Delaware
|
0-26598
|
22-3137907
|
(State
or other jurisdiction of incorporation)
|
(Commission
File Number)
|
(IRS
Employer Identification No.)
|
Jilin
Dongsheng Weiye Science and Technology Development Co., Ltd.,
Jifeng East
Road, Gaoxin District
Jilin,
Jilin Province, PRC
|
|
(Address
of principal executive
offices)
|
Registrant’s
telephone number, including area code:
|
86-432-4566702
|
· |
Aidong
Nutritionals, which include supplements and healthcare products with
Chitosan as a main ingredient
|
· |
Jiujiu
Ozone Purifiers, a line of portable home Ozone air, water, and food
purifiers
|
· |
“Nao
Li Zhi Bao” Herbal Extracts, a line of scientifically formulated natural
botanical extracts that use Chinese herbs to improve brain
health
|
· |
Donghe
Cosmetics, a unique line of skin and personal care products with
nucleic
acid as a main ingredient
|
Fiscal
Year Ended June 30
|
2006
|
2007*
|
2008*
|
|||||||
Revenue
|
$
|
19,783,912
|
$
|
25,204,398
|
$
|
32,260,029
|
||||
Net
Income
|
$
|
6,761,503
|
$
|
8,935,209
|
$
|
11,435,996
|
||||
Shareholders’
Equity
|
$
|
9,239,926
|
$
|
11,827,105
|
$
|
15,138,694
|
Chitosan
Sales
|
Other
Products Sales
|
|
2005
|
58%
|
42%
|
2006
|
56%
|
44%
|
2007*
|
60%
|
40%
|
2008*
|
63%
|
37%
|
2009*
|
65%
|
35%
|
· |
The
Aidong Nutritionals product line is produced by Dalian Xin Die Chitosan
Limited Company, the leading chitosan producer in
China
|
· |
Jiujiu
Ozone purifiers are manufactured by Harbin Jiujiu Electric Chemistry
Engineering and Technique Co., Ltd.
|
· |
“Nao
Li Zhi Bao” herbal extracts are manufactured by Beijing Nao Kang
Bio-Tech Development Co., Ltd.
|
· |
The
Donghe Cosmetics product line is manufactured by Dalian XinHe Cosmetics
Co., Ltd.
|
· |
Dietary
Supplements - products such as vitamins, minerals, specialty supplements
such as fish oils and bee products, herbs and botanicals, sports
performance enhancers, and meal
supplements.
|
· |
Natural
and Organic Foods - products such as cereals, milk, non-dairy beverages,
and frozen entrees derived from natural sources and that are, to
varying
degrees, free of pesticides, additives, preservatives and refined
ingredients.
|
· |
Functional
Foods - products with added ingredients or fortification specifically
for
health or performance purposes, such as sports drinks, sports bars,
and
vitamin-enhanced snack foods.
|
· |
Natural
Personal Care - health and beauty products derived from natural sources
and combining nutrition with skin care.
|
· |
Dalian
Xin Die Chitosan Co., Ltd - This company produces Chitosan health
capsules, and has relatively advanced production and R&D technology.
|
· |
Xiamen
Longlive Biological Product Co., Ltd - This company is engaged in
the
development, production, and distribution of health foods. It has
introduced a variety of health food products into the market, such
as the
Daily Health Capsule, Gingko American Ginseng Capsule, Ganoderma
Lucidum
Capsule, Aloe Toxin Expulsion Capsule, Ginseng Tablet, and American
Ginseng Pearl Tablet.
|
· |
Hangtai
County Jin Hu Carapace Product Co., Ltd - This company is engaged
in the
production of chitosan products by adopting extractive techniques
developed by the Ocean University of Qingdao.
|
· |
Shenzhen
Nanbai Enterprise Co., Ltd - This company is a Chinese foreign cooperative
venture. It integrates R&D, production, distribution, and customer
service. It professionally develops ozone generators, ozone sterilizing
machines, air purifiers, automobile oxygen bars, and multifunction
humidifiers.
|
· |
Max
Environmental Science Technologies Co., Ltd of Industrial Park of
Suzhou -
This company is engaged in the development and manufacture of specialized
sterilization equipment and ozone generators for the water treatment
industry and specialized air sterilization equipment for the
pharmaceutical industry.
|
· |
The
Company is investing in two production bases. Construction is expected
to
be finished by September 2006 on the first phase, with production
expected
to begin by November 2006. The total investment for construction
is $4.5
million.
|
· |
The
Company is also investing in the construction of a R&D center.
