SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Amendment No. 1
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): December 2, 2013
American Jianye Greentech Holdings Ltd.
(Exact name of Company as specified in its charter)
(State or other jurisdiction
136-20 38th Ave. Unit 3G, Flushing, NY 11354
(Address of principal executive offices) (Zip Code)
Company’s telephone number, including area code
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the Company under any of the following provisions:
|☐||Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)|
|☐||Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)|
|☐||Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))|
|☐||Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))|
This Amendment No.1 on Form 8-K/A amends the Company’s Current Report on Form 8-K, as filed with the Securities and Exchange Commission (the “SEC”) on December 2, 2013 (the “Original Filing”).
The purpose of this Amendment No.1 on Form 8-K/A is to respond to certain comments received from the Staff of the SEC, including updated Financial Statements of the Business Acquired.
ITEM 1.01 ENTRY INTO A MATERIAL DEFINITVE AGREEMENT.
On November 30, 2013, American Jianye Greentech Holdings Ltd. (the “Company”) entered into an agreement to acquire all of the issued and outstanding stock of Jin Chih International, Ltd., a Taiwan corporation, from its sole owner Chu Li An for five million shares of the Company’s common stock. The closing under the Agreement was held on November 30, 2013. Jin Chih is in developing and marketing greentech products such as electric car components and solar system. It is the innovator of connecting new energy with agriculture techniques. It is also investor of professional and high-eggicient energy assets.
The foregoing does not constitute a full statement of the terms of the Agreement. The agreement has been filed as exhibit to this report. Reference is made to such exhibit for a full description of the rights and obligations of the parties under the agreement.
The Company intends to utilize the assets of the company to expand its manufacturing base and increase its retail operations in Taiwan.
ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS.
|(a)||Financial Statements of Business Acquired|
|(b)||Pro-Forma Financial Information|
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this Report to be signed on its behalf by the undersigned hereunto duly authorized.
|Date: January 9, 2015|
|AJ GREENTECH HOLDINGS LTD.|
|By:||/s/ Chu Li An|
|Chu Li An|
|Chief Executive Officer|
|Jin Chih International, Ltd|
|Nov 30, 2013||Dec 31, 2012|
|Cash And Cash Equivalents||63, 412||128,662|
|Prepayments and Other Current Assets||36||26|
|Advance on purchase||—||9,063|
|Total Current Assets||2,221,126||1,126,885|
|Property Plant and Equipment||1,177,797||1,213,647|
|Current Li abilities|
|Accrued Expenses and Other Current Liabilities||—||3,270|
|Advances from customers||143,199||86,211|
|Total Current Liabilities||1,787,985||1,507,744|
|Long Term Debt||911,020||317,608|
|Total Stockholder Equity||722,153||534,605|
|Total Liabilities and Stockholders’' Equity||3,405,557||2,359,957|
|Jin Chih International, Ltd|
The Period ended
The year ended
|Cost of Revenue||1,719,927||1,933,740|
|Total Operating Expenses||108,930||156,707|
|Operating Income or Loss||62,423||38,254|
|Income from interest||251||181|
|Other Income (expenses)||2,375||971|
|Income Before Tax||25,520||17,842|
|Income Tax Expense||—||3,033|
|Net Income From Continuing Ops|
|Effect Of Accounting Changes|
|Jin Chih International, Ltd|
|Statements of Cash Flows|
|The period Ended||The year Ended|
|Nov 30,2013||Dec 31,2012|
|Operating Activities, Cash Flows Provided By or Used In|
|Net Income (Loss)||25,520||14,809|
|Adjustments To Net Income|
|Loss on sale of PPE||—||—|
|Changes In operating assets and liabilities|
|Advance on purchase||9,063||—|
|Accrued Expenses and Other Current Liabilities||(3,270)||(808)|
|Total Cash Flow From Operating Activities||(793,678)||280,231|
|Investing Activities, Cash Flows Provided By or Used In|
|Purchase of PPE||—||(1,189,487)|
|Decrease in Other Assets||12,792||32,802|
|Total Cash Flows From Investing Activities||13,043||(1,156,504)|
|Financing Activities, Cash Flows Provided By or Used In|
|Issue common stock||169,000||172,000|
|Increase in long term debt||593,412||297,385|
|Other Cash Flows from Financing Activities||(5,907)|
|Total Cash Flows From Financing Activities||738,598||662,346|
|Effect Of Exchange Rate Changes||(23,213)||14,565|
|Change In Cash and Cash Equivalents||(65,250)||(199,361)|
|Cash at beginning of the period||128,662||328,023|
|Cash at end of the period||63, 412||128,662|
|Jin Chih International, Ltd|
|Statement of Stockholders’ Equity|
|For the period Ended November 30, 2013 and the year Ended December 31, 2012|
|Period Ending||No. of Shares||Amount||Additional Paid-in Capital||Retained Earnings||Foreign Currency Translation Gain||Total Stockholders'Equity|
|Balance, December 31, 2012||1,500,000||$||516,000||$||—||$||18,200||$||405||$||534,605|
|Issuance of common shares for cash at $0.338 per share on April 26,2013||500,000||169000||—||—||—||169,000|
|Cash dividend distribution||—||—||—||(13,328)||—|
|Foreign currency translation loss||—||—||—||—||(9,245)||(9,245)|
|Balance, November 30, 2013||2,000,000||685,000||—||30,392||(8,840)||706,552|
Notes to financial statements
1. Company summary
Jin Chih International Development Co., Ltd (the ‘company’), was incorporated in Taiwan on July 14, 1995 under the International Business Companies Act. The company’s business operations involve:
a) General advertising
b) TV program production
c) Radio and TV program distribution
d) Book publication
e) Food wholesale and food & drink retail
2. Significant accounting policies
Basis of Presentation
The Company’s financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”).
Use of Estimates and Assumptions
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America 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.
The Company’s significant estimates and assumptions include the fair value of financial instruments; allowance for doubtful accounts; inventory valuation and obsolescence; the carrying value, recoverability and impairment, if any, of long-lived assets, including the values assigned to and the estimated useful lives of property, plant and equipment; interest rate; revenue recognized or recognizable; sales returns and allowances; valued added tax rate, income tax rate and related tax provision, reporting currency of the Company, functional currency, and foreign currency exchange rate. Those significant accounting estimates or assumptions bear the risk of change due to the fact that there are uncertainties attached to those estimates or assumptions, and certain estimates or assumptions are difficult to measure or value.
Management bases its estimates on historical experience and on various assumptions that are believed to be reasonable in relation to the financial statements taken as a whole 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.
Management regularly evaluates the key factors and assumptions used to develop the estimates utilizing currently available information, changes in facts and circumstances, historical experience and reasonable assumptions. After such evaluations, and if deemed appropriate, those estimates are adjusted accordingly. Actual results could differ from those estimates.
Fair Value of Financial Instruments
The Company follows paragraph 825-10-50-10 of the FASB Accounting Standards Codification for disclosures about fair value of its financial instruments and has adopted paragraph 820-10-35-37 of the FASB Accounting Standards Codification (“Paragraph 820-10-35-37”) to measure the fair value of its financial instruments. Paragraph 820-10-35-37 establishes a framework for measuring fair value in accounting principles generally accepted in the United States of America (U.S. GAAP), and expands disclosures about fair value measurements. To increase consistency and comparability in fair value measurements and related disclosures, Paragraph 820-10-35-37 establishes a fair value hierarchy which prioritizes the inputs to valuation techniques used to measure fair value into three (3) broad levels. The three (3) levels of fair value hierarchy defined by Paragraph 820-10-35-37 are described below:
Level 1 - Quoted market prices available in active markets for identical assets or liabilities as of the reporting date.
Level 2 - Pricing inputs other than quoted prices in active markets included in Level 1, which are either directly or indirectly observable as of the reporting date.
Level 3 - Pricing inputs that are generally observable inputs and not corroborated by market data.
Financial assets are considered Level 3 when their fair values are determined using pricing models, discounted cash flow methodologies or similar techniques and at least one significant model assumption or input is unobservable.
The fair value hierarchy gives the highest priority to quoted prices (unadjusted) in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. If the inputs used to measure the financial assets and liabilities fall within more than one level described above, the categorization is based on the lowest level input that is significant to the fair value measurement of the instrument.
The carrying amounts of the Company’s financial assets and liabilities, such as cash, accounts receivable, advance on purchases, prepayments and other current assets, accounts payable, deposits, corporate income tax payable, accrued expenses and other current liabilities approximate their fair values because of the short maturity of these instruments.
Fair Value of Non-Financial Assets or Liabilities Measured on a Recurring Basis
The Company’s non-financial assets include inventories. The Company identifies potentially excess and slow-moving inventories by evaluating turn rates, inventory levels and other factors. Excess quantities are identified through evaluation of inventory aging, review of inventory turns and historical sales experiences. The Company provides lower of cost or market reserves for such identified excess and slow-moving inventories. The Company establishes a reserve for inventory shrinkage, if any, based on the historical results of physical inventory cycle counts.
The Company considers all highly liquid investments with maturities of three months or less at the time of purchase to be cash equivalents.
Accounts Receivable and Allowance for Doubtful Accounts
Accounts receivable are recorded at the invoiced amount, net of an allowance for doubtful accounts. The Company follows paragraph 310-10-50-9 of the FASB Accounting Standards Codification to estimate the allowance for doubtful accounts. The Company performs on-going credit evaluations of its customers and adjusts credit limits based upon payment history and the customer’s current credit worthiness, as determined by the review of their current credit information; and determines the allowance for doubtful accounts based on historical write-off experience, customer specific facts and economic conditions.
Outstanding account balances are reviewed individually for collectability. The allowance for doubtful accounts is the Company’s best estimate of the amount of probable credit losses in the Company’s existing accounts receivable. Bad debt expense is included in general and administrative expenses, if any. Pursuant to paragraph 310-10-50-2 of the FASB Accounting Standards Codification account balances are charged off against the allowance after all means of collection have been exhausted and the potential for recovery is considered remote. The Company has adopted paragraph 310-10-50-6 of the FASB Accounting Standards Codification and determine when receivables are past due or delinquent based on how recently payments have been received.
The Company values inventories at the lower of cost or market. The Company reduces inventories for the diminution of value, resulting from product obsolescence, damage or other issues affecting marketability, equal to the difference between the cost of the inventory and its estimated market value. Factors utilized in the determination of estimated market value include (i) current sales data and historical return rates, (ii) estimates of future demand, (iii) competitive pricing pressures, (iv) new product introductions, (v) product expiration dates.
The Company evaluates its current level of inventories considering historical sales and other factors and, based on this evaluation, classify inventory markdowns in the income statement as a component of cost of goods sold pursuant to Paragraph 420-10-S99 of the FASB Accounting Standards Codification to adjust inventories to net realizable value.
Property, Plant and Equipment
Property, plant and equipment are recorded at cost. Expenditures for major additions and betterments are capitalized. Maintenance and repairs are charged to operations as incurred. Depreciation of property, plant and equipment is computed by the straight-line method (after taking into account their respective estimated residual values) over the assets estimated useful lives ranging from five (5) years to twenty (20) years. Upon sale or retirement of property, plant and equipment, the related cost and accumulated depreciation are removed from the accounts and any gain or loss is reflected in the income statement. Leasehold improvements, if any, are amortized on a straight-line basis over the term of the lease or the estimated useful lives, whichever is shorter. Upon becoming fully amortized, the related cost and accumulated amortization are removed from the accounts.
Construction in progress represents direct costs of construction or the acquisition cost of long-lived assets. Under U.S. GAAP, all costs associated with construction of long-lived assets should be reflected as long-term as part of construction-in-progress. Capitalization of these costs ceases and the construction in progress is transferred to property, plant and equipment when substantially all of the activities necessary to prepare the long-lived assets for their intended use are completed. No depreciation is provided until the construction of the long-lived assets is complete and ready for their intended use.
The Company applies paragraph 605-10-S99-1 of the FASB Accounting Standards Codification for revenue recognition. The Company recognizes revenue when it is realized or realizable and earned. The Company considers revenue realized or realizable and earned when all of the following criteria are met: (i) persuasive evidence of an arrangement exists, (ii) the product has been shipped or the services have been rendered to the customer, (iii) the sales price is fixed or determinable, and (iv) collectability is reasonably assured.
Insurance of common stock
In 3rd May, 2013, the company issued new shares of 500,000, valued at $0.338 per share or $169000 on the date of insurance.
3. Other income
|For the period Ended||For the year Ended|
|Nov. 30, 2013||Dec. 31, 2012|
|Foreign exchange gain (loss)||—||971|
|Total Other income||2,375||971|
4. Cash and cash equivalents
|Nov. 30, 2013||Dec. 31, 2012|
|Nov. 30, 2013||Dec. 31, 2012|
|Less: Accumulated depreciation||66,158||74,062|