UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

(Mark One)

x ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, ~~2014~~2015

o ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ___________ to ___________

Commission File Number: 000-26777

China Yida Holding, Co.

(Exact name of registrant as specified in its charter)

Nevada		50-0027826
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

28/F Yifa Building No. 111 Wusi Road Fuzhou, Fujian, P. R. China,		350003
(Address of principal executive offices)		(Zip Code)

Registrant’s telephone number, including area code: (718) 838-9552

Securities registered pursuant to Section 12(b) of the Act:

Title of each class		Name of each exchange on which registered
Common Stock, $0.001 par value per share		NASDAQ Capital Market

Securities registered under Section 12(g) of the Act:

Not Applicable

(Title of Class)

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes o☐ No x☒

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Exchange Act. Yes o☐ No x☒

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange ~~Act~~ Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), ~~and~~ and (2) has been subject to such filing requirements for the past 90 days. Yes x ☒ No o☐

Indicate by by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every ~~Interactive~~ Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes x ☒ No o☐

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§232.405 of this chapter) is not contained herein, and will not be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. ¨☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer ¨☐ Accelerated filer ¨☐ Non-accelerated filer ¨☐ Smaller reporting company x☒ (Do not check if a smaller reporting company)

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes o ☐ No x☒

The aggregate market value of the voting and non-voting stock held by non-affiliates of the registrant, as of June 30, ~~2014~~2015, the last business day of the registrant’s most recently completed second fiscal quarter, based on the closing price of the common stock on NASDAQ Capital Market exchange on such date was $5.62 million.

The number of shares outstanding of the registrant’s common stock as of March 2030, 2015 was 3,914,580 shares.

FORM 10-K

INDEX

		Page
	PART I
ITEM 1.	Business	1
ITEM 1A.	Risk Factors	13
ITEM 1B.	Unresolved Staff Comments	25
ITEM 2.	Properties	2625
ITEM 3.	Legal Proceedings	2726
ITEM 4.	Mine Safety Disclosures	2726
	PART II
ITEM 5.	Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities	2827
ITEM 6.	Selected Financial Data	2928
ITEM 7.	Management’s Discussion and Analysis of Financial Condition and Results of Operation	2928
ITEM 7A.	Quantitative and Qualitative Disclosures About Market Risk	4041
ITEM 8.	Financial Statements and Supplementary Data	41F-1
ITEM 9.	Changes in and Disagreements with Accountants on Accounting and Financial Disclosure	42
ITEM 9A.	Controls and Procedures	42
ITEM 9B.	Other Information	43
	PART III
ITEM 10.	Directors, Executive Officers and Corporate Governance	44
ITEM 11.	Executive Compensation	44
ITEM 12.	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	44
ITEM 13.	Certain Relationships and Related Transactions, and Director Independence	44
ITEM 14.	Principal Accounting Fees and Services	44
	PART IV
ITEM 15.	Exhibits, Financial Statement Schedules	45
SIGNATURES		47

STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

Except for the historical information contained herein, some of the statements in this Report contain forward-looking statements that involve risks and uncertainties. These statements are found in the sections entitled "Business," "Management's Discussion and Analysis of Financial Condition and Results of Operations," and "Risk Factors." They include statements concerning: our business strategy; expectations of market and customer response; liquidity and capital expenditures; future sources of revenues; expansion of our product lines; addition of new product lines; and trends in industry activity generally. In some cases, you can identify forward-looking statements by words such as "may," "will," "should," "expect," "plan," "could," "anticipate," "intend," "believe," "estimate," "predict," "potential," "goal," or "continue" or similar terminology. These statements are only predictions and involve known and unknown risks, uncertainties and other factors, including, but not limited to, the risks outlined under "Risk Factors," that may cause our or our industry's actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by such forward-looking statements. For example, assumptions that could cause actual results to vary materially from future results include, but are not limited to: our ability to successfully develop and market our products to customers; our ability to generate customer demand for our products in our target markets; the development of our target markets and market opportunities; our ability to produce and deliver suitable products at competitive cost; market pricing for our products and for competing products; the extent of increasing competition; technological developments in our target markets and the development of alternate, competing technologies in them; and sales of shares by existing shareholders. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements. Unless we are required to do so under U.S. federal securities laws or other applicable laws, we do not intend to update or revise any forward-looking statements.

USE OF CERTAIN DEFINED TERMS

Except as otherwise indicated by the context, references in this report to “we,” “us,” “our,” “our Company,” or “the Company” are to the combined business of China Yida Holding, Co. and its subsidiaries.

PART I

ITEM 1. BUSINESS.

Corporate Overview

We, together with our subsidiaries, operate various tourist destinations in Fujian and Jiangxi provinces in the People’s Republic of China. We develop, operate, manage and market tourist destinations, including natural, cultural, and historical tourist destinations and theme parks. We also create/design and construct new tourist concepts, attractions and properties.

We currently have three destinations that are open to the public: (i) Yunding Recreational Park (a large-scale recreational park, or the “Yunding Park”) in Yongtai County, Fujian, and (ii) Hua’An Tulou Cluster (the “Earth Buildings” or “Tulou,” part of Fujian Tulou – a World Cultural Heritage Site granted by UNESCO) in Hua’An County, Fujian, and (iii) the China Yang-sheng (Nourishing Life) Paradise (“Yang-sheng Paradise”), a theme park style destination featuring a rare salt water hot spring located in Zhangshu, Jiangxi. We also currently have one destination that is under construction, the City of Caves (“City of Caves”), an underground natural attraction located in Xinyu, Jiangxi.

In 2011, we started to construct and develop Yunding Park’s second phase of construction and new tourism projects, the China Yang-sheng (Nourishing Life) Paradise in Zhangshu City, Jiangxi province, and the City of Caves in Fenyi City, Jiangxi province. The construction was in line with our schedule. We completed the second phase of construction of Yunding Park by the end of 2012. We completed the first phase construction of Yang-sheng Paradise and opened it to the public for trial in October, 2013. We started the first phase construction of City of Caves in 2014 and ~~expect~~opened to ~~open it to~~ the public byin ~~the~~May ~~2nd quarter~~ of 2015.

Our Corporate History and Structure

China Yida Holding Co. was organized as a Delaware Corporation in June 4, 1999, formerly known as Apta Holdings, Inc. (“China Yida Delaware”). On August 1, 2012, our board of directors and majority stockholders adopted written consents to approve an amendment to the Company’s ~~Certificate~~ Certificate of Incorporation to effectuate a one-for-five reverse stock split of the Company’s common stock. On November 16, 2012, China Yida Delaware filed a Certificate of Amendment of the Company’s Certificate of Incorporation (the “Certificate of Amendment”) with the Secretary of State of the State of Delaware to effectuate the reverse stock split. ~~Any~~At that time, any fractional share was rounded to the next whole share. On November 19, 2012, China Yida Delaware consummated a merger (the “Reincorporation”) with and into its wholly-owned subsidiary, China Yida Holding Co., a Nevada corporation (“China Yida Nevada”), pursuant to the terms and conditions of an Agreement and Plan of Merger entered into by China Yida Nevada and China Yida Delaware on November 19, 2012. As a result of the Reincorporation, we are now a Nevada corporation. In addition, the articles of incorporation and bylaws of China Yida Nevada are now our governing documents.

Share Exchange Transaction and Our subsidiaries

Keenway Limited was incorporated under the laws of the Cayman Islands on May 9, 2007 for the purpose of functioning as an off-shore holding company to obtain ownership interests in Hong Kong Yi Tat International Investment Co., Ltd (“Hong Kong Yi Tat”), a company incorporated under the laws of Hong Kong. Immediately prior to the Reverse Merger (defined below), Mr. Minhua Chen and his wife, Ms. Yanling Fan, were the majority shareholders of Keenway Limited.

On November 19, 2007, we entered into a share exchange and stock purchase agreement with Keenway Limited, Hong Kong Yi Tat, and the then shareholders of Keenway Limited, including Minhua Chen, Yanling Fan, Xinchen Zhang, Extra Profit International Limited, and Lucky Glory International Limited (collectively, the “Keenway Limited Shareholders”), pursuant to which in exchange for all of their shares of Keenway Limited common stock, the Keenway Limited Shareholders received 18,180,649 newly issued shares (or 90,903,246 shares prior to the reverse stock split on November 16, 2012) of our common stock and 728,359 shares (or 3,641,796 shares prior to the reverse stock split on November 16, 2012) of our common stock which were transferred from some of our then existing shareholders (the “Reverse Merger”). As a result of the closing of the Reverse Merger, the Keenway Limited Shareholders owned approximately 94.5% of our then issued and outstanding shares on a fully diluted basis and Keenway Limited became our wholly owned subsidiary.

Hong Kong Yi Tat was incorporated under the laws as the holding company of our operating entities, (i) Fujian Jintai Tourism Development, Co, Ltd. (“Fujian Jintai Tourism”), (ii) Yida (Fujian) Tourism Group., Ltd., formerly known as, Fujian Yunding Tourism Industrial Co., Ltd. (“Fujian Yida”), (iii) Fujian Jiaoguang Media, Co., Ltd. (“Fujian Jiaoguang”), and (iv) Fujian Yida Tulou Tourism Development Co. Ltd. (“Tulou”). Hong Kong Yi Tat does not have any other operations.

Hong Kong Yi Tat, a company incorporated laws of Hong Kong, established its crucial operating PRC subsidiary, Fujian Jintai Tourism in October 2001. At the time when Fujian Jintai Tourism was incorporated, a number of governmental tax incentives would be only applicable to foreign investment enterprises, such as the tax reduction for the foreign investment enterprise located in economic development zone. Under the PRC income tax laws effective prior to January 1, 2008, domestic companies typically were subject to an enterprise income tax rate of 33%, while foreign invested manufacturing enterprises with operation terms of 10 or more years might enjoy preferential tax treatment of “two-year tax exemption and three-year tax reduction of 50%,” subject to the approval of relevant tax authority. For these reasons, Fujian Jintai Tourism was reorganized to be a subsidiary of a foreign parent company (in this case, a Hong Kong Company) to take advantage of the tax treatment.

Moreover, the other reason to use a Cayman Islands company is to facilitate the share transfer with a U.S. public entity at the later date. Transferring equity at both the Hong Kong level or at the PRC level will require complicated governmental filings and/or approval procedures to effect the transfer, as well as tax filings and payment of fees or taxes. Transferring equity of a Cayman Islands company, on the other hand, is subject to a relatively simple governmental procedure for completion of the transfer and generally is free from any taxes under the laws of Cayman Islands. Accordingly, we decided to use Keeway Limited, a Cayman Islands company as the parent of the Hong Kong company which in turn owned the PRC operating entities.

Fujian Jintai Tourism

Fujian Jintai Tourism was formed on October 29, 2001. Its primary business is tourism operation at the Great Golden Lake. The Company offers bamboo rafting, parking lot service, photography services and ethnic cultural communications.

Fujian Jintai Tourism has one wholly owned subsidiary, Fuzhou Hongda Commercial Services Co., Ltd. (“Hongda”). Hongda currently does not have any operations. On March 15, 2010, Hongda entered into an equity transfer agreement with Fujian Yida, pursuant to which Fujian Yida acquired 100% of the issued and outstanding shares of Fuzhou Fuyu Advertising Co., Ltd. (“Fuyu”) from Hongda at the aggregate purchase price of RMB 3,000,000 ($473,000 USD). As a result, Fujian Yida became the 100% holding company of Fuyu. Fuyu is engaged in the mass media segment of our business. Its primary business is focused on advertising, including media publishing, television, cultural and artistic communication activities, and performance operation and management activities. Hongda was deregistered on December 2, 2012.

Fujian Jintai Tourism also owned 100% of the ownership interest in Fujian Yintai Tourism Co., Ltd. (“Yintai”). On March 15, 2010 Fujian Jintai Tourism entered into an equity transfer agreement with Fujian Yida, pursuant to which Fujian Yida acquired 100% of the issued and outstanding common stock of Yintai from Fujian Jintai Tourism at the aggregate purchase price of RMB 5,000,000 ($789,000). As a result, Yintai became a wholly owned subsidiary of Fujian Yida. Yintai was deregistered on November 18, 2010.

On August 26, 2014, Hong Kong Yi Tat entered into a certain share transfer agreement with Fujian Taining Great Golden Lake Tourism Economic Development Industrial Co., Ltd. (the “Fujian Taining”), an unrelated party, pursuant to which Hong Kong Yi Tat sold 100% of its equity interest in Fujian Jintai Tourism to Fujiang Taining for a price of RMB 228,801,359, or approximately $37 million.

Fujian Yida

Fujian Yida’s primary business relates to the operation of our Yunding Park tourism destination and all of our newly engaged tourism destinations, and the management of our media business.

On March 16, 2010, Fujian Yida formed a wholly-owned subsidiary, Yongtai Yunding Resort Management Co., Ltd. (“Yunding Resort Management”) with its address at No. 68 Xianfu Road, Zhangcheng Town, Yongtai County, China. Yunding Resort Management has currently no material business operations. Yunding Park was opened on September 28, 2010. We plan to develop Yunding Resort Management into a business entity primarily focusing on the management services of Yunding Park when the second phase development of Yunding Park is completed.

On April 12, 2010, our operating subsidiary Fujian Yida, which was called “Fujian Yunding Tourism Industrial Co., Ltd.,” changed its name to “Yida (Fujian) Tourism Group Limited”.” This was to reflect its new role of expanding our business in operations of domestic tourism destinations in China by acquiring new tourism destinations.

On April 15, 2010, Fujian Yida entered into agreement with Anhui Xingguang Group to set up a joint venture – Anhui Yida Tourism Development Co. Ltd. (“Anhui Yida”). Fujian Yida and Anhui Xingguang Group own 60% and 40% of the equity interest of Anhui Yida, respectively. The primary business of Anhui Yida was development of the Ming Dynasty Entertainment World. On June 3, 2013, Fujian Yida entered into a stock transfer agreement with Anhui Xingguang Investment Group Ltd (“Anhui Xingguang”), pursuant to which Anhui Xingguang assumed all the equity interest in Anhui Yida as well as all the assets and liabilities of Anhui Yida., including its two subsidiaries.

On July 6, 2010, Fujian Yida formed a wholly-owned subsidiary, Jiangxi Zhangshu (Yida) Tourism Development Co., Ltd. (“Jiangxi Zhangshu”), in Zhangshu City, Jiangxi Province to develop the Yang-sheng Paradise.

On July 7, 2010, Fujian Yida formed a wholly-owned subsidiary, Jiangxi Fenyi (Yida) Tourism Development Co., Ltd. (“Jiangxi Fenyi”), in Xinyu City, Jiangxi Province to develop the City of Caves.

On June 24, 2011, Fujian Yida formed a wholly owned subsidiary, Fujian Yida Travel Service Co., Ltd. (“Yida Travel”). The total paid-in capital of Yida Travel was $1,546,670 (RMB10 million). Its primary business is to conduct domestic and international traveling services in China, including operating the direct sales of travel services for our current tourist destinations at the Great Golden Lake, Yunding Recreational Park, and Hua’An Tulou Cluster, China Yang-sheng (Nourishing Life) Paradise, and the City of Caves which is under construction.

On May 11, 2012, Jiangxi Zhangshu formed a wholly owned subsidiary, Zhangshu (Yida) Real Estate Development Co., Ltd. (“Zhangshu Development”). The total paid-in capital of Zhangshu Development was $792,532 (RMB 5 million). Its primary business is to conduct business of real estate development and sales in China.

On May 16, 2012, Anhui Yida formed a wholly owned subsidiary, Bengbu (Yida) Real Estate Development Co., Ltd. (“Bengbu Yida”). The total paid-in capital of Bengbu Yida was $1,268,050 (RMB 8 million). Its primary business is to conduct business of real estate development in China. As a result of the stock transfer agreement by and between Fujian Yi da and Anhui Xingguang dated June 3, 2013, Anhui Xingguang acquired all the equity interests in Anhui Yida and assumed all the assets and liabilities of Anhui Yida including the equity interests in Bengbu Yida.

On May 22, 2012, Jiangxi Zhangshu formed a wholly owned subsidiary, Zhangshu (Yida) Investment Co., Ltd. (“Zhangshu Investment”). The total paid-in capital of Zhangshu Investment was $792,532 (RMB 5 million). Its primary business is to conduct real estate investment, project management and consulting in China.

On June 6, 2012, Jiangxi Fenyi formed a wholly owned subsidiary, Fenyi (Yida) Property Development Co., Ltd. (“Fenyi Development”). The total paid-in capital of Fenyi Development was $792,532 (RMB 5 million). Its primary business is to conduct business of real estate development and sales in China.

On July 20, 2012, Anhui Yida formed a wholly owned subsidiary, Bengbu (Yida) Investment Co., Ltd. (“Bengbu Investment”). The total paid-in capital of Bengbu Investment was $792,532 (RMB 5 million). Its primary business is to conduct real estate investment, project management and consulting in China. As a result of the stock transfer agreement by and between Fujian Yi da and Anhui Xingguang dated June 3, 2013, Anhui Xingguang acquired all the equity interests in Anhui Yida and assumed all the assets and liabilities of Anhui Yida including the equity interests in Benhu Investment.

On July 30, 2012, Fujian Yida formed a wholly owned subsidiary, Fujian (Yida) Culture and Tourism Performing Arts Co., Ltd. (“Yida Arts”). The total paid-in capital of Yida Arts was $792,532 (RMB 5 million). Its primary business is to operate Yunding performance and show events.