Construction is expected to be completed by October 2006. The total
investment for construction is $4.75
million.
|
· |
The
Company is presently designing an office building. Expected investment
is
$1.8 million, with expected construction to begin in 2007.
|
· |
The
Company will also invest in the main company building in Jilin City.
Design has begun, and construction is expected to begin in 2007.
Expected
investment for construction is $8.2 million.
|
· |
The
Company hopes to develop four company bases in Beijing, Shanghai,
Shenzhen, and Wuhan in 2007.
|
· |
The
Company also hopes to acquire distribution centers internationally
in
2008.
|
Title
of Class
|
|
Name
and Address of
Beneficial
Owner
|
|
Amount
and Nature of
Beneficial
Owner
|
|
|
Percent
of Class (2)
|
|
Common
Stock
|
|
William
Weiss (1)
(3)
|
|
3,569,643
|
(4)
|
|
43.55
|
%
|
Common
Stock
|
|
Michael
Suleski (1)
(3)
|
|
780,936
|
(5)
|
|
9.53
|
%
|
Common
Stock
|
|
D.
Michael Bridges (1)
(3)
|
|
556,500
|
(6)
|
|
6.79
|
%
|
Common
Stock
|
|
All
officers and directors as a group (3 in number)
|
|
4,911,079
|
|
|
59.92
|
%
|
Series
A Preferred Stock
|
William
Weiss (1)
(3)
|
2,533,869
|
69.43
|
%
|
||||
Series
A Preferred Stock
|
D.
Michael Bridges (1)
(3)
|
150,000
|
4.11
|
%
|
||||
Series
A Preferred Stock
|
All
officers and directors as a group (3 in number)
|
2,683,869
|
73.54
|
%
|
Title
of Class
|
|
Name
and Address of
Beneficial
Owner
|
|
Amount
and Nature of
Beneficial
Owner
|
|
|
Percent
of Class (2)
|
|
Common
Stock
|
|
William
Weiss (1)
(3)
|
|
3,569,643
|
(4)
|
|
11.90
|
%
|
Common
Stock
|
|
Michael
Suleski (1)
(3)
|
|
780,936
|
(5)
|
|
2.60
|
%
|
Common
Stock
|
|
D.
Michael Bridges (1)
(3)
|
|
556,500
|
(6)
|
|
1.86
|
%
|
Common
Stock
|
Huakang
Zhou
|
19,033,708
|
(7)
|
63.45
|
%
|
|||
Common
Stock
|
Aidong
Yu (1)(8)
|
|||||||
Common
Stock
|
Huizhu
Xie (1)
(8)
|
|||||||
Common
Stock
|
Dekui
Wang (1)
(8)
|
|||||||
Common
Stock
|
|
All
officers and directors as a group (6 in number)
|
|
%
|
||||
Series
A Preferred Stock
|
William
Weiss (1)
(3)
|
2,533,869
|
69.43
|
%
|
||||
Series
A Preferred Stock
|
D.
Michael Bridges (1)
(3)
|
150,000
|
4.11
|
%
|
||||
Series
A Preferred Stock
|
All
officers and directors as a group (2 in number)
|
2,683,869
|
73.54
|
%
|
Series
B Preferred Stock
|
Huakang Zhou |
1,538,580
|
(9) |
87.30
|
% | |||
Series
B Preferred Stock
|
Aidong Yu (1)(8) | |||||||
Series
B Preferred Stock
|
Huizhu Xie (1) (8) | |||||||
Series
B Preferred Stock
|
Dekui Wang (1) (8) | |||||||
Series
B Preferred Stock
|
All officers and directors as a group (3 in number) |
87.30
|
% |
Name
|
Age
|
Office
|
||
William
Weiss
|
63
|
Chief
Executive Officer, Principal Financial Officer,
Director
|
||
Michael
Suleski
|
46
|
Vice
President Engineering, Secretary, Director
|
||
D.
