On October 24, 2005, Forlink entered into a definitive agreement to acquire a 17.5% equity interest from China Liquid Chemical Exchange Company Limited (“CLCE”), a limited liability company in PRC. Under the terms of the agreement, Forlink deployed the “For-online Electronic Trading System”, a proprietary, integrated software solution, to support the Exchange’s operations, including, but not limited to, online trading, online billing and payment, user authentication, customer care, in exchange for the 17.5% equity interest. This investment has been recognized as corporate joint venture and is accounted for under the equity method of accounting, under SOP 78-9. In early 2007, CLCE has increased its share capital. As the Company has not subscribed the new shares, our shareholding in CLCE as of June 30, 2007 has diluted to 13.46%. CLCE commenced business in early 2007. http://www.sec.gov/Archives/edgar/data/866458/...63/v084218_10qsb.htm |