On June 26, 2013, Fujian Yida formed a wholly owned subsidiary, Yongtai Yunding Hotel Co, Ltd (“Yida Hotel”). The total paid-in capital of Yida Hotel was $4,860,000 (RMB 30 million). Its primary business is operating Yunding hotel services.

On June 3, 2013, Yida (Fujian) Tourism Group Limited. (“Fujian Yida”), our subsidiary, entered into a stock transfer agreement with Anhui Xingguang Investment Group Ltd (“Anhui Xingguang”), pursuant to which Fujian Yida agreed to transfer its 60% interest in Anhui Yida Tourism Development Co. Ltd. (“Anhui Yida”) to Anhui Xingguang for RMB 60 million, or $9.72 million. Anhui Xingguang also assumed all the assets and liabilities of Anhui Yida.

Fujian Jiaoguang

Fujian Jiaoguang and our contractual relationship met the requirements of the Accounting Standard Codification ("ASC") 810, to consolidate Fujiang Jiaoguang’s financial statements as a Variable Interest Entity. Fujian Jiaoguang has no material business operations.

Tulou

Tulou is 100% owned by Hong Kong Yi Tat. Tulou’s primary business relates to the operation of Tulou, one of our tourism destinations.

The following chart depicts our current corporate structure:

* Each of Fujian Jiaoguang and Yunding Resort Management ~~currently~~have ~~has~~ no material business operations.

Our Wholly Foreign Owned Enterprises

We have two wholly foreign owned Enterprises. Fujian Yida Tulou Tourism Co., Ltd. and Yida (Fujian) Tourism Group, Ltd.

Our Variable Interest Entity Agreements

On December 30, 2004, Fujiang Jiaoguang and its shareholders entered into a set of contractual arrangements with us which governs the relationships between Fujian Jiaoguang and the Company. The Contractual Arrangements are comprised of a series of agreements, including a Consulting Agreement and an Operating Agreement, through which we have the right to advise, consult, manage and operate Fujian Jiaoguang, and collect and own all of Fujian Jiaoguang’s respective net profits. Additionally, under a Proxy and Voting Agreement and a Voting Trust and Escrow Agreement, the shareholders of Fujian Jiaoguang have vested their voting control over Fujian Jiaoguang to the Company. In order to further reinforce the Company’s rights to control and operate Fujian Jiaoguang, Fujian Jiaoguang and its shareholders have granted us, under an Option Agreement, the exclusive right and option to acquire all of their equity interests in the Fujian Jiaoguang or, alternatively, all of the assets of Fujian Jiaoguang. Further, the shareholders of Fujian Jiaoguang have pledged all of their rights, titles and interests in Fujian Jiaoguang to us under an Equity Pledge Agreement. We effectuated this organizational structure due to China’s limitations on foreign investments and ownership in Chinese domestic businesses. Generally, the Chinese law prohibits foreign entities from directly owning certain types of businesses, such as the media industry.

The shareholders of Fujian Jiaoguang are also our principal shareholders, Chairman Minhua Chen and Yanling Fan.

We have obtained an opinion from Allbright Law Office, our Chinese legal counsel, that this structure is legal and valid and that the U.S. holding corporation can obtain the same benefits and risks with this contractual structure as it would with a direct equity ownership. There is, however, a risk with this contractual structure that the contracting party breaches its contract with us. If Fujian Jiaoguang fails to perform its obligations under the contractual arrangements, we are required to enforce our rights through arbitration before the China International Economic and Trade Arbitration Commission (CIETAC). To initiate a proceeding under the CIETAC we must first prepare and submit an arbitration request for approval and acceptance. Once accepted, CIETAC will form an arbitration tribunal to hear the matter, set a hearing date and notify the parties of the proceeding. The parties would be contractually bound by the decision of the tribunal. While we do feel the possibility is remote, in the event such decision is unfavorable, we may effectively lose control over Fujian Jiaoguang, which would materially affect our business, financial condition and results of operations.

Additionally, the pledge agreement that entered into on December 30, 2004 is enforceable under the PRC law although it was not registered with local government agency. The PRC Property Law went effective on October 1, 2007. At the time of the execution of the pledge agreement, no registration with local administration for industry and commerce was required for the effectiveness and enforcement of pledge agreement. The PRC Property Law does not have retrospective effect and nor does it require the registration of an executed pledge agreement before the effectiveness of the PRC Property Law. The pledge agreement was effective upon execution and, therefore enforceable under the PRC laws.

Although Fujian Jiaoguang is still contractually obligated to us pursuant to the agreements, it no longer is an operating entity. All the assets and revenue of Fujian Jiaoguang have been transferred to Fuyu, our wholly owned subsidiary, on July 31, 2011 pursuant to an agreement by and among Fujian Jiaoguang, Fuyu and Fujian Xinhengji Advertisement Co., Ltd. This transfer of assets has been completed in compliance with PRC laws and was done so that we no longer had to rely on the contractual arrangements of our variable interest entities. We believe that this is a more efficient and less risky corporate structure.

Our Products, Services and Customers

Advertisement

FETV

FETV, owned by the Fujian Education TV Station, is a provincial comprehensive entertainment television channel .

On August 1, 2010, Fuyu, our wholly-owned subsidiary, entered into a Fujian Education Television Channel Project Management Agreement (the “Management Agreement”), with Fujian Education Media Limited Company, a wholly state-owned company organized by the Fujian Education TV Station under the laws of the People’s Republic of China (“Fuijan Education Media”), pursuant to which, Fujian Education Media granted to us five years of exclusive management rights for the FETV channel from August 1, 2010 to July 31, 2015 (the “Term”), with the first three years of the Term, from August 1, 2010 to July 31, 2013, as phase I (the “Phase I”) and the remaining two years of the Term, from August 1, 2013 to July 31, 2015, the phase II (the “Phase II”). At the end of Phase I, we and Fujian Education Media shall conduct full performance review of our cooperation under the Management Agreement. If we and Fujian Education mutually agree that there is no event of violation or breach of contract, the Management Agreement shall be extended to Phase II. Additionally, Fujian Education Media will also review our operations and make an assessment as to whether it would be profitable for them to continue the arrangement. If they determine that the future operations will not be successful, they can terminate the Agreement and not move forward with Phase II. During the Phase I Period and Phase II Phase, we shall pay annual payment of RMB 12,000,000 ($1,893,000 USD) to Fujian Education TV Station for the first year and shall be increased by 20% per year for each of subsequent years during two phases.

Under the Management Agreement, we obtained the full rights to provide programming and content management services and to re-sell all advertising airtime of FETV.

Certain PRC regulations promulgated by the State Administration for Radio, Film and Television which bans certain television and radio advertisements, has had a negative effect on our advertisement business model and a significant number of clients had discontinued their agreements with us. As a result of these regulations, our revenues from the advertising business had declined significantly. Therefore, when the Management Agreement with FETV expired in July 2013, we did not renew the Management Agreement and discontinued the FETV operations.

Railway Media

In February 2009, our wholly owned subsidiary, Fuzhou Fuyu Advertising Co., Ltd., entered into a six-year exclusive agreement with China’s Railway Media Center to create “Journey through China on the Train” infomercial programs, pursuant to which we would produce 20 minute monthly episodes focused on tourist destinations around China and travel ideas and tips with product placement advertisements. We were obligated to pay an annual fee of approximately $46,154 or RMB 300,000 to Railway Media Center for the first three years and approximately $53,846 or RMB 350,000 for the second three years. The Company lost all the ~~clients~~ clients since the railway program was broadcasted manually by train attendants and was generally not broadcasted. We had no control over the frequency of program broadcasting. We terminated “Journey through China on the Train” program in March of of 2013.

Tourism

The Great Golden Lake

As discussed above, we sold our equity interest in Fujian Jintai Tourism to an unrelated party in August 2014. Therefore, we no longer operate the Great Golden Lake destination.

Yunding Park

On November 27, 2008, Hong Kong Yi Tat International Limited, our wholly owned subsidiary, entered into the Tourist Destination Cooperative Development Agreement with the Yongtai County People’s Government in Fuzhou, China which is effective until 2048. Pursuant to the agreement, we obtained the exclusive right and special authorization to develop the Yunding Park located at Yongtai Beixi and Jiezhukou Lake for forty (40) years from 2008. The Yunding Park is approximately 50 kilometer from Fuzhou, the capital city of Fujian. We are obligated to construct, operate and manage two tourist destinations, subject to specific terms and conditions negotiated between us and the Yongtai government. We have the exclusive right to develop both Yongtai Beixi and Jiezhukou Lake and the government is prohibited from granting the right of development, operation and management to any third party during the existence of our agreement. As of December 31, ~~2014~~2015, we have invested approximately $83.5 million to build the tourism, transportation and entertainment facilities. In September 2010, we timely announced the grand opening of our Yunding Park to the public. Fujian Yida was responsible for the development and operations of Yunding Park. Now we have completed the second phase of Yunding Park. Yunding Resort Management will be responsible for the management services of Yunding Park . We generate revenue from entrance fees, cable cars, restaurants, lodgings and entertainment activities.

Hong Kong Yi Tat incorporated Fujian Yida for handling the business operation and receiving revenues from the ticket sales at Yunding Park. Under the Tourist Destination Cooperative Development Agreement, Hong Kong Yi Tat is entitled to: (1) the ticket sales revenue, provided, that, we are required to pay a total of 5 million RMB ($790,000 USD) to the Yongtai County People’s Government over the course of the first 10 years of the Agreement; (2) the earnings excluding 5% of the actual ticket sales during that time in the second ten years; (3) the earnings excluding 6% of the actual ticket sales during that time in the third ten years and (4) the earnings excluding 7% of the actual ticket sales during that time in the fourth ten years. By the end of 2013, we had fulfilled this obligation with total payments made in the amount of approximately $818,036 (RMB 5.0 million). Hong Kong Yi Tat contributes the revenue to Fujian Yida, however, there is no agreement between Hong Kong Yi Tat and Fujian Yida regarding payment or entitlement to revenue under the Tourist Destination Cooperative Agreement or any other agreement.

Yunding Park opened to the public on September 28, 2010. In ~~2014~~the year ended December 31,2015, we had total gross ticket sales of 2018.4 1 million RMB ($32.3292 million USD) as compared to 2120.24 million RMB ($3.~~47 million~~32million USD) in ~~2013~~2014. In ~~2014~~2015, we had ~~308~~263,~~000~~037 visitors to Yunding Park as compared to ~~259~~308,000 visitors in ~~2013~~2014. ~~The gross ticket sales decreased 3.7% despite the increased number of visitors because we had to provide deeper ticket discount among the strong competition.~~

Hua’an Tulou Cluster (“Earth Buildings” or the “Tulou”)

The Tulou Cluster, composed of large multilayer earth buildings built by ancient wealthy families as their residence, is known for their unique round shape, ingenious structure and oriental mystery. The Tulou Cluster was recognized as part of Fujian Tulou World Cultural Heritage Site in 2008 by UNESCO. The Tulou Cluster is a 1.5 hour drive from Xiamen City, one of Fujian’s most famous tourist coastal cities.

In December 2008, Hong Kong Yi Tat International Limited, our wholly owned subsidiary, entered into a Tourist Resources Development Agreement with Hua’an County Government. The agreement is effective until 2048. Pursuant to this agreement, we began to develop the Hua’an Tulou tourist destinations with a right of priority to develop other scenic areas in Hua’an County. Hua’an Tulou Cluster requires a total capital input of approximately 47,500,000 RMB ($7.5 million USD) to put it into infrastructure and facility constructions. The Hua’an Tulou Cluster was closed during the construction and re-opened to the public before the fourth quarter of 2009. Currently, approximately half of its visitors are from overseas, including Taiwan. Our revenue is generated from the sale of entrance ticket fees, fees from rides on tour cars and food at our restaurants.

Under the contractual arrangements with respect to Hua’an Tulou Cluster, when the ticket price of the Dadi Tulou Clusters is RMB60 ($9.50 USD) or above per person, the proportion paid by Hong Kong Yi Tat to Hua’an County government shall be: (1) 16% of gross ticket sales in the first five years; (2) 20% of gross ticket sales in the second five years; (3) 23% of gross ticket sales in the third five years; (4) 25% of gross ticket sales in the fourth five years; (5) 28% of gross ticket sales in the fifth five years; and (6) 30% of gross ticket sales from the 26th year. Currently, our average ticket price at Hua’an Tulou is 90RMB ($14.50 USD). In the event our ticket price is less than RMB 60 ($9.50USD), the Hua’an County government shall be entitled to a reduced portion of the gross ticket sales.

Our ticket prices are subject to the approval of the local PRC government. According to the PRC Pricing Law, the scope and level of the government-set and guided prices shall properly be adjusted in light of the national economy. The Company may file an application with the government to request a price change to our ticket prices. However, the government will use its discretion to decide whether or not to adjust the ticket price and will use their discretion to determine the adequate price for the tickets to our park. Additionally, even if we do not apply for a price adjustment, the local PRC government may adjust the price based on consumer or business operations or the national economy.

In ~~2014~~2015, Hua’~~an Tulou~~ anTulou Cluster had 5747,000 visitors, an ~~increase~~decrease of 717.5%, and gross ticket sales of approximately $~~400~~302,~~000 USD~~400USD, a decrease of 524% as compared to ~~2013~~2014, and we paid the Hua’an County government $56,896 USD. We are facing strong competition among the homogeneous tourism destinations such as Nanjing Tulou Cluster and ~~Yongding~~YongdingTulou ~~Tulou~~ Cluster. The gross ticket sales decreased 5% despite the increased number of visitors because we had to provide deeper ticket discount among the strong consumption and the tourist consumption was also decreased. We expect this trend to continue in the future.

Ming Dynasty Entertainment World

On April 15, 2010, Yida (Fujian) Tourism Group Ltd. jointly with Anhui Xingguang Investment Group Ltd., a privately held company engaged in real estate and commercial development in Anhui province, entered into an Emperor Ming Taizu Cultural and Ecological Resort and Tourist Project Finance Agreement with Anhui Province Bengbu Municipal Government, pursuant to which we and Anhui Xingguang formed a limited liability company, with a total registered capital of RMB 100 million (approximately $14.6 million) to engage in construction and development of a new tourism destination – Ming Dynasty Entertainment World in Bengbu City, Anhui Province.

On June 3, 2013, Fujian Yida entered into a stock transfer agreement with Anhui Xingguang pursuant to which Fujian Yida transferred its 60% interest in Anhui Yida to Anhui Xingguang for RMB 60 million, or $9.72 million. Anhui Xingguang also assumed all the assets and liabilities of Anhui Yida.

As such, the Ming Dynasty Entertainment World operation was discontinued.

Yang-sheng Paradise

The Project is designed to focus on the theme of famous Taoist practice – Yang-sheng (nourishing life), with Zhangshu City’s rare natural resources – salt water hot spring, and reputation as one of China’s traditional medicine and herb center. Preliminarily, Yang-sheng Paradise is planned to include (i) Salt Water Hot Spring SPA & Health Center, (ii) Yang-sheng Holiday Resort, (iii) World Yang-sheng Cultural Museum, (iii) International Camphor Tree Garden, (iv) Chinese Medicine and Herb Museum, (v) Yang-sheng Sports Club, (vi) Old Town of Chinese Traditional Medicine, and (vii) various other Yang-sheng related projects and tourism real estate projects. We formed a limited liability company with a total registered capital of RMB 20 million (approximately $3 million) as of December 31. 2010.

The Project will be developed approximately two (2) kilometers from Zhangshu’s downtown, and within one hour travel from the adjacent airport or Nanchang, the capital city of Jiangxi Province. In addition, the Project is on the route from Nanchang to Lu Mountain, a World Natural Heritage Site, and Jing-Gang Mountain, one of the most popular political education tourism destinations as it was at the origin of Chairman Mao’s military force.

The capital expenditure planned for the first development phase of Project is estimated at approximately RMB250 million (approximately $36.6 million), which includes the planned construction of the Salt Water Hot Spring Spa & Health Center (the “SPA Center”), the Yang-sheng Holiday Resort (the “Resort Hotel”), in-destination roads and lakes, and the purchase of the land use rights for a parcel of approximately 3,000 Mu (approximately 494 acres, commercial and residential land use, the “Commercial Land”) as well as the rental payment for a parcel of approximately 3,000 Mu (approximately 494 acres) with the annual rent estimated at RMB0.5 million (approximately $73,300). The rental of the additional parcel of approximately 3,000 Mu of land would be leased from the local PRC government but we would not be required to obtain land-use rights because the lease will only be for the management rights of the land based on a cooperative agreement that would be entered into at the time of the lease. No such arrangement, however, has been entered into.

The SPA Center and the Resort Hotel ~~was~~opened ~~open~~ to the public in October, 2013.

In addition to the SPA Center and the Resort Hotel, Company plans to build additional attractions on the Project site that may include the World Yang-sheng Cultural Museum, the International Camphor Tree Garden, the Chinese Medicine & Herb Museum, the Yang-sheng Sports Club, the Old Town of Chinese Traditional Medicine and other Yang-sheng related projects and tourism real estate projects. The Company is now conducting in-depth research, evaluation and preparation on these plans.

Zhangshu Municipal Government has agreed not to approve any additional salt water hot spring or related tourism projects to any third parties to protect the exclusivity of Project. It will also waive the usage fees of the project tourism resources and thermohaline spring water resources. In addition, it will waive or reduce most of the administration fees throughout the Project’s constructions. It will also allow China Yida to pay for its outdoor lighting at a cheaper rate as of city’s street lighting.