Michael Bridges
|
52
|
President,
Director
|
ANNUAL
COMPENSATION
|
LONG-TERM
COMPENSATION
|
|||||||
AWARDS
|
PAYOUTS
|
|||||||
NAME
AND PRINCIPAL POSITION
|
YEAR
|
SALARY
($)
|
BONUS
($)
|
OTHER
ANNUAL COMPENSATION
($)
|
RESTRICTED
STOCK AWARD(S)
($)
|
SECURITIES
UNDERLYING OPTIONS/SARS
(#)
|
LTIP
PAYOUTS
($)
|
ALL
OTHER COMPENSATION
($)
|
Wiliam
Weiss(1)
|
2006
|
$120,000
|
0
|
0
|
0
|
--
|
--
|
--
|
Chief
Executive Officer,
Principal
Financial Officer
|
2005
|
$120,000
|
0
|
0
|
0
|
--
|
--
|
--
|
2004
|
$120,000
|
0
|
0
|
0
|
--
|
--
|
--
|
|
Michael
Suleski
|
2006
|
$105,000
|
0
|
0
|
0
|
--
|
--
|
--
|
Vice
President, Engineering
|
2005
|
$105,000
|
0
|
0
|
0
|
--
|
--
|
--
|
2004
|
$105,000
|
0
|
0
|
0
|
--
|
--
|
--
|
|
D.
Michael Bridges
|
2006
|
$107,800
|
0
|
0
|
0
|
--
|
--
|
--
|
President
|
2005
|
$107,800
|
0
|
0
|
0
|
--
|
--
|
|
2004
|
$107,800
|
0
|
0
|
0
|
--
|
--
|
Equity
Compensation Plan Information
|
|||
Plan
category
|
Number
of securities to be issued upon exercise of outstanding options,
warrants
and rights
(a)
|
Weighted-average
exercise price of outstanding options, warrants and
rights
(b)
|
Number
of securities remaining available for future issuance under equity
compensation plans (excluding securities reflected in column
(a))
(c)
|
Equity
compensation plans approved by security holders
|
2,980,842
(1)
|
$0.31
|
0
(2)
|
Equity
compensation plans not approved by security holders
|
100,000
(3)
|
0
|
500,000
(4)
|
Total
|
3,080,842
|
0
|
500,000
|
Name
|
Age
|
Office
|
||
Aidong
Yu
|
47
|
Chairman,
Chief Executive Officer, Chief Financial Officer,
Director
|
||
Huizhu
Xie
|
54
|
General
Manager, Director
|
||
Dekui
Wang
|
53
|
Vice
President, Director
|
ANNUAL
COMPENSATION
|
LONG-TERM
COMPENSATION
|
|||||||
AWARDS
|
PAYOUTS
|
|||||||
NAME
AND PRINCIPAL POSITION
|
YEAR
|
SALARY
($)
|
BONUS
($)
|
OTHER
ANNUAL COMPENSATION
($)
|
RESTRICTED
STOCK AWARD(S)
($)
|
SECURITIES
UNDERLYING OPTIONS/SARS
(#)
|
LTIP
PAYOUTS
($)
|
ALL
OTHER COMPENSATION
($)
|
Aidong
Yu
|
2006
|
$50,000
|
0
|
0
|
0
|
--
|
--
|
--
|
Chairmanief
Executive Officer,
|
2005
|
$37,500
|
0
|
0
|
0
|
--
|
--
|
--
|
Principal
Financial Officer
|
2004
|
$25,000
|
0
|
0
|
0
|
--
|
--
|
--
|
Huizhu
Xie
|
2006
|
$30,000
|
0
|
0
|
0
|
--
|
--
|
--
|
General
Manager
|
2005
|
$22,500
|
0
|
0
|
0
|
--
|
--
|
--
|
2004
|
$15,000
|
0
|
0
|
0
|
--
|
--
|
--
|
|
Dekui
Wang
|
2006
|
$30,000
|
0
|
0
|
0
|
--
|
--
|
--
|
Vice
President
|
2005
|
$22,500
|
0
|
0
|
0
|
--
|
--
|
|
2004
|
$15,000
|
0
|
0
|
0
|
--
|
--
|
|
|
Closing
Bid
|
||||
YEAR
2004
|
|
High Bid
|
|
Low Bid
|
||
1st
Quarter Ended March 31
|
|
$
|
0.10
|
|
$
|
0.04
|
2nd
Quarter Ended June 30
|
|
$
|
0.18
|
|
$
|
0.09
|
3rd
Quarter Ended September 30
|
|
$
|
0.12
|
|
$
|
0.06
|
4th
Quarter Ended December 31
|
|
$
|
0.14
|
|
$
|
0.07
|
YEAR
2005
|
|
High
Bid
|
|
Low
Bid
|
||
1st
Quarter Ended March 31
|
|
$
|
0.14
|
|
$
|
0.04
|
2nd
Quarter Ended June 30
|
|
$
|
0.07
|
|
$
|
0.05
|
3rd
Quarter Ended September 30
|
|
$
|
0.08
|
|
$
|
0.04
|
4th
Quarter Ended December 31
|
|
$
|
0.06
|
|
$
|
0.03
|
YEAR
2006
|
|
High
Bid
|
|
Low
Bid
|
||
1st
Quarter Ended March 31
|
|
$
|
0.05
|
|
$
|
0.03
|
2nd
Quarter Ended June 30
|
|
$
|
0.05
|
|
$
|
0.04
|
3rd
Quarter Ended September 30
|
|
$
|
0.05
|
|
$
|
0.03
|
Period
ended November 6, 2006
|
$
|
0.03
|
|
$
|
0.03
|
Item
3.02
|
Unregistered
Sales of Equity
Securities.
|
Name
|
Common
Stock
|
Series
B Convertible Preferred Stock
|
Warner
Technology & Investment Corp.
