(Commission
File Number)
|
(IRS
Employer Identification No.)
|
|
000-51576
|
625
Broadway, Suite 1111
San
Diego, CA 92101
(Address
of Principal Executive Offices and zip code)
|
N/A
|
o
|
Written
communications pursuant to Rule 425 under the Securities Act (17
CFR
230.425)
|
o
|
Soliciting
material pursuant to Rule 14a-12(b) under the Exchange Act (17 CFR
240.14a-12(b))
|
o
|
Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17
CFR
240.14d-2(b))
|
o
|
Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17
CFR
240.13e-4(c))
|
Year
ending June 30,
|
After-Tax
Profit
|
|
2006
|
$11,000,000
|
|
2007
|
$16,000,000
|
|
2008
|
$21,000,000
|
|
2009
|
$29,000,000
|
Patent
|
Name
of Patent
|
Patent
Number
|
Proprietor
of Patent
|
Effective
Period*
|
|||||||||
Design
Patent
|
Packing
bag
|
ZL
993 14865.4
|
Beijing
Origin Limited
|
November
1, 1999 to October 31, 2009
|
|||||||||
Invention
Patent
|
A
method of producing hybrid corn seed
|
ZL
02146510.X
|
Beijing
Origin Limited**
Henan
Agriculture University**
|
October
18, 2002 to October 17, 2022
|
|||||||||
Seed
|
LinAol
|
CAN
19990108.2
|
Beijing
Origin Limited
|
March
1, 2003 to February 28, 2018
|
*
|
Effective
period means the period from approval of the patent until its
expiration.
|
**
|
Henan
Agricultural University and Origin share this patent relating to
a
proprietary method of producing hybrid corn seed. Both parties may
use the
method to produce seed and are not required to pay any sum to the
other.
Neither party has the right to allow a third party to use the patent.
Those provisions are embodied in the patent and not in a separate
agreement.
|
Name
of Seed
|
Applicant
|
Date
Filed
|
Date
of Announcement
|
Filing
Number
|
|||||||||
OS
3101
|
Beijing
Origin Limited
|
January
13, 2004
|
May
1, 2004
|
20040020.7
|
|||||||||
OS
3102
|
Beijing
Origin Limited
|
January
13, 2004
|
July
1, 2004
|
20040021.5
|
|||||||||
Zhongyou
85 (rice seed)
|
Beijing
Origin Limited
|
August
24, 2004
|
January
1, 2005
|
20040347.8
|
|||||||||
OS
(silage com) 5102
|
Beijing
Origin Limited
|
April
7, 2005
|
September
1, 2005
|
20050215.8
|
|||||||||
OS
3108
|
Beijing
Origin Limited
|
April
7, 2005
|
July
1, 2005
|
20050214.X
|
|||||||||
OS
3202
|
Beijing
Origin Limited
|
April
7, 2005
|
July
1, 2005
|
20050213.1
|
|||||||||
OS
3111
|
Beijing
Origin Limited
|
April
7, 2005
|
July
1, 2005
|
20050212.3
|
Seed
Name
|
Percentage
of
2003
Sales
|
Percentage
of
2004
Sales
|
|||||
Liao
No. 1
|
49.00%
|
50.50%
|
|||||
OS
17
|
1.14%
|
7.44%
|
|||||
Liyu
16
|
0.00%
|
0.11%
|
|||||
OS
19
|
0.09%
|
0.57%
|
|||||
Liyu
26
|
0.00%
|
0.02%
|
|||||
Total
|
50.23%
|
58.64%
|
·
|
To
obtain a national distribution license, the licensee must have registered
capital of at least RMB 30 million (approximately
$3,750,000);
|
·
|
To
obtain a provincial license to distribute hybrid seeds, the licensee
requires registered capital of not less than RMB 5 million (approximately
$645,000); and
|
·
|
To
obtain a provincial license to distribute non-hybrid seed varieties,
the
licensee requires registered capital of not less than RMB 1 million
(approximately $125,000).
|
·
|
Submit
the application to provincial
government;
|
·
|
Go
through two cycles of monitored growth in at least five different
locations in the province. Seeds submitted for testing are planted
together with control seeds, which is typically the most popular
seed with
farmers in the testing locations. Only seeds that have and increased
yield
of 8% or higher versus the control seeds and that rank in the top
6 among
all seeds then being tested are cleared to proceed to the second
year of
testing, during which the results of the initial test season must
be
confirmed;
|
·
|
Go
through one successful cycle of trial production, also in at least
five
different locations.
|
·
|
Submit
the application to the Ministry of
Agriculture;
|
·
|
Go
through two cycles of monitored production in at least five different
locations. Only seeds that have 8% or higher yield compared to
control
seeds and that also rank in the top 6 among all seeds being tested
in that
cycle can proceed to the second year of testing;
and
|
·
|
Go
through one successful cycle of trial production in at least five
different locations.
|
Consigned
Stock
|
Consigning
Owner
|
%
of Shares Consigned
|
||
Beijing
Origin
|
Han
Gengchen
|
34.4%
|
||
Yang
Yasheng
|
28.675%
|
|||
Yuan
Liang
|
25.8%
|
|||
Zhao
Yuping
|
3.995%
|
|||
Zhang
Weidong
|
3.13%
|
|||
Chen
Weicheng
|
1.96%
|
|||
97.96%
|
||||
Changchun
Origin
|
Beijing
Origin
|
99.0%
|
||
Han
Gengchen
|
1.0%
|
|||
100.0%
|
||||
Henan
Origin
|
Beijing
Origin
|
90.0%
|
||
Zhang
Yingli
|
4.1%
|
|||
Yang
Yasheng
|
3.86%
|
|||
97.96%
|
Name
|
Age
|
Position
|
||
Gengchen
Han
|
49
|
Chairman
of the Board and Chief Executive Officer
|
||
Yasheng
Yang
|
41
|
Director
and President, Treasurer and Chief Operating Officer
|
||
Liang
Yuan
|
47
|
Director
and Executive Vice Chairman
|
||
Bailiang
Zhang
|
63
|
Director
|
||
Da
Fang Huang
|
63
|
Director
|
||
Kerry
S. Propper
|
30
|
Director
|
||
Steven
Urbach
|
29
|
Director
|
||
Michael
D. Chermak
|
45
|
Director
|
||
Remo
Richli
|
42
|
Director
|
||
Richard
D. Propper, M.D.
|
58
|
Vice
President for Corporate Development
|
Annual
Compensation
|
||||||||||
Name
|
Year
|
Salary
($)
|
Bonus
($)
|
|||||||
Gengchen
Han
|
2002
2003
2004
|
50,051
52,920
—
|
0
66,672
—
|
|||||||
Liang
Yuan
|
2002
2003
2004
|
21,140
18,663
—
|
0
50,004
—
|
|||||||
Yasheng
Yang
|
2002
2003
2004
|
33,739
36,612
—
|
0
55,576
—
|
·
|
each
director and executive officer; and
|
·
|
all
directors and officers as a group.
|
Name
|
Shares
of Chardan Common
Stock
|
Percentage
of
Outstanding
Common
Stock(*)
|
|||||
Gengchen
Han(1)(2)
Chairman
of the Board and Chief Executive Officer
|
3,336,400
|
22.0%
|
|||||
Yasheng
Yang(1)(3)
President,
Treasurer and Chief Operating Officer and Director
|
1,946,550
|
12.9%
|
|||||
Liang
Yuan(1)(4)
Executive
Vice Chairman and Director
|
3,336,400
|
22.0%
|
|||||
Bailiang
Zhang(1)
Director
|
-0-
|
-0-
|
|||||
Da
Fang Huang(1)
Director
|
-0-
|
-0-
|
|||||
Kerry
Proper(5)(6)
Director
|
444,292
|
2.9%
|
|||||
Steven
Urbach(5)
Director
|
72,917
|
0.5%
|
|||||
Michael
D. Chermak(5)
Director
|
-0-
|
-0-
|
|||||
Remo
Richli(5)
Director
|
-0-
|
-0-
|
|||||
Richard
D. Propper, M.D.(5)(7)
Vice
President for Corporate Development
|
515,375
|
3.4%
|
|||||
Directors
and officers as a group (10 persons)(8)
|
9,651,934
|
61.7%
|
*
|
Beneficial
ownership and percentage has been determined in accordance with Rule
13d-3
under the Securities Exchange Act of 1934.
|
(1)
|
Unless
otherwise indicated, the business address of each of the individuals
is
c/o 21 Shengmingyuan Road, Changping District, Beijing PRC
102206.
|
(2)
|
The
shares reported in the above table are held by Dr. Han through a
personal
holding company, Sinodream Limited, a company formed under the laws
of the
British Virgin Islands of which he is the sole officer and director.
Therefore, Dr. Han will have voting and dispositive authority over
all the
shares.
|
(3)
|
The
shares reported in the above table are held by Mr. Yang through a
personal
holding company, Leekdon Limited, a company formed under the laws
of the
British Virgin Islands of which he is the sole officer and director.
Therefore, Mr. Yang will have voting and dispositive authority over
all
the shares.
|
(4)
|
The
shares reported in the above table are held by Mr. Yuan through a
personal
holding company, Bonasmart Limited, a company formed under the laws
of the
British Virgin Islands of which he is the sole officer and director.
Therefore, Mr. Yuan will have voting and dispositive authority over
all
the shares.
|
(5)
|
Unless
otherwise indicated, the business address of each of the individuals
is
c/o 625 Broadway, Suite 1111, San Diego, CA 92101.
|
(6)
|
Includes
267,250 shares of common stock issuable upon exercise of publicly
traded
common stock purchase warrants.
|
(7)
|
Includes
271,250 shares of common stock issuable upon exercise of publicly
traded
common stock purchase warrants.
|
(8)
|
See
notes 6 and 7 above.
|
·
|
uncertain
growth in the market for, and uncertain market acceptance of, its
products
and services;
|
·
|
the
evolving nature of the crop seed business in PRC, where significant
consolidation is likely to occur, leading to the formation of companies
better able to compete with Origin than is currently the case; and
|
·
|
the
risks of competition, technological change or evolving customer
preferences could harm sales of their products or services.
|
·
|
Dr.