There are no other revenue sharing provisions or other restrictions on the revenue that we will receive from such venue.

In ~~2014~~ 2015, Yang-sheng Paradise had 94170,~~300~~000 visitors and a gross ticket sales of $1.283 million.

The City of Caves

On June 1, 2010, Yida (Fujian) Tourism Group Ltd., our wholly-owned subsidiary, entered into an agreement with Jiangxi Province People’s Government of Fenyi County in Xinyu city, Jiangxi Province, to develop a brand new tourism project to be named “The City of Caves”, based on the largest and most characteristic karst land underground caverns in China, for a management period of forty (40) years commencing from 2010.

The Company has completed the construction of the first phase, mainly composed of Altair Cave and Vega Cave, and ~~plan~~began toits ~~start~~ trial operation byin ~~the 2nd~~May ~~quarter~~ of 2015. The second phase includes the Hanmao Cave Cluster and the third phase will include the tourism resources of Dagang Mountain. Investment budget for each of the three phases is RMB100 million ($14.7 million), with a total budget of RMB300 million ($44.1 million). The City of Caves will attract tourists who are visiting the several nearby world-class tourism destinations, including Sanqing Mountain, Longhu Mountain, Jinggang Mountain, and Lu Mountain, all of which are famous and popular attractions in China. In addition, the Project is approximately a one-hour drive from China Yida's Yang-sheng Paradise, which means the Company can integrate the resources of the two projects and launch a very cost-effective and powerful integrated marketing campaign. The Project will be designed to provide comprehensive cultural background and will feature a high level of interaction between natural views and entertainment experiences, as compared to simple sightseeing of peer caves. We formed a limited liability company and committed RMB 60 million (approximately $9 million) of capital investment. As of December 31, ~~2014~~2015, the Company has paid RMB ~~131.6~~ 172 million (approximately $~~21.5~~28 million) for the construction of The City of Caves.

Fenyi County is located in the mid-west of Xinyu City, 30 kilometers from downtown Xinyu. Xinyu is believed to have the highest industrialization among all cities of Jianxi Province, featuring two key industries: (i) steel; and (ii) photovoltaic. Management estimates that a three-hour driving circle will cover a population of approximately 50 million in 11 cities including the three provincial capital cities of Nanchang, Changsha and Wuhan. Several rail lines and highways across Xinyu make transportation convenient.

Under the contractual arrangements, Fujian Yida shall pay to the Fenyi County government the “use fees” of scenic resources. The “use fees” are payable as follows: during the first five years of operations we will not be required to pay anything to the Fenyi County government, during the second five years of operations we will be required to pay 5% of gross ticket sales per year to the Fenyi County government and for all years thereafter we will pay 8% of gross ticket sales per year to the Fenyi County government. In 2015, City of Caves had 99,000 visitors and gross ticket sales of $1.48 million.

~~The City of Caves did not have any~~Marketing ~~visitors~~and inDistribution ~~2014~~Methods ~~because this site has not officially opened to the public due to lack~~ of ~~construction~~Products ~~funds~~ and ~~unexpected storm in 2014. We expect to open it to the public for trial by the 2nd quarter of 2015.~~Services

~~Marketing~~The current marketing strategy of our tourist and ~~Distribution~~related ~~Methods~~operations has two major promotional elements. The first is promoting the unique brand and scenic locations through traditional advertisement mediums. These traditional channels include television, radio and print media. To reduce costs, the Company has implemented a cost minimization plan whereby the majority of ~~Products~~the media advertisement and ~~Services~~promotion of the tourist destination is done through the media platforms available to the Company, including FETV and Railway Media. This cost minimization plan allows our tourist and related operations to reduce its cost of advertising while maintaining a relatively high degree of exposure through our provincial TV channel province-wide and through China’s high-speed railway network.

The second ~~current~~element of the Company's marketing ~~strategy~~effort of ~~our~~ tourist and related operations ~~has~~is ~~two~~promotion ~~major~~of ~~promotional~~the ~~elements.~~scenic ~~The~~destinations ~~first~~through the isattainment ~~promoting~~of ~~the~~nationally ~~unique~~and ~~brand~~internationally ~~and~~recognized merits of scenic ~~locations~~achievement. ~~through traditional~~To ~~advertisement~~this ~~mediums.~~end, ~~These~~the ~~traditional~~Great ~~channels~~Golden ~~include~~Lake ~~television,~~has received ~~radio~~the ~~and~~designation ~~print~~of ~~media.~~the ToGlobal ~~reduce~~Geo-park ~~costs,~~from ~~the~~UNESCO ~~Company~~ and has ~~implemented~~become apart ~~cost~~of ~~minimization~~China ~~plan~~Danxia ~~whereby~~– the ~~majority~~World ofNatural ~~the~~Heritage Site ~~media~~by ~~advertisement~~UNESCO and ~~promotion~~ranked ofin ~~the~~China’s ~~tourist~~Top ~~destination is~~10 ~~done~~Most ~~through~~Appealing ~~the~~Destinations ~~media~~and ~~platforms~~Top ~~available~~50 Places for Foreigners to Visit. During the ~~Company~~second half of 2008, ~~including~~Dadi ~~FETV~~Tulou ~~and~~was ~~Railway~~included ~~Media.~~on ~~This~~the ~~cost~~World ~~minimization~~Cultural ~~plan~~Heritage ~~allows our~~List ~~tourist~~as ~~and~~part ~~related~~of ~~operations~~the toFujian ~~reduce~~Tulou. ~~its~~By ~~cost~~achieving this high degree of ~~advertising~~recognition, ~~while~~the ~~maintaining~~destination becomes visible on a ~~relatively~~massive ~~high~~scale ~~degree~~increasing the draw of ~~exposure~~tourists ~~through our~~from a provincial to TVan ~~channel~~international ~~province-wide~~level. ~~and~~The goal is to significantly increase the daily visitation rate through ~~China’s~~attainment ~~high-speed~~of ~~railway~~significant ~~network~~merit.

~~The second~~ Each element of the ~~Company's~~ marketing ~~effort~~ ofstrategy ~~tourist~~has ~~and~~been ~~related~~developed ~~operations~~in isorder ~~promotion~~to ofincrease the ~~scenic~~international ~~destinations~~consumer ~~through~~awareness ~~the attainment~~ of ~~nationally and internationally recognized merits of scenic achievement. To this end,~~ the ~~Great Golden Lake has received the designation of the Global Geo-park from UNESCO and has become part of China Danxia – the World Natural Heritage Site by UNESCO and ranked in China’~~Company's ~~Top~~ 10tourist ~~Most~~destinations, ~~Appealing Destinations and Top 50 Places for Foreigners~~ to ~~Visit.~~reduce ~~During~~ the ~~second~~associated ~~half~~costs of ~~2008,~~such ~~Dadi~~awareness ~~Tulou~~and was included on the World Cultural Heritage List as part of the Fujian Tulou. By achieving this high degree of recognition, the destination becomes visible on a massive scale increasing the draw of tourists from a provincial to anultimately ~~international level. The goal is to significantly~~ increase the ~~daily~~usage ~~visitation~~ rate ~~through~~and ~~attainment~~ revenues of ~~significant~~the ~~merit~~park.

~~Each~~Because the ~~element~~tourist ofdestination ~~the~~is ~~marketing~~a ~~strategy~~static ~~has been~~product/service, ~~developed~~its indistribution ~~order~~mainly toconsists ~~increase~~of the ~~international~~promotional ~~consumer~~strategies ~~awareness~~described in of the ~~Company's~~paragraphs ~~tourist~~above. ~~destinations,~~The toservices ~~reduce~~are ~~the~~promoted ~~associated costs~~and distributed through traditional forms of ~~such~~advertising ~~awareness~~media. Information and tomarketing ~~ultimately~~materials ~~increase~~regarding the ~~usage~~park ~~rate~~services ~~and~~are ~~revenues~~distributed ofon ~~the park~~site.

Because the tourist destination is a static product/service, its distribution mainly consists of the promotional strategies described in the paragraphs above. The services are promoted and distributed through traditional forms of advertising media. Information and marketing materials regarding the park services are distributed on site.9

9Industry and Competitive Factors

~~Industry~~New competitors are entering into the tourism industry at a record pace. Competition is increasing and ~~Competitive~~it ~~Factors~~is beginning to become difficult to gain market share and grow. There are, however, certain factors that we believe will be critical for our growth:

~~New competitors are entering into the tourism~~1. ~~industry~~maintaining atits aleading ~~record~~management ~~pace.~~position ~~Competition~~by ismonitoring ~~increasing~~ and itmaking istimely ~~beginning~~adjustment to ~~become~~tourism ~~difficult to gain~~ market ~~share~~changes; and ~~grow. There are, however, certain factors that we believe will be critical for our growth:~~

12. Experienced ~~maintaining~~management ~~its~~team ~~leading~~with ~~management position~~more bythan ~~monitoring~~70 ~~and~~years ~~making~~of ~~timely~~combined ~~adjustment~~experience toin ~~tourism~~China ~~market~~media, ~~changes;~~tourism and entertainment industry.

2Our main competitor in the tourism business is Wuyi Mountain and Yongding Tulou Cluster Tourism Destination. ~~Experienced~~Muyi ~~management~~Mountain ~~team~~is ~~with~~a ~~more~~state owned ~~than~~enterprise located in Fujian province and has been operating since 1980. It was added to the World Heritage List by UNESCO 70in ~~years~~1999. ofYongding ~~combined~~Tulou ~~experience~~Cluster is also located in ~~China~~Fujian ~~media,~~Province. ~~tourism~~It was established in September 2007 and ~~entertainment~~is ~~industry~~managed by Fujian Province Tourism Development Co., Ltd. Yongding Tulou Cluster is a Yongding county government owned large-scale state-owned enterprises. It was added to the World Heritage List in July 2008.

Our ~~main competitor in the tourism business~~ isIntellectual Wuyi Mountain and Yongding Tulou Cluster Tourism Destination. Muyi Mountain is a state owned enterprise located in Fujian province and has been operating since 1980. It was added to the World Heritage List by UNESCO in 1999. Yongding Tulou Cluster is also located in Fujian Province. It was established in September 2007 and is managed by Fujian Province Tourism Development Co., Ltd. Yongding Tulou Cluster is a Yongding county government owned large-scale state-owned enterprises. It was added to the World Heritage List in July 2008.Property

~~Our~~We have ~~Intellectual~~obtained ~~Property~~a trademark and the exclusive use permission for the “Great Golden Lake.” This trademark has been filed with Taining County State-owned Assets Investment Operation Co., Ltd. We do not own nor do we intend to own any patents or have any of our products or services patented. In the future, we intend to acquire other trademarks from companies that we acquire or file trademarks or patents in order to protect our intellectual property.

~~We have obtained a trademark and the exclusive~~Compliance ~~use permission for the “Great Golden Lake.” This trademark has been filed~~ with ~~Taining~~Environmental County State-owned Assets Investment Operation Co., Ltd. We do not own nor do we intend to own any patents or have any of our products or services patented. In the future, we intend to acquire other trademarks from companies that we acquire or file trademarks or patents in order to protect our intellectual property.Law

~~Compliance~~We comply with the Environmental Protection Law of PRC as well as applicable local regulations. In addition to statutory and regulatory compliance, we actively ensure the environmental sustainability of our operations. Penalties would be levied upon us if we fail to adhere to and maintain certain standards. Such failure has not occurred in the past, and we generally do not anticipate that it will occur in the future, but no assurance can be given in this regard.

WeIn accordance ~~comply~~ with the Environmental Protection Law of the PRC asadopted ~~well~~by asthe ~~applicable~~Standing ~~local~~Committee ~~regulations.~~of Inthe ~~addition~~NPC toon ~~statutory~~December 26, 1989, the bureau of environmental protection of the State Council set the national guidelines for discharging pollutants. The provincial and ~~regulatory~~municipal ~~compliance~~governments of each province, weautonomous ~~actively~~region ~~ensure~~and municipalities may also set their own guidelines for the discharge ~~environmental~~of ~~sustainability~~pollutants ofwithin ~~our~~their ~~operations~~own province or district. ~~Penalties~~Enterprises ~~would~~producing beenvironmental ~~levied~~contamination ~~upon~~and usother ifpublic wehazards must ~~fail~~incorporate tothe ~~adhere~~relevant environmental protection standards into their planning and establish environmental protections. These companies must also adopt effective measures to prevent environmental contamination and ~~maintain~~hazardous ~~certain~~emissions, such as waste gas, waste water, deposits, dusts, pungent gases and radioactive matters, as well as noise, vibration and magnetic radiation. Companies discharging contaminated wastes in excess of the discharge standards prescribed by the environmental protection authority must pay non-standard discharge fees in accordance with national regulations and be responsible for the applicable remediation. Government ~~Such~~authorities ~~failure~~may ~~has~~impose ~~not~~different ~~occurred~~penalties against persons or companies in violation of the ~~past,~~environmental protection laws and weregulations ~~generally~~depending doon ~~not~~individual ~~anticipate~~circumstances. Such penalties may include warnings, fines, imposition of deadlines for remediation, orders to cease certain operations, orders to reinstall contamination prevention and remediation facilities that have itbeen ~~will~~removed ~~occur~~or inleft unused, imposition of administrative actions against the ~~future,~~responsible ~~but~~persons or orders to close down nothe ~~assurance~~company. ~~can~~Where the violation is egregious and deemed serious, the responsible parties may be ~~given~~required into ~~this~~pay ~~regard~~damages and may be subject to criminal liability.

~~In accordance with the Environmental Protection~~Additionally, ~~Law of the PRC adopted by the Standing Committee of the NPC~~ on ~~December~~November 2629, ~~1989~~1998, the ~~bureau~~State ofCouncil ~~environmental protection~~ of the ~~State~~ ~~Council~~PRC ~~set~~promulgated the ~~national~~Regulations ~~guidelines~~on ~~for discharging pollutants. The provincial and municipal governments of each province, autonomous region and municipalities may also set their own guidelines for~~ the ~~discharge~~Administration of ~~pollutants~~Construction ~~within~~Project ~~their own province~~Environmental Protection, or ~~district. Enterprises producing environmental contamination and other public hazards must incorporate~~ the ~~relevant~~Construction ~~environmental protection~~Project ~~standards~~Environmental ~~into~~Protection ~~their planning and establish environmental protections. These companies must also adopt effective measures to prevent environmental contamination and hazardous emissions~~Regulations, ~~such~~which asrequire ~~waste~~construction ~~gas,~~projects ~~waste~~that ~~water, deposits, dusts, pungent gases~~generate ~~and~~pollution ~~radioactive~~to ~~matters,~~comply aswith ~~well~~both asstate ~~noise, vibration~~ and ~~magnetic~~local ~~radiation. Companies discharging contaminated wastes in excess of the discharge~~ standards ~~prescribed~~for by the ~~environmental protection authority must pay non-standard~~ discharge ~~fees~~of inpollutant; ~~accordance with~~requirements ~~national regulations and be responsible~~ for ~~the~~aggregate ~~applicable~~control ~~remediation. Government authorities may impose different penalties~~of ~~against~~discharge ~~persons or companies in violation~~ of ~~the~~major ~~environmental~~pollutants ~~protection~~must ~~laws~~also ~~and~~be ~~regulations~~met ~~depending~~in onareas ~~individual~~under ~~circumstances. Such~~aggregate ~~penalties~~control ~~may include warnings, fines, imposition~~ of ~~deadlines~~discharge ~~for remediation, orders to cease certain operations, orders to reinstall contamination prevention and remediation facilities that have been removed or left unused, imposition~~ of ~~administrative actions~~major ~~against the responsible persons or orders to close down the company~~pollutants. ~~Where the violation is egregious and deemed serious, the responsible parties may be required to pay damages and may be subject to criminal liability.~~

~~Additionally, on November 29, 1998, the State~~We ~~Council~~have ofalways ~~the~~complied ~~PRC~~with ~~promulgated~~all ~~the~~applicable ~~Regulations on the Administration of Construction Project Environmental Protection~~laws, orrules ~~the~~and ~~Construction Project~~regulations ~~Environmental Protection Regulations, which require construction projects that generate pollution to comply with both state~~ and ~~local~~have ~~standards~~never ~~for~~faced ~~the~~any ~~discharge~~penalties ofor ~~pollutant;~~citations ~~requirements~~ for ~~aggregate~~violating any ~~control~~ of ~~discharge~~the ofabove ~~major~~laws, ~~pollutants~~rules ~~must~~or ~~also be met in areas under aggregate control of discharge of major pollutants~~regulations.