(1)
|
1,361,991
|
110,096
|
Huakang
Zhou (1)
|
17,671,717
|
1428,484
|
Sanyu
Jin
|
147,537
|
11,926
|
Dehou
Wang
|
147,537
|
11,926
|
Yufeng
Hu
|
441,884
|
35,719
|
American
Union Securities (2)
|
441,884
|
35,719
|
Xiaojin
Wang
|
625760
|
50,583
|
John
Leo
|
147,537
|
11,926
|
Strategic
Alliance Fund, LP(3)
|
817,630
|
66,093
|
(a) |
Financial
Statements of Businesses
Acquired.
|
(b) |
Pro
Forma Financial
Information.
|
(c) |
Shell
Company Transactions.
|
(d) |
Exhibits.
|
Exhibit No.
|
|
Title
of Document
|
2.1
|
Stock
Purchase and Share Exchange Agreement dated November 6, 2006 between
PCLP,
ASI, ASI Shareholders and Dongsheng
|
|
2.2
|
Amendment
to Stock Purchase and Share Exchange Agreement dated November 9,
2006
between PCLP, ASI, ASI Shareholders and Dongsheng*
|
|
3.1
|
|
Designation
of Series B Convertible Preferred Stock and Amendment to Certificate
of
Incorporation
|
10.1 |
Entrusted
Management Agreement*
|
|
10.2 |
Share
Pledge*
|
|
10.3 |
Proxy*
|
PAPERCLIP
SOFTWARE, INC.
|
||
|
|
|
Date: November 14, 2006 | By: | /s/ Aidong Yu |
Name: Aidong
Yu
|
||
Title:
Chief Executive Officer
|
Report
of Independent Registered Public Accounting Firm
|
1
|
Balance
Sheets at June 30, 2006 and 2005
|
2
|
Statements
of Income for the years ended June 30, 2006 and 2005
|
3
|
Statements
of Changes in Shareholders’ Equity for the years ended June 30, 2006 and
2005
|
4
|
Statements
of Cash Flows for the years ended June 30, 2006 and 2005
|
5
|
Notes
to Financial Statements
|
6
-
14
|
JILIN
DONGSHENG WEIYE SCIENCE & TECHNOLOGY DEVELOPMENT CO.,
LTD.
|
|||||||
BALANCE
SHEETS
|
|||||||
JUNE
30,
|
|||||||
ASSETS
|
|||||||
Current
assets:
|
2006
|
2005
|
|||||
Cash
and cash equivalents
|
$
|
30,801
|
$
|
601,657
|
|||
Accounts
receivable
|
6,204
|
5,994
|
|||||
Inventory
|
57,179
|
64,464
|
|||||
Advances
to suppliers
|
3,897,563
|
44,403
|
|||||
Total
Current Assets
|
3,991,747
|
716,518
|
|||||
Property
and equipment, net of accumulated depreciation of
|
|||||||
$111,034
and $20,282, respectively
|
4,278,053
|
260,764
|
|||||
Other
assets:
|
|||||||
Deposit
on land
|
2,626,872
|
1,449,888
|
|||||
Construction
in progress
|
6,397,558
|
-
|
|||||
Total
Other Assets
|
9,024,430
|
1,449,888
|
|||||
Total
Assets
|
$
|
17,294,230
|
$
|
2,427,170
|
|||
LIABILITIES
AND SHAREHOLDERS' EQUITY
|
|||||||
Current
liabilities:
|
|||||||
Unearned
revenue
|
$
|
-
|
$
|
981
|
|||
Taxes
payable
|
7,756,459
|
917,823
|
|||||
Accrued
expenses and other payables
|
297,845
|
325,729
|
|||||
Total
Current Liabilities
|
8,054,304
|
1,244,533
|
|||||
Commitments
and Contingencies
|
|||||||
Shareholders'
Equity
|
|||||||
Capital
|
1,245,460
|
60,405
|
|||||
Accumulated
other comprehensive income
|
110,746
|
15
|
|||||
Retained
earnings - appropriated
|
1,189,106
|
159,069