Gengchen Han;
|
·
|
Dr.
Yasheng Yang; and
|
·
|
Liang
Yuan.
|
Year
ended December 31,
|
Six
Months ended June 30,
(unaudited)
|
||||||||||||||||||
2002
|
2003
|
2004
|
2004
|
2005
|
2005
|
||||||||||||||
(RMB)
|
(RMB)
|
(RMB)
|
(US
$)
|
(RMB)
|
(US
$)
|
||||||||||||||
Net
cash (used in) provided by operating activities
|
55,976,315
|
(14,961,297
|
)
|
42,744,534
|
5,164,566
|
23,150,481
|
2,797,134
|
||||||||||||
Net
cash used in investing activities
|
(24,585,920
|
)
|
(32,961,133
|
)
|
(27,200,560
|
)
|
(3,286,480
|
)
|
(20,117,335
|
)
|
(2,430,658
|
)
|
|||||||
Net
cash used in financing activities
|
10,000,000
|
18,445,872
|
4,082,765
|
493,296
|
(18,120,000
|
)
|
(2,189,331
|
)
|
|||||||||||
Net
increase(decrease) in cash and cash equivalents
|
41,390,395
|
(29,476,558
|
)
|
19,626,739
|
2,371,382
|
(15,086,854
|
)
|
(1,822,855
|
)
|
||||||||||
Cash
and cash equivalents, beginning of year
|
37,307,578
|
78,697,973
|
49,221,415
|
5,947,129
|
68,848,154
|
8,318,511
|
|||||||||||||
Cash
and cash equivalents, end of year
|
78,697,973
|
49,221,415
|
68,848,154
|
8,318,511
|
53,761,300
|
6,495,656
|
Payment
Due by Period
|
||||||||||||||||||||||
Total
|
Within
2005
|
2006
|
2007
|
2008
|
2009
|
Thereafter
|
||||||||||||||||
RMB
|
RMB
|
RMB
|
RMB
|
RMB
|
RMB
|
RMB
|
||||||||||||||||
Operating
lease commitments
|
12,919,737
|
647,742
|
1,449,655
|
1,381,597
|
481,225
|
403,538
|
8,555,980
|
|||||||||||||||
Capital
commitments
|
21,352,410
|
21,352,410
|
—
|
—
|
—
|
—
|
—
|
|||||||||||||||
Total
contractual obligations
|
34,272,147
|
22,000,152
|
1,449,655
|
1,381,597
|
481,225
|
403,538
|
8,555,980
|
|||||||||||||||
Equivalent
US$
|
4,140,899
|
2,658,147
|
175,153
|
166,930
|
58,144
|
48,757
|
1,033,768
|
RMB
|
US$
|
||||||
Plant
and building construction
|
20,128,190
|
2,431,969
|
|||||
Equipment
|
1,224,220
|
147,915
|
|||||
Total
|
21,352,410
|
2,579,884
|
Exhibit
|
Description
|
|
2.1
|
Stock
Purchase Agreement (Included in Annex A of the proxy statement/prospectus
included in Registration Statement 333-124709 and incorporated
by
reference herein)
|
|
2.2
|
Form
of Agreement and Plan of Merger between Chardan China Acquisition
Corp.
and Registrant (Incorporated by reference from Registration Statement
333-124709, Item 2.2)
|
|
3.1
|
Memorandum
of Association of Registrant (Included in Annex B of the proxy
statement/prospectus included in Registration Statement 333-124709
and
incorporated by reference herein)
|
|
3.2
|
Articles
of Association of Registrant (Included in Annex C of the proxy
statement/prospectus included in Registration Statement 333-124709
and
incorporated by reference herein)
|
|
4.1
|
Specimen
Unit Certificate of Registrant (Incorporated by reference from
Registration Statement 333-124709, Item 4.1)
|
|
4.2
|
Specimen
Common Stock Certificate of Registrant (Incorporated by reference
from
Registration Statement 333-124709, Item 4.2)
|
|
4.3
|
Specimen
Warrant Certificate (Incorporated by reference from Registration
Statement
333-124709, Item 4.3)
|
|
4.4
|
Form
of Unit Purchase Option (Incorporated by reference from Registration
Statement 333-111970, dated February 23, 2004, Item
4.4)
|
|
4.5
|
Form
of Warrant Agreement between American Stock Transfer & Trust Company
and Chardan China Acquisition Corp. (Incorporated by reference
from
Registration Statement 333-111970, dated March 12, 2004, Item
4.5)
|
|
10.1
|
2005
Performance Equity Plan (Included in Annex D of the proxy
statement/prospectus included in Registration Statement 333-124709
and
incorporated by reference herein)
|
|
10.2
|
Letter
Agreement among Chardan China Acquisition Corp., EarlyBirdCapital,
Inc.
and Dr. Richard D. Propper. (Incorporated by reference from Registration
Statement 333-111970, dated January 16, 2004, Item
10.1)
|
Exhibit
|
Description
|
|
10.3
|
Letter
Agreement among Chardan China Acquisition Corp., EarlyBirdCapital,
Inc.
and Kerry Jiangnan Huang. (Incorporated by reference from Registration
Statement 333-111970, dated January 16, 2004, Item
10.2)
|
|
10.4
|
Letter
Agreement among Chardan China Acquisition Corp., EarlyBirdCapital,
Inc.
and Li Zhang. (Incorporated by reference from Registration Statement
333-111970, dated January 16, 2004, Item 10.3)
|
|
10.5
|
Letter
Agreement among Chardan China Acquisition Corp., EarlyBirdCapital,
Inc.
and Kerry Propper. (Incorporated by reference from Registration
Statement
333-111970, dated January 16, 2004, Item 10.4)
|
|
10.6
|
Letter
Agreement among Chardan China Acquisition Corp., EarlyBirdCapital,
Inc.
and Michael Urbach. (Incorporated
by reference from Registration Statement 333-111970, dated January
16,
2004, Item 10.5)
|
|
10.7
|
Letter
Agreement among Chardan China Acquisition Corp., EarlyBirdCapital,
Inc.
and Dan Beharry. (Incorporated by reference from Registration
Statement
333-111970, dated January 16, 2004, Item 10.6)
|
|
10.8
|
Letter
Agreement among Chardan China Acquisition Corp., EarlyBirdCapital,
Inc.
and Steven Urbach. (Incorporated by reference from Registration
Statement
333-111970, dated January 16, 2004, Item 10.7)
|
|
10.9
|
Letter
Agreement among Chardan China Acquisition Corp., EarlyBirdCapital,
Inc.
and Anthony D. Errico Jr.
(Incorporated by reference from Registration Statement 333-111970,
dated
January 16, 2004, Item 10.8)
|
|
10.10
|
Form
of Investment Management Trust Agreement between Continental
Stock
Transfer & Trust Company and Chardan China Acquisition
Corp..
(Incorporated by reference from Registration Statement 333-111970,
dated
February 23, 2004, Item 10.9)
|
|
10.11
|
Form
of Stock Escrow Agreement between Chardan China Acquisition Corp.,
Continental Stock Transfer & Trust Company and the Initial
Stockholders.
(Incorporated by reference from Registration Statement 333-111970,
dated
February 23, 2004, Item 10.10)
|
|
10.12
|
Form
of Registration Rights Agreement among Chardan China Acquisition
Corp. and
the Initial Stockholders.
(Incorporated by reference from Registration Statement 333-111970,
dated
January 16, 2004, Item 10.13)
|
|
10.13
|
Letter
amendment to Letter Agreements between Chardan China Acquisition
Corp.,
EarlyBirdCapital, Inc. and each of Dr. Richard D. Propper, Jiangnan
Huang,
Li Zhang, Kerry Propper, Michael Urbach, Dan Beharry, Steven
Urbach and
Anthony D. Errico Jr.
(Incorporated by reference from Registration Statement 333-111970,
dated
March 8, 2004, Item 10.16)
|
|
10.14
|
Technology
Service Agreement between Origin Biotechnology and Beijing Origin
(Incorporated by reference from Registration Statement 333-124709,
Item
10.14)
|
|
10.15
|
Technology
Service Agreement between Origin Biotechnology and Henan
Origin(Incorporated by reference from Registration Statement
333-124709,
Item 10.15)
|
|
10.16
|
Technology
Service Agreement between Origin Biotechnology and Changchun
Origin(Incorporated by reference from Registration Statement
333-124709,
Item 10.16)
|
|
10.17
|
Form
of Stock Consignment Agreement (Incorporated by reference from
Registration Statement 333-124709, Item
10.17)
|
Exhibit
|
Description
|
|
10.18
|
List
of Schedules to Stock Purchase Agreement (Incorporated by reference
from
Registration Statement 333-124709, Item 10.18)
|
|
10.19
|
Agreement
to provide or file Schedules, Supplements and Exhibits to Stock
Purchase
Agreement(Incorporated by reference from Registration Statement
333-124709, Item 10.19)
|
|
10.20
|
Employment
Agreement between State Harvest and Dr. Han Gengchen(Incorporated
by
reference from Registration Statement 333-124709, Item
10.20)
|
|
10.21
|
Employment
Agreement between State Harvest and Mr. Yang Yasheng(Incorporated
by
reference from Registration Statement 333-124709, Item
10.21)
|
|
10.22
|
Employment
Agreement between State Harvest and Mr. Yuan Liang(Incorporated
by
reference from Registration Statement 333-124709, Item
10.22)
|
|
10.23
|
Consulting
Agreement between Chardan and Best of the Best(Incorporated by
reference
from Registration Statement 333-124709, Item 10.23)
|
|
10.24
|
Form
of Voting Agreement among Registrant and Dr. Han and Messrs.