~~We have always complied with all applicable laws, rules and regulations and have never faced any penalties or citations for violating any of the above laws, rules or regulations.~~Regulations

~~Regulations~~The principal regulations governing our tourism businesses tourism include:

● The ~~principal~~PRC ~~regulations~~Pricing ~~governing~~Law ~~our~~● ~~tourism businesses~~The ~~tourism~~State ~~include:~~Council’s Regulations on Scenic Spots ● The National Development and Reform Commission’s Circular on Further Standardizing the Administration over the Price of Entrance Tickets to Sightseeing Spots (2005) and the Notice on Further Improving Administration of Scenic Spots’ Admission Price (2007) ● The Notice on Regulating the Ticket Price of Scenic Spots (2008); and ● The State Council’s Opinions on Accelerating the Development of Tourism Industry (2009)

● The PRC Pricing Law ● The State Council’s Regulations on Scenic Spots ● The National Development and Reform Commission’s Circular on Further Standardizing the Administration over the Price of Entrance Tickets to Sightseeing Spots (2005) and the Notice on Further Improving Administration of Scenic Spots’ Admission Price (2007) ● The Notice on Regulating the Ticket Price of Scenic Spots (2008); and ● The State Council’s Opinions on Accelerating the Development of Tourism Industry (2009)10

10PRC Pricing Law

The PRC Pricing Law was adopted by the Standing Committee of National People's Congress on December 29, 1997 and effective on May 1, 1998. PRC Pricing Law governs all pricing acts within the territory of the People's Republic of China, including the pricing for commodities and services. According to the Pricing Law, the government gradually adjusts the market-oriented price mechanism under macroeconomic regulation and control. The pricing shall be determined by the Law of Value. The prices of most commodities and services shall be the market-oriented and prices of an extremely small number of commodities and services shall be the government-guided or the government-set. According to the PRC Pricing Laws, if necessary, the government may enforce government-guided prices or government-set prices for the certain commodities and services, such as: (1) an extremely small number of commodities vital for the development of the national economy and people's life; (2) a small number of commodities the resources of which are rare or short; (3) commodities under natural monopoly management; (4) essential public utilities; and (5) essential non-profit services. PRC center and local governments publish and amend their guidelines for commodities or services with government-guided or government-set price, frequently. The price of Advertising currently is not included in governmental guideline for commodities or services effective on August 1, 2001. Certain tickets for scenic spots, however, are subject to government-guided or government-set prices.

The ~~PRC Pricing Law was adopted by the Standing~~ ~~Committee~~price of ~~National People's Congress on December 29, 1997 and effective on May 1, 1998. PRC Pricing Law governs all pricing acts within~~ the ~~territory~~tickets ~~of the People's Republic of China, including the pricing~~ for ~~commodities~~our ~~and~~scenic ~~services.~~spots ~~According~~is toapproved ~~the Pricing Law, the government gradually adjusts the market-oriented price mechanism under macroeconomic regulation and control. The pricing shall be determined~~ by the ~~Law~~Office of ~~Value~~Price Administration. ~~The~~We ~~prices~~believe ofthat ~~most~~we ~~commodities~~are ~~and~~in ~~services~~all ~~shall be the market-oriented and prices~~material ofrespects anin ~~extremely~~compliance ~~small~~with ~~number~~all ~~of commodities and services shall be the government-guided or the government-set. According to the~~ PRC Pricing Laws, if necessary, the government may enforce government-guided prices or government-set prices for the certain commodities and services, such as: (1) an extremely small number of commodities vital for the development of the national economy and people's life; (2) a small number of commodities the resources of which are rare or short; (3) commodities under natural monopoly management; (4) essential public utilities; and (5) essential non-profit services. PRC center and local governments publish and amend their guidelines for commodities or services with government-guided or government-set price, frequently. The price of Advertising currently is not included in governmental guideline for commodities or services effective on August 1, 2001. Certain tickets for scenic spots, however, are subject to government-guided or government-set prices.

~~The price of the tickets for our scenic spots~~State’s isCouncil’s ~~approved~~Regulations byon ~~the~~Scenic ~~Office of Price Administration. We believe that we are in all material respects in compliance with all PRC Pricing Laws.~~Spots

Regulation on Scenic Spots and Historic Sites, issued by State’s Council’s ~~Regulations~~ in September 19, 2006 and effective on December 1, 2006, governs the establishment, planning, protection, utilization and management of Scenic Spots and Historic Sites. For example, the landscape and natural environment within Scenic Spots and Historic Sites shall be protected strictly according to the principle of sustainable development and shall not be destroyed or changed at will. The residents and visitors of Scenic Spots and Historic Sites shall protect scenic spots, water, planting, wild animal and all other facilities. The management institution of Scenic Spots and Historic Site shall investigate, evaluate and take necessary measures to protect the significant scenic spots.

~~Regulation on Scenic Spots and Historic Sites,~~PRC ~~issued~~Regulations ~~by State Council in September 19, 2006 and effective~~ on ~~December~~Ticket 1,Sales ~~2006, governs the establishment, planning, protection, utilization~~ and ~~management~~Ticket of Scenic Spots and Historic Sites. For example, the landscape and natural environment within Scenic Spots and Historic Sites shall be protected strictly according to the principle of sustainable development and shall not be destroyed or changed at will. The residents and visitors of Scenic Spots and Historic Sites shall protect scenic spots, water, planting, wild animal and all other facilities. The management institution of Scenic Spots and Historic Site shall investigate, evaluate and take necessary measures to protect the significant scenic spots.Prices

~~PRC~~On April ~~Regulations~~29, 2005, the National Development and Reform Commission issued a Circular on ~~Ticket~~Further ~~Sales~~Standardizing the Administration over the Price of Entrance Tickets to Sightseeing Spots (“Circular No. 712”). Circular No. 712 emphasized a number of issues regarding ticket pricing. For example, the government shall review the entrance ticket price subject to government-guided or the government-set prices and ~~Ticket~~prevent the rapid increasing regarding the price of entrance ticket; the pricing for certain tickets ~~Prices~~shall be subject to hearing procedure; the representative who attends the hearing shall be wide and typical enough.

OnThe Notice ~~April~~on ~~29,~~Further ~~2005,~~Improving ~~the~~Administration of Scenic Spots’ Admission Price was issued by National Development and Reform Commission ~~issued~~on aJanuary ~~Circular~~29, on2007 ~~Further~~(Notice ~~Standardizing~~No. ~~the~~227). ~~Administration~~According ~~over~~to Notice No. 227, the ~~Price~~pricing of ~~Entrance~~entrance ~~Tickets~~ticket toshall ~~Sightseeing~~reflect public ~~Spots~~interests. ~~(“Circular~~The ~~No.~~planning ~~712”).~~for ~~Circular~~adjustment ~~No.~~of ~~712~~ticket ~~emphasized~~shall amake ~~number~~public of2 ~~issues~~months ~~regarding~~prior ~~ticket~~to ~~pricing~~adjustment. ~~For~~The ~~example,~~frequency ~~the~~for adjustment ~~government~~of the same ticket shall ~~review~~not ~~the~~be ~~entrance~~less ~~ticket~~than ~~price~~3 years. For the scenic spots subject to government-guided or the government-set prices ~~and prevent the rapid~~, ~~increasing~~certain ~~regarding~~discount ~~the~~or ~~price~~preferential ofpolicy ~~entrance ticket; the pricing for certain tickets~~ shall be ~~subject~~provided to ~~hearing procedure;~~ the ~~representative who~~elders, ~~attends~~soldiers ~~the~~in ~~hearing~~active ~~shall~~service, bejuveniles ~~wide~~ and ~~typical enough~~students.

The Notice on ~~Further~~Regulating ~~Improving~~the ~~Administration~~ Ticket Price of Scenic Spots’, ~~Admission~~issued ~~Price~~on ~~was~~April ~~issued~~9, 2008 by National Development and Reform Commission, Ministry onof ~~January~~Finance 29and other six government authorities jointly, ~~2007~~mainly ~~(Notice~~focus ~~No. 227).~~on ~~According~~ticket topricing ~~Notice~~and Noadministration for pricing. For ~~227~~example, the ~~pricing~~government-guided ofor ~~entrance~~the ~~ticket~~government-set ~~shall~~prices ~~reflect~~are ~~public~~applicable ~~interests.~~to ~~The~~scenic ~~planning~~spots ~~for~~built ~~adjustment~~in ofreliance on national natural ~~ticket~~or ~~shall~~cultural ~~make~~resources. ~~public~~For 2those ~~months~~scenic ~~prior~~spots toartificially ~~adjustment.~~built ~~The~~by ~~frequency~~commercial ~~for~~investment ~~adjustment~~without ofrelying ~~the~~on ~~same~~national ~~ticket~~natural or ~~shall~~cultural ~~not~~resources, bemarket-oriented ~~less~~price ~~than~~is ~~3 years~~applicable. ~~For~~The ~~the~~adjustment ~~scenic~~of ~~spots~~ticket price subject to government-guided or the government-set prices is required to complete hearing procedure, ~~certain~~extensive ~~discount~~discussion orand ~~preferential~~improve ~~policy~~the transparency of decision ~~shall~~making. beThe ~~provided~~ticket toprice, the ~~elders~~scope and extent of preferential policies of tickets, ~~soldiers~~transportation inprice ~~active~~for ~~service~~trolley, ~~juveniles~~sight-seeing buses, boats and ~~students~~hot-line shall be prominently displayed.

~~The Notice~~ Opinions on ~~Regulating~~Accelerating the ~~Ticket~~Development ~~Price~~ of ~~Scenic~~ ~~Spots,~~Tourism ~~issued~~Industry onwas ~~April~~issued ~~9, 2008~~ by ~~National~~PRC ~~Development~~State ~~and~~Council ~~Reform~~in ~~Commission,~~December ~~Ministry~~2009 of(“Opinion”) ~~Finance and other six government authorities jointly, mainly focus on ticket pricing and administration~~ for ~~pricing. For example,~~ the ~~government-guided~~purpose orof ~~the~~taking ~~government-set prices~~advantage ~~are~~of ~~applicable~~functions toof ~~scenic~~tourism ~~spots~~industry ~~built~~ in ~~reliance~~sustaining oneconomic ~~national natural or cultural resources. For those scenic spots artificially built by commercial investment without relying on national natural or cultural resources~~development, ~~market-oriented~~enlarging ~~price~~domestic ~~is applicable.~~demand ~~The~~and ~~adjustment~~altering ~~of ticket price subject to government-guided or~~ the ~~government-set~~economic ~~prices~~structural. isOpinion ~~required~~stipulated togeneral ~~complete hearing procedure~~principle, ~~extensive~~ ~~discussion~~goal ~~and~~for ~~improve~~development, ~~the~~reform ~~transparency~~tourism ofindustry ~~decision~~in ~~making. The ticket price~~depth, improvement ~~the scope and extent~~ of ~~preferential~~consumer ~~policies of tickets~~service, ~~transportation~~civilization ~~price~~on ~~for trolley~~tourism, ~~sight-seeing~~infrastructural ~~buses,~~of ~~boats~~tourism industry and ~~hot-line~~so ~~shall be prominently displayed~~on.

~~Opinions~~The Company onalso ~~Accelerating~~has ~~the~~to ~~Development~~comply with certain local regulations in respect of scenic spots, such as Fujian Province Administration Measures ~~Tourism~~for ~~Industry~~Natural ~~was~~Reserve issued byon ~~PRC~~June ~~State~~20, ~~Council~~2000, inpursuant ~~December~~to ~~2009~~which ~~(“Opinion”)~~the ~~for~~revocation of natural reserve, and the ~~purpose~~adjustment or change of ~~taking~~nature, ~~advantage~~scope ~~of functions~~and boundary of ~~tourism~~natural ~~industry~~reserve inshall ~~sustaining~~be ~~economic~~approved ~~development,~~by ~~enlarging~~local ~~domestic~~government ~~demand~~which ~~and~~establishes ~~altering~~such ~~the~~natural ~~economic structural.~~reserve; ~~Opinion~~Fujian ~~stipulated~~Forest ~~general~~Regulation ~~principle,~~issued ~~goal~~in ~~for~~2001 ~~development,~~by ~~reform~~local ~~tourism~~congress ~~industry~~indicates inthat ~~depth,~~any ~~improvement~~unit ofor ~~consumer~~person ~~service,~~who uses the forest land shall make ~~civilization~~use onof ~~tourism,~~the ~~infrastructural~~forest land according to planning for protection of ~~tourism~~forest. ~~industry~~Timber ~~and~~cutting sowithout onlicensing shall be banned.

The ~~Company also has to comply with certain~~ ~~local~~price ~~regulations in respect~~ of ~~scenic~~the ~~spots,~~tickets ~~such as Fujian Province Administration Measures~~ for ~~Natural~~our ~~Reserve~~Scenic ~~issued~~Spots onis ~~June 20,~~approved ~~2000,~~by ~~pursuant~~The toOffice ~~which the revocation~~ of ~~natural~~Price ~~reserve,~~Administration. ~~and~~The ~~the~~Company ~~adjustment~~conducts orits ~~change of nature, scope and boundary of natural~~business ~~reserve~~in ~~shall~~compliance bein ~~approved~~all bymaterial ~~local~~respects ~~government~~with ~~which~~all ~~establishes~~applicable ~~such~~laws ~~natural~~regarding ~~reserve;~~scenic ~~Fujian~~spots ~~Forest Regulation issued~~ in ~~2001~~material ~~by local congress indicates that any unit or person who uses the forest land shall make use of the forest land according to planning for protection of forest~~respects. ~~Timber cutting without licensing shall be banned.~~

The price of the tickets for our Scenic Spots is approved by The Office of Price Administration. The Company conducts its business in compliance in all material respects with all applicable laws regarding scenic spots in material respects.11

11Regulations Applicable to Foreign Invested Enterprises and Wholly Foreign Owned Enterprises

~~Regulations~~Foreign invested ~~Applicable~~enterprises include sino-foreign joint venture and the wholly foreign owned enterprise. The Company currently does not have any sino-foreign joint venture subsidiaries. The Company’s indirect subsidiaries owned by Hong Kong Yi Tat shall be subject to Foreign-Owned ~~Invested Enterprises~~Enterprise Law of the People's Republic China and ~~Wholly~~its ~~Foreign~~implemental rules. According to Foreign-Owned ~~Enterprises~~Enterprise Law, the establishment of wholly foreign-owned enterprises shall be examined and approved by the State Council department in charge of foreign economic relations and trade or an organization authorized by the State Council, which usually refer to Ministry of Commerce and its local counterpart. In addition, the foreign investors shall file application with Administration for Industry and Commerce within 30 days for the procurement of business license. All indirect subsidiaries of the Company owned by Hong Kong Yi Tat, such as Yida (Fujian), Yida Tulou, Jintai Tourism were incorporated with the approval of local counterpart of Ministry of Commerce and has obtained business license under the PRC laws.

Foreign invested enterprises include sino-foreign joint venture and the wholly foreign owned enterprise. The Company currently does not have any sino-foreign joint venture subsidiaries. The Company’s indirect subsidiaries owned by Hong Kong Yi Tat shall be subject to Foreign-Owned Enterprise Law of the People's Republic China and its implemental rules. According to Foreign-Owned Enterprise Law, the establishment of wholly foreign-owned enterprises shall be examined and approved by the State Council department in charge of foreign economic relations and trade or an organization authorized by the State Council, which usually refer to Ministry of Commerce and its local counterpart. In addition, the foreign investors shall file application with Administration for Industry and Commerce within 30 days for the procurement of business license. All indirect subsidiaries of the Company owned by Hong Kong Yi Tat, such as Yida (Fujian), Yida Tulou, Jintai Tourism were incorporated with the approval of local counterpart of Ministry of Commerce and has obtained business license under the PRC laws.Employees

~~Employees~~As of March 2016, we have a total of 635 full-time employees, including 20 executive officers and senior management.

~~As of March 2015, we have a total of 656 full-time employees, including 22 executive officers and senior management.~~12

12ITEM 1A. RISK FACTORS.

~~ITEM~~Because of ~~1A.~~the ~~RISK~~following ~~FACTORS~~factors, as well as other factors affecting the Company’s financial condition and operating results, past financial performance should not be considered to be a reliable indicator of future performance, and investors should not use historical trends to anticipate results or trends in future periods.

~~Because of the following factors, as well~~Risks asRelating ~~other factors affecting the Company’s financial condition and operating results, past financial performance should not be considered~~ to beOur ~~a reliable indicator of future performance, and investors should not use historical trends to anticipate results or trends in future periods.~~Business

~~Risks~~The substantial ~~Relating~~and continuing net losses, and significant on-going working capital deficit incurred in the past few years, may require us to ~~Our~~change ~~Business~~our business plan or even may cause us not to be able to continue our operations if sufficient funding and/or additional cash from revenues is not realized. These matters raised substantial doubt about the Company’s ability to continue as a going concern.

~~The~~We ~~substantial~~have ~~and~~incurred ~~continuing~~ net losses, of $20,152,787 and ~~significant~~$ ~~on-going~~33,665,449 ~~working~~for ~~capital~~the ~~deficit~~years ~~incurred~~ended inDecember ~~the~~31, ~~past~~2015 ~~few~~and ~~years~~2014, ~~may~~respectively. ~~require~~As usof toDecember ~~change~~31, ~~our business~~2015 ~~plan~~and or2014, ~~even~~our ~~may~~working ~~cause~~capital deficits uswere ~~not~~$1.75 tomillion beand ~~able~~$35.89 tomillion, ~~continue~~respectively. ~~our~~Our ~~operations~~independent ifauditors ~~sufficient~~have ~~funding~~indicated ~~and/or~~in ~~additional~~its ~~cash from~~audit ~~revenues~~report isfor fiscal ~~not~~year ~~realized.~~2015 ~~These~~that these matters raised substantial doubt about ~~the~~our ~~Company’s~~ ability to continue as a going concern.