|
|||||
Retained
earnings - unappropriated
|
6,694,614
|
963,148
|
|||||
Total
Shareholders' Equity
|
9,239,926
|
1,182,637
|
|||||
Total
Liabilities and Shareholders' Equity
|
$
|
17,294,230
|
$
|
2,427,170
|
|||
2006
|
2005
|
||||||
Revenues
|
$
|
19,783,912
|
$
|
2,989,414
|
|||
Cost
of Goods Sold
|
8,891,958
|
1,306,987
|
|||||
Gross
Profit
|
10,891,954
|
1,682,427
|
|||||
Operating
Expenses
|
|||||||
Selling,
general and administrative
|
1,083,029
|
127,021
|
|||||
Income
before other Income and (Expenses)
|
9,808,925
|
1,555,406
|
|||||
Other
Income and (Expenses)
|
|||||||
Other
income
|
300,645
|
36,432
|
|||||
Interest
expense
|
(16,662
|
)
|
(2,248
|
)
|
|||
Total
other income and (expenses)
|
283,983
|
34,184
|
|||||
Income
Before Income Taxes
|
10,092,908
|
1,589,590
|
|||||
Provision
for Income Taxes
|
3,331,405
|
526,383
|
|||||
Net
Income
|
$
|
6,761,503
|
$
|
1,063,207
|
|||
Basic
and diluted income per common share
|
$
|
3.12
|
$
|
2.13
|
|||
Weighted
average number of common shares
|
2,165,753
|
500,000
|
JILIN
DONGSHENG WEIYE SCIENCE & TECHNOLOGY DEVELOPMENT CO.,
LTD.
|
||||||||||||||||||||||
STATEMENTS
OF CHANGES IN SHAREHOLDERS' EQUITY
|
||||||||||||||||||||||
FOR
THE YEARS ENDED JUNE 30, 2006 AND 2005
|
||||||||||||||||||||||
Accumulated
Other
|
Retained
|
Retained
|
||||||||||||||||||||
Comprehensive
|
Earnings
|
Earnings
|
Comprehensive
|
|||||||||||||||||||
Capital
|
Income
|
(Appropriated)
|
(Unappropriated)
|
Income
|
Total
|
|||||||||||||||||
Balance
- June 30, 2004
|
$
60,405
|
$
9
|
-
|
$
59,010
|
$
119,424
|
|||||||||||||||||
Comprehensive
income
|
||||||||||||||||||||||
Net income for the year |
159,069
|
904,138
|
1,063,207
|
1,063,207
|
||||||||||||||||||
Other Comprehensive income, net of tax | ||||||||||||||||||||||
Foreign currency translation adjustment |
6
|
6
|
6
|
|||||||||||||||||||
Comprehensive
income
|
1,063,213
|
|||||||||||||||||||||
Balance
- June 30, 2005
|
60,405
|
15
|
159,069
|
963,148
|
1,182,637
|
|||||||||||||||||
Additional capital contributed |
1,185,055
|
-
|
-
|
-
|
1,185,055
|
|||||||||||||||||
Comprehensive
income
|
||||||||||||||||||||||
Net income for the year |
1,030,037
|
5,731,466
|
6,761,503
|
6,761,503
|
||||||||||||||||||
Other Comprehensive income, net of tax | ||||||||||||||||||||||
Foreign currency translation adjustment |
110,731
|
110,731
|
110,731
|
|||||||||||||||||||
Comprehensive
income
|
6,872,234
|
|||||||||||||||||||||
Balance
- June 30, 2006
|
$
|
1,245,460
|
$
|
110,746
|
$
|
1,189,106
|
$
|
6,694,614
|
$
|
9,239,926
|
||||||||||||
Cash
Flows From Investing Activities:
|
|||||||
Deposit
made for the land use right
|
(1,176,984
|
)
|
(1,449,888
|
)
|
|||
Purchase
of property and equipment
|
(4,098,120
|
)
|
(279,548
|
)
|
|||
(Additions)
