Quarterly Report, unless the context requires or is otherwise indicated, the terms “we,” “us,” “our,” the “Registrant,” the “Company,” “our company” and similar expressions include the following entities (as defined below):

(i) China Liaoning Dingxu Ecological Agriculture Development, Inc., formerly known as

Hazlo! Technologies, Inc., a Nevada corporation (“Company”, “we”, or “us”), which is a publicly traded company;

(ii) China Liaoning DingXu Ecological Agriculture Development Co, Ltd., a BVI company ( “DingXu BVI”)

(iii) Panjin Hengrun Biological Technology Development Co., Ltd. 盘锦恒润生物技术开发有限公司, a limited liability company organized under the laws of the People’s Republic of China and a ninety-nine percent owned subsidiary of DingXu BVI (“Panjin Hengrun”)

(iv) Liaoning Dingxu Ecological Agriculture Development Co., Ltd.辽宁鼎旭生态农业发展有限公司, a limited liability company organized under the laws of the People’s Republic of China and an affiliated entity of Panjin Hengrun through contractual arrangements (“Liaoning Dingxu”).

“China” or “PRC” refers to the People’s Republic of China, excluding Hong Kong, Macau and Taiwan. “RMB” or “Renminbi” refers to the legal currency of China and “$” or “U.S. Dollars” refers to the legal currency of the United States. We make no representation that the RMB or U.S. Dollar amounts referred to in this report could have been or could be converted into U.S. Dollars or RMB, as the case may be, at any particular rate or at all. “GAAP” unless otherwise indicated refers to accounting principles generally accepted in the United States.

ITEM 1. FINANCIAL STATEMENTS

CHINA LIAONING DINGXU ECOLOGICAL AGRICULTURE DEVELOPMENT, INC
CONSOLIDATED BALANCE SHEETS
(AMOUNTS EXPRESSED IN US DOLLAR)

	As of		As of
	September 30, 2012		December 31, 2011
	(Unaudited)		(Audited)
ASSETS

Cash and cash equivalents		1,477,809		709,812
Inventories		357,568		2,862
Advances to suppliers		79,756		83,057
Other receivables, net		89,436		20,997

Total Current Assets		2,004,569		816,728

Property and equipment, net		4,764,667		4,743,710
Construction in progress		5,017,901		4,661,733
Land use right		4,351,823		3,225,474
Prepaid lease for land		953,140		999,927

Total Assets	$	17,092,100	$	14,447,572

LIABILITIES AND STOCKHOLDERS' EQUITY

Current Liabilities:
Short-term loan		473,111		476,122
Other payables		1,241,895		1,267,842

Total Current Liabilities		1,715,006		1,743,964

Due to related parties		5,745,837		4,186,337


Total Liabilities		7,460,843		5,930,301

Commitments		-		-

Stockholders' Equity:
Common stock ($0.001 par value; 75,000,000 shares authorized;
66,450,000 and 66,450,000 shares issued and outstanding at September 30,2012 and December 31, 2011)		66,450		66,450
Additional paid-in capital		7,659,544		7,659,544
Statutory reserve		185,268		57,805
Retained earnings		1,531,313		479,420
Accumulated other comprehensive income		188,682		254,052

Total Stockholders' Equity		9,631,259		8,517,271

Total Liabilities and Stockholders' Equity	$	17,092,100	$	14,447,572

See accompanying notes to unaudited pro forma consolidated financial statements

CHINA LIAONING DINGXU ECOLOGICAL AGRICULTURE DEVELOPMENT, INC

CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME

(AMOUNTS EXPRESSED IN US DOLLAR)

	For the Nine			For the Nine		For the Three			For the Three
	Months Ended			Months Ended		Months Ended			Months Ended
	September 30, 2012			September 30, 2011		September 30, 2012			September 30, 2011
	(Unaudited)			(Unaudited)		(Unaudited)			(Unaudited)

NET REVENUES	$	5,466,599		$	3,163,439	$	1,881,049		$	1,167,291

COST OF REVENUES		4,008,185			1,927,539		1,412,211			662,719

GROSS PROFIT		1,458,414			1,235,900		468,838			504,572

OPERATING EXPENSES:
General and administrative		535,572			460,977	$	124,544			217,790
Impairment loss		91,468			-		91,468			-

Total Operating Expenses		627,040			460,977		216,012			217,790

INCOME FROM OPERATIONS		831,374			774,923		252,826			286,782

OTHER INCOME (EXPENSES):
Other income		372,845			104,619					104,619
Other expenses		-			-		(1,319	)		-
Interest expenses		(24,863	)		-		(11,531	)		-


INCOME BEFORE PROVISION FOR INCOME TAX		1,179,356			879,542		239,976			391,401

PROVISION FOR INCOME TAXES		-			-		-			-

NET INCOME	$	1,179,356		$	879,542	$	239,976		$	391,401

COMPREHENSIVE INCOME:
Net income	$	1,179,356		$	879,542	$	239,976		$	391,401

OTHER COMPREHENSIVE INCOME:
Unrealized foreign currency translation gain (loss)	(65,370)				183,741		(19,079	)		159,611

COMPREHENSIVE INCOME	$	1,113,986		$	1,063,283	$	220,897		$	551,012

NET INCOME PER COMMON SHARE:
Basic	$	0.02		$	0.15	$	0.02		$	0.09
Diluted	$	0.02		$	0.15	$	0.02		$	0.09

WEIGHTED AVERAGE COMMON SHARES OUTSTANDING:
Basic		66,450,000			5,818,116		66,450,000			6,450,000
Diluted		66,450,000			5,818,116		66,450,000			6,450,000

See accompanying notes to unaudited consolidated financial statements.