We have incurred significant negative cash flows from operative activities, and continuing net losses and working capital deficits ofthat ~~$29,281,114~~allow ~~and~~us ~~$16,354,397~~to ~~for~~continue ~~the~~as ~~years~~a ~~ended~~going ~~December~~concern. ~~31,~~Our ~~2014~~ability ~~and~~to ~~2013,~~continue ~~respectively~~as a going concern is dependent on us obtaining adequate capital resources to fund operating losses until we become profitable. AsManagement’s ofplans ~~December~~to ~~31,~~obtain ~~2014~~additional ~~and~~capital resources ~~2013,~~include ~~our~~(1) ~~working~~obtaining capital ~~deficits~~from ~~were~~the ~~$35.89~~sale ~~million~~of its substantial assets, (2) generating and ~~$43.04~~recovery ~~million~~of tourism revenue, ~~respectively~~and (3) short-term and long-term borrowings from banks, stockholders or other related party(ies) when needed. ~~Our~~However, ~~independent~~management ~~auditors~~cannot ~~have~~provide ~~indicated~~any assurance that we will be successful in accomplishing any of its ~~audit~~plans. ~~report~~If ~~for~~we ~~fiscal~~are ~~year~~unable ~~2014~~to ~~that~~secure ~~these~~additional ~~matters~~capital, as ~~raised~~circumstances ~~substantial~~require, ~~doubt~~or ~~about~~do not succeed in meeting our ~~ability~~profit objectives we may be required to ~~continue~~ aschange aor ~~going~~cease ~~concern~~our operations.

We ~~have incurred significant negative cash~~ ~~flows~~may ~~from~~not ~~operative~~be ~~activities,~~able ~~and continuing net losses and working capital deficits that allow us~~ to ~~continue~~execute asour abusiness ~~going~~plan ~~concern. Our~~for ability to continue as a going concern is dependent on us obtaining adequate capital resources to fund operating losses until we become profitable. Management’s plans to obtain additional capital resources include (1) obtaining capital from the ~~sale of its substantial assets, (2) generating and recovery of~~ tourism revenue, and (3) short-term and long-term borrowings from banks, stockholders or other related party(ies) when needed. However, management cannot provide any assurance that we will be successful in accomplishing any of its plans. If we are unable to secure additional capital, as circumstances require, or do not succeed in meeting our profit objectives we may be required to change or cease our operations.

In 2013, we discontinued the advertisement operations as we lost a significant number of our clients due to changes in certain PRC regulations. We may ~~not~~make changes to our tourism business in case of competition and regulatory environment changes. We may not be able to ~~execute~~adjust our business strategy in response to fluctuation in microeconomic condition and regulatory environment which ~~plan~~may ~~for~~lead ~~the~~to ~~tourism~~deviation ~~operations.~~or abandonment of our business plan.

In ~~2013, we discontinued the advertisement~~ ~~operations~~order asto weincrease ~~lost a significant number of~~ our ~~clients~~revenues, ~~due~~we tobelieve ~~changes~~we inmust ~~certain~~further ~~PRC~~expand ~~regulations. We may make changes to~~ our ~~tourism~~ business ~~in case of competition and regulatory environment changes~~operations. We ~~may~~cannot ~~not~~assure beyou ~~able~~that ~~to adjust~~ our ~~business~~internal growth strategy in ~~response~~will tobe ~~fluctuation~~successful inwhich ~~microeconomic~~may ~~condition~~result ~~and~~in ~~regulatory~~a ~~environment~~negative ~~which~~impact ~~may~~on ~~lead~~our togrowth, ~~deviation~~financial orcondition, ~~abandonment~~results of operations ~~our~~and ~~business~~cash ~~plan~~flow.

In order to ~~increase~~maximize the potential growth in our ~~revenues~~current and potential markets, we believe that we must further expand the scope of our ~~business~~services ~~operations~~in the tourism industry. One of our strategies is to grow internally through increasing the customers and locations where we promote tourism by penetrating existing markets in the PRC and entering new geographic markets in PRC as well as other parts of Asia and globally. However, many obstacles to this expansion exist, including, but not limited to, increased competition from similar businesses, international trade and tariff barriers, unexpected costs, costs associated with marketing efforts abroad and maintaining attractive foreign exchange ratios. We cannot, therefore, assure you that ~~our~~we ~~internal~~will ~~growth~~be ~~strategy~~able ~~will~~to besuccessfully ~~successful~~overcome ~~which~~such ~~may~~obstacles ~~result~~and establish our services in any additional markets. Our inability to implement this internal growth strategy successfully may have a negative impact on our growth, future financial condition, results of operations ~~and~~or cash ~~flow~~flows.

In addition ~~order~~ to ~~maximize~~our ~~the~~internal ~~potential~~ growth ~~in our current and potential markets~~strategy, we ~~believe~~may ~~that we must further expand the scope of our services in the tourism industry. One of our strategies is to~~ grow ~~internally~~ through ~~increasing~~strategic ~~the customers and locations where we promote tourism by penetrating existing markets in the PRC and entering new geographic markets in PRC as well as other parts of Asia and globally~~acquisitions. However, many obstacles to this expansion exist, including, but not limited to, increased competition from similar businesses, international trade and tariff barriers, unexpected costs, costs associated with marketing efforts abroad and maintaining attractive foreign exchange ratios. We cannot, ~~therefore,~~ assure you that ~~we will be able to successfully overcome such obstacles and establish~~ our ~~services~~ ~~in any additional markets. Our inability to implement this internal~~ acquisition growth strategy ~~successfully~~will ~~may~~be ~~have~~successful aresulting ~~negative~~in ~~impact on~~ our ~~growth,~~failure ~~future~~to ~~financial~~meet ~~condition,~~growth ~~results~~and ofrevenue ~~operations or cash flows~~expectations.

InWe also ~~addition~~intend to ~~our~~pursue ~~internal~~opportunities ~~growth~~to ~~strategy,~~acquire businesses in the PRC that are complementary or related in product lines and business structure to us. However, we may ~~grow~~not ~~through~~be ~~strategic~~able to locate suitable acquisition candidates at prices that we consider appropriate or to finance acquisitions on terms that are satisfactory to us. WeIf ~~cannot~~we ~~assure~~do ~~you~~identify ~~that~~an ~~our~~appropriate acquisition ~~growth~~candidate, ~~strategy~~we ~~will~~may not be ~~successful~~able ~~resulting~~to negotiate successfully the terms of an acquisition, or, if the acquisition occurs, integrate the acquired business into our existing business. Acquisitions of businesses or other material operations may require debt financing or additional equity financing, resulting in leverage or dilution of ownership. We may not be able to secure such financing if we want to expand into other propects. Integration of acquired business operations could disrupt our ~~failure~~business by diverting management away from day-to-day operations. ~~meet~~The ~~growth~~difficulties of integration may be increased by the necessity of coordinating geographically dispersed organizations, integrating personnel with disparate business backgrounds and ~~revenue~~combining ~~expectations~~different corporate cultures.

We also ~~intend~~may tonot ~~pursue~~be ~~opportunities~~able to ~~acquire businesses~~maintain inkey ~~the~~employees ~~PRC~~or ~~that~~customers ~~are~~of ~~complementary~~an oracquired ~~related~~business inor ~~product~~realize ~~lines~~cost ~~and~~efficiencies ~~business~~or ~~structure~~synergies or toother ~~us.~~benefits ~~However,~~ we ~~may~~anticipated ~~not~~when beselecting ~~able to~~our ~~locate suitable~~ acquisition candidates. atIn ~~prices~~addition, ~~that~~ we ~~consider~~may ~~appropriate~~need or to ~~finance~~record ~~acquisitions~~write-downs onfrom future ~~terms~~impairments ~~that~~of ~~are~~intangible ~~satisfactory to~~assets, ~~us.~~which Ifcould wereduce doour ~~identify~~future anreported ~~appropriate~~earnings. ~~acquisition~~At ~~candidate~~times, weacquisition candidates may have ~~not~~liabilities beor ~~able~~adverse tooperating ~~negotiate~~issues ~~successfully~~that ~~the~~we ~~terms~~fail ofto andiscover ~~acquisition, or,~~through ifdue diligence prior to the acquisition. ~~occurs,~~In ~~integrate~~addition to the ~~acquired~~above, ~~business~~acquisitions ~~into~~in ~~our~~PRC, ~~existing~~including ~~business.~~state ~~Acquisitions~~owned of businesses, orwill ~~other material~~be ~~operations~~required ~~may~~to ~~require~~comply ~~debt~~with ~~financing~~laws orof ~~additional~~the ~~equity financing~~PRC, ~~resulting~~to inthe ~~leverage or dilution of ownership.~~extent Weapplicable. ~~may~~There ~~not~~can be ~~able~~no toassurance ~~secure~~that ~~such~~any ~~financing~~given ifproposed weacquisition ~~want~~will tobe ~~expand~~able ~~into~~to ~~other~~comply ~~propects.~~with ~~Integration~~PRC ofrequirements, ~~acquired business operations~~rules ~~could~~and/or ~~disrupt~~regulations, ~~our~~or ~~business~~that bywe ~~diverting~~will ~~management~~successfully ~~away~~obtain ~~from~~governmental ~~day-to-day~~approvals ~~operations.~~which ~~The~~are ~~difficulties~~necessary ofto ~~integration~~consummate ~~may~~such ~~be increased~~acquisitions, byto the ~~necessity~~extent ofrequired. ~~coordinating~~If ~~geographically~~our ~~dispersed~~acquisition ~~organizations~~strategy is unsuccessful, ~~integrating~~we ~~personnel~~will ~~with~~not ~~disparate~~grow ~~business~~our ~~backgrounds~~ operations and ~~combining~~revenues ~~different~~at ~~corporate~~the ~~cultures~~rate that we anticipate.

We also may not be able to maintain key employees or customers of an acquired business or realize cost efficiencies or synergies or other benefits we anticipated when selecting our acquisition candidates. In addition, we may need to record write-downs from future impairments of intangible assets, which could reduce our future reported earnings. At times, acquisition candidates may have liabilities or adverse operating issues that we fail to discover through due diligence prior to the acquisition. In addition to the above, acquisitions in PRC, including state owned businesses, will be required to comply with laws of the PRC, to the extent applicable. There can be no assurance that any given proposed acquisition will be able to comply with PRC requirements, rules and/or regulations, or that we will successfully obtain governmental approvals which are necessary to consummate such acquisitions, to the extent required. If our acquisition strategy is unsuccessful, we will not grow our operations and revenues at the rate that we anticipate.13

In the event of rapid growth of our business operations, we may experience a significant strain on our management and operational infrastructure. Our failure to manage growth will cause a disruption of our operations resulting in the failure to generate revenue.

If we expand our business through successful implementation of our internal growth strategy and/or acquisition strategy, our management and our operational, accounting, and information infrastructure may experience a significant strain caused by such expansion. In order to deal with the strain our anticipated business expansion could put on our resources, we will need to continue to improve our financial controls, operating procedures, and management information systems. We will also need to effectively train, motivate, and manage our employees. Our failure to manage our growth could disrupt our operations and ultimately prevent us from generating the revenues we expect.

13If we are not able to implement our strategies or expand our tourism operations and acquire additional tourist attractions, our business operations and financial performance may be adversely affected.

IfWe expanded our business in 2010 by acquiring the operation rights of additional tourist attractions under various agreements, including the City of Caves, Yang-sheng Paradise, Ming Dynasty Entertainment World and FETV. Since 2008, we ~~are~~have ~~not~~entered ~~able~~various toagreements for ~~implement~~Yongtai ~~our~~Beixi ~~strategies~~and Jiezhukou Lake, Hua’an Tulou, and Yang-sheng Paradise. Our continuous business development plan is orbased ~~expand~~on a further expansion of our tourism ~~operations~~operation and ~~acquire~~acquisition of additional tourist attractions. There is inherent risks and uncertainties involved throughout these stages of development. There is no assurance that we will be successful in continuously expanding our media operations or acquiring additional tourist attractions, or that our strategies, even if implemented, will lead to the successful achievement of our objectives. If we are not able to successfully implement these further development strategies, our business operations and financial performance may be adversely affected.

~~We expanded our business in 2010 by acquiring~~Tourism the operation rights of additional tourist attractions under various agreements, including the City of Caves, Yang-sheng Paradise, Ming Dynasty Entertainment World and FETV. Since 2008, we have entered various agreements for Yongtai Beixi and Jiezhukou Lake, Hua’an Tulou, and Yang-sheng Paradise. Our continuous business development plan is ~~based on~~ a ~~further~~competitive ~~expansion~~business ofwhich ~~our tourism~~could ~~operation~~adversely ~~and~~affect acquisition of additional tourist attractions. There is inherent risks and uncertainties involved throughout these stages of development. There is no assurance that we will be successful in continuously expanding our media operations or acquiring additional tourist attractions, or that our strategies, even if implemented, will lead to the successful achievement of our objectives. If we are not able to successfully implement these further development strategies, our business operations and financial performance ~~may be adversely affected~~.

~~Tourism is~~We operate in a competitive ~~business~~environment ~~which~~and ~~could~~have ~~adversely~~to ~~affect~~compete with other tourist destinations in order to attract visitors. In order to be successful in attracting visitors or customers we may be forced to lower prices or spend more money on advertising to continue to compete with our ~~financial~~competitors. ~~performance~~These competitive measures may result in lower net income.

~~We operate in a competitive environment and~~Economic ~~have~~crisis ~~to compete with other tourist destinations in order to attract visitors. In order to be successful in attracting visitors~~ or ~~customers~~turmoil, ~~we may be forced to lower prices~~ or ~~spend~~suppression ~~more money~~ on ~~advertising~~individual torights ~~continue~~may tocause ~~compete with~~a ~~our~~downturn ~~competitors. These competitive measures may result~~ in ~~lower~~china’s ~~net~~tourism ~~income~~industry.

~~Economic~~A downturn ~~crisis~~in the world economic markets, or ~~turmoil~~just the Chinese economy, may have a negative impact on our business. Consumers with a lack of disposable incomes may decide not to vacation or travel to our tourism destinations, which would negatively impact our business. Additionally, the perceived suppression onof individual rights by the Chinese government may deter tourists from visiting China, which may cause a ~~downturn~~decline in ~~china’s~~visitors ~~tourism~~to ~~industry~~our attraction.

~~A downturn in the world economic markets, or~~Our ~~just~~business ~~the Chinese economy,~~ may ~~have~~be adirectly ~~negative~~and ~~impact~~indirectly onaffected ~~our~~by ~~business.~~unfavorable ~~Consumers~~weather ~~with~~conditions ~~a lack of disposable incomes may decide not to vacation~~ or ~~travel~~natural todisasters ~~our~~that ~~tourism~~reduce ~~destinations, which would negatively impact our business. Additionally,~~ the ~~perceived suppression~~visits of ~~individual~~our ~~rights~~resorts byand ~~the Chinese government may deter tourists from visiting China, which may cause a decline in visitors to our attraction.~~destinations

~~Our~~Poor or ~~business~~unusual ~~may~~weather beconditions, ~~directly~~can significantly affect the visits of the tourists to our resorts and ~~indirectly~~destinations. Insufficient ~~affected~~levels byof ~~unfavorable~~rain ~~weather~~or ~~conditions~~drought orcan ~~natural~~cause ~~disasters~~significant ~~that~~affect to our tourist destination. Temperatures outside normal ranges can also reduce tourists’ volume. Natural calamities such as regional floods, hurricanes, earthquakes, tsunamis, or other storms, and droughts can have significant negative effects on our tourism business. In the ~~visits~~second half of 2010, we had to close part of our ~~resorts~~tourist ~~and~~destination ~~destinations~~in Great Golden Lake due to flooding, as a result we had reduced revenue.

~~Poor or unusual weather conditions, can significantly~~The ~~affect~~slow ~~the~~recovery ~~visits~~ of the ~~tourists~~global toeconomic ~~our~~crisis ~~resorts~~could ~~and destinations. Insufficient levels of rain or drought can cause significant~~ affect tothe ~~our~~overall ~~tourist~~availability ~~destination. Temperatures outside normal ranges can also reduce tourists’ volume. Natural calamities such as regional floods, hurricanes, earthquakes, tsunamis, or other storms,~~ and ~~droughts~~cost ~~can have significant negative effects on our tourism business. In the second half~~ of ~~2010,~~external wefinancing ~~had~~for ~~to close part of~~ our ~~tourist destination in Great Golden Lake due to flooding, as a result we had reduced revenue~~operations.

The slow recovery of the global financial markets from the global economic crisis ~~could~~and ~~affect~~turmoil may adversely impact our business, the business ~~overall~~and ~~availability~~financial condition of our customers and ~~cost~~the business of ~~external~~potential investors from whom we expect to generate our potential sources of capital financing. ~~for~~Presently it is unclear to what extent the economic stimulus measures and other actions taken or contemplated by the Chinese governments and other governments throughout the world will mitigate the effects of the negative impact caused by the economic turmoil on our industry and other industries that affect our business. Although these conditions have not presently impaired our ability to access credit markets and finance our operations, the impact of the current crisis on our ability to obtain capital financing in the future, and the cost and terms of same, is unclear.