to construction in process
|
(6,397,558
|
)
|
-
|
||||
Cash
(used in) investing activities
|
(11,672,662
|
)
|
(1,729,436
|
)
|
|||
Cash
Flows From Financing Activities
|
|||||||
Proceeds
from additional capital contributed
|
1,185,056
|
-
|
|||||
Cash
provided by financing activities
|
1,185,056
|
-
|
|||||
Effect
of exchange rate changes on cash and cash equivalents
|
101,524
|
9
|
|||||
Increase
(decrease) in cash and cash equivalents
|
(570,856
|
)
|
416,573
|
||||
Cash
and Cash Equivalents - Beginning of year
|
601,657
|
185,084
|
|||||
Cash
and Cash Equivalents - Ending of year
|
$
|
30,801
|
$
|
601,657
|
|||
Supplemental
disclosures of cash flow information:
|
|||||||
Interest
paid
|
$
|
16,662
|
$
|
2,248
|
|||
Income
taxes paid
|
$
|
-
|
$
|
-
|
|||
3. |
SUMMARY
OF SIGNIFICANT ACCOUNTING POLICIES Use
of estimates
|
|
For
the Years Ended June 30,
|
||||||
2006
|
2005
|
||||||
Raw
Materials
|
$
|
-
0 -
|
$
|
10,192
|
|||
Finished
Goods
|
57,179
|
54,272
|
|||||
Total
|
$
|
57,179
|
$
|
64,464
|
For
the years ended June 30,
|
|||||||
2006
|
2005
|
||||||
Machinery
& Equipment
|
$
|
232,878
|
$
|
205,135
|
|||
Office
Furniture
|
82,309
|
75,911
|
|||||
Buildings
and Improvement
|
4,073,900
|
-
0 -
|
|||||
Total
|
4,389,087
|
281,046
|
|||||
Less:
Accumulated Depreciation
|
(111,034
|
)
|
(20,282
|
)
|
|||
Property
& Equipment, net
|
$
|
4,278,053
|
$
|
260,764
|
2006
|
2005
|
||||||
Advance
for machinery & equipment
|
$
|
3,85,836
|
$
|
44,403
|
|||
Other
Advances
|
$
|
37,727
|
$
|
-
0 -
|
|||
Total
Advances to Suppliers
|
$
|
3,897,563
|
$
|
44,403
|
PRC
only:
|
2006
|
2005
|
|||||
Current
|
$
|
3,331,405
|
$
|
526,383
|
|||
Deferred
|
-
0 -
|
-
0 -
|
|||||
Total
|
$
|
3,331,405
|
$
|
526,383
|
PAGE(S)
|
|
Introduction
to Unaudited Pro Forma Condensed Consolidated
|
|
Financial
Statements
|
1
|
|
|
Balance
Sheet- June 30, 2006 (Unaudited
|
2
|
Statement
of Operations for the six months ended
|
|
June
30, 2006 (Unaudited
|
3
|
Statement
of Income for the year ended December 31, 2005(Unaudited)
|
4
|
Notes
to Financial Statements(Unaudited)
|
5
|
ASSETS
|
||||||||||||||||||||
American
|
||||||||||||||||||||
Paperclip
|
Sunrise
|
(1)
|
||||||||||||||||||
Software,
|
International
|
Pro
|
||||||||||||||||||
Inc.
|
Group,
Inc.
|
Note
|
Adjustments
|
Forma
|
||||||||||||||||
Current Assets | ||||||||||||||||||||
Cash
and cash equivalents
|
$
|
154,041
|
$
|
30,801
|
A
|
(154,041
|
)
|
$
|
30,801
|
|||||||||||
Accounts
Receivable
|
173,571
|
6,204
|
A
|
(173,571
|
)
|
6,204
|
||||||||||||||
Inventory
|
-
|
57,179
|
57,179
|
|||||||||||||||||
Advances
to suppliers
|
-
|
3,897,563
|
3,897,563
|
|||||||||||||||||
Prepaid
expense & other current assets
|
4,028
|
-
|
A
|
(4,028
|
)
|
-
|
||||||||||||||
Total
current assets
|
331,640
|
3,991,747
|
