ADVANCE FOR BUSINESS ACQUISITION | 9 Months Ended |
|---|---|
Sep. 30, 2011 | |
| ADVANCE FOR BUSINESS ACQUISITION [Text Block] | NOTE 3: ADVANCE FOR BUSINESS ACQUISIITON On January 4, 2010, the Company entered into a Memorandum of Understanding (MOU) with Shenzhen DongFang Hualian Technology Ltd. Dongfang Hualian was established on September 29, 2005 in Shenzhen with a registered capital of RMB 10 million for the purpose of engaging in the design, manufacture, and marketing of lithium-ion (PLI) batteries. The Company paid $9,397,891 as acquisition deposit during 2010. On August 13, 2011, the Company entered into a Share Purchase Agreement (“Purchase Agreement”), dated August 13, 2011, among the Company, its wholly-owned subsidiary, Leading Asia, and the shareholders of Loyal Top Capital Investment Limited (“Loyal Top”), for the purchase of Loyal Top and its wholly-owned Chinese subsidiary, Shenzhen Dongfang Hualian Technology Co., Ltd ("Dongfang Hualian"), for an aggregate purchase price of RMB72 million (approximately $11 million) in cash and 8,108,000 shares of the Company’s common stock at $2 per share to be issued within 90 days of the closing of the Purchase Agreement. The closing of the transaction will occur following the registration of Loyal Top’s ownership of Dongfang Hualian with the Shenzhen Administration for Industry and Commerce. As of September 30, 2011, the Company had made an advance payment of RMB 67,838,925 (approximately $10.6 million) towards the purchase price on behalf of Leading Asia. The Company is obligated to issue and deliver 5,000,000 shares of the Company’s common stock to the Seller within 90 days of the closing of the Purchase Agreement and deliver the rest 3,108,000 shares of the Company’s common stock to the Seller if Dongfang Hualian achieves a net profit of RMB 60 million (approximately $ 9.3 million) for the fiscal year ended December 31, 2011. Loyal Top was established in 2011 in Hong Kong with 10,000 HK dollar of registered capital for the purpose of being a holding company for Dongfang Hualian. In May, 2011 Loyal Top received MOFCOM approval for its acquisition of Dongfang Hualian, but it is still awaiting registration of Loyal Top’s ownership of Dongfang Hualian with the Shenzhen Administration for Industry and Commerce. |