~~The~~We have ~~slow~~not ~~recovery~~yet ofcontracted ~~the~~with ~~global~~local ~~financial~~governments ~~markets from the global economic crisis~~ and ~~turmoil~~ may ~~adversely~~be ~~impact~~unable ~~our~~to ~~business,~~continue ~~the business and financial condition of~~ our ~~customers and~~land ~~the~~use ~~business~~rights ~~of potential investors~~ from ~~whom~~the wegovernment ~~expect~~for ~~to generate~~ our ~~potential sources of capital financing. Presently it~~tourism isdevelopment ~~unclear~~as towe ~~what~~currently ~~extent~~do ~~the~~which ~~economic~~could ~~stimulus~~negatively ~~measures and other actions taken or contemplated by the Chinese governments and other governments throughout the world will mitigate the effects of the negative~~ impact ~~caused by the economic turmoil on~~ our ~~industry and other industries that affect our business. Although these conditions have not presently impaired our~~ ability to ~~access~~continue ~~credit markets~~to ~~and~~operate ~~finance~~ our ~~operations,~~tourist ~~the impact of the current crisis on our ability to obtain capital financing in the future, and the cost and terms of same, is unclear.~~destinations

Our business and our revenue depend on the operation of our tourist destinations, which in turn depends on our ability to acquire and continue to use land the land from the PRC government whether by lease or by land use right. We have obtained certain land use rights for Yunding Park, Yang-sheng Paradise, Ming Dynasty Entertainment World, and City of Caves. We currently have operated 3 tourist destinations: (i) Great Golden Lake, (ii) Yunding Park, and (iii) Hua’an Tulou. For the 3 operating tourist destinations, with the exception of the Yunding Park, we have not yet ~~contracted~~entered into contracts with local governments for the land-use rights for Great Golden Lake and ~~may~~Hua’an beTulou. ~~unable~~With respect to ~~continue~~the Yunding Park, our land use rights ~~from~~include ~~the~~130,513 ~~government~~square meters for ~~our~~scenic ~~tourism~~views, ~~development~~hotels and restaurant and entertainment. The term is for 40 years beginning on August 9, 2010 and ending on August 9, 2050 for a total payment of 12,805,000RMB (or approximately $2,033,000). A copy of the State-Owned Land Use Rights Agreement is attached hereto as Exhibit 10.26. With respect to the Great Golden Lake and Tulou, we ~~currently~~have doobtained the management and operating ~~which~~rights ~~could~~on ~~negatively~~the ~~impact~~land, ~~our~~although ~~ability~~we have not obtained the land-use rights. It is not required to ~~continue~~obtain the land-use rights in order to operate ~~our~~on ~~tourist~~the ~~destinations~~land. The Company’s 3 new projects, Ming Dynasty Entertainment World, Yang-sheng Paradise and City of Caves are currently under construction. We have already obtained certain land use rights for these 3 new projects, and the Company will continue to obtain additional land-use rights under the agreements entered into with local governments for all of our properties.

Our business and our revenue depend on the operation of our tourist destinations, which in turn depends on our ability to acquire and continue to use land the land from the PRC government whether by lease or by land use right. We have obtained certain land use rights for Yunding Park, Yang-sheng Paradise, Ming Dynasty Entertainment World, and City of Caves. We currently have operated 3 tourist destinations: (i) Great Golden Lake, (ii) Yunding Park, and (iii) Hua’an Tulou. For the 3 operating tourist destinations, with the exception of the Yunding Park, we have not yet entered into contracts with local governments for the land-use rights for Great Golden Lake and Hua’an Tulou. With respect to the Yunding Park, our land use rights include 130,513 square meters for scenic views, hotels and restaurant and entertainment. The term is for 40 years beginning on August 9, 2010 and ending on August 9, 2050 for a total payment of 12,805,000RMB (or approximately $2,033,000). A copy of the State-Owned Land Use Rights Agreement is attached hereto as Exhibit 10.26. With respect to the Great Golden Lake and Tulou, we have obtained the management and operating rights on the land, although we have not obtained the land-use rights. It is not required to obtain the land-use rights in order to operate on the land. The Company’s 3 new projects, Ming Dynasty Entertainment World, Yang-sheng Paradise and City of Caves are currently under construction. We have already obtained certain land use rights for these 3 new projects, and the Company will continue to obtain additional land-use rights under the agreements entered into with local governments for all of our properties.14

Pursuant to PRC laws, the assignment of land-use rights is the responsibility of local government. The size, location, purpose of usage, term and other conditions under assignment of land use right shall be planned by local land administration departments in conjunction with a number of governmental administrative departments such as urban planning, construction and the housing administration. In addition, such plan shall be submitted to the proper authorities for approval according to authorizations granted and stipulated by PRC State Council. After that, the local land administration departments may implement the arrangements for the assignment of land use right. If, however, at any time the local governments seek to terminate our land-use rights, we may be unable to operate our tourist destinations and will be forced to close down our attractions.

14The maximum term of land use right usually is decided by its purpose of usage, e.g. 70 years term of land for residence, 50 years term of land for industrial use, 40 years term of land for commerce, tourism and recreation, 50 years term of land for comprehensive purpose. Such term commonly will be decided by the government.

The process ~~maximum~~for ~~term~~obtaining ofthe land -use right ~~usually~~ is ~~decided~~lengthy byand ~~its~~we ~~purpose~~have not completed it for any of ~~usage,~~the ~~e.g.~~locations 70that ~~years~~we ~~term~~operate ofexcept for the land ~~for~~use ~~residence,~~rights 50that ~~years~~we ~~term~~obtained from Yongtai County Municipal Bureau of ~~land~~Land ~~for~~and ~~industrial~~Resources. ~~use,~~Our 40agreements ~~years~~with the local ~~term~~PRC ofgovernments who have not yet granted us land-use ~~for~~rights ~~commerce,~~does ~~tourism~~not ~~and~~set ~~recreation,~~forth 50all ~~years~~details ~~term~~for assignment of land ~~for~~use ~~comprehensive~~right ~~purpose.~~and most ~~Such~~of ~~term~~the ~~commonly~~lands ~~will~~are ~~be decided~~subject byto ~~the~~governmental ~~government~~internal procedure.

~~The~~Although we ~~process~~believe ~~for~~that ~~obtaining~~ the ~~land-use~~local ~~right is~~PRC ~~lengthy~~government ~~and~~will ~~we have~~ not ~~completed~~terminate itour ~~for~~right ~~any~~to ofmanage the ~~locations~~land ~~that~~before we ~~operate~~are ~~except~~able ~~for~~to ~~the~~obtain land -use agreements ~~rights~~with ~~that~~each property, we ~~obtained from~~cannot ~~Yongtai~~assure ~~County~~you ~~Municipal~~that ~~Bureau~~the oflocal ~~Land~~government ~~and~~will ~~Resources.~~continue ~~Our~~to ~~agreements~~honor the understandings that we have with ~~the~~each local PRC ~~governments~~government. ~~who~~We ~~have~~are not ~~yet~~able ~~granted us~~to own land~~-use~~ ~~rights~~in ~~does~~the ~~not~~PRC, ~~set~~we ~~forth~~can ~~all~~only ~~details~~lease ~~for~~it ~~assignment~~from the PRC government. At the end of ~~land~~any land-use ~~right~~rights ~~and~~agreements ~~most~~with oflocal PRC governments, the ~~lands~~land ~~are~~will ~~subject~~return to ~~governmental~~the government and we will not receive ~~internal~~any ~~procedure~~reimbursement or reward.

~~Although we believe that the local PRC government~~If ~~will not terminate our right to manage the land before~~ we are ~~able~~unsuccessful toin ~~obtain~~obtaining land-use ~~agreements~~rights ~~with~~for each property, weit ~~cannot assure~~is ~~you~~possible that the local PRC government ~~will~~may ~~continue~~require us to ~~honor~~leave the ~~understandings~~property ~~that~~and we ~~have~~would ~~with~~lose ~~each~~all ~~local~~rights ~~PRC government. We are not able~~ to ~~own land in~~ the ~~PRC~~construction, webuildings ~~can~~and ~~only~~improvements ~~lease~~we ithave ~~from~~made on the ~~PRC government~~land. AtHowever, not ~~the~~having ~~end of any~~ land-use rights ~~agreements with~~does ~~local~~not ~~PRC~~prohibit ~~governments,~~us ~~the~~from ~~land~~operating ~~will~~our ~~return~~tourism todestinations ~~the~~at ~~government~~those ~~and~~locations. weWe ~~will~~can ~~not~~still ~~receive~~obtain the ~~any~~right ~~reimbursement~~to ormanage ~~reward~~and operate on the land.

~~If we are unsuccessful in obtaining land-use~~We ~~rights for each property, it is possible that the local PRC government~~ may ~~require~~not usbe able to ~~leave~~continually ~~the~~manage ~~property~~ and weoperate ~~would~~our ~~lose~~tourism ~~all rights~~development ~~to the construction, buildings~~ and ~~improvements we have made on~~ the ~~land.~~termination ~~However,~~of ~~not~~revenue ~~having~~sharing ~~land-use~~agreements ~~rights does not prohibit~~will usnegatively ~~from~~impact ~~operating~~ our ~~tourism~~financial ~~destinations~~conditions ~~at those locations. We can still obtain the right to manage~~ and ~~operate on the land~~revenues.

WeIf the ~~may~~land ~~not~~use beagreements ~~able~~are toterminated, ~~continually~~then ~~manage and~~we ~~operate~~will have to cease our tourism business if we cannot renew the agreements. According to tourism development and revenue sharing agreement in respect to Great Golden Lake Resort, the agreement may be terminated before its expiration in case that (i) the purpose of contract is failed due to the material breach of defaulting party or (ii) the occurrence of force majeure. When any above events for termination occurs, the contractual parties shall terminate agreement through friendly negotiation or by initiating a legal proceeding. The termination of revenue sharing agreements will negatively impact our ~~financial conditions~~revenues and ~~revenues~~results of operations. We rely on ticket sales to pay off the loans on the property.

~~If the land use agreements are terminated,~~We ~~then~~depend weon ~~will have to cease~~ our ~~tourism~~key ~~business~~management ifpersonnel ~~we cannot renew the agreements. According to tourism development~~ and ~~revenue sharing agreement in respect to Great Golden Lake Resort,~~ the ~~agreement~~loss ~~may be terminated before its expiration in case that (i) the purpose~~ of ~~contract~~their isservices ~~failed~~could ~~due~~adversely toaffect the material breach of defaulting party or (ii) the occurrence of force majeure. When any above events for termination occurs, the contractual parties shall terminate agreement through friendly negotiation or by initiating a legal proceeding. The termination of revenue sharing agreements will negatively impact our ~~revenues and results of operations~~business. ~~We rely on ticket sales to pay off the loans on the property.~~

We place ~~depend~~substantial onreliance upon the efforts and abilities of our ~~key~~executive ~~management~~officers, ~~personnel~~Mr. Minhua Chen, our Chairman and ~~the~~Chief Executive Officer and Ms. Yanling Fan, our Vice President of Operations. The loss of ~~their~~ the services of any of our executive officers could have ~~adversely~~a ~~affect~~material adverse effect on our business, operations, revenues or prospects. We do not maintain key man life insurance on the lives of these individuals. We may not be able to attract or retain qualified management on acceptable terms in the future due to the intense competition for qualified personnel in our industry and as a result, our business could be adversely affected.

We place substantial reliance upon the efforts and abilities of our executive officers, Mr. Minhua Chen, our Chairman and Chief Executive Officer and Ms. Yanling Fan, our Vice President of Operations. The loss of the services of any of our executive officers could have a material adverse effect on our business, operations, revenues or prospects. We do not maintain key man life insurance on the lives of these individuals. We may not be able to attract or retain qualified management on acceptable terms in the future due to the intense competition for qualified personnel in our industry and as a result, our business could be adversely affected.15

15We require various licenses to operate our business, and the loss of or failure to renew any or all of these licenses could require us to suspend some or all of our operations. Also, the loss or misappropriation of the corporate chops, seals, or other controlling non-tangible assets of our PRC subsidiaries might delay or disrupt our business and adversely affect our revenues.

WeIn accordance ~~require~~with PRC laws and regulations, we are required to maintain various licenses in order to operate our business,. ~~and~~The ~~the~~ loss, suspension, of or failure to renew ~~any~~our orbusiness ~~all of these~~ licenses could require us to temporarily or permanently suspend some or all of our operations. ~~Also,~~ We also keep the ~~loss~~business licenses, corporate seal s, chops or ~~misappropriation~~other controlling nontangible assets under the Company’s Administration Department. Our staff in the Administration Department are responsible to do the document recording and for the use of the corporate ~~chops,~~seals. The corporate seals and licenses can only be used based on management’s written approval. If we lose the business license, orcorporate seal and other ~~controlling~~related ~~non-tangible~~documents, ~~assets~~the ofCompany ~~our~~may ~~PRC~~have ~~subsidiaries~~to file with local government for ~~might~~re-issuance of such documents which could delay or disrupt our ~~business~~operations and adversely affect our revenues and profitability.

~~In accordance with PRC laws and regulations,~~We wemay ~~are~~never ~~required~~pay toany ~~maintain~~dividends ~~various licenses in order~~ to ~~operate~~shareholders ~~our~~and ~~business.~~we ~~The~~are ~~loss,~~a ~~suspension,~~holding orcompany ~~failure~~that tois ~~renew~~dependent ~~our~~on ~~business licenses~~receiving ~~could~~dividends ~~require us to temporarily~~ or ~~permanently suspend some or all of our operations. We also keep the business licenses, corporate seal s, chops or~~ other ~~controlling nontangible assets under the Company’s Administration Department. Our staff~~distributions infrom ~~the~~our ~~Administration~~operating ~~Department~~subsidiaries ~~are responsible to do the document recording~~ and ~~for~~variable ~~the~~interest ~~use~~entities, of ~~the~~which ~~corporate seals. The corporate seals and licenses can only be used based on management’s written approval. If we lose~~ the ~~business~~operating ~~license,~~subsidiaries ~~corporate~~are ~~seal and~~located ~~other~~in ~~related documents,~~ the ~~Company may have to file with local government for re-issuance of such documents which could delay or disrupt our operations and adversely affect our revenues and profitability~~PRC.

We have ~~may~~ never ~~pay~~paid any dividends. Our board of directors does not intend to ~~shareholders~~distribute dividends in the near future. The declaration, payment and weamount ~~are~~of aany ~~holding~~future ~~company~~dividends ~~that~~will isbe ~~dependent~~made onat ~~receiving~~the ~~dividends~~discretion orof the board of directors, and will depend upon, among other ~~distributions~~things, ~~from~~the results of our operations, cash flows and financial condition, operating ~~subsidiaries~~and capital requirements, and other ~~variable~~factors ~~interest~~as ~~entities,~~the board of ~~which~~directors ~~the~~considers ~~operating~~relevant. ~~subsidiaries~~There is no assurance that future dividends will be paid, and, if dividends are ~~located~~paid, inthere is no assurance with respect to the ~~PRC~~amount of any such dividend.

We are ~~have~~a ~~never~~holding ~~paid~~company ~~any~~and ~~dividends.~~our ~~Our~~operating ~~board of~~subsidiaries ~~directors~~and ~~does~~variable ~~not~~interest ~~intend~~entity toare ~~distribute~~entirely ~~dividends~~located and operate in the ~~near~~People’s Republic ~~future~~of China. ~~The~~There ~~declaration,~~are ~~payment~~significant ~~and~~restrictions ~~amount~~on ofdividends ~~any~~and ~~future~~distributions ~~dividends will~~from becompanies ~~made~~located atand ~~the~~operating ~~discretion~~in of the People’s ~~board~~Republic of ~~directors,~~China. ~~and~~Foreign ~~will~~exchange ~~depend~~is ~~upon,~~regulated ~~among~~as ~~other~~well. ~~things,~~The ~~the~~government ~~results~~needs ofto ~~our~~approve ~~operations~~any dividends, payments ~~cash~~or ~~flows~~distributions ~~and~~to ~~financial~~any ~~condition,~~offshore ~~operating~~entity ~~and~~or ~~capital~~company ~~requirements,~~not ~~and~~located ~~other~~in ~~factors as~~ the ~~board~~People’s Republic of ~~directors~~China. ~~considers~~In ~~relevant. There~~the islast notwo ~~assurance~~fiscal years, ~~that~~we ~~future~~have ~~dividends~~not ~~will~~received beany ~~paid~~dividends, ~~and,~~payments ifor ~~dividends~~distributions ~~are~~from ~~paid,~~any ~~there~~subsidiary isor noVIE ~~assurance~~located ~~with~~or ~~respect~~operating toin the People’s ~~amount~~Republic of ~~any such dividend~~China.

We ~~are a holding company and our operating~~ ~~subsidiaries~~do ~~and~~not ~~variable~~carry interest entity are entirely located and operate in the People’s Republic of China. There are significant restrictions on dividends and distributions from companies located and operating in the People’s Republic of China. Foreign exchange is regulated as well. The government needs to approve any ~~dividends,~~business ~~payments~~interruption ~~or distributions to any offshore entity or company not located in the People’s Republic of China. In the last two fiscal years~~insurance, weproduct ~~have~~liability ~~not received any dividends, payments~~ or ~~distributions~~recall ~~from~~insurance ~~any subsidiary~~ or ~~VIE~~third-party ~~located~~liability ~~or operating in the People’s Republic of China~~insurance.

Operation of our business and facilities involves many risks, including natural disasters, labor disturbances, business interruptions, property damage, personal injury and death. We do not carry any business interruption insurance, ~~product~~ or third-party liability insurance for our business to cover claims in respect of personal injury or ~~recall~~property ~~insurance~~or environmental damage arising from accidents on our property or ~~third-party~~relating ~~liability~~to our operations. Therefore, we may not have insurance coverage sufficient to cover all risks associated with our business. As a result, we may be required to pay for financial and other losses, damages and liabilities, including those caused by natural disasters and other events beyond our control, out of our own funds, which could have a material adverse effect on our business, financial condition and results of operations.