3,991,747
|
|||||||||||||||||
Property
and Equipment, Net
|
41,168
|
4,278,053
|
A
|
(41,168
|
)
|
4,278,053
|
||||||||||||||
Other
Assets
|
||||||||||||||||||||
Construction
in progress
|
-
|
6,397,558
|
6,397,558
|
|||||||||||||||||
Deposit
on land
|
-
|
2,626,872
|
2,626,872
|
|||||||||||||||||
Other
assets
|
8,506
|
-
|
A
|
(8,506
|
)
|
-
|
||||||||||||||
Total
other assets
|
8,506
|
9,024,430
|
9,024,430
|
|||||||||||||||||
TOTAL
ASSETS
|
$
|
381,314
|
$
|
17,294,230
|
$
|
17,294,230
|
||||||||||||||
LIABILITIES
AND STOCKHOLDERS' EQUITY (DEFICIT)
|
||||||||||||||||||||
Current
Liabilites
|
||||||||||||||||||||
Accounts
payable & accrued expenses
|
$
|
456,033
|
$
|
297,845
|
A
|
(456,033
|
)
|
$
|
297,845
|
|||||||||||
Unearned
revenue
|
399,700
|
-
|
A
|
(399,700
|
)
|
-
|
||||||||||||||
Taxes
payable
|
13,500
|
7,756,459
|
A
|
(13,500
|
)
|
7,756,459
|
||||||||||||||
Note
payable - current
|
129,691
|
-
|
A
|
(129,691
|
)
|
-
|
||||||||||||||
Total
current liabilities
|
998,924
|
8,054,304
|
8,054,304
|
|||||||||||||||||
Long-Term
Liabilities
|
||||||||||||||||||||
Accrued
Compensation - related party
|
888,672
|
-
|
A
|
(888,672
|
)
|
-
|
||||||||||||||
Total
long-term liabilities
|
888,672
|
-
|
-
|
|||||||||||||||||
TOTAL
LIABILITIES
|
1,887,596
|
8,054,304
|
8,054,304
|
|||||||||||||||||
STOCKHOLDERS'
EQUITY (DEFICIT)
|
||||||||||||||||||||
Preferred
stock, Convertible Series B, $0.01 par value, 10,000,000
|
||||||||||||||||||||
authorized,
1,762,472 shares issued and outstanding
|
-
|
-
|
A
|
17,625
|
17,625
|
|||||||||||||||
Commom
stock, $0.01 par value, 30,000,000 shares authorized,
|
||||||||||||||||||||
30,000,000
shared issued and outstanding
|
81,965
|
-
|
A
|
218,035
|
300,000
|
|||||||||||||||
Additional
paid-in capital
|
19,450,318
|
1,245,457
|
A
|
(19,767,940
|
)
|
927,835
|
||||||||||||||
Accumulated
other comprehensive income
|
-
|
110,746
|
110,746
|
|||||||||||||||||
Deficit
accumulated during development stage
|
(21,075,060
|
)
|
-
|
A
|
21,075,060
|
-
|
||||||||||||||
Retained
earnings
|
-
|
7,883,720
|
7,883,720
|
|||||||||||||||||
Total
stockholders' equity (deficit)
|
(1,542,777
|
)
|
9,239,923
|
9,239,926
|
||||||||||||||||
|
||||||||||||||||||||
TOTAL
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
|
$
|
344,819
|
$
|
17,294,227
|
$
|
17,294,230
|
||||||||||||||
(1)
Represents reverse merger showing American Sunrise International,
Inc.
only
|
||||||||||||||||||||
PAPERCLIP
SOFTWARE, INC. AND SUBSIDIARIES
|
||||||||||||||
UNAUDITED
PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF
OPERATIONS
|
||||||||||||||
FOR
THE SIX MONTHS ENDED JUNE 30, 2006
|
||||||||||||||
|
American
Sunrise
|
|||||||||||||||||||||
Paperclip
|
International
|
Pro
|
||||||||||||||||||||
Software, Inc. |
Group,
Inc.
|
|
Note
|
Adjustments
|
Forma
|
|||||||||||||||||
REVENUES
|
$
|
791,426
|
$
|
9,891,956
|
A
|
$
|
(791,426
|
)
|
$
|
9,891,956
|
||||||||||||
COST
OF GOODS SOLD
|
-
|
4,445,979
|
4,445,979
|
|||||||||||||||||||
GROSS
PROFIT
|
791,426
|
5,445,977
|
5,445,977
|
|||||||||||||||||||
OPERATING
EXPENSES
|
||||||||||||||||||||||
Research
and development expenses
|
260,450
|
-
|
A
|
(260,450
|
)
|
-
|
||||||||||||||||
Selling,
general and adminstrative expenses
|
674,893
|
541,514
|
A
|
(674,893
|
)
|
541,514
|
||||||||||||||||
Total
operating expenses
|
935,343
|
541,514
|
541,514
|
|||||||||||||||||||
NET
INCOME (LOSS) FROM OPERATIONS
|
(143,917
|
)
|
4,904,463
|
4,904,463
|
||||||||||||||||||
OTHER
INCOME (EXPENSE)
|
||||||||||||||||||||||
Interest
income
|
2,979
|
-
|
A
|
(2,979
|
)
|
-
|
||||||||||||||||
Interest
expense
|
(29,643
|
)
|
(8,331
|
)
|
A
|
29,643
|
(8,331
|
)
|
||||||||||||||
Settlement
of loan payable, net
|
41,529
|
-
|
A
|
(41,529
|
)
|
-
|
||||||||||||||||
Other
income
|
-
|
150,322
|
150,322
|
|||||||||||||||||||
Total
other income (expense)
|
14,865
|
141,991
|
141,991
|
|||||||||||||||||||
NET
INCOME (LOSS) FROM OPEATIONS
|
(129,052
|
)
|
5,046,454
|
5,046,454
|
||||||||||||||||||
NET
INCOME (LOSS) BEFORE PROVISION FOR INCOME TAXES
|
||||||||||||||||||||||
Provision
for income taxes
|
-
|
1,665,702
|
1,665,702
|
|||||||||||||||||||
NET
INCOME (LOSS) APPLICABLE TO COMMON SHARES
|
$
|
(129,052
|
)
|
$
|
3,380,752
|
$
|
3,380,752
|
|||||||||||||||
BASIC
AND DILUTED INCOME (LOSS) PER SHARE
|
$
|
(0.02
|
)
|
$
|
112.69
|
|||||||||||||||||
WEIGHTED
AVERAGE NUMBER
|
||||||||||||||||||||||
OF
COMMON SHARES
|
8,196,521
|
30,000
|
||||||||||||||||||||
PAPERCLIP
SOFTWARE, INC. AND SUBSIDIARIES
|
||||||||||||||
UNAUDITED
PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF
INCOME
|
||||||||||||||
FOR
THE YEAR ENDED DECEMBER 31, 2005
|
||||||||||||||
American
Sunrise
|
|||||||||||||||||||
Paperclip
|
International
|
Pro
|
|||||||||||||||||
Software,
Inc.
|
Group,
Inc.
|
Note
|
Adjustments
|
Forma
|
|||||||||||||||
REVENUES
|
$
|
1,739,394
|
$
|
11,386,663
|
A
|
$
|
(1,739,394
|
)
|
$
|
11,386,663
|
|||||||||
COST
OF GOODS SOLD
|
-
|
5,099,472
|
5,099,472
|
||||||||||||||||
GROSS
PROFIT
|
1,739,394
|
6,287,191
|
6,287,191
|
||||||||||||||||
OPERATING
EXPENSES
|
|||||||||||||||||||
Research
and development expenses
|
502,979
|
-
|
A
|
(502,979
|
)
|
-
|
|||||||||||||
Selling,
general and adminstrative expenses
|
1,396,878
|
605,024
|
A
|
(1,396,878
|
)
|
605,024
|
|||||||||||||
Total
operating expenses
|
1,899,857
|
605,024
|
605,024
|
||||||||||||||||
NET
INCOME (LOSS) FROM OPERATIONS
|
(160,463
|
)
|
5,682,167
|
5,682,167
|
|||||||||||||||
OTHER
INCOME (EXPENSE)
|
|||||||||||||||||||
Interest
income
|
1,032
|
-
|
A
|
(1,032
|
)
|
-
|
|||||||||||||
Interest
expense
|
(59,186
|
)
|
(9,455
|
)
|
A
|
59,186
|
(9,455
|
)
|
|||||||||||
extinguishment
of accounts payable
|
35,090
|
-
|
A
|
(35,090
|
)
|
-
|
|||||||||||||
Other
income
|
-
|
168,538
|
168,538
|
||||||||||||||||
Total
other income (expense)
|
(23,064
|
)
|
159,083
|
159,083
|
|||||||||||||||
NET
INCOME (LOSS) FROM OPEATIONS
|
(183,527
|
)
|
5,841,250
|
5,841,250
|
|||||||||||||||
NET
INCOME (LOSS) BEFORE PROVISION FOR INCOME TAXES
|
|||||||||||||||||||
Provision
for income taxes
|
-
|
1,928,893
|
1,928,893
|
||||||||||||||||
NET
INCOME (LOSS) APPLICABLE TO COMMON SHARES
|
$
|
(183,527
|
)
|
$
|
3,912,357
|
$
|
3,912,357
|
||||||||||||
BASIC
AND DILUTED INCOME (LOSS) PER SHARE
|
$
|
(0.02
|
)
|
$
|
130.41
|
||||||||||||||
WEIGHTED
AVERAGE NUMBER
|
|||||||||||||||||||
OF
COMMON SHARES
|
8,196,521
|
30,000
|
A. |
To
record the issuance of stock and recapitalization of the
Company.
|