Yang and
Yuan(Incorporated by reference from Registration Statement 333-124709,
Item 10.24)
|
|
10.25
|
Opinion
re Consignment Agreements of Guantao Law Firm(Incorporated
by reference from Registration Statement 333-124709, Item
10.25)
|
|
10.26
|
Corn
Seed Production Booking Contract Form(Incorporated
by reference from Registration Statement 333-124709, Item
10.26)
|
|
10.27
|
Technology
Transfer Agreement between Henan Agricultural University and
Beijing
Origin Seed Limited (YuYu22)
(Incorporated by reference from Registration Statement 333-124709,
Item
10.27)
|
|
10.28
|
Joint
Development agreement with Corn Research Institute of Li County
(1st
Agreement)
(Incorporated by reference from Registration Statement 333-124709,
Item
10.28)
|
|
10.29
|
Joint
Development Agreement with Corn Research Institute of Li County
(2nd
Agreement(Incorporated
by reference from Registration Statement 333-124709, Item
10.29)
|
|
10.30
|
Joint
Development Agreement with Hubei Province Shiyan Agricultural
Sciences
Institute (EYu10)
(Incorporated by reference from Registration Statement 333-124709,
Item
10.30)
|
|
99.1
|
Press
Release announcing the Closing filed on November 8,
2005.
|
Origin Agritech Limited | ||
|
|
|
Date: November 10, 2005 | By: | /s/ Gengchen Han |
Gengchen Han, President |
||
PAGE
|
||||
STATE
HARVEST HOLDINGS LIMITED
|
||||
REPORT
OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
|
F-2
|
|||
CONSOLIDATED
BALANCE SHEETS AS OF DECEMBER 31, 2002, 2003, 2004, AND AS OF JUNE
30,
2005 (UNAUDITED)
|
F-3
|
|||
CONSOLIDATED
STATEMENTS OF OPERATIONS FOR THE YEARS
ENDED DECEMBER 31, 2002, 2003, 2004 AND FOR
THE SIX MONTHS ENDED JUNE 30, 2004 (UNAUDITED) AND 2005
(UNAUDITED)
|
F-4
|
|||
CONSOLIDATED
STATEMENTS OF SHAREHOLDERS’ EQUITY FOR
THE YEARS
ENDED DECEMBER 31, 2002, 2003, 2004 AND FOR THE SIX MONTHS ENDED
JUNE 30,
2005 (UNAUDITED)
|
F-5
|
|||
CONSOLIDATED
STATEMENTS OF CASH FLOWS FOR
THE YEARS
ENDED DECEMBER 31, 2002, 2003 AND 2004 AND FOR THE SIX MONTHS ENDED
JUNE
30, 2004 (UNAUDITED) AND 2005 (UNAUDITED)
|
F-6
|
|||
NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS
|
F-7
to F-27
|
|||
PRO
FORMA FINANCIAL INFORMATION
|
||||
UNAUDITED
PRO FORMA CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
|
F-28
|
|||
PRO
FORMA ADJUSTMENTS
|
F-29
|
|||
UNAUDITED
PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET AT JUNE 30,
2005
|
F-30
|
|||
UNAUDITED
PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS FOR THE
SIX
MONTHS ENDED JUNE 30, 2005
|
F-31
|
|||
UNAUDITED
PRO FORMA CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS FOR THE
YEAR
ENDED DECEMBER 31, 2004
|
F-32
|
At
December 31,
|
June
30,
|
||||||||||||||||||
2002
|
2003
|
2004
|
2004
|
2005
|
2005
|
||||||||||||||
RMB
|
RMB
|
RMB
|
US$
|
RMB
|
US$
|
||||||||||||||
(unaudited)
|
|||||||||||||||||||
Assets
|
|
||||||||||||||||||
Current
assets:
|
|||||||||||||||||||
Cash
and cash equivalents
|
78,697,973
|
49,221,415
|
68,848,154
|
$
|
8,318,511
|
53,761,300
|
$
|
6,495,656
|
|||||||||||
Accounts
receivable, net of allowance of RMB50,850, nil, nil for 2002,
2003 and 2004, and (unaudited) nil at June 30, 2005
respectively
|
5,274,006
|
—
|
—
|
—
|
—
|
—
|
|||||||||||||
Due
from related parties
|
420,000
|
520,000
|
784,547
|
94,792
|
282,757
|
34,164
|
|||||||||||||
Advances
to growers
|
—
|
—
|
—
|
—
|
6,318,414
|
763,416
|
|||||||||||||
Advances
to suppliers
|
1,810,529
|
7,371,122
|
1,643,666
|
198,594
|
3,708,197
|
448,039
|
|||||||||||||
Inventories
|
114,903,721
|
170,887,988
|
235,821,671
|
28,492,922
|
135,647,143
|
16,389,433
|
|||||||||||||
Income
tax receivable
|
9,795,564
|
1,449,676
|
7,531,581
|
909,996
|
933,799
|
112,825
|
|||||||||||||
Prepaid
expenses and other current assets
|
7,038,563
|
8,504,254
|
10,269,502
|
1,240,803
|
13,989,901
|
1,690,316
|
|||||||||||||
Total
current assets
|
217,940,356
|
237,954,455
|
324,899,121
|
39,255,618
|
214,641,511
|
25,933,849
|
|||||||||||||
Land
use rights, net
|
5,177,677
|
10,988,736
|
11,301,997
|
1,365,553
|
11,190,723
|
1,352,108
|
|||||||||||||
Plant
and equipment, net
|
31,652,831
|
55,400,693
|
66,001,864
|
7,974,611
|
75,354,875
|
9,104,679
|
|||||||||||||
Long
term investments
|
—
|
—
|
10,274,604
|
1,241,419
|
11,118,506
|
1,343,383
|
|||||||||||||
Acquired
intangible assets, net
|
570,319
|
237,956
|
2,872,463
|
347,062
|
4,748,050
|
573,679
|
|||||||||||||
Deferred
income tax assets
|
1,573,084
|
2,142,148
|
418,981
|
50,623
|
503,460
|
60,830
|
|||||||||||||
Other
assets
|
473,261
|
532,771
|
614,550
|
74,252
|
6,433,171
|
777,282
|
|||||||||||||
Total
assets
|
257,387,528
|
307,256,759
|
416,383,580
|
$
|
50,309,138
|
323,990,296
|
$
|
39,145,810
|
|||||||||||
Liabilities
and shareholders’ equity
|
|||||||||||||||||||
Current
liabilities:
|
|||||||||||||||||||
Short-term
borrowings
|
15,000,000
|
35,000,000
|
41,000,000
|
$
|
4,953,785
|
21,000,000
|
$
|
2,537,304
|
|||||||||||
Accounts
payable
|
12,069,243
|
14,474,266
|
22,741,562
|
2,747,727
|
8,624,250
|
1,042,017
|
|||||||||||||
Due
to growers
|
42,552,299
|
35,411,109
|
83,356,902
|
10,071,516
|
10,860,000
|
1,312,149
|
|||||||||||||
Due
to related parties
|
—
|
—
|
1,413,234
|
170,753
|
13,208,533
|
1,595,908
|
|||||||||||||
Advances
from customers
|
57,285,612
|
73,419,263
|
78,683,497
|
9,506,856
|
69,920,667
|
8,448,096
|
|||||||||||||
Deferred
revenues
|
74,764,068
|
65,295,950
|
37,920,553
|
4,581,714
|
—
|
—
|
|||||||||||||
Income
tax payable
|
—
|
—
|
1,151,985
|
139,187
|
900,418
|
108,792
|
|||||||||||||
Other
payables and accrued expenses
|
3,487,187
|
4,167,510
|
6,734,536
|
813,694
|
10,624,506
|
1,283,695
|
|||||||||||||
Total
current liabilities
|
205,158,409
|
227,768,098
|
273,002,269
|
32,985,232
|
135,138,374
|
16,327,961
|
|||||||||||||
Long-term
borrowings
|
—
|
—
|
—
|
—
|
1,880,000
|
227,149
|
|||||||||||||
Other
long-term liabilities
|
2,871,801
|
2,871,801
|
2,871,801
|
346,982
|
2,871,801
|
346,983
|
|||||||||||||
Minority
interests
|
3,271,218
|
3,183,679
|
3,534,095
|
427,004
|
4,199,357
|
507,384
|
|||||||||||||
Commitments
and contingencies (Note 16)
|
|||||||||||||||||||
Shareholders’
equity:
|
|||||||||||||||||||
Common
shares (nil for 2002 and 2003; US$1 par value, 10,000 shares authorized,
issued and outstanding in 2004 and (unaudited) June 30,