~~Operation of our business and facilities involves~~Management ~~many~~exercises ~~risks,~~significant ~~including~~control ~~natural~~over ~~disasters,~~matters ~~labor~~requiring ~~disturbances,~~shareholder ~~business~~approval ~~interruptions,~~which ~~property~~may ~~damage,~~result ~~personal~~in ~~injury~~the ~~and~~delay ~~death. We do not carry any business interruption insurance~~ or ~~third-party~~prevention ~~liability insurance for our business to cover claims in respect~~ of personal injury or property or environmental damage arising from accidents on our property or relating to our operations. Therefore, we may not have insurance coverage sufficient to cover all risks associated with our business. As a ~~result, we may be required~~change toin ~~pay for financial and other losses, damages and liabilities, including those caused by natural disasters and other events beyond~~ our control~~, out of our own funds, which could have a material adverse effect on our business, financial condition and results of operations~~.

~~Management~~Mr. Minhua Chen, our Chairman and Chief Executive Officer, through his common stock ownership, currently has voting power equal to approximately 28.81 % of our voting securities. Ms. Yanling Fan, our Vice President of Operations and the spouse of Mr. Minhua Chen, through her common stock ownership, currently has voting power equal to approximately 28.70 % of our voting securities. Mr. Minhua Chen and Ms. Yanling Fan are married and have combined voting power in our Company equal to approximately 57.51 % of our voting securities. As a result, management through such stock ownership exercises significant control over ~~matters~~all matters requiring shareholder approval, ~~which~~including ~~may~~the ~~result~~election of directors and approval of significant corporate transactions. This concentration of ownership in ~~the~~management ~~delay~~may oralso ~~prevention~~have the effect of delaying or preventing a change in ~~our~~ control of us that may be otherwise viewed as beneficial by shareholders other than management.

~~Mr. Minhua Chen, our Chairman and Chief Executive~~We ~~Officer,~~may ~~through~~incur ~~his~~significant ~~common~~costs ~~stock ownership, currently has voting power equal~~ to ~~approximately~~ensure ~~28.81%~~compliance ofwith ~~our~~United ~~voting~~States ~~securities. Ms.~~corporate ~~Yanling~~governance ~~Fan, our Vice President of Operations~~ and ~~the~~accounting ~~spouse of Mr~~requirements. Minhua Chen, through her common stock ownership, currently has voting power equal to approximately 28.70% of our voting securities. Mr. Minhua Chen and Ms. Yanling Fan are married and have combined voting power in our Company equal to approximately 57.51% of our voting securities. As a result, management through such stock ownership exercises significant control over all matters requiring shareholder approval, including the election of directors and approval of significant corporate transactions. This concentration of ownership in management may also have the effect of delaying or preventing a change in control of us that may be otherwise viewed as beneficial by shareholders other than management.

We may incur significant costs associated with our public company reporting requirements, costs associated with newly applicable corporate governance requirements, including requirements under the Sarbanes-Oxley Act of 2002 and other rules implemented by the Securities and Exchange Commission. We expect all of these applicable rules and regulations to ~~ensure~~significantly increase our legal and financial compliance costs and to make some activities more time consuming and costly. We also expect that these applicable rules and regulations may make it more difficult and more expensive for us to obtain director and officer liability insurance and we may be required to accept reduced policy limits and coverage or incur substantially higher costs to obtain the same or similar coverage. As a result, it may be more difficult for us to attract and retain qualified individuals to serve on our board of directors or as executive officers. We are currently evaluating and monitoring developments with ~~United~~respect to these newly applicable ~~States~~rules, and we cannot predict or estimate the amount of additional costs we may incur or the timing of such costs. Even though we have been a reporting company since 1999, this risk applies to us because we completed a share exchange with Keenway Limited in 2007 whereby a Chinese operating company became our wholly owned subsidiary. This Chinese operating company is newly reporting and we are adjusting to the increased disclosure requirements for us to comply with corporate governance and accounting requirements.

We may incur significant costs associated with our public company reporting requirements, costs associated with newly applicable corporate governance requirements, including requirements under the Sarbanes-Oxley Act of 2002 and other rules implemented by the Securities and Exchange Commission. We expect all of these applicable rules and regulations to significantly increase our legal and financial compliance costs and to make some activities more time consuming and costly. We also expect that these applicable rules and regulations may make it more difficult and more expensive for us to obtain director and officer liability insurance and we may be required to accept reduced policy limits and coverage or incur substantially higher costs to obtain the same or similar coverage. As a result, it may be more difficult for us to attract and retain qualified individuals to serve on our board of directors or as executive officers. We are currently evaluating and monitoring developments with respect to these newly applicable rules, and we cannot predict or estimate the amount of additional costs we may incur or the timing of such costs. Even though we have been a reporting company since 1999, this risk applies to us because we completed a share exchange with Keenway Limited in 2007 whereby a Chinese operating company became our wholly owned subsidiary. This Chinese operating company is newly reporting and we are adjusting to the increased disclosure requirements for us to comply with corporate governance and accounting requirements.16

16In our experience, we expect to incur approximately $157,000 per year in additional costs to ensure compliance with all corporate governance and accounting requirements. These costs consist of: (i) internal control and U.S. GAAP reporting consulting services: $97,000 and (ii) Legal fees: $60,000.

~~In our experience,~~ If we ~~expect~~fail to ~~incur~~maintain ~~approximately $157,000~~an ~~per~~effective ~~year~~system inof ~~additional~~internal ~~costs~~control toover ~~ensure~~financial ~~compliance~~reporting, ~~with~~our ~~all~~ability ~~corporate~~to ~~governance~~accurately and ~~accounting~~timely ~~requirements.~~report our ~~These~~financial ~~costs consist~~results ~~of:~~or ~~(i)~~prevent ~~internal~~fraud ~~control~~may be adversely affected and ~~U.S.~~investor ~~GAAP~~confidence ~~reporting~~and ~~consulting~~the ~~services:~~market ~~$97,000~~price ~~and~~of ~~(ii)~~our ~~Legal~~common ~~fees:~~shares may ~~$60,000~~be adversely impacted.

IfAs directed weby ~~fail~~Section to404 ~~maintain~~of anthe ~~effective~~Sarbanes-Oxley ~~system~~Act of 2002, or SOX 404, the Securities and Exchange Commission adopted rules requiring public companies to include a report of management on the company’s internal ~~control~~controls over financial reporting in their annual reports, including Form 10-K. Our management may conclude that our ~~ability~~internal tocontrols ~~accurately~~over ~~and~~our ~~timely~~financial ~~report~~reporting are not effective. If our management concludes that our internal controls over financial ~~results~~reporting orare ~~prevent~~not ~~fraud may~~effective, beit ~~adversely~~might ~~affected~~result in ~~and~~an ~~investor~~adverse ~~confidence~~reaction ~~and~~in the ~~market~~financial ~~price~~marketplace due to a loss of ~~our~~investor ~~common~~confidence ~~shares~~in ~~may~~the bereliability ~~adversely~~of ~~impacted~~such financial statements.

AsOn May ~~directed~~20, by2010, ~~Section~~BDO ~~404~~Li ofXin ~~the~~Da ~~Sarbanes-Oxley Act~~Hua ofwas ~~2002,~~appointed oras ~~SOX~~our ~~404,~~independent ~~the~~auditors ~~Securities~~but ~~and~~never ~~Exchange~~completed ~~Commission~~any ~~adopted~~interim ~~rules~~review ~~requiring~~of ~~public~~our ~~companies~~financial statements toor ~~include~~issued aany audit report ~~of management~~ on ~~the~~our ~~company’s~~financial ~~internal~~statement ~~controls~~disclosure, ~~over~~or ~~financial~~auditing ~~reporting~~scope inor ~~their~~procedure ~~annual~~and ~~reports,~~subsequently ~~including~~resigned on ~~Form~~August ~~10-K~~8, 2010. ~~Our management~~The ~~may~~reason ~~conclude~~for ~~that~~BDO ~~our~~Li ~~internal~~Xin ~~controls~~Da ~~over~~Hua’s ~~our~~resignation ~~financial~~was ~~reporting~~that ~~are~~they ~~not~~identified ~~effective.~~that Ifthe ~~our~~Company ~~management~~lacked ~~concludes~~a good ~~that~~system ~~our~~of internal controls, ~~over~~such ~~financial~~as ~~reporting~~inadequate ~~are~~documentation ~~not~~for ~~effective,~~certain ittransactions ~~might~~and ~~result~~lack inof ancompetent ~~adverse~~and ~~reaction~~well ~~in the financial~~trained ~~marketplace~~personnel ~~due~~ to afurnish ~~loss~~U.S. ofGAAP ~~investor~~based ~~confidence~~reporting indocuments ~~the~~to ~~reliability~~be ~~of such financial statements~~filed.

OnWe took ~~May~~a ~~20,~~series ~~2010,~~of ~~BDO~~remediation Limeasures ~~Xin~~plan Dato ~~Hua~~to ~~was~~cure ~~appointed as~~the ~~our~~lacks ~~independent auditors but never completed any interim review~~ of ~~our~~internal ~~financial~~controls: ~~statements~~Although orwe ~~issued~~have ~~any~~rectified ~~audit~~the ~~report~~lack onof ~~our~~internal ~~financial~~controls ~~statement~~issue ~~disclosure,~~and orhired ~~auditing~~external ~~scope~~consultant oras ~~procedure~~a ~~and~~measure ~~subsequently~~to ~~resigned~~improve onour ~~August~~internal 8,controls ~~2010.~~and ~~The~~strengthen ~~reason~~our ~~for~~financial ~~BDO~~reporting, Liit ~~Xin~~is Dapossible ~~Hua’s~~that ~~resignation~~our ~~was~~current ~~that~~auditor ~~they~~may ~~identified~~conclude that ~~the~~our ~~Company~~controls ~~lacked~~over afinancial ~~good~~reporting ~~system~~are ofnot ~~internal~~effective ~~controls,~~which ~~such as~~could ~~inadequate~~result ~~documentation~~in ~~for~~an ~~certain~~adverse ~~transactions~~reaction ~~and~~in ~~lack~~the offinancial ~~competent~~marketplace ~~and~~due ~~well~~to ~~trained~~a ~~personnel~~loss toof ~~furnish~~investor ~~U.S.~~confidence ~~GAAP~~in ~~based~~the ~~reporting documents~~reliability toof besuch ~~filed~~financial statements.

~~We took a series of remediation measures plan~~Material toweaknesses toin ~~cure~~our ~~the lacks of~~ internal controls: ~~Although~~and wefinancial ~~have~~reporting ~~rectified~~and ~~the~~our lack of ~~internal~~a ~~controls~~chief ~~issue~~financial ~~and~~officer ~~hired~~with ~~external~~sufficient ~~consultant~~U.S. GAAP asexperience amay ~~measure~~limit ~~to improve~~ our ~~internal~~ability ~~controls~~to ~~and~~prevent ~~strengthen~~or ~~our~~detect financial ~~reporting,~~misstatements itor isomissions. ~~possible~~As ~~that~~a result, our ~~current~~financial ~~auditor may~~reports ~~conclude~~may ~~that~~not ~~our~~be ~~controls~~in ~~over~~compliance ~~financial~~with ~~reporting~~U.S. ~~are~~GAAP. ~~not~~Any ~~effective~~material ~~which~~weakness, ~~could~~misstatement ~~result~~or omission in anour ~~adverse~~financial ~~reaction~~statements inwill ~~the financial~~negatively ~~marketplace~~affect ~~due~~the tomarket aand ~~loss~~the price of ~~investor~~our ~~confidence~~stock inwhich ~~the~~could ~~reliability~~result ofin ~~such~~significant ~~financial~~loss ~~statements~~to our investors.

~~Material~~None of ~~weaknesses~~the inmembers of our ~~internal~~current ~~controls~~management has experience managing and operating a public company, and they rely in many instances on the professional experience and advice of third parties. While we are obligated to hire a qualified chief financial ~~reporting~~officer to ~~and~~enable us to satisfy our ~~lack~~reporting ofobligations as a U.S. public company, we do not have a chief financial officer with ~~sufficient~~any significant U.S. GAAP experience ~~may~~presently. ~~limit~~Although ~~our~~we ~~ability~~are ~~to prevent~~actively orseeking ~~detect~~such a chief financial ~~misstatements~~officer, qualified individuals are often difficult to find, or ~~omissions~~the individual may not have all of the qualifications that we require. AsTherefore, we may, in turn, experience “weakness” and potential problems in implementing and maintaining adequate internal controls as required under Section 404 of the “Sarbanes-Oxley” Act of 2002. This “weakness” also includes a ~~result~~deficiency, or combination of deficiencies, in internal controls over financial reporting, such that there is a reasonable possibility that a material misstatement of our annual or interim financial ~~reports~~statements will not be prevented or detected on a timely basis. If we fail to achieve and maintain the adequacy of our internal controls, as such requirements are modified, supplemented or amended from time to time, we may not be able to ensure that we can conclude on an ongoing basis that we have effective internal controls over financial reporting in ~~compliance~~accordance with ~~U.S.~~Section ~~GAAP~~404 of the Sarbanes-Oxley Act of 2002. Moreover, effective internal controls, ~~Any~~particularly ~~material~~those ~~weakness~~related to revenue recognition, ~~misstatement~~are necessary for us to produce reliable financial reports and are important to help prevent financial fraud. If we cannot provide reliable financial reports or ~~omission~~prevent infraud, our ~~financial~~business ~~statements~~and ~~will~~operating results ~~negatively~~could ~~affect~~be ~~the~~harmed, ~~market~~investors could lose confidence in our reported financial information, and the trading price of our common stock, ~~which~~if ~~could~~a ~~result~~market inever ~~significant~~develops, ~~loss~~could todrop ~~our investors~~significantly.

~~None~~Pursuant to ofSection ~~the~~404 ~~members~~ of ~~our current management has experience managing and operating a public company, and they rely in many instances on~~ the ~~professional~~Sarbanes-Oxley ~~experience and advice of third parties. While we are obligated to hire a qualified chief financial officer to enable us to satisfy our reporting obligations as a U.S. public company~~Act, we ~~do not have a chief financial officer with any significant U.S. GAAP experience presently. Although we~~ are ~~actively~~required ~~seeking such a chief financial officer, qualified individuals are often difficult~~ to ~~find,~~include ~~or the individual may not have all of the qualifications that we require. Therefore, we may,~~ in ~~turn,~~our ~~experience~~annual ~~“weakness”~~reports ~~and~~our ~~potential problems~~assessment ~~in implementing and maintaining adequate internal controls as required under Section 404~~ of the ~~“Sarbanes-Oxley”~~effectiveness ~~Act~~ of ~~2002.~~our ~~This “weakness” also includes a deficiency, or combination of deficiencies, in~~ internal ~~controls~~control over financial reporting, ~~such~~as ~~that~~of ~~there~~the isend ~~a reasonable possibility that a material misstatement~~ of our ~~annual~~fiscal ~~or interim financial statements will not be prevented or detected on a timely basis~~years. IfWe wehave ~~fail~~determined tothat ~~achieve and maintain the adequacy of~~ our internal controls, and asprocedures ~~such requirements~~ are ~~modified, supplemented or amended from time to time, we may~~ not beeffective ~~able~~due to ~~ensure that we can conclude on an ongoing basis that we have effective internal controls over financial reporting in accordance with Section 404 of~~ the ~~Sarbanes-Oxley~~lack ~~Act~~ of ~~2002~~U. ~~Moreover, effective internal controls, particularly those related to revenue recognition, are necessary for us to produce reliable financial reports and are important to help prevent financial fraud~~S. IfGAAP weexperience ~~cannot~~from ~~provide reliable financial reports or prevent fraud,~~ our business and operating results could be harmed, investors could lose confidence in our reported financial information, and the trading price of our common stock, if a market ever develops, could drop significantlymanagement.

Pursuant to Section 404 of the Sarbanes-Oxley Act, we are required to include in our annual reports our assessment of the effectiveness of our internal control over financial reporting as of the end of our fiscal years. We have determined that our internal controls and procedures are not effective due to the lack of U.S. GAAP experience from our management.17

17We may have difficulty raising necessary capital to fund operations as a result of market price volatility for our shares of common stock.

WeIn recent ~~may~~years, ~~have~~the ~~difficulty~~securities ~~raising~~markets ~~necessary capital~~in tothe ~~fund~~United ~~operations~~States ashave experienced a ~~result~~high level of price and volume volatility, and the market price ~~volatility~~of ~~for~~securities of many companies have experienced wide fluctuations that have not necessarily been related to the operations, performances, underlying asset values or prospects of such companies. For these reasons, our shares of common stock can also be expected to be subject to volatility resulting from purely market forces over which we will have no control. If our business development plans are successful, we may require additional financing to continue to develop and exploit existing and new products and services related to our industries and to expand into new markets. The exploitation of our services may, therefore, be dependent upon our ability to obtain financing through debt and equity or other means.

~~In recent years, the securities markets in~~We ~~the United States~~ have ~~experienced~~ a ~~high~~contractual ~~level~~relationship ofwith ~~price~~Fujian ~~and~~Jiaoguang ~~volume~~which ~~volatility,~~may ~~and~~be ~~the~~in ~~market~~non-compliance ~~price~~with ofPRC ~~securities~~laws ofand ~~many~~does ~~companies have experienced wide fluctuations that have~~ not ~~necessarily~~provide ~~been related to~~ the ~~operations, performances, underlying asset values~~same oroperational ~~prospects of such companies. For these reasons, our shares of common stock can also be expected to be subject to volatility resulting from purely market forces over which we will have no~~ control. Ifas ~~our~~a ~~business~~direct development plans are successful, we may require additional financing to continue to develop and exploit existing and new products and services related to our industries and to expand into new markets. The exploitation of our services may, therefore, be dependent upon our ability to obtain financing through debt and equity ~~or other means~~interest.