CHINA LIAONING DINGXU ECOLOGICAL AGRICULTURE DEVELOPMENT, INC
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(AMOUNTS EXPRESSED IN US DOLLAR)
(UNAUDITED)

	For the Nine Months Ended
	September 30,
	2012			2011
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income	$	1,179,356		$	879,541
Adjustments to reconcile net income to net cash
Provided by operating activities:
Depreciation and amortization		281,926			99,369
Impairment loss		91,468
Changes in assets and liabilities:
Inventories		(354,707	)		(1,707	)
Other receivables		(68,438	)		22,718
Prepaid expense/Advances to suppliers		50,089			(1,582,267	)
Other payables		(28,959	)		697,905
NET CASH PROVIDED BY OPERATING ACTIVITIES		1,150,735			115,559

CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of property, plant and equipment		(251,296	)		(4,815,813	)
Construction in progress		(447,636	)		(1,048,838	)
Acquisition of land use right		(1,177,935	)		(2,923,684	)
Prepaid lease for land		-			(1,022,833	)
NET CASH USED IN INVESTING ACTIVITIES		(1,876,867	)		(9,811,167	)

CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from capital injection		-			6,953,458
Proceeds from share issuances		-			25,000
Proceeds from related parties		1,559,500			3,442,417
NET CASH PROVIDED BY FINANCING ACTIVITIES		1,559,500			10,420,876

EFFECT OF EXCHANGE RATE ON CASH		(65,370	)		154,742

NET INCREASE IN CASH AND CASH EQUIVALENTS		767,997			880,010

CASH AND CASH EQUIVALENTS - beginning of period		709,812			79,178

CASH AND CASH EQUIVALENTS - end of period	$	1,477,809		$	959,188

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid for:
Interest	$	24,863		$	-
Income taxes		-			-

Reclassification of retained earnings to statutory reserve	$	127,463		$	-

See accompanying notes to unaudited consolidated financial statement

CHINA LIAONING DINGXU ECOLOGICAL AGRICULTURE DEVELOPMENT INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

SEPTEMBER 30, 2012

NOTE 1. ORGANIZATION AND DESCRIPTION OF BUSINESS

China Liaoning Dingxu Ecological Agriculture Development INC. (the "Company") was incorporated under the laws of State of Nevada on August 19th, 2010. The Company is primarily engaged in the growing and selling of agriculture products in People’s Republic of China (“PRC”).

NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

BASIS OF PRESENTATION

These financial statements and related notes are presented in accordance with accounting principles generally accepted in the United States of America (“US GAAP”). The company maintains its books and accounting records in Renminbi (“RMB”), and its reporting currency is United States dollars.

ACCOUNTING METHOD

The Company’s financial statements are prepared using the accrual method of accounting. The Company has elected a fiscal year ending on December 31.

USE OF ESTIMATES

The preparation of financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and 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. In the opinion of management, all adjustments necessary in order to make the financial statements not misleading have been included. Actual results could differ from those estimates.

CASH AND CASH EQUIVALENTS

The Company considers all highly liquid investments with maturity of three months or less when purchased to be cash equivalents. The amount of cash and cash equivalents at September 30, 2012 and December 31, 2011 is $1,477,809 and $709,812 respectively.

INVENTORIES

Inventories are stated at the lower of cost or market value. Cost is determined using moving weighted average method. Cost of finished goods comprises direct material, direct production cost and an allocated portion of production overheads based on normal operating capacity.

PROPERTY, PLANT AND EQUIPMENT

Property, plant and equipment are stated at cost less accumulated depreciation and impairment. Depreciation on property, plant and equipment is calculated on the straight-line method after taking into account their respective estimated residual values over the estimated useful lives of the assets as follows:

Building	20	years
Plant	5-10	years
Office equipment	3-5	years
Vehicles	4	years

Maintenance and repair costs are expensed as incurred, whereas significant renewals and betterments are capitalized.

Construction in progress represents capital assets under construction or being installed and is stated at cost. Cost comprises original cost of plant and equipment, installation, construction and other direct costs prior to the date of reaching the expected usable condition. Construction in progress is transferred to the property, plant and equipment and depreciation commences when the asset has been substantially completed and reaches the expected usable condition.

LAND USE RIGHTS

The Company states land use right at cost less accumulated amortization. The land use right is amortized on straight line method during the contract period, varying from 47 to 50 years. For the nine months ended September 30, 2012 and 2011, amortization expense amounted to $51,857 and 33,781, respectively.

The Company paid $1,198,549 for a new land use right during this period. The land need to change its nature from farmland to industrial land for building the greenhouse. The contract period is 50 years from the land nature changed.

LONG TERM PREPAID LEASE

Leases where substantially all the risks and rewards of ownership of assets remain with the lessor are accounted for as operating leases. Payments made under operating leases net of any incentives received from the lessor are charged to the consolidated statements of operations on a straight-line basis over the terms of the underlying lease.

The Company records lease payments at cost less accumulated. As China’s regulations prohibit companies from acquiring land use right of farmlands, the Company entered into long term agreements with certain unrelated parties to rent land. The lease payments for the entire contract period are prepaid at the inception of leases. The lease payments are recorded as operating lease expenses using the straight line method during the contract period of 20 years. For the nine months ended September 30, 2012 and 2011, the Company recorded lease expense of $40,506 and 17,591, respectively.

REVENUE RECOGNITION

Sales revenue is recognized at the date of shipment from the Company’s facilities to customers when a formal arrangement exists, the price is fixed or determinable, the delivery is completed, ownership has passed, no other significant obligations of the Company exist and collectability is reasonably assured.

The Company’s revenue consists of the invoiced value of goods, net of value-added tax (“VAT”).

TAXATION

Taxation on profits earned in the PRC has been calculated on the estimated assessable profits for the year at the rates of taxation prevailing in the PRC where the Company operates after taking into effect the benefits from any special tax credits or “tax holidays” allowed in the county of operations.

The Company does not accrue United States income tax since it has no operating income in the United States. The Company is organized and located in the PRC and do not conduct any business in the United States.

Enterprise income tax

In accordance with the relevant tax laws in the PRC, as an agriculture growing enterprise, the Company is exempted from enterprise income tax from 2010 to 2012. Accordingly, the Company statutory rate was 0% and 0% for the nine months ended September 30, 2012 and 2011, respectively.

Value added tax

The Provisional Regulations of The People’s Republic of China Concerning Value Added Tax promulgated by the State Council came into effect on January 1, 1994. Under these regulations and the Implementing Rules of the Provisional Regulations of the PRC Concerning Value Added Tax, value added tax is imposed on goods sold in or imported into the PRC and on processing, repair and replacement services provided within the PRC.

In accordance with the relevant tax laws in the PRC, as an agriculture growing enterprise, the Company is exempted from VAT from 2010 to 2012.

FOREIGN CURRENCY TRANSLATION

The reporting currency of the Company is the U.S. dollar. The functional currency of the parent company is the U.S. dollar and the functional currency of the Company’s operating subsidiaries and variable interest entities is the RMB. For the subsidiaries and variable interest entities whose functional currencies are the RMB, results of operations and cash flows are translated at average exchange rates during the period, assets and liabilities are translated at the unified exchange rate at the end of the period, and equity is translated at historical exchange rates. Translation adjustments resulting from the process of translating the local currency financial statements into U.S. dollars are included in determining comprehensive income. Transaction gains and losses that arise from exchange rate fluctuations on transactions denominated in a currency other than the functional currency are included in the results of operations as incurred. All of the Company’s revenue transactions are transacted in the functional currency. The Company does not enter any material transaction in foreign currencies and accordingly, transaction gains or losses have not had, and are not expected to have, a material effect on the results of operations of the Company.

In accordance with ASC Topic 230, cash flows from the Company’s operations are calculated based upon the local currencies using the average translation rate. As a result, amounts related to assets and liabilities reported on the statement of cash flows will not necessarily agree with changes in the corresponding balances on the balance sheets.

ACCUMULATED OTHER COMPREHENSIVE INCOME

Accumulated other comprehensive income represents the change in equity of the Company during the periods presented from foreign currency translation adjustments.

NEW ACCOUNTING PRONOUNCEMENTS

In December 2011, the FASB issued ASU No.2011-12, deferral of the effective date for Amendments to the presentation of reclassifications of items out of accumulated other comprehensive income in ASU 2011-05. ASU2 2011-12 defers the requirement that companies present reclassification adjustments for each component of accumulated other comprehensive income (“AOCI”) in both net income and other comprehensive income (“OCI”) on the face of financial statements. All other requirements in ASU No. 2011-05 are not affected by ASU 2011-12, including the requirement to report comprehensive income either in a single continuous financial statement or in two separate but consecutive financial statements. Public entities should apply these requirements for fiscal years, and interim periods within those years, beginning after December 15, 2011. The adoption of this standard is not expected to have a material impact on the Company’s consolidated financial position and results of operations.

In July 2012, the FASB issued ASU 2012-02, “Intangibles-Goodwill and Other (Topic 350): Testing Indefinite-Lived Intangible Assets for Impairment.” This ASU simplifies how entities test indefinite-lived intangible assets for impairment, which improves consistency in impairment testing requirements among long-lived asset categories. These amended standards permit an assessment of qualitative factors to determine whether it is more likely than not that the fair value of indefinite-lived intangible assets is less than their carrying value. For assets in which this assessment concludes it is more likely than not that the fair value is more than its carrying value, these amended standards eliminate the requirement to perform quantitative impairment testing as outlined in the previously issued standards. The guidance is effective for annual and interim impairment tests performed for fiscal years beginning after September 15, 2012. Early adoption is permitted. The adoption of this standard is not expected to have a material impact on the Company’s consolidated financial position and results of operations.

In October 2012, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2012-04, “Technical Corrections and Improvements” in Accounting Standards Update No. 2012-04. The amendments in this update cover a wide range of Topics in the Accounting Standards Codification. These amendments include technical corrections and improvements to the Accounting Standards Codification and conforming amendments related to fair value measurements. The amendments in this update will be effective for fiscal periods beginning after December 15, 2012. The adoption of ASU 2012-04 is not expected to have a material impact on our financial position or results of operations.

In August 2012, the FASB issued ASU 2012-03, “Technical Amendments and Corrections to SEC Sections: Amendments to SEC Paragraphs Pursuant to SEC Staff Accounting Bulletin (SAB) No. 114, Technical Amendments Pursuant to SEC Release No. 33-9250, and Corrections Related to FASB Accounting Standards Update 2010-22 (SEC Update)” in Accounting Standards Update No. 2012-03. This update amends various SEC paragraphs pursuant to the issuance of SAB No. 114. The adoption of ASU 2012-03 is not expected to have a material impact on our financial position or results of operations.

NOTE 3. PROPERTY, PLANT AND EQUIPMENT

Property, Plant and Equipment at September 30, 2012 and December 31, 2011 consists of the following:

	September 30, 2012		December 31, 2011
	$		$
Building		4,509,644		4,538,344
Plant		513,652		233,418
Vehicles		42,069		42,337
Office equipment		54,038		54,008
		5,119,403		4,868,107

Less: Accumulated depreciation		354,736		124,397
Property, plant and equipment, net		4,764,667		4,743,710

Construction in progress		5,017,901		4,661,733

		9,782,568		9,405,443

For the nine months ended September 30, 2012 and 2011, the Company recorded depreciation expense of $230,339 and $47,998, respectively.

NOTE 5 RELATED PARTY TRANSACTION

As of September 30, 2012, Chin Yung Kong, the director and shareholder of the Company advanced fund in the amount of $2,006,975 to the Company to purchase land use right in China.

As of September 30, 2012, Huang Yong, the director of one of the Company’s subsidiaries advanced fund in the amount of $3,738,862 to the Company to purchase land use right in China.

NOTE 4. LOAN PAYABLE

The Company became indebted to Bank of China in December 2011 for $476,122, payable in December 2012, interest at 8.46% per annum. The loan is secured by a land use right with net book value of $558,637 of the Company.

For the nine months ended September 30, 2012 and 2011, the Company recorded interest expense of $24,863 and nil, respectively.

NOTE 5. COMMON STOCK

The Company’s capitalization is 75,000,000 common shares with a par value of $0.001 per share. 66,450,000 shares issued and outstanding at September 30,2012. No preferred shares have been authorized or issued. The Company has not granted any stock options and has not recorded any stock-based compensation since inception.

NOTE 6. COMMITMENT AND CONTINGENCIES

Other than in the normal course of business, the Company did not have significant capital and other commitments, or significant guarantees as of September 30, 2012 and December 31, 2011, respectively.