2005)
|
—
|
—
|
82,765
|
10,000
|
82,765
|
10,000
|
|||||||||||||
Additional
paid-in capital
|
3,671,500
|
100,000,000
|
100,000,000
|
12,082,402
|
100,000,000
|
12,082,402
|
|||||||||||||
Retained
earnings (accumulated deficit)
|
42,414,600
|
(26,566,819
|
)
|
36,892,650
|
4,457,518
|
79,817,999
|
9,643,931
|
||||||||||||
Total
shareholders’ equity
|
46,086,100
|
73,433,181
|
136,975,415
|
16,549,920
|
179,900,764
|
21,736,333
|
|||||||||||||
Total
liabilities and shareholders’ equity
|
257,387,528
|
307,256,759
|
416,383,580
|
$
|
50,309,138
|
323,990,296
|
$
|
39,145,810
|
Year
ended December 31,
|
Six
months ended June 30,
|
|||||||||||||||||||||
2002
|
2003
|
2004
|
2004
|
2004
|
2005
|
2005
|
||||||||||||||||
RMB
|
RMB
|
RMB
|
US$
|
RMB
|
RMB
|
US$
|
||||||||||||||||
(unaudited)
|
(unaudited)
|
|||||||||||||||||||||
Revenues
|
98,717,316
|
191,645,454
|
301,519,504
|
$
|
36,430,799
|
212,400,538
|
208,554,287
|
$
|
25,198,367
|
|||||||||||||
Cost
of revenues
|
(46,006,510
|
)
|
(118,976,611
|
)
|
(178,312,702
|
)
|
(21,544,457
|
)
|
(130,855,178
|
)
|
(129,941,009
|
)
|
(15,699,995
|
)
|
||||||||
Gross
profit
|
52,710,806
|
72,668,843
|
123,206,802
|
14,886,342
|
81,545,360
|
78,613,278
|
9,498,372
|
|||||||||||||||
Operating
expenses:
|
||||||||||||||||||||||
Selling
and marketing
|
(6,480,427
|
)
|
(13,310,899
|
)
|
(20,389,786
|
)
|
(2,463,576
|
)
|
(9,167,891
|
)
|
(15,009,922
|
)
|
(1,813,559
|
)
|
||||||||
General
and administrative
|
(9,641,490
|
)
|
(18,947,787
|
)
|
(24,149,593
|
)
|
(2,917,851
|
)
|
(14,412,182
|
)
|
(14,493,332
|
)
|
(1,751,143
|
)
|
||||||||
Research
and development
|
(5,371,954
|
)
|
(5,287,964
|
)
|
(6,773,621
|
)
|
(818,416
|
)
|
(2,701,270
|
)
|
(3,596,471
|
)
|
(434,540
|
)
|
||||||||
Total
operating expenses
|
(21,493,871
|
)
|
(37,546,650
|
)
|
(51,313,000
|
)
|
(6,199,843
|
)
|
(26,281,343
|
)
|
(33,099,725
|
)
|
(3,999,242
|
)
|
||||||||
Income
from operations
|
31,216,935
|
35,122,193
|
71,893,802
|
8,686,499
|
55,264,017
|
45,513,553
|
5,499,130
|
|||||||||||||||
Interest
expense
|
(416,934
|
)
|
(483,314
|
)
|
(831,166
|
)
|
(100,425
|
)
|
(405,291
|
)
|
(1,598,976
|
)
|
(193,195
|
)
|
||||||||
Equity
in earnings of associated company
|
—
|
—
|
1,924,604
|
232,538
|
—
|
843,902
|
101,963
|
|||||||||||||||
Interest
income
|
440,254
|
845,448
|
372,010
|
44,948
|
134,747
|
297,186
|
35,907
|
|||||||||||||||
Other
income
|
2,265,862
|
1,137,140
|
149,119
|
18,017
|
50,226
|
13,220
|
1,599
|
|||||||||||||||
Provision
for litigation
|
(2,871,801
|
)
|
—
|
—
|
—
|
—
|
—
|
—
|
||||||||||||||
Income
before income taxes an minority interests
|
30,634,316
|
36,621,467
|
73,508,369
|
8,881,577
|
55,043,699
|
45,068,885
|
5,445,404
|
|||||||||||||||
Income
taxes
|
(1,498,312
|
)
|
(7,807,797
|
)
|
(7,698,484
|
)
|
(930,162
|
)
|
(5,072,818
|
)
|
(1,478,274
|
)
|
(178,611
|
)
|
||||||||
Income
before minority interests
|
29,136,004
|
28,813,670
|
65,809,885
|
7,951,415
|
49,970,881
|
43,590,611
|
5,266,793
|
|||||||||||||||
Minority
interests
|
(2,574,818
|
)
|
137,539
|
(350,416
|
)
|
(42,339
|
)
|
(660,107
|
)
|
(665,262
|
)
|
(80,380
|
)
|
|||||||||
Net
income
|
26,561,186
|
28,951,209
|
65,459,469
|
$
|
7,909,076
|
49,310,774
|
42,925,349
|
$
|
5,186,413
|
|||||||||||||
Net
income per share:
|
||||||||||||||||||||||
Basic
and diluted
|
RMB2,656.12
|
RMB2,895.12
|
RMB6,545.95
|
$
|
US790.91
|
RMB4,931.08
|
RMB4,292.53
|
$
|
US518.64
|
|||||||||||||
Shares
used in computation:
|
||||||||||||||||||||||
Basic
and diluted
|
10,000
|
10,000
|
10,000
|
10,000
|
10,000
|
10,000
|
10,000
|
Retained
|
||||||||||||||||
Additional
|
earnings
|
Total
|
||||||||||||||
Common
shares
|
paid-in
|
(accumulated
|
shareholders’
|
|||||||||||||
Shares
|
Amount
|
capital
|
deficit)
|
equity
|
||||||||||||
(RMB)
|
(RMB)
|
(RMB)
|
(RMB)
|
|||||||||||||
Balance
as of January 1, 2001
|
—
|
—
|
3,671,500
|
7,925,167
|
11,596,667
|
|||||||||||
Net
income
|
—
|
—
|
—
|
8,115,010
|
8,115,010
|
|||||||||||
Balance
as of December 31, 2001
|
—
|
—
|
3,671,500
|
16,040,177
|
19,711,677
|
|||||||||||
Capital
contribution to minority interest
|
—
|
—
|
—
|
(186,763
|
)
|
(186,763
|
)
|
|||||||||
Net
income
|
—
|
—
|
—
|
26,561,186
|
26,561,186
|
|||||||||||
Balance
as of December 31, 2002
|
—
|
—
|
3,671,500
|
42,414,600
|
46,086,100
|
|||||||||||
Net
income
|
—
|
—
|
—
|
28,951,209
|
28,951,209
|
|||||||||||
Capital
restructuring
|
—
|
—
|
96,328,500
|
(96,328,500
|
)
|
—
|
||||||||||
Cash
dividend
|
—
|
—
|
—
|
(1,604,128
|
)
|
(1,604,128
|
)
|
|||||||||
Balance
as of December 31, 2003
|
—
|
—
|
100,000,000
|
(26,566,819
|
)
|
73,433,181
|
||||||||||
Net
income
|
—
|
—
|
—
|
65,459,469
|
65,459,469
|
|||||||||||
Capital
contribution
|
10,000
|
82,765
|
—
|
—
|
82,765
|
|||||||||||
Cash
dividend
|
—
|
—
|
—
|
(2,000,000
|
)
|
(2,000,000
|
)
|
|||||||||
Balance
as of December 31, 2004
|
10,000
|
82,765
|
100,000,000
|
36,892,650
|
136,975,415
|
|||||||||||
Net
income (unaudited)
|
—
|
—
|
—
|
42,925,349
|
42,925,349
|
|||||||||||
Balance
as of June 30, 2005 (unaudited)
|
10,000
|
82,765
|
100,000,000
|
79,817,999
|
179,900,764
|
|||||||||||
In
US$ (unaudited)
|
10,000
|
10,000
|
12,082,402
|
9,643,931
|
21,736,333
|
Year
ended December 31,
|
Six
months ended June 30,
|
|||||||||||||||||||||
2002
|
2003
|
2004
|
2004
|
2004
|
2005
|
2005
|
||||||||||||||||
RMB
|
RMB
|
RMB
|
US$
|
RMB
|
RMB
|
US$
|
||||||||||||||||
(unaudited)
|
(unaudited)
|
|||||||||||||||||||||
Operating
activities:
|
||||||||||||||||||||||
Net
income
|
26,561,186
|
28,951,209
|
65,459,469
|
$
|
7,909,076
|
49,310,774
|
42,925,349
|
$
|
5,186,413
|
|||||||||||||
Adjustments
to reconcile net income to net cash (used in) provided by operating
activities:
|
||||||||||||||||||||||
Depreciation
and amortization
|
1,555,976
|
3,260,788
|
5,225,135
|
631,322
|
2,861,696
|
3,320,414
|
401,186
|
|||||||||||||||
Loss
on disposal of plant and equipment
|
—
|
473,787
|
76,486
|
9,241
|
242,497
|
79,597
|
9,617
|
|||||||||||||||
Bad
debt provision
|
30,228
|
(50,850
|
)
|
—
|
—
|
—
|
302,441
|
36,542
|
||||||||||||||
Inventory
provision
|
—
|
—
|
—
|
—
|
—
|
3,521,533
|
425,486
|
|||||||||||||||
Minority
interests
|
2,574,818
|
(137,539
|
)
|
350,416
|
42,339
|
660,107