WeOur contractual ~~have~~relationship with Fujian Jiaoguang was structured as a contractual relationship as opposed to a direct equity interest in order to comply with PRC law. We have received a PRC legal counsel attesting that this structure is in compliance with the ~~Fujian~~PRC ~~Jiaoguang~~law. ~~which~~However, the PRC law may be subject to change or the government may review the structure and determine that this contractual relationship is not in ~~non-~~compliance with PRC laws and force the termination of this relationship. Additionally, the contractual relationship between us and Fujian Jiaoguang does not provide us with the same operational control as a direct equity interest. Therefore, we are subject to the risks associated with contractual rights as opposed to owning the company. Such risks could include breach of contract or failure to honor the terms of the contract. In the event that we are not unable to maintain effective control of this entity, we would not be able to continue to consolidate our financial results. However, these risks are mitigated by the fact that the shareholders of Fujian Jiaoguang are Chairman Minhua Chen and Ms. Yanling Fan who are also our majority shareholders.

~~Our contractual relationship with~~ Fujian ~~Jiaoguang~~ ~~was~~Jiaoguang ~~structured~~has astransferred aall ~~contractual~~its ~~relationship~~operations ~~as opposed~~ to aour ~~direct~~wholly-owned ~~equity~~subsidiaries ~~interest~~and inno ~~order~~longer tocontributes ~~comply~~any ~~with~~revenue ~~PRC~~to ~~law~~us. ~~We have received~~All athe ~~PRC~~revenue ~~legal~~we ~~counsel~~have ~~attesting~~realized ~~that~~from this ~~structure~~entity is innot ~~compliance~~realized ~~with~~directly ~~the~~from ~~PRC~~our ~~law~~wholly-owned subsidiary. ~~However,~~Although ~~the~~Fujian ~~PRC~~Jiaoguang is ~~law~~no ~~may~~longer begenerating ~~subject~~revenues, toit ~~change or~~continues ~~the~~to ~~government~~incur ~~may~~expenses ~~review~~to ~~the~~maintain ~~structure~~its ~~and~~business ~~determine~~status ~~that~~as ~~this~~a ~~contractual~~corporate ~~relationship~~entity. isFujiang Jiaoguang ~~not~~has incurrent ~~compliance~~assets ~~with PRC laws~~ and ~~force~~liabilities ~~the~~because ~~termination~~it ofis ~~this~~acting ~~relationship.~~as ~~Additionally,~~an ~~the~~intercompany ~~contractual~~to ~~relationship~~transfer ~~between~~funds usfrom and ~~Fujian~~to ~~Jiaoguang~~the ~~does~~Company’s ~~not~~directly-owned ~~provide~~subsidiaries, uswhich ~~with~~resulted ~~the~~in ~~same~~part ~~operational~~of ~~control~~the asintercompany areceivables ~~direct~~and ~~equity interest~~payables. ~~Therefore,~~Fujian weJiaoguang ~~are~~is ~~subject~~a ~~to the risks associated~~variable ~~with~~interest ~~contractual~~entity ~~rights~~subject ~~as opposed~~ to ~~owning~~consolidation into the ~~company.~~Company ~~Such~~and ~~risks~~fully ~~could~~controlled ~~include~~by ~~breach~~the ofCompany’s ~~contract~~management. orTherefore, ~~failure~~expenses incurred toat ~~honor~~Fujian ~~the~~Jiaoguang ~~terms of~~had ~~the~~been ~~contract.~~included Inin the ~~event~~Company’s ~~that~~audited weconsolidated ~~are~~statement ~~not~~of ~~unable~~income toand ~~maintain~~comprehensive income. ~~effective~~As ~~control~~a result of ~~this~~Fujian ~~entity,~~Jiaoguang webeing ~~would~~a ~~not~~variable beinterest ~~able~~entity toinstead ~~continue to~~of ~~consolidate~~a ~~our~~directly ~~financial~~owned ~~results. However~~subsidiary, ~~these~~you ~~risks~~may ~~are~~face increased ~~mitigated~~risks byassociated with the ~~fact~~possession, ~~that~~security ~~the~~and ~~shareholders~~control ofover ~~Fujian~~the ~~Jiaoguang are~~chops ~~Chairman~~for ~~Minhua~~this ~~Chen~~entity and ~~Ms.~~control ~~Yanling~~over ~~Fan~~the individuals who ~~are~~may ~~also~~have ~~our~~access ~~majority~~to ~~shareholders~~its bank accounts.

~~Fujian Jiaoguang has transferred all its operations~~Risks toRelating ~~our wholly-owned subsidiaries and no longer contributes any revenue~~ to ~~us. All~~ the revenue we have realized from this entity is not realized directly from our wholly-owned subsidiary. Although Fujian Jiaoguang is no longer generating revenues, it continues to incur expenses to maintain its business status as a corporate entity. Fujiang Jiaoguang has current assets and liabilities because it is acting as an intercompany to transfer funds from and to the Company’People's ~~directly-owned~~Republic ~~subsidiaries, which resulted in part~~ of the intercompany receivables and payables. Fujian Jiaoguang is a variable interest entity subject to consolidation into the Company and fully controlled by the Company’s management. Therefore, expenses incurred at Fujian Jiaoguang had been included in the Company’s audited consolidated statement of income and comprehensive income. As a result of Fujian Jiaoguang being a variable interest entity instead of a directly owned subsidiary, you may face increased risks associated with the possession, security and control over the chops for this entity and control over the individuals who may have access to its bank accounts.China

~~Risks~~Substantially all ~~Relating~~of our operating assets are located in China and substantially all of our revenue will be derived from our operations in china so our business, results of operations and prospects are subject to the ~~People's~~economic, ~~Republic~~political and legal policies, developments and ofconditions ~~China~~in china.

~~Substantially~~The PRC’s ~~all~~economic, ofpolitical and social conditions, as well as government policies, could impair our ~~operating~~business. ~~assets~~The PRC economy ~~are~~differs ~~located~~from the economies of most developed countries in many respects. China’s ~~and~~GDP ~~substantially~~has ~~all~~grown consistently since 1978 (National Bureau of ~~our~~Statistics ~~revenue~~of China). However, we cannot assure you that such growth will be ~~derived~~sustained ~~from~~in ~~our~~the ~~operations~~future. If, in ~~china~~the sofuture, China’s ~~our~~economy ~~business~~experiences a downturn or grows at a slower rate than expected, ~~results~~there may be less demand for spending in ofcertain ~~operations~~industries. ~~and~~A ~~prospects~~decrease ~~are~~in ~~subject~~demand for spending in certain industries could impair our ability to ~~the~~remain profitable. The PRC’s economic growth has been uneven, ~~political~~both geographically and ~~legal~~among ~~policies~~various sectors of the economy. The PRC government has implemented various measures to encourage economic growth and guide the allocation of resources. Some of these measures benefit the overall PRC economy, ~~developments~~but may have a negative effect on us. For example, our financial condition and ~~conditions~~results of operations may be hindered by PRC government control over capital investments or changes in ~~china~~tax regulations.

The PRC’s ~~economic,~~economy ~~political~~has ~~and~~been ~~social conditions,~~transitioning asfrom ~~well~~a asplanned ~~government~~economy ~~policies,~~to ~~could~~a ~~impair~~more ~~our~~market-oriented ~~business~~economy. ~~The~~Although ~~PRC~~in ~~economy~~recent ~~differs~~years ~~from~~ the ~~economies of most developed~~PRC ~~countries~~government inhas ~~many~~implemented ~~respects.~~measures ~~China’s~~emphasizing ~~GDP~~the ~~has~~use ~~grown~~of ~~consistently~~market ~~since~~forces ~~1978~~for ~~(National~~economic ~~Bureau~~reform, ofthe ~~Statistics~~reduction of ~~China).~~state ~~However,~~ownership weof ~~cannot~~productive ~~assure~~assets ~~you~~and ~~that~~the ~~such~~establishment ~~growth~~of ~~will~~sound becorporate ~~sustained~~governance in ~~the~~business ~~future. If~~enterprises, ina ~~the~~substantial ~~future,~~portion ~~China’s~~of ~~economy experiences a downturn~~productive orassets ~~grows~~in atChina ais ~~slower~~still ~~rate~~owned ~~than~~by ~~expected,~~the ~~there~~PRC ~~may be less demand for spending in certain industries~~government. AIn ~~decrease~~addition, inthe ~~demand~~PRC ~~for spending~~government incontinues ~~certain industries could impair our ability~~ to ~~remain~~play ~~profitable.~~a ~~The~~significant ~~PRC’s~~role ~~economic growth has been uneven,~~in ~~both~~regulating ~~geographically~~industry ~~and~~development ~~among~~by ~~various~~imposing ~~sectors~~industrial ~~of the economy~~policies. ~~The~~It ~~PRC~~also ~~government~~exercises ~~has~~significant ~~implemented~~control ~~various~~over ~~measures~~PRC ~~to encourage~~ economic growth through ~~and guide~~ the allocation of resources~~. Some of these measures benefit the overall PRC economy~~, ~~but~~controlling ~~may~~payment ~~have~~of aforeign ~~negative effect~~currency-denominated ~~on us. For example~~obligations, ~~our~~setting ~~financial~~monetary ~~condition~~ policy and ~~results~~providing ofpreferential ~~operations~~treatment ~~may~~to beparticular ~~hindered~~industries ~~by PRC government control over capital investments~~ or ~~changes in tax regulations~~companies.

The PRC economy has been transitioning from a planned economy to a more market-oriented economy. Although in recent years the PRC government has implemented measures emphasizing the use of market forces for economic reform, the reduction of state ownership of productive assets and the establishment of sound corporate governance in business enterprises, a substantial portion of productive assets in China is still owned by the PRC government. In addition, the PRC government continues to play a significant role in regulating industry development by imposing industrial policies. It also exercises significant control over PRC economic growth through the allocation of resources, controlling payment of foreign currency-denominated obligations, setting monetary policy and providing preferential treatment to particular industries or companies.18

18There are significant uncertainties under the Draft Foreign Investment Law relating to the status of businesses in China controlled by foreign invested enterprises primarily through contractual arrangements, such as our business.

~~There~~On ~~are~~January ~~significant~~19, ~~uncertainties~~2015, ~~under~~MOFCOM published a draft of the PRC Law on Foreign Investment (Draft for Comment), or the Draft Foreign Investment Law, which is open for public comments until February 17, 2015. At the same time, MOFCOM published an accompanying explanatory note of the Draft Foreign Investment Law, ~~relating~~or the Explanatory Note, which contains important information about the Draft Foreign Investment Law, including its drafting philosophy and principles, main content, plans to transition to the ~~status~~new legal regime and treatment of ~~businesses~~business in China controlled by foreign invested enterprises, or FIEs, primarily through contractual arrangements,. The ~~such~~Draft FIL utilizes the concept of “actual control” for determining whether an entity is considered to be a foreign-invested asenterprise, ~~our~~and ~~business~~defines “control” broadly to include, among other things, voting or board control through contractual arrangements.

OnThe ~~January~~Draft ~~19,~~Foreign ~~2015,~~Investment ~~MOFCOM~~Law ~~published~~proposes asignificant ~~draft~~changes ofto the PRC ~~Law~~foreign oninvestment ~~Foreign~~legal ~~Investment~~regime ~~(Draft~~and ~~for~~may ~~Comment),~~have a material impact on Chinese companies listed or ~~the~~to be listed overseas. The proposed Draft Foreign Investment Law~~, which~~ is ~~open~~to ~~for~~regulate ~~public~~FIEs ~~comments~~the ~~until~~same ~~February~~way as 17PRC domestic entities, ~~2015~~except for those FIEs that operate in industries deemed to be either “restricted” or “prohibited” in a “Negative List.” AtBecause the ~~same~~Negative ~~time,~~List ~~MOFCOM~~has yet to be published, anit is unclear whether it will differ from ~~accompanying~~the ~~explanatory~~current ~~note~~list of ~~the~~industries subject to restrictions or prohibitions on foreign investment. The Draft Foreign Investment Law, also orprovides ~~the Explanatory~~that ~~Note,~~only ~~which~~FIEs ~~contains~~operating ~~important~~in ~~information~~industries ~~about~~on the ~~Draft~~Negative ~~Foreign Investment~~List ~~Law,~~will ~~including its~~require ~~drafting~~entry ~~philosophy~~clearance and ~~principles,~~other ~~main~~approvals ~~content,~~that are ~~plans~~not torequired ~~transition~~of toPRC ~~the~~domestic ~~new~~entities. ~~legal~~As ~~regime~~a result of the entry clearance and ~~treatment~~approvals, ofcertain ~~business~~FIE’s operating in ~~China~~industries ~~controlled~~on bythe ~~foreign~~Negative ~~invested~~List ~~enterprises,~~may ornot ~~FIEs,~~be ~~primarily~~able to continue to conduct their operations through contractual arrangements. ~~The~~It ~~Draft FIL utilizes the~~states ~~concept~~that ofentities ~~“actual~~established ~~control”~~in ~~for~~China ~~determining~~but ~~whether~~controlled anby ~~entity~~foreign isinvestors ~~considered~~will to be atreated as foreign-invested ~~enterprise~~enterprises, ~~and~~while ~~defines~~entities ~~“control”~~set ~~broadly~~up tooutside ~~include,~~of ~~among~~China ~~other~~which ~~things,~~are ~~voting~~controlled by PRC persons or ~~board~~entities, ~~control~~would ~~through~~be ~~contractual~~treated ~~arrangements.~~as domestic enterprises after completion of market entry procedures.

~~The~~There ~~Draft~~is ~~Foreign~~substantial ~~Investment Law~~uncertainty ~~proposes~~regarding ~~significant changes to~~ the ~~PRC foreign investment legal regime and may have a material impact on Chinese companies listed or to be listed overseas. The proposed~~ Draft Foreign Investment Law, isincluding, toamong ~~regulate FIEs the same way as PRC domestic entities~~others, ~~except~~what ~~for~~the ~~those~~actual ~~FIEs~~content ~~that~~of ~~operate~~the law inwill ~~industries deemed to~~ be ~~either~~as ~~“restricted” or~~well ~~“prohibited”~~as ~~in a “Negative List.” Because~~ the ~~Negative~~adoption ~~List~~and ~~has~~effective ~~yet~~date toof ~~be published, it is unclear whether it will differ from~~ the ~~current~~final ~~list~~form of ~~industries~~the ~~subject~~law. toWhile ~~restrictions~~such oruncertainty ~~prohibitions~~exists, onwe ~~foreign investment. The~~cannot ~~Draft~~assure ~~Foreign~~you ~~Investment Law also provides~~ that ~~only~~the ~~FIEs~~new ~~operating~~foreign ininvestment ~~industries~~law, ~~on the~~when ~~Negative~~it ~~List~~is ~~will~~adopted ~~require entry clearance~~ and ~~other~~becomes ~~approvals~~effective, ~~that~~will ~~are~~ not ~~required~~have ~~of PRC domestic entities. As~~ a ~~result of~~material ~~the entry clearance~~ and ~~approvals,~~adverse effect ~~certain FIE’s operating in industries~~ on ~~the~~our ~~Negative~~ability ~~List may not be able~~ to ~~continue to~~ conduct ~~their~~our ~~operations~~business through our contractual arrangements. It states that entities established in China but controlled by foreign investors will be treated as foreign-invested enterprises, while entities set up outside of China which are controlled by PRC persons or entities, would be treated as domestic enterprises after completion of market entry procedures.

~~There~~If isthe ~~substantial~~ministry ~~uncertainty~~of ~~regarding~~finance ~~the~~and ~~Draft Foreign Investment Law~~commerce, ~~including, among~~or ~~others~~MOFCOM, ~~what~~China ~~the~~Securities ~~actual~~Regulatory ~~content~~Commission, ofor ~~the~~CSRC, ~~law~~or ~~will~~another bePRC asregulatory ~~well~~agency, determines asthat ~~the~~MOFCOM ~~adoption~~ and ~~effective~~CSRC ~~date~~approval of ~~the~~our ~~final~~merger ~~form~~was ofrequired ~~the~~or ~~law. While~~if ~~such~~other ~~uncertainty~~regulatory ~~exists,~~obligations weare ~~cannot~~imposed ~~assure~~upon ~~you that the new foreign investment law~~us, ~~when~~we may itincur ~~is adopted and becomes effective~~sanctions, ~~will~~ ~~not~~penalties ~~have~~or aadditional ~~material~~costs ~~and~~which ~~adverse~~would ~~effect~~damage on our ~~ability to conduct our~~ business ~~through our contractual arrangements~~.

IfOn August ~~the~~8, ~~ministry~~2006, ofsix ~~finance~~PRC regulatory agencies, including the MOFCOM and ~~commerce~~the CSRC, promulgated the Rules on Acquisition of Domestic Enterprises by Foreign Investors, or ~~MOFCOM~~the M&A Rules, ~~China~~regulations ~~Securities~~with ~~Regulatory~~respect ~~Commission~~to the mergers and acquisitions of domestic enterprises by foreign investors that became effective on September 8, or2006. ~~CSRC~~Article 11 of the M&A Rules requires PRC companies, enterprises or ~~another~~natural persons to obtain MOFCOM approval in order to effectuate mergers or acquisitions between PRC ~~regulatