Annual report pursuant to section 13 and 15(d)

Related Party Transactions

v2.4.0.6
Related Party Transactions
12 Months Ended
Dec. 31, 2012
Related Party Transactions [Abstract]  
Related Party Transactions Disclosure [Text Block]

Note 5 — Related Party Transactions

 

The Company entered into an unsecured promissory note with an officer of the Company in an aggregate principal amount of $200,000. The note did not bear interest and was payable upon the completion of the Offering.  $19,900 of interest was imputed on the note at 7% and charged to additional paid-in capital.  The discount was amortized to interest expense on a monthly basis. Interest expense for the year ended December 31, 2012 and 2011 and the periods from January 18, 2010 (inception) to December 31, 2011 was $0, $7,739 and $19,900, respectively. The loan was repaid in full in June 2011 with proceeds from the Offering. 

 

In June 2011, the Company has agreed to pay Chum Capital Group Limited (“Chum”) a total of $10,000 per month for office space, utilities, secretarial and general and administrative services for a period commencing June 2, 2011 and ending on the earlier of the consummation by the Company of an initial Business Combination or the Company’s liquidation. Chum Capital Group Limited is an affiliate of Xuesong Song, Jin Shi and Michael W. Zhang, the Company’s executives. Total expenses related to office space, utilities, secretarial and general and administrative services for the year ended December 31, 2012 and 2011 and the period from January 18, 2010 (inception) to December 31, 2012 were $120,000, $70,000 and $190,000, respectively.

 

On October 15, 2011, the Company’s Board of Directors authorized it to advance $390,000 to Chum in order to reduce potential losses incurred by Chinese currency appreciation against the U.S. dollar. The advance was used to fund the operating expenses of the Company. During the year ended December 31, 2011 the Company advanced Chum a total of $382,198 and recognized a foreign exchange gain of $632 on the advance. As of December 31, 2011 the Company had a receivable of $382,830 from Chum. These amounts were repaid during 2012 and there was no amount due as of December 31, 2012.

 

On September 29, 2012, the Company entered into a new unsecured promissory note with an officer of the Company in an aggregate principal amount of $75,137. The note doesn’t bear interest and will be payable upon the closing of the business combination. To support further operating expenses of the Company, the Company entered into several unsecured promissory notes with an officer of the Company in an aggregate principal amount of $106,000 as listed below. These notes don’t bear interest and will be payable upon the closing of the business combination.

 

  Date Amount
Unsecured promissory note September 29, 2012 $75,137
Unsecured promissory note October 30, 2012 $40,000
Unsecured promissory note November 29, 2012 $25,000
Unsecured promissory note December 10, 2012 $25,000
Unsecured promissory note December 28, 2012 $16,000