|
665,262
|
80,380
|
||||||||||||||
Equity
in earnings of associated company
|
—
|
—
|
(1,924,604
|
)
|
(232,538
|
)
|
—
|
(843,902
|
)
|
(101,964
|
)
|
|||||||||||
Changes
in operating assets and liabilities:
|
||||||||||||||||||||||
Accounts
receivable
|
(5,272,000
|
)
|
5,324,856
|
—
|
—
|
—
|
—
|
—
|
||||||||||||||
Due
from related parties
|
(400,000
|
)
|
(100,000
|
)
|
(264,547
|
)
|
(31,964
|
)
|
20,000
|
501,790
|
60,628
|
|||||||||||
Advance
to growers
|
—
|
—
|
—
|
—
|
(7,036,691
|
)
|
(6,318,414
|
)
|
(763,416
|
)
|
||||||||||||
Advances
to suppliers
|
963,469
|
(5,560,593
|
)
|
5,727,456
|
692,014
|
3,916,444
|
(2,064,531
|
)
|
(249,445
|
)
|
||||||||||||
Inventories
|
(76,787,563
|
)
|
(55,984,267
|
)
|
(64,933,683
|
)
|
(7,845,549
|
)
|
89,352,791
|
96,652,995
|
11,678,003
|
|||||||||||
Income
tax receivable
|
(9,062,281
|
)
|
8,345,888
|
(6,081,905
|
)
|
(734,840
|
)
|
(3,937,795
|
)
|
6,597,782
|
797,171
|
|||||||||||
Prepaid
expenses and other current assets
|
(3,476,476
|
)
|
(1,465,691
|
)
|
(1,765,248
|
)
|
(213,284
|
)
|
3,402,090
|
(4,022,840
|
)
|
(486,055
|
)
|
|||||||||
Deferred
tax assets
|
(1,161,113
|
)
|
(569,064
|
)
|
1,723,167
|
208,200
|
(222,324
|
)
|
(84,479
|
)
|
(10,207
|
)
|
||||||||||
Other
assets
|
(367,396
|
)
|
(59,510
|
)
|
(81,779
|
)
|
(9,881
|
)
|
45,789
|
(218,621
|
)
|
(26,415
|
)
|
|||||||||
Accounts
payable
|
11,061,592
|
2,405,023
|
8,267,296
|
998,888
|
(743,719
|
)
|
(14,117,312
|
)
|
(1,705,710
|
)
|
||||||||||||
Due
to growers
|
35,777,069
|
(7,141,190
|
)
|
47,945,793
|
5,793,003
|
(35,411,109
|
)
|
(72,496,902
|
)
|
(8,759,367
|
)
|
|||||||||||
Due
to related parties
|
—
|
—
|
1,413,234
|
170,753
|
5,248,916
|
11,795,299
|
1,425,155
|
|||||||||||||||
Advances
from customers
|
2,883,343
|
16,133,651
|
5,264,234
|
636,046
|
(24,820,734
|
)
|
(8,762,830
|
)
|
(1,058,760
|
)
|
||||||||||||
Deferred
revenues
|
69,979,599
|
(9,468,118
|
)
|
(27,375,397
|
)
|
(3,307,606
|
)
|
(65,295,950
|
)
|
(37,920,553
|
)
|
(4,581,714
|
)
|
|||||||||
Income
tax payable
|
—
|
—
|
1,151,985
|
139,187
|
2,583,464
|
(251,567
|
)
|
(30,395
|
)
|
|||||||||||||
Other
payables and accrued expenses
|
(1,755,937
|
)
|
680,323
|
2,567,026
|
310,159
|
4,705,461
|
3,889,970
|
470,001
|
||||||||||||||
Other
long-term liabilities
|
2,871,801
|
—
|
—
|
—
|
—
|
—
|
—
|
|||||||||||||||
Net
cash (used in) provided by operating activities
|
55,976,315
|
(14,961,297
|
)
|
42,744,534
|
5,164,566
|
24,881,707
|
23,150,481
|
2,797,134
|
||||||||||||||
Investing
activities:
|
||||||||||||||||||||||
Purchase
of plant and equipment
|
(20,011,477
|
)
|
(26,995,374
|
)
|
(15,469,658
|
)
|
(1,869,106
|
)
|
(2,679,372
|
)
|
(12,107,953
|
)
|
(1,462,932
|
)
|
||||||||
Purchase
of land use rights
|
(4,574,443
|
)
|
(5,956,759
|
)
|
(535,810
|
)
|
(64,739
|
)
|
(505,810
|
)
|
—
|
—
|
||||||||||
Purchase
of other assets
|
—
|
—
|
—
|
—
|
—
|
(5,600,000
|
)
|
(676,615
|
)
|
|||||||||||||
Acquisition
of cost method investment
|
—
|
—
|
(8,320,000
|
)
|
(1,005,256
|
)
|
—
|
—
|
—
|
|||||||||||||
Acquisition
of equity method investment
|
—
|
—
|
(30,000
|
)
|
(3,625
|
)
|
—
|
—
|
—
|
|||||||||||||
Purchase
of intangible assets
|
—
|
(9,000
|
)
|
(3,100,000
|
)
|
(374,554
|
)
|
(2,713,953
|
)
|
(2,500,000
|
)
|
(302,060
|
)
|
|||||||||
Proceeds
on disposal of plant and equipment
|
—
|
—
|
254,908
|
30,800
|
—
|
90,618
|
10,949
|
|||||||||||||||
Net
cash used in investing activities
|
(24,585,920
|
)
|
(32,961,133
|
)
|
(27,200,560
|
)
|
(3,286,480
|
)
|
(5,899,135
|
)
|
(20,117,335
|
)
|
(2,430,658
|
)
|
||||||||
Financing
activities:
|
||||||||||||||||||||||
Proceeds
from borrowings
|
15,000,000
|
35,000,000
|
41,000,000
|
4,953,785
|
—
|
36,880,000
|
4,455,990
|
|||||||||||||||
Repayment
of borrowings
|
(5,000,000
|
)
|
(15,000,000
|
)
|
(35,000,000
|
)
|
(4,228,841
|
)
|
(35,000,000
|
)
|
(55,000,000
|
)
|
(6,645,321
|
)
|
||||||||
Dividend
paid
|
—
|
(1,604,128
|
)
|
(2,000,000
|
)
|
(241,648
|
)
|
—
|
—
|
—
|
||||||||||||
Issuance
of share capital
|
—
|
—
|
82,765
|
10,000
|
—
|
—
|
—
|
|||||||||||||||
Contribution
from minority shareholders
|
—
|
50,000
|
—
|
—
|
—
|
—
|
—
|
|||||||||||||||
Net
cash provided by (used in) financing activities
|
10,000,000
|
18,445,872
|
4,082,765
|
493,296
|
(35,000,000
|
)
|
(18,120,000
|
)
|
(2,189,331
|
)
|
||||||||||||
Net
increase (decrease) in cash and cash equivalents
|
41,390,395
|
(29,476,558
|
)
|
19,626,739
|
2,371,382
|
(16,017,428
|
)
|
(15,086,854
|
)
|
(1,822,855
|
)
|
|||||||||||
Cash
and cash equivalents, beginning of year
|
37,307,578
|
78,697,973
|
49,221,415
|
5,947,129
|
49,221,415
|
68,848,154
|
8,318,511
|
|||||||||||||||
Cash
and cash equivalents, end of year
|
78,697,973
|
49,221,415
|
68,848,154
|
$
|
8,318,511
|
33,203,987
|
53,761,300
|
$
|
6,495,656
|
|||||||||||||
Supplemental
disclosure of cash flow information:
|
||||||||||||||||||||||
Income
taxes paid
|
9,821,705
|
2,355,531
|
10,905,237
|
$
|
1,131,144
|
6,649,473
|
1,814,320
|
$
|
219,213
|
|||||||||||||
Interest
paid
|
416,934
|
483,314
|
831,166
|
$
|
100,425
|
405,291
|
1,598,976
|
$
|
193,195
|
1.
|
ORGANIZATION
AND PRINCIPAL ACTIVITIES
|
1.
|
ORGANIZATION
AND PRINCIPAL ACTIVITIES -
continued
|
2. |
SUMMARY
OF SIGNIFICANT ACCOUNTING
POLICIES
|
2. |
SUMMARY
OF SIGNIFICANT ACCOUNTING POLICIES -
continued
|
2. |
SUMMARY
OF SIGNIFICANT ACCOUNTING POLICIES -
continued
|
Leasehold
improvements
|
Shorter
of the useful lives or the lease term
|
Plant
and building
|
20-40
years
|
Machinery
and equipment
|
10-15
years
|
Furniture
and office equipment
|
5
years
|
Motor
vehicles
|
5
years
|
2.
|
SUMMARY
OF SIGNIFICANT ACCOUNTING POLICIES -
continued
|
(a)
|
The
Company received RMB610,000, RMB1,137,139 and RMB 70,960 for the
years
ended December 31, 2002, 2003 and 2004, and (unaudited) Nil and RMB15,000
for six-month period ended June 30, 2004 and 2005 to fund research
and
development activities.
|
(b)
|
The
Company received a government incentive of RMB 5,005,148 and RMB3,719,940
for the years ended December 31, 2003 and 2004, and (unaudited) RMB309,052
and Nil for six-month period ended June 30, 2004 and 2005, in the
form of
a reduction in the cost of land use
rights.
|
2.
|
SUMMARY
OF SIGNIFICANT ACCOUNTING POLICIES -
continued
|
2.