NOTE 7. SUBSEQUENT EVENTS

The Company has performed an evaluation of subsequent events in accordance with ASC Topic 855 and the Company is not aware of any subsequent events which would require recognition or disclosure in the financial statements.

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Forward-Looking Statements

Certain statements, other than purely historical information, including estimates, projections, statements relating to our business plans, objectives, and expected operating results, and the assumptions upon which those statements are based, are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. These forward-looking statements generally are identified by the words “believes,” “project,” “expects,” “anticipates,” “estimates,” “intends,” “strategy,” “plan,” “may,” “will,” “would,” “will be,” “will continue,” “will likely result,” and similar expressions. We intend such forward-looking statements to be covered by the safe-harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995, and are including this statement for purposes of complying with those safe-harbor provisions. Forward-looking statements are based on current expectations and assumptions that are subject to risks and uncertainties which may cause actual results to differ materially from the forward-looking statements. Our ability to predict results or the actual effect of future plans or strategies is inherently uncertain. Factors which could have a material adverse affect on our operations and future prospects on a consolidated basis include, but are not limited to: changes in economic conditions, legislative/regulatory changes, availability of capital, interest rates, competition, and generally accepted accounting principles. These risks and uncertainties should also be considered in evaluating forward-looking statements and undue reliance should not be placed on such statements. We undertake no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise. Further information concerning our business, including additional factors that could materially affect our financial results, is included herein and in our other filings with the SEC.

Overview

We mainly engage in the business of growing and marketing fresh mushrooms and related mushroom products including mushroom spawn and mushroom seeds through our affiliated variable interest entity LiaoNing DingXu.

We mainly produce and sell two types of products:

(1)

Fresh mushrooms. We grow fresh mushrooms in our greenhouse and sell them to markets. Our fresh mushrooms include oyster mushroom, king oyster mushroom, king trumpet mushroom, and button mushroom.

The revenues from the sales of fresh mushrooms constitute approximately 55% and 70% of our total revenues in the half year of 2012 and 2011, respectively.

(2)	Related mushroom products including mushroom spawn and mushroom seeds. The revenues from the sales of related mushroom products constitute approximately 45% and 30% of our total revenues in the half year of 2012 and 2011, respectively.

History

We was incorporated under the name “Hazlo! Technologies, Inc.” on August 19, 2010 in the State of Nevada. Our initial business plan was to modify and translate software and web applications originally written in English into Spanish and to focus on the needs of the Arizona business community to better serve the Spanish-speaking population. We did not generate any revenue from the said IT services and data translation services.

On December 12, 2011, we entered a Share Exchange Agreement with DingXu BVI Shareholder (Chin Yung Kong) under which we issue 60,000,000 shares of common stock to Chin Yung Kong to acquire 100% of the issued and outstanding shares of DingXu BVI. Upon closing of the Share Exchange transaction, DingXu BVI became the wholly owned subsidiary of PUBCO.

China Liaoning DingXu Ecological Agriculture Development Co, Ltd., a BVI company (the “DingXu BVI”) was incorporated under the laws of British Virgin Islands on April 15, 2011. Chin Yung Kong was the sole shareholder and director of DingXu BVI.

On July 5, 2011, DingXu BVI formed Panjin Hengrun Biological Technology Development Co., Ltd. 盘锦恒润生物技术开发有限公司, a limited liability company organized under the laws of the People’s Republic of China (“Panjin Hengrun”). DingXu BVI owns 99% of the total ownership of Panjing Hengrun.

On November 28, 2011, Panjin Hengrun entered into a set of contractual arrangements with Liaoning Dingxu Ecological Agriculture Development Co., Ltd.辽宁鼎旭生态农业发展有限公司, a limited liability company organized under the laws of the People’s Republic of China and an affiliated entity of Panjin Hengrun through contractual arrangements (“Liaoning Dingxu”). The contractual arrangements are comprised of a series of agreements, including a Consulting Service Agreement and an Operating Agreement, through which Panjin Hengrun has the right to advise, consult, manage and operate Liaoning Dingxu to collect and own all of Liaoning Dingxu’s net profits and net losses. Additionally, under a Proxy Agreement, the shareholders of Liaoning Dingxu have vested their voting control over Liaoning Dingxu to Panjin Hengrun. In order to further reinforce Panjin Hengrun’s rights to control and operate Liaoning Dingxu. Liaoning Dingxu and its shareholders have granted Panjin Hengrun, under an Option Agreement, the exclusive right and option to acquire all of their equity interests in Liaoning Dingxu, or, alternatively, all of the assets of Liaoning Dingxu. Further, the shareholders of Liaoning Dingxu agreed to pledge all of their rights, titles and interests in Liaoning Dingxu under an Equity Pledge Agreement.

Upon entry of these contractual arrangements, Liaoning Dingxu became the Variable Interest Entities (“VIE”) of Panjin Hengrun pursuant to FIN 46 (R) and Panjin Hengrun was able to carry out business operations through Liaoning Dingxu.

Set forth below is our organizational chart upon completion of the share exchange transaction:

Liaoning Dingxu Ecological Agriculture Development Co., Ltd.辽宁鼎旭生态农业发展有限公司 (“Liaoning Dingxu”) was formed as a limited liability company organized under the laws of the People’s Republic of China on August 6, 2009. It mainly engages in the business of growing mushroom and marketing mushroom and related agricultural products.

Upon the completion of share exchange transaction, our business operations are carried out through Panjin Hengrun and its affiliated operating entity Liaoning Dingxu. On December 12, 2011, we ceased the business of development stage IT service and data translation services and started to engage in the business of growing mushroom and marketing mushroom and related agricultural products through Liaoning Dingxu.

Financial condition as of September 30, 2012 and December 31, 2011

The following table presents an overview of our results of assets, liabilities and shareholders’ equity as of September 30, 2012 and December 31, 2011.

	September 30, 2012		December 31, 2011		Increase (decrease)

Current assets
Cash		1,477,809		709,812	767,997

Other Receivables		89,436		20,997	68,439

Advance to suppliers		79,756		83,057	(3,301)

Inventory		357,568		2,862	354, 706

Total current assets		2,004,569		816,728	1,187,841

Non-current assets
Property, plant and equipment - net of accumulated depreciation		4,764,667		4,743,710	20,957

Construction in progress		5,017,901		4,661,733	356,168

Land use rights		4,351,823		3,225,474	1,126,349

Long term prepaid lease		953,140		999,927	(46,787)

Total non-current assets		15,087,531		13,630,844	1,456,687

Total assets		17,092,100		14,447,572	2,644,528

Current liabilities

Short-term loan		473,111		476,122	(3,011)

Other payables		1,241,895		1,267,842	(25,947)

Total current liabilities		1,715,006		1,743,964	(28,958)

Due to Related Parties		5,745,837		4,186,337	1, 559,500

Total liabilities		7,460,843		5,930,301	1,530,542

Shareholders’ liabilities
Common stock		66,450		66,450	-

Paid-in capital		7,659,544		7,659,544	-

Statutory reserve		185,268		57,805	127,463

Retained earnings		1,531,313		479,420	1,051,893

Other comprehensive income - foreign currency		188,682		254,052	(65,370)

Total shareholders’ equity		9,631,257		8,517,271	1,113,986

Total liabilities and shareholders’ equity		17,092,100		14,447,572	2,644,528

Liquidity and Capital Resources:

To date, our operations have been funded by contributions to “due to related parties” and the net cash provided by our operations. As a result, at September 30, 2012 we had $2,004,569 current assets, an increase of $1,187,841 since our last year ended on December 31, 2011. At September 30, 2012, we had $1,715,006 current liabilities mainly consisted of the $473,111 bank loan expiring at the end of 2012 and the $1,214,320 contract deposit from the mushroom planters and others. We had working capital totaling $289,563, which is sufficient to fund our operations for the coming period.

During the nine months ended September 30, 2012, our operating activities provided $1,150,735 in net cash. Over the long term, our expectation to see a trend of growing sales for our mushroom series products, including fresh mushrooms & mushroom spawns and seeds, resulting from the growing of the market scales, improving of general agriculture industry, improving of the planting skills and the quality of our products, and the continuing encouragement from local government. As we continue invest to develop our mushroom planting greenhouse and structures, mushroom seeds cultivate workshop and manufacturing workshop, the categories and total quantities of our products would be much higher than we produced in the last period.

Current assets:

1. Other receivables

Other receivables mainly consisted of staff borrowing to use as petty cash fund. We observed an increase of the petty cash fund with the business development compared to December 31, 2011.

Current assets (Continued):

2. Advance to suppliers

The subject of advance to suppliers was mainly used to record the advance paid to raw material suppliers.

3. Inventory

The balance at the end of this period consisted of raw materials, unfinished goods, and low-value consumables. The fresh mushroom mainly came from local farmer and farming organizations as the business model of cooperation with local farmers and farming organizations. So the company had few unfinished goods before. As part of the greenhouse and planting structures under construction are completed, the company began to plant the fresh mushroom by themselves, which result in the unfinished goods increasing. hence we observed a significant increase of the inventory compared to December 31, 2011.

Non-Current assets:

4. Property, plant and equipment

Our property, plant and equipment are stated at cost less accumulated depreciation and impairment. Depreciation on property, plant and equipment is calculated on the straight-line method after taking into account their respective estimated residual values over the estimated useful lives of the assets as follows:

Building and constructions		20 years
Plant		5-10 years
Office equipment		3-5 years
Vehicles		4 years

As consistent with the policies in the year of 2011, maintenance and repair costs are expensed as incurred, whereas significant renewals and betterments are capitalized.

Property, Plant and Equipment consists of the following:

	September 30, 2012		December 31, 2011
	USD		USD
Building	a	4,509,644		4,538,344
Plant	b	513,652		229,443
Vehicles	c	42,069		42,337
Office equipment	d	54,038		57,983
Less: Accumulated depreciation	e	354,736		124,397
Property, plant and equipment, net		4,764,667		4,743,710
Construction in progress	f	5,017,901		4,661,733
Total property, plant & equipment		9,782,568		9,405,443

a. The building mainly represented for the greenhouses, manufacturing workshops, warehouse and office building, all of which were transferred from the construction in progress (CIP).

b. The plant represented for the planting area or structures completed and transferred out from CIP and the production equipments purchased outside. The company invested $251,296 to purchase mushroom processing equipment this period, hence we observed a significant increase of the plant compared to December 31, 2011.

c. The vehicles were the truck for transporting raw materials or finish goods.

d. The office equipment represented for the office computers, printers, desks and other office appliance.

e. For the nine months ended September 30, 2012 and 2011, the Company recorded depreciation expense of $230,339 and $47,998, respectively..

f. The detailed information of the construction projects in progress which was not yet transfer to fixed assets is as below:

	September 30, 2012		December31, 2011
	USD		USD

Mushroom seeds cultivate workshop and warehouse		1,116,941		1,114,084
Manufacturing workshops		655,510		322,494
Greenhouse and Planting structures		3,233,459		3,218,533
Others		11,991		6,622
Total amount of CIP		5,017,901		4,661,733

5. Land use right

The Company states land use rights at cost less accumulated amortization. As the business growing and expanding in the period of 2011, the company recognized a total amount of approximately USD 2,948,000 land use right in the year of 2011 and USD 1,199,000 land use right in the nine months of 2012. The land use right was used to build up greenhouse and planting structures, manufacturing workshop and other buildings. As of September 30, 2012and December 31, 2011, the net values of land use rights are US$4,351,823 and $3,225,474 , respectively.

The land use rights are amortized on straight line method during the contract period, varying from 47 to 50 years. For the nine months ended September 30, 2012 and 2011, amortization expense amounted to $51, 587 and 33,781, respectively.

6. Long-term prepaid lease

The Company records lease payments at cost less accumulated amortization and amount that to be amortized within one year. The amount to be amortized within one year is recorded as current portion of prepaid leases. As China’s regulations prohibit companies from acquiring land use right of farmlands, the Company entered into long term agreements with local government to rent land. The rental payments for the entire contract period are prepaid at the inception of leases and the payment amount was $1,031,599 in 2011. The rental payments are recorded as operating lease expenses using the straight line method during the contract period of 20 years.

Lease expense of $40,506 and $17,591 were recorded for the nine months ended September 30, 2012 and 2011.

liabilities:

7.Short-term loan

For the nine months ended September 30, 2012 and 2011, the Company recorded interest expense of $24,863 and nil, respectively.

8. Other payables

The balance at the end of this period mainly consisted of the contract deposit $1,214K from the mushroom planters and others. The balance had no significant change in the half year of 2012.

9. Due to related parties

The total amount of due to related parties consisted of the borrowing of the shareholder. Since the shareholder Mr. Chin and Mr. Huang respectively lend $1,300,000 and $280,510 to the company for purchase the land use right to build greenhouse and planting structure, the balance had a significant increase as of September 30, 2012 compared to that as of December 31, 2011.

Results of Operations for the nine months ended September 30, 2012 and 2011

The following table presents an overview of our results of operation for the nine months ended September 30, 2012 and 2011.

					Increase
	2012		2011		(decrease)

Total revenue		5,466,599		3,163,439		2,303,160
Total cost of revenue		(4,008,185)		(1,927,539)		(2,080,646)
Gross profit		1,458,414		1,235,900		222,514
Operating expenses		(627,040)		(460,977)		(166,063)
Income from operations		831,374		774,923		56,451
Other income		372,845		104,619		268,226
Interest expense		(24,863)		-		(24,863)
Income before income taxes		1,179,356		879,542		299,814
Income taxes
Net income		1,179,356		879,542		299,814

1. Revenue

The following table sets forth the breakdown of our revenue for the nine months ended September 30, 2012 and 2011, respectively:

	2012				2011
	USD		%		USD		%
Fresh Mushrooms sales		3,445,588		63.03%		1,870,202		59.12%
Mushroom spawns and seeds sales		2,021,011		36.97%		1,293,237		40.88%
Total revenue		5,466,599		100%		3,163,439		100%

1. Revenue (continued)

We derived our revenues predominantly from sales of our fresh mushrooms, mushroom spawn and seeds. For the nine months ended September 30, 2012 and 2011, revenues from sales of our fresh mushrooms sales were $3,445,588 and $1,870,202 respectively representing an increase of $1,575,385. Revenues from sales of our mushroom spawn and seeds were $2,021,011 and $1,293,237 for the nine months ended September 30, 2012 and 2011, which also indicated $727,774 increase.

The increase was primarily due to the increase of the sales volume as a result of an increasing numbers of new customers developed. To be specific, the increase in our revenue was attributable to the following reasons:

We started to open and run the business in the second half of 2009. In the years of 2009 and 2010, the company was still under a development stage with relatively low brand name. The company began the mushroom sales in January of 2011, which led to lower amount of sales revenue in nine months ended September 30, 2011 compared with 2012. For the nine months ended September 30, 2012, as the company progressed toward maturity, we strengthened our sales and marketing campaign which helped to enhance our brand name and increase our sales.

The business model of cooperation with local farmers and farming organizations developed since local government encouraged the farmers to develop the local agriculture. As a result, our mushroom spawns and seeds were also supported and welcomed by local farmers and farming organizations, which significantly increased our sales.

c.	As part of the greenhouse and planting structures under construction are completed, the categories and total quantities of our products are much higher than we produced in compared period.

We expect to see a trend of growing sales for our mushroom series products, including fresh mushroom & mushroom spawns and seeds, resulting from the growing of the market scales, improving of general agriculture industry, improving of the planting skills and the quality of our products, and the continuing encouragement from local government.

2. Cost of revenue

The following table presents a breakdown of our cost of revenue of fresh mushroom and mushroom spawns and seeds for the nine months ended September 30, 2012 and 2011.

	2012		2011
	USD		USD

Cost of fresh mushrooms sales		2,586,874		1,354,133

Cost of mushroom spawns and seeds sales		1,421,311		573,407

Total		4,008,185		1,927,539

Cost of fresh mushrooms sales: Our cost of fresh mushrooms sales consists primarily of costs associated with purchased materials, planting cost and purchased fresh mushroom from farmers or farming organizations. Cost of fresh mushrooms sales are allocated to each kind of mushroom using the specific identification method. Costs are allocated to specific units within a product based on the ratio of the sales quantities of units to the total sellable quantities of the product.

Cost of mushroom spawns and seeds sales: Our cost of mushroom spawns and seeds sales mainly represented the costs of purchased and cultivate seeds or spawns. We used our workshop to cultivate well mushroom seeds or spawns and sold them to local farmers or farming organizations. We also purchased some good quality mushroom seeds from third party and sold them to our customers as well after our selection. The costs are as well allocated to specific units within a product based on the ratio of the sales quantities of units to the total sellable quantities of the product.

3. Gross profit

The following table presents the gross profit of our businesses for the nine months ended September 30, 2012 and 2011:

	2012					2011
	Gross		Gross			Gross		Gross
Production Category	Profit		Margin			Profit		Margin
	USD		%			USD		%

Fresh mushrooms sales		858,714		24.92	%		516,069		27.59%

Mushroom spawns and seeds sales		599,700		29.67	%		719,831		55.66%

Total gross profit		1,458,414		26.68	%		1,235,900		39.07%

Gross profit from our mushroom growing business increased by $222,514 for nine months ended September 30, 2012 compared to the period of 2011. The increase was a primary result from cumulative effect of our business development and sales volume increase. The gross margin of our Fresh mushrooms decreased from 27.59% for the nine months ended September 30, 2011 to 24.92% for the nine months ended September 30, 2012.And the gross margin of our mushroom spawns and seeds decreased from 55.66% for the nine months ended September 30, 2011 to 29.67% for the nine months ended September 30, 2012.

The decrease of gross margin was principally attributed to that the price of oyster mushroom and oyster mushroom seeds decreasing in the nine months of 2012. Since oyster mushroom has lower technical requirements to plant, the local farmers and farming organizations preferred to plant it and got good harvest, that resulted in the market price of oyster mushroom came down and oyster mushroom seeds price decreasing accordingly.

4. Operating expenses

For the nine months ended September 30, 2012, our operating expenses were $627,040, representing an increase of $166,063 or 36%, as compared to that for the nine months ended September 30, 2011. The increase was primarily a result of increased office expenses, salaries and bonus in response to the business development. The increase also related to impairment of software in the amount of $91,468 due to obsolescence of the technology.

5. Other income

Other income is used to record the company’s non operating income, such as government grant, inventory profit, and donation from other third parties, etc. For the nine months ended in September 30, 2012, the other income includes the $372,569 from the government grant for encourage developing local agriculture.

6. Income taxes

In accordance with the relevant tax laws in the PRC, as an agriculture growing enterprise, the Company is exempted from corporate income tax from 2010 to 2012. Accordingly, the company statutory rate was 0% and 0% for the nine months ended September 30, 2012 and 2011.

Cash flow for the nine months ended September 30, 2012 and 2011

The following table presents selected cash flow data from our cash flow statements for the nine months ended September 30, 2012 and 2011, respectively.

	2012		2011

Net cash provided by (used in) operating activities	$	1,150,735	$	115,559

Net cash used in investing activities		(1,876,867)		(9,811,167)

Net cash provided by (used in) financing activities		1,559,500		10,420,876

Effect of exchange rate changes on cash and cash equivalents		(65,370)		154,742

Net increase(decrease) in cash and cash equivalents		767,997		880,010

Cash and cash equivalents, beginning of period		709,812		79,178

Cash and cash equivalents, end of period	$	1,477,809	$	959,188

Operating Activities

Net cash provided by operating activities for the nine months ended September 30, 2012 was $1,150,735, which was primarily due to (i) an increase of the net income $1,179,356 and (ii) atotal increase of $281,926 of the depreciation and amortization of fixed assets, land use right and (iii) an increase of the impairment loss 91,468 and (iv) an total decrease of $402,015 of the changes in assets and liabilities.

Net cash provided by operating activities for the nine months ended September 30, 2011 was $115,559, which was primarily due to (i) an increase of the net income $879,541 and (ii) an total increase of $99,369 of the depreciation and amortization of fixed assets, land use right and prepaid lease and (iii) an total decrease of $863,352 of the changes in assets and liabilities.

Cash flow for the nine months ended September 30, 2012 and 2011 (continued)

Investing Activities

Net cash used in investing activities was $1,876,867 for the nine months ended September 30, 2012, which was primarily attributable to (i) an investment of $447,636 for the construction in progress to build greenhouse and planting structures and (ii) an investment of $251,296 for the purchase of production equipment and (iii) an investment of $1,177,935 for the acquisition of land use right.

Net cash used in investing activities was $9,811,167 for the nine months ended September 30, 2011, which was primarily attributable to (i) an investment of $1,048,838 for the construction in progress to build greenhouse and planting structures and (ii) an investment of $4,815,813 for the purchase of PP&E which include buildings,plants, vehicles and office equipments and (iii) an investment of $2,923,684 for the acquisition of land use right and (iv) an investment of 1,022,833 for the prepaid lease of land.

Financing activities

Net cash provided by financing activities was $1,559,500 for the nine months ended September 30, 2012, which was mainly attributable to a total $1,559,500 of the current account from a related party .

Net cash provided by financing activities was $10,420,876 for the nine months ended September 30, 2011, which was mainly attributable to (i) a total $6,593,458 from capital injection of shareholders and (ii) a total $3,442,417 of the current account from a related party and (iii) a total $25,000 from share issuances.

Significant Accounting Policies

USE OF ESTIMATES

CASH AND CASH EQUIVALENTS

The Company considers all highly liquid investments with maturity of three months or less when purchased to be cash equivalents.

INVENTORIES

REVENUE RECOGNITION

The Company’s revenue consists of the invoiced value of goods, net of value-added tax (“VAT”).

Significant Accounting Policies (continued)

FOREIGN CURRENCY TRANSLATION

The functional currency of the Company is the RMB and the RMB is not freely convertible into foreign currencies. The Company maintains its financial statements in the functional currency. Monetary assets and liabilities denominated in currencies other than the functional currency are translated into the functional currency at rates of exchange prevailing at the balance sheet date. 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 transactions. Exchange gains or losses arising from foreign currency transactions are included in the determination of net income for the respective periods.

For financial reporting purposes, the financial statements of the Company, which are prepared using the functional currency, have been translated into United States dollars. Assets and liabilities translated at exchange rates at the balance sheet date, revenue and expenses are translated at the average exchange rates for the period, and members' equity is translated at historical exchange rates. Translation adjustments are included in accumulated other comprehensive income, a component of members’ equity.

ACCUMULATED OTHER COMPREHENSIVE INCOME

Accumulated other comprehensive income represents the change in equity of the Company during the periods presented from foreign currency translation adjustments.

TAXATION

Enterprise income tax

Value added tax

In accordance with the relevant tax laws in the PRC, as an agriculture growing enterprise, the Company is exempted from VAT for the nine months ended September 30, 2012 and 2011.

PROPERTY, PLANT and EQUIPMENT

Significant Accounting Policies (continued)

PROPERTY, PLANT and EQUIPMENT (CONTINUED)

Building and constructions		20 years
Plant		5-10 years
Office equipment		3-5 years
Vehicles		4 years

Maintenance and repair costs are expensed as incurred, whereas significant renewals and betterments are capitalized.

LAND USE RIGHTS

The Company states land use rights at cost less accumulated amortization. The land use rights are amortized on straight line method during the contract period, varying from 47 to 50 years.

LONG TERM PREPAID LEASE

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Not required

ITEM 4. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

We maintain “disclosure controls and procedures,” as such term is defined in Rule 13a-15(e) under the Securities Exchange Act of 1934 (the “Exchange Act”), that are designed to ensure that information required to be disclosed in our Exchange Act reports is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure. We conducted an evaluation (the “Evaluation”), under the supervision and with the participation of our Chief Executive Officer (“CEO”) and Chief Financial Officer (“CFO”), of the effectiveness of the design and operation of our disclosure controls and procedures (“Disclosure Controls”) as of the end of the period covered by this report pursuant to Rule 13a-15 of the Exchange Act.

Based upon the required evaluation, our CEO and CFO concluded that as of September 30, 2012, the Company’s disclosure controls and procedures were not effective to ensure that information required to be disclosed by the issuer in the reports that it files or submits under the Act (15 U.S.C. 78a et seq.) is recorded, processed, summarized and reported, within the time periods specified in the Commission's rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by an issuer in the reports that it files or submits under the Act is accumulated and communicated to the issuer's management, including its principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.

The Company has identified the following weaknesses in internal control:

●	The Company does not have an independent board of directors or audit committee or adequate segregation of duties;

●	All of our financial reporting is carried out by our financial consultant.

●	We do not have an independent body to oversee our internal controls over financial reporting and lack segregation of duties due to the limited nature and resources of the Company.

●	Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Therefore, even those systems determined to be effective can provide only reasonable assurance of achieving their control objectives.

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). The Company’s internal control over financial reporting is a process designed to provide reasonable assurance to our management and board of directors regarding the reliability of financial reporting and the preparation of the financial statements for external purposes in accordance with accounting principles generally accepted in the United States of America.

Our internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the Company; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with accounting principles generally accepted in the United States of America, and that receipts and expenditures of the Company are being made only in accordance with authorizations of management and directors of the Company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the Company’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal controls over financial reporting may not prevent or detect misstatements. All internal control systems, no matter how well designed, have inherent limitations, including the possibility of human error and the circumvention of overriding controls. Accordingly, even effective internal control over financial reporting can provide only reasonable assurance with respect to financial statement preparation. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Our management assessed the effectiveness of our internal control over financial reporting as of September 30, 2012. 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. Based on our assessment, we believe that, as of September 30, 2012, the Company’s internal control over financial reporting was not effective due to the following weakness:

The Company does not have an independent board of directors or audit committee or adequate segregation of duties;

All of our financial reporting is carried out by our financial consultant.

We do not have an independent body to oversee our internal controls over financial reporting and lack segregation of duties due to the limited nature and resources of the Company.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Therefore, even those systems determined to be effective can provide only reasonable assurance of achieving their control objectives.

This annual report does not include an attestation report of our registered public accounting firm regarding internal control over financial reporting. Management’s report was not subject to attestation by our registered public accounting firm pursuant to temporary rules of the Securities and Exchange Commission that permit us to provide only management’s report in this annual report.

Changes in Internal Controls

We have also evaluated our internal controls for financial reporting, and there has been no change in our internal control over financial reporting that occurred during the quarter ended September 30, 2012 that has materially affected, or is reasonably likely to materially affect our internal control over financial reporting

Disclosure controls and procedures are controls and other procedures that are designed to ensure that information required to be disclosed in our reports filed or submitted under the Exchange Act are recorded, processed, summarized and reported, within the time periods specified in the SEC's rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed in our reports filed under the Exchange Act is accumulated and communicated to management, including our Chief Executive Officer and Chief Financial Officer, to allow timely decisions regarding required disclosure.

PART II - OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

Currently we are not aware of any litigation pending or threatened by or against the Company.

ITEM 1A. RISK FACTORS

Not required for Smaller Reporting Company.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

On August 29, 2011, Chin Yung Kong acquired 4,700,000 shares of common stock from Michael Klinicki and Alejandra De La Torre and subsequently Chin Yung Kung took control of the Company. The sales of 4,700,000 shares of common stock were pursuant to the exemption from registration provided by Section 4(2) of the Securities Act of 1933.

On December 12, 2011, we entered a Share Exchange Agreement with DingXu BVI Shareholder (Chin Yung Kong) under which we issue 60,000,000 shares of common stock to Chin Yung Kong to acquire 100% of the issued and outstanding shares of DingXu BVI. The sales of 60,000,000 shares of common stock were pursuant to the exemption from registration provided by Section 4(2) of the Securities Act of 1933.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None

ITEM 4. SUBMISSIONS OF MATTERS TO A VOTE OF SECURITY HOLDERS

None

ITEM 5. OTHER INFORMATION

None

ITEM 6. EXHIBITS

None

Exhibit No.		Description

3.1		Articles of Incorporation*
3.2		Bylaws*
10.1		Share Exchange Agreement**
10.2		Consulting Service Agreement (Panjin Hengrun and Liaoning Dingxu)**
10.3		Operating Agreement (Panjin Hengrun and Liaoning Dingxu)**
10.4		Equity Pledge Agreement (Panjin Hengrun and Liaoning Dingxu)**
10.5		Option Agreement (Panjin Hengrun and Liaoning Dingxu)**
10.6		Proxy Agreement (Panjin Hengrun and Liaoning Dingxu)**
31.1		Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (6)
31.2		Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (6)
32.1		Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (6)
32.2		Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (6)
101***		The following materials from our Quarterly Report on Form 10-Q for the quarter ended September 30, 2012, formatted in XBRL (eXtensible Business Reporting Language): (i) the Consolidated Balance Sheets, (ii) the Consolidated Statements of Operations, (iii) the Consolidated Statements of Cash Flows, and (iv) Notes to Consolidated Financial Statements.

101.INS****		XBRL Instance
101.SCH***		XBRL Taxonomy Extension Schema
101.CAL***		XBRL Taxonomy Extension Calculation
101.DEF***		XBRL Taxonomy Extension Definition
101.LAB***		XBRL Taxonomy Extension Labels
101.PRE***		XBRL Taxonomy Extension Presentation

* Incorporated by reference to our Registration Statement on Form S-1, filed on November 9, 2010

**Incorporated by reference to the Form 8-K Current Report filed on December 13, 2011.

*** XBRL information is furnished and not filed or a part of a registration statement or prospectus for purposes of sections 11 or 12 of the Securities Act of 1933, as amended, is deemed not filed for purposes of section 18 of the Securities Exchange Act of 1934, as amended, and otherwise is not subject to liability under these sections.

SIGNATURES

In accordance with Section 13 or 15(d) of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	China Liaoning Dingxu Ecological Agriculture Development, Inc. Formerly known as Hazlo! Technologies, Inc

November 19, 2012	By:	/s/ Chin Yung Kong
		Chin Yung Kong President and Chief Executive Officer

Attached files

China Liaoning Dingxu Ecological Agriculture Development, Inc. Reports

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