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Investment in Sales-Type Leases, Net

3 Months Ended

Mar. 31, 2019

4. INVESTMENT IN SALES-TYPE LEASES, NET

Under sales-type leases, Xi'an TCH leases the following systems: (i) BMPG systems to Pucheng Phase I and II (15 and 11 year terms, respectively); (ii) BMPG systems to Shenqiu Phase I (11-year term); and (iii) BMPG systems to Shenqiu Phase II (9.5-year term). The components of the net investment in sales-type leases as of March 31, 2019 and December 31, 2018 are as follows:

	2019			2018
Total future minimum lease payments receivable	$	58,513,403		$	88,661,266
Less: executory cost		(3,753,690	)		(5,687,704	)
Less: unearned interest		(15,442,638	)		(19,398,707	)
Less: realized interest income but not yet received		(5,434,301	)		(9,336,141	)
Less: allowance for net investment receivable		(22,534,192	)		(29,276,658	)
Investment in sales-type leases, net		11,348,582			24,962,056
Current portion		-			-
Noncurrent portion	$	11,348,582		$	24,962,056

On February 15, 2019, Xi'an TCH transferred Shenqiu Phase I and II Projects to Mr. Bai for RMB 127,066,000 ($18.55 million). Mr. Bai agreed to transfer all the equity shares of his wholly owned company, Xi'an Hanneng, to HYREF as repayment for the loan made by Xi'an Zhonghong to HYREF. As of March 31, 2019, the future minimum rentals to be received on non-cancelable sales-type leases by year are as follows:

2020	$	22,959,826
2021		6,772,110
2022		6,772,110
2023		6,772,110
2024		6,772,110
Thereafter		8,465,137
Total	$	58,513,403