|
SUMMARY
OF SIGNIFICANT ACCOUNTING POLICIES -
continued
|
2. |
SUMMARY
OF SIGNIFICANT ACCOUNTING POLICIES -
continued
|
3. |
RELATED
PARTY BALANCES AND
TRANSACTIONS
|
(1)
|
Amounts
due from shareholders, recorded in due from related parties on the
consolidated balance sheet, as of December 31, 2002, 2003 and 2004,
and as
of June 30, 2005 are as follows:
|
December
31,
|
June
30,
|
||||||||||||||||||
Name
of Shareholders
|
2002
|
2003
|
2004
|
2004
|
2005
|
2005
|
|||||||||||||
RMB
|
RMB
|
RMB
|
US$
|
RMB
|
US$
|
||||||||||||||
(unaudited)
|
|||||||||||||||||||
Yang
Ya Sheng
|
—
|
300,000
|
324,226
|
39,174
|
24,226
|
2,927
|
|||||||||||||
Zhao
Yu Ping
|
200,000
|
200,000
|
203,377
|
24,573
|
203,377
|
24,573
|
|||||||||||||
Han
Geng Chen
|
—
|
—
|
29,067
|
3,512
|
29,067
|
3,512
|
|||||||||||||
Yuan
Liang
|
—
|
—
|
21,792
|
2,633
|
21,792
|
2,633
|
|||||||||||||
Zhang
Wei Dong
|
—
|
—
|
2,640
|
319
|
2,640
|
319
|
|||||||||||||
Chen
Wei Qiang
|
—
|
—
|
1,655
|
200
|
1,655
|
200
|
|||||||||||||
200,000
|
500,000
|
582,757
|
70,411
|
282,757
|
34,164
|
3. |
RELATED
PARTY BALANCES AND TRANSACTIONS -
continued
|
(2)
|
Amounts
due from related parties as of December 31, 2002, 2003 and 2004,
and as of
June 30, 2005 are as follows:
|
Name
of related
party
|
Shareholder
interested
|
December
31,
|
June
30,
|
|||||||||||||||||||
2002
|
2003
|
2004
|
2004
|
2005
|
2005
|
|||||||||||||||||
RMB
|
RMB
|
RMB
|
US$
|
RMB
|
US$
|
|||||||||||||||||
(unaudited)
|
||||||||||||||||||||||
Li
Xian Corn Research Center
|
*
|
220,000
|
20,000
|
—
|
—
|
—
|
—
|
|||||||||||||||
He
Nan Agriculture University
|
***
|
—
|
—
|
201,790
|
24,381
|
—
|
—
|
|||||||||||||||
220,000
|
20,000
|
201,790
|
24,381
|
—
|
—
|
(3)
|
Amount
due to a shareholder, recorded in due to related parties on the
consolidated balance sheets, are as
follows:
|
December
31,
|
June
30,
|
||||||||||||||||||
Name
of the shareholder
|
2002
|
2003
|
2004
|
2004
|
2005
|
2005
|
|||||||||||||
RMB
|
RMB
|
RMB
|
US$
|
RMB
|
US$
|
||||||||||||||
(unaudited)
|
|||||||||||||||||||
Yuan
Liang
|
—
|
—
|
—
|
—
|
8,297,789
|
1,002,572
|
|||||||||||||
|
—
|
—
|
—
|
—
|
8,297,789
|
1,002,572
|
(4)
|
Amounts
due to related parties as of December 31, 2002, 2003 and 2004, and
as of
June 30, 2005 are as follows:
|
Name
of
related party
|
Shareholder
interested
|
December
31,
|
June 30, | |||||||||||||||||||
2002
|
2003
|
2004
|
2004
|
2005
|
2005
|
|||||||||||||||||
RMB
|
RMB
|
RMB
|
US$
|
RMB
|
US$
|
|||||||||||||||||
(unaudited)
|
||||||||||||||||||||||
Shijiazhuang
Li Yu Technology Development Co., Ltd.
|
**
|
—
|
—
|
1,413,234
|
170,753
|
4,810,744
|
581,253
|
|||||||||||||||
Henan
Agriculture University
|
***
|
—
|
—
|
—
|
—
|
100,000
|
12,082
|
|||||||||||||||
|
—
|
—
|
1,413,234
|
170,753
|
4,910,744
|
593,336
|
3. |
RELATED
PARTY BALANCES AND TRANSACTIONS - continued
|
(5)
|
Transactions
with related parties for the years ended December 31, 2002, 2003
and 2004,
and as of June 30, 2005 are
follows:
|
Name
of
related party
|
Shareholder
interested
|
December
31,
|
June
30,
|
||||||||||||||||||||||
2002
|
2003
|
2004
|
2004
|
2004
|
2005
|
2005
|
|||||||||||||||||||
RMB
|
RMB
|
RMB
|
US$
|
RMB
|
RMB
|
US$
|
|||||||||||||||||||
|
(unaudited)
|
(unaudited)
|
|||||||||||||||||||||||
Li
Xian Corn Research Center
|
*
|
1,443,754
|
4,495,617
|
—
|
—
|
—
|
—
|
—
|
|||||||||||||||||
Shijiazhuang
Li Yu Technology Development Co., Ltd.
|
**
|
—
|
—
|
8,242,939
|
995,945
|
5,148,916
|
4,958,223
|
599,072
|
|||||||||||||||||
He
Nan Agriculture University
|
***
|
371,000
|
687,502
|
1,104,098
|
253,736
|
704,098
|
301,790
|
36,463
|
|||||||||||||||||
1,814,754
|
5,183,119
|
9,347,037
|
1,249,681
|
5,853,014
|
5,260,013
|
635,535
|
|||||||||||||||||||
*
|
Li
Xian Corn Research Center was previously owned by one of the Company’s
principal shareholders, Yang Ya
Sheng.
|
**
|
Shijiazhuang
Li Yu Technology Development Co., Ltd. was previously owned by one
of the
Company’s principal shareholders, Yang Ya Sheng, and from September 2004
onwards, it became the Company’s equity method
investment.
|
***
|
He
Nan Agriculture University is one of the shareholders of Beijing
Origin.
|
(6)
|
Transactions
with a shareholder for the period ended June 30, 2005 are provisions
of
operating fund (unaudited) RMB8,297,789 to the
Company.
|
4. |
INVENTORIES
|
As
of December 31,
|
As
of June 30,
|
||||||||||||||||||
2002
|
2003
|
2004
|
2004
|
2005
|
2005
|
||||||||||||||
RMB
|
RMB
|
RMB
|
US$
|
RMB
|
US$
|
||||||||||||||
(unaudited)
|
|||||||||||||||||||
Work
in progress and supplies
|
58,517,975
|
98,469,190
|
131,457,368
|
15,883,207
|
122,722,940
|
14,827,879
|
|||||||||||||
Finished
goods
|
56,385,746
|
72,418,798
|
104,364,303
|
12,609,715
|
12,924,203
|
1,561,554
|
|||||||||||||
114,903,721
|
170,887,988
|
235,821,671
|
28,492,922
|
135,647,143
|
16,389,433
|
5. |
PREPAID
EXPENSES AND OTHER CURRENT
ASSETS
|
As
of December 31,
|
As
of June 30,
|
||||||||||||||||||
2002
|
2003
|
2004
|
2004
|
2005
|
2005
|
||||||||||||||
RMB
|
RMB
|
RMB
|
US$
|
RMB
|
US$
|
||||||||||||||
(unaudited)
|
|||||||||||||||||||
Employee
travel allowance
|
3,048,877
|
4,174,814
|
3,108,682
|
375,604
|
3,657,050
|
441,859
|
|||||||||||||
Deposit
for land use rights
|
2,781,200
|
—
|
1,200,000
|
144,989
|
2,400,000
|
289,978
|
|||||||||||||
Deposit
for technology usage fee
|
—
|
3,100,000
|
1,000,000
|
120,824
|
—
|
—
|
|||||||||||||
Professional
fees
|
—
|
—
|
4,544,699
|
549,109
|
7,112,827
|
859,400
|
|||||||||||||
Other
prepaid expenses
|
1,208,486
|
1,229,440
|
416,121
|
50,277
|
820,024
|
99,079
|
|||||||||||||
7,038,563
|
8,504,254
|
10,269,502
|
1,240,803
|
13,989,901
|
1,690,316
|
6. |
LAND
USE RIGHTS, NET
|
As
of December 31,
|
As
of June 30,
|
||||||||||||||||||
2002
|
2003
|
2004
|
2004
|
2005
|
2005
|
||||||||||||||
RMB
|
RMB
|
RMB
|
US$
|
RMB
|
US$
|
||||||||||||||
(unaudited)
|
|||||||||||||||||||
Land
use rights
|
5,293,882
|
11,250,641
|
11,786,451
|
1,424,086
|
11,786,451
|
1,424,086
|
|||||||||||||
Less:
accumulated amortization
|
116,205
|
261,905
|
484,454
|
58,533
|
595,728
|
71,978
|
|||||||||||||
Land
use rights, net
|
5,177,677
|
10,988,736
|
11,301,997
|
1,365,553
|
11,190,723
|
1,352,108
|
7. |
PLANT
AND EQUIPMENT, NET
|
As
of December 31,
|
As
of June 30,
|
||||||||||||||||||
2002
|
2003
|
2004
|
2004
|
2005
|
2005
|
||||||||||||||
RMB
|
RMB
|
RMB
|
US$
|
RMB
|
US$
|
||||||||||||||
(unaudited)
|
|||||||||||||||||||
Plant
and building
|
16,606,445
|
28,117,697
|
30,814,063
|
3,723,079
|
31,154,400
|
3,764,200
|
|||||||||||||
Machinery
and equipment
|
10,015,765
|
17,414,532
|
19,225,819
|
2,322,941
|
19,379,409
|
2,341,498
|
|||||||||||||
Furniture
and office equipment
|
3,032,484
|
4,675,017
|
5,549,536
|
670,518
|
6,034,156
|
729,071
|
|||||||||||||
Motor
vehicles
|
5,372,341
|
6,944,417
|
8,923,270
|
1,078,145
|
9,814,398
|
1,185,815
|
|||||||||||||
Leasehold
improvements
|
55,398
|
55,398
|
127,899
|
15,453
|
127,899
|
15,453
|
|||||||||||||
Total
|
35,082,433
|
57,207,061
|
64,640,587
|
7,810,136
|
66,510,262
|
8,036,037
|
|||||||||||||
Less:
accumulated depreciation and amortization
|
3,450,118
|
6,223,843
|
10,760,936
|
1,300,180
|
13,308,679
|
1,608,008
|
|||||||||||||
Construction
in progress
|
20,516
|
4,417,475
|
12,122,213
|
1,464,655
|
22,153,292
|
2,676,650
|
|||||||||||||
Plant
and equipment, net
|
31,652,831
|
55,400,693
|
66,001,864
|
7,974,611
|
75,354,875
|
9,104,679
|
8. |
LONG-TERM
INVESTMENTS
|
As
of December 31,
|
As
of June 30,
|
||||||||||||||||||
2002
|
2003
|
2004
|
2004
|
2005
|
2005
|
||||||||||||||
RMB
|
RMB
|
RMB
|
US$
|
RMB
|
US$
|
||||||||||||||
(unaudited)
|
|||||||||||||||||||
Equity
method investment
|
—
|
—
|
1,954,604
|
236,163
|
2,798,506
|
338,127
|
|||||||||||||
Cost
method investment
|
—
|
—
|
8,320,000
|
1,005,256
|
8,320,000
|
1,005,256
|
|||||||||||||
Total
|
—
|
—
|
10,274,604
|
1,241,419
|
11,118,506
|
1,343,383
|
9. |
ACQUISITIONS
|
10. |
ACQUIRED
INTANGIBLE ASSETS, NET
|
As
of December 31,
|
As
of June 30,
|
||||||||||||||||||
2002
|
2003
|
2004
|
2004
|
2005
|
2005
|
||||||||||||||
RMB
|
RMB
|
RMB
|
US$
|
RMB
|
US$
|
||||||||||||||
(unaudited)
|
|||||||||||||||||||
Technology
usage agreements
|
991,559
|
991,559
|
4,091,559
|
494,359
|
6,591,559
|
796,419
|
|||||||||||||
Others
|
—
|
9,000
|
9,000
|
1,087
|
9,000
|
1,087
|
|||||||||||||
991,559
|
1,000,559
|
4,100,559
|
495,446
|
6,600,559
|
797,506
|
||||||||||||||
Accumulated
amortization
|
421,240
|
762,603
|
1,228,096
|
148,384
|
1,852,509
|
223,827
|
|||||||||||||
Acquired
intangible assets, net
|
570,319
|
237,956
|
2,872,463
|
347,062
|
4,748,050
|
573,679
|
RMB
|
||||
Six
months ending December 31, 2005
|
599,753
|
|||
Year
ending December 31,
|
||||
2006
|
1,124,964
|
|||
2007
|
1,120,000
|
|||
2008
|
1,120,000
|
|||
2009
|
783,333
|
|||
Total
|
4,748,050
|
11. |
OTHER
ASSETS
|
As
of December 31,
|
As
of June 30,
|
||||||||||||||||||
2002
|
2003
|
2004
|
2004
|
2005
|
2005
|
||||||||||||||
RMB
|
RMB
|
RMB
|
US$
|
RMB
|
US$
|
||||||||||||||
(unaudited)
|
|||||||||||||||||||
Prepaid
lease
|
473,261
|
532,771
|
614,550
|
74,252
|
833,171
|
100,667
|
|||||||||||||
Deposit
for acquisition of an investment*
|
—
|
—
|
—
|
—
|
5,600,000
|
676,615
|
|||||||||||||
473,261
|
532,771
|
614,550
|
74,252
|
6,433,171
|
777,282
|
*
|
On
December 28, 2004, the Company entered into an agreement to acquire
an
additional 7% of the outstanding shares of Chuang Shi Ji for a cash
consideration of RMB5,600,000. As of June 30, 2005, the Company had
made a
payment of (unaudited) RMB5,600,000. On August 4, 2005, the Company
obtained necessary government approval and completed the
acquisition.
|
12. |
BORROWINGS
|
As
of December 31,
|
As
of June 30,
|
||||||||||||||||||
2002
|
2003
|
2004
|
2004
|
2005
|
2005
|
||||||||||||||
RMB
|
RMB
|
RMB
|
US$
|
RMB
|
US$
|
||||||||||||||
(unaudited)
|
|||||||||||||||||||
Short-term
borrowings
|
15,000,000
|
35,000,000
|
41,000,000
|
4,953,785
|
21,000,000
|
2,537,304
|
|||||||||||||
Long-term
borrowings
|
—
|
—
|
—
|
—
|
1,880,000
|
227,149
|
13.
|
OTHER
PAYABLES AND ACCRUED
EXPENSES
|
As
of December 31,
|
As
of June 30,
|
||||||||||||||||||
2002
|
2003
|
2004
|
2004
|
2005
|
2005
|
||||||||||||||
RMB
|
RMB
|
RMB
|
US$
|
RMB
|
US$
|
||||||||||||||
(unaudited)
|
|||||||||||||||||||
Other
payables
|
2,101,366
|
1,981,097
|
2,325,164
|
280,936
|
2,316,152
|
279,847
|
|||||||||||||
Salaries
and bonus payables
|
—
|
—
|
—
|
—
|
3,400,000
|
410,802
|
|||||||||||||
Accrued
welfare benefits
|
1,333,060
|
2,054,223
|
4,022,614
|
486,028
|
4,738,805
|
572,561
|
|||||||||||||
Other
taxes payable
|
48,561
|
132,190
|
359,312
|
43,414
|
113,673
|
13,734
|
|||||||||||||
Other
accrued expenses
|
4,200
|
—
|
27,446
|
3,316
|
55,876
|
6,751
|
|||||||||||||
3,487,187
|
4,167,510
|
6,734,536
|
813,694
|
10,624,506
|
1,283,695
|
14. |
SHAREHOLDERS’
EQUITY
|
15. |
INCOME
TAXES
|
15. |
INCOME
TAXES - continued
|
As
of December 31,
|
Six
months ended June 30,
|
|||||||||||||||||||||
2002
|
2003
|
2004
|
2004
|
2004
|
2005
|
2005
|
||||||||||||||||
RMB
|
RMB
|
RMB
|
US$
|
RMB
|
RMB
|
US$
|
||||||||||||||||
(unaudited)
|
(unaudited)
|
|||||||||||||||||||||
Current
|
2,659,425
|
8,376,861
|
5,975,317
|
721,962
|
5,295,142
|
1,562,753
|
188,818
|
|||||||||||||||
Deferred
|
(1,161,113
|
)
|
(569,064
|
)
|
1,723,167
|
208,200
|
(222,324
|
)
|
(84,479
|
)
|
(10,207
|
)
|
||||||||||
1,498,312
|
7,807,797
|
7,698,484
|
930,162
|
5,072,818
|
1,478,274
|
178,611
|
As
of December 31,
|
As
of June 30,
|
||||||||||||||||||
2002
|
2003
|
2004
|
2004
|
2005
|
2005
|
||||||||||||||
RMB
|
RMB
|
RMB
|
US$
|
RMB
|
US$
|
||||||||||||||
(unaudited)
|
|||||||||||||||||||
Noncurrent
deferred tax assets:
|
|||||||||||||||||||
Net
operating loss carry forward
|
1,571,920
|
2,288,779
|
4,325,150
|
522,582
|
2,438,904
|
294,678
|
|||||||||||||
Others
|
157,833
|
261,116
|
418,981
|
50,623
|
503,460
|
60,830
|
|||||||||||||
Noncurrent
deferred tax assets
|
1,729,753
|
2,549,895
|
4,744,131
|
573,205
|
2,942,364
|
355,508
|
|||||||||||||
Valuation
allowance
|
(156,669
|
)
|
(407,747
|
)
|
(4,325,150
|
)
|
(522,582
|
)
|
(2,438,904
|
)
|
(294,678
|
)
|
|||||||
Net
noncurrent deferred tax assets
|
1,573,084
|
2,142,148
|
418,981
|
50,623
|
503,460
|
60,830
|
Years
ended December 31,
|
Six
months ended June 30,
|
|||||||||||||||
2002
|
2003
|
2004
|
2004
|
2005
|
||||||||||||
%
|
%
|
%
|
%
|
%
|
||||||||||||
(unaudited)
|
||||||||||||||||
Statutory
rate
|
33
|
33
|
33
|
33
|
33
|
|||||||||||
Effect
of preferential tax treatment
|
(32
|
)
|
(19
|
)
|
(31
|
)
|
(27
|
)
|
(27
|
)
|
||||||
Permanent
book-tax difference
|
3
|
6
|
4
|
3
|
1
|
|||||||||||
Change
in valuation allowance
|
1
|
1
|
5
|
-
|
(4
|
)
|
||||||||||
Effective
income tax rate
|
5
|
21
|
11
|
9
|
3
|
16.
|
EMPLOYEE
BENEFIT PLANS AND PROFIT
APPROPRIATION
|
16. |
EMPLOYEE
BENEFIT PLANS AND PROFIT APPROPRIATION -
continued
|
17. |
COMMITMENTS
AND CONTINGENCIES
|
(a)
|
Capital
commitments
|
June
30,
|
||||
2005
|
||||
RMB
|
||||
(unaudited)
|
||||
Plant
and building construction
|
||||
-
related to Zhongguancun life science
park land development project |
15,084,555
|
|||
-
related to building projects in Lin Ze branch
and Chang Chun Origin |
5,043,635
|
|||
20,128,190
|
||||
Equipment
|
1,224,220
|
|||
21,352,410
|
17.
|
COMMITMENTS
AND CONTINGENCIES -
continued
|
(b)
|
Operating
lease
|
June
30,
|
||||
2005
|
||||
RMB
|
||||
(unaudited)
|
||||
Year
ended December 31,
|
||||
2005
|
647,742
|
|||
2006
|
1,449,655
|
|||
2007
|
1,381,597
|
|||
2008
|
481,225
|
|||
2009
|
403,538
|
|||
Thereafter
|
8,555,980
|
|||
12,919,737
|
(c)
|
Litigation
|
18. |
SEGMENT
AND GEOGRAPHIC INFORMATION
|
19. |
REORGANIZATION
|
(a)
|
to
record the release of funds held in trust by
Chardan
|
(b)
|
to
record the payment of the $10,000,000 initial cash payment, net of
$250,000 hold back to secure indemnification
obligations
|
(c)
|
to
reclassify common stock held in trust to permanent equity and to
record
related deferred interest as income
|
(d)
|
to
record the issuance of 10,200,000 shares of Chardan common stock
for all
the shares of State Harvest
|
(e)
|
to
eliminate the accumulated deficit (as adjusted for additional interest
income per Item C) of Chardan as the accounting acquiree under the
reverse
acquisition application of the purchase method of
accounting
|
(f)
|
Pro
forma net income per share was calculated by dividing pro forma net
income
by the weighted average number of shares outstanding as
follows:
|
Year
ended
December
31, 2004
|
Six
months ended June 30, 2005
Primary
|
Six
Months ended June 30, 2005
Diluted
|
||||||||
Shares
issued in the Transaction
|
10,200,000
|
10,200,000
|
10,200,000
|
|||||||
Chardan
weighted average shares
|
4,039,000
|
4,900,000
|
7,745,551
|
|||||||
14,239,000
|
15,100,000
|
17,945,551
|
State
Harvest
|
Chardan
|
Pro
Forma Adjustments
|
Pro
Forma Combined
|
|||||||||||||
ASSETS
|
||||||||||||||||
Current
Assets:
|
||||||||||||||||
Cash
and cash equivalents
|
$
|
6,495,656
|
$
|
9,116
|
$
|
20,974,761
|
(a)
|
$
|
17,729,533
|
|||||||
(9,750,000
|
)
|
(b)
|
||||||||||||||
Investments
held in trust
|
20,974,761
|
(20,974,761
|
)
|
(a)
|
—
|
|||||||||||
Due
from related parties
|
34,164
|
34,164
|
||||||||||||||
Advances
to growers
|
763,416
|
763,416
|
||||||||||||||
Advances
to suppliers
|
448,039
|
448,039
|
||||||||||||||
Inventories
|
16,389,433
|
16,389,433
|
||||||||||||||
Income
tax receivable
|
112,825
|
112,825
|
||||||||||||||
Prepaid
expenses and other current assets
|
1,690,316
|
9,369
|
1,699,685
|
|||||||||||||
Total
Current Assets
|
25,933,849
|
20,993,246
|
(9,750,000
|
)
|
37,177,095
|
|||||||||||
Land
use rights, net
|
1,352,108
|
1,352,108
|
||||||||||||||
Plant
and equipment, net
|
9,104,679
|
9,104,679
|
||||||||||||||
Equity
investment
|
1,343,383
|
1,343,383
|
||||||||||||||
Acquired
intangible assets, net
|
573,679
|
573,679
|
||||||||||||||
Deferred
income tax assets
|
60,830
|
60,830
|
||||||||||||||
Other
assets
|
777,282
|
777,282
|
||||||||||||||
Total
assets
|
$
|
39,145,810
|
$
|
20,993,246
|
$
|
(9,750,000
|
)
|
$
|
50,389,056
|
|||||||
LIABILITIES
AND SHAREHOLDERS’ EQUITY
|
||||||||||||||||
Current
Liabilities:
|
||||||||||||||||
Short
term borrowings
|
$
|
2,537,304
|
$
|
2,537,304
|
||||||||||||
Accounts
payable
|
1,042,017
|
$
|
1,042,017
|
|||||||||||||
Due
to growers
|
1,312,149
|
1,312,149
|
||||||||||||||
Due
to officers and related parties
|
1,595,908
|
10,170
|
250,000
|
(b)
|
1,856,078
|
|||||||||||
Advances
from customers
|
8,448,096
|
8,448,096
|
||||||||||||||
Advances
from Stockholder
|
55,950
|
55,950
|
||||||||||||||
Deferred
revenue
|
—
|
|||||||||||||||
Deferred
interest
|
89,688
|
(89,688
|
)
|
(c)
|
—
|
|||||||||||
Other
payables and accrued expenses
|
1,392,487
|
520,644
|
1,913,131
|
|||||||||||||
Total
Current Liabilities
|
16,327,961
|
676,452
|
160,312
|
17,164,725
|
||||||||||||
Other
long-term liabilities
|
574,132
|
574,132
|
||||||||||||||
Total
Liabilities
|
16,902,093
|
676,452
|
160,312
|
17,738,857
|
||||||||||||
Common
stock subject to redemption
|
4,103,450
|
(4,103,450
|
)
|
(c)
|
—
|
|||||||||||
Minority
interests
|
507,384
|
507,384
|
||||||||||||||
Shareholders’
equity (deficiency):
|
||||||||||||||||
Common
stock
|
10,000
|
490
|
(10,000
|
)
|
(d)
|
1,510
|
||||||||||
1,020
|
(d)
|
|||||||||||||||
Additional
paid-in capital
|
12,082,402
|
17,163,483
|
4,103,450
|
(c)
|
22,497,374
|
|||||||||||
(12,082,402
|
)
|
(d)
|
||||||||||||||
1,230,441
|
(b)(d)(e)
|
|
||||||||||||||
Retained
earnings (accumulated deficit)
|
9,643,931
|
(950,629
|
)
|
89,688
|
(c)
|
9,643,931
|
||||||||||
860,941
|
(e)
|
|||||||||||||||
Total
shareholders’ equity
|
21,736,333
|
16,213,344
|
(5,806,862
|
)
|
32,142,815
|
|||||||||||
Total
liabilities and shareholders’ equity
|
$
|
39,145,810
|
$
|
20,993,246
|
$
|
(9,750,000
|
)
|
$
|
50,389,056
|
State
Harvest
|
Chardan
|
Pro
Forma Adjustments
|
Pro
Forma Combined
|
|||||||||||||
Revenues
|
$
|
25,198,367
|
$
|
25,198,367
|
||||||||||||
Cost
of revenues
|
15,699,995
|
15,699,995
|
||||||||||||||
Gross
Profit
|
9,498,372
|
9,498,372
|
||||||||||||||
Operating
expenses
|
||||||||||||||||
Selling
and marketing expenses
|
1,813,559
|
1,813,559
|
||||||||||||||
General
and administrative expenses
|
1,751,143
|
$
|
473,686
|
2,224,829
|
||||||||||||
Research
and development expenses
|
434,540
|
434,540
|
||||||||||||||
Total
operating expenses
|
3,999,242
|
473,686
|
4,472,928
|
|||||||||||||
Income
from operations
|
5,499,130
|
(473,686
|
)
|
5,025,444
|
||||||||||||
Interest
expense
|
(193,195
|
)
|
(193,195
|
)
|
||||||||||||
Interest
in income
|
101,963
|
191,291
|
$
|
48,143
|
(c)
|
341,397
|
||||||||||
Interest
in affiliates
|
35,907
|
35,907
|
||||||||||||||
Other
income
|
1,599
|
1,599
|
||||||||||||||
Income
before income taxes and minority
|
||||||||||||||||
Interests
|
5,445,404
|
(282,395
|
)
|
48,143
|
5,211,152
|
|||||||||||
Income
taxes
|
178,611
|
178,611
|
||||||||||||||
Income
before minority interests
|
5,266,793
|
(282,395
|
)
|
48,143
|
5,032,541
|
|||||||||||
Minority
interests
|
(80,380
|
)
|
(80,380
|
)
|
||||||||||||
Net
income (loss)
|
$
|
5,186,413
|
$
|
(282,395
|
)
|
$
|
48,143
|
$
|
4,952,161
|
|||||||
Net
income per share-basic
|
$
|
518.64
|
$
|
0.06
|
(f)
|
$
|
0.33
|
|||||||||
Net
income per share-diluted
|
$
|
518.64
|
$
|
0.06
|
(f)
|
$
|
0.28
|
Pro
Forma
|
Pro
forma
|
|||||||||||||||
State
Harvest
|
Chardan
|
Adjustments
|
Combined
|
|||||||||||||
Revenues
|
$
|
36,430,799
|
$
|
36,430,799
|
||||||||||||
Cost
of revenues
|
21,544,457
|
21,544,457
|
||||||||||||||
Gross
Profit
|
14,886,342
|
14,886,342
|
||||||||||||||
Operating
expenses
|
||||||||||||||||
Selling
and marketing expenses
|
2,463,576
|
2,463,576
|
||||||||||||||
General
and administrative expenses
|
2,917,851
|
$
|
834,182
|
3,752,033
|
||||||||||||
Research
and development expenses
|
818,416
|
818,416
|
||||||||||||||
Total
operating expenses
|
6,199,843
|
834,182
|
7,034,025
|
|||||||||||||
Income
from operations
|
8,686,499
|
(834,182
|
)
|
7,852,317
|
||||||||||||
Interest
expense
|
(100,425
|
)
|
(100,425
|
)
|
||||||||||||
Interest
income
|
44,948
|
166,483
|
$
|
41,545
|
(c)
|
252,976
|
||||||||||
Equity
in earnings of associated company
|
232,538
|
232,538
|
||||||||||||||
Other
income
|
18,017
|
18,017
|
||||||||||||||
Income
before income taxes and minority
|
||||||||||||||||
Interests
|
8,881,577
|
(667,699
|
)
|
41,545
|
8,255,423
|
|||||||||||
Income
taxes
|
930,162
|
930,162
|
||||||||||||||
Income
before minority interests
|
7,951,415
|
(667,699
|
)
|
41,545
|
7,325,261
|
|||||||||||
Minority
interests
|
(42,339
|
)
|
(42,339
|
)
|
||||||||||||
Net
income (loss)
|
$
|
7,909,076
|
$
|
(667,699
|
)
|
$
|
(41,545
|
)
|
$
|
7,282,922
|
||||||
Net
income per share - basic and diluted
|
$
|
790.91
|
$
|
(0.17
|
)
|
(f)
|
$
|
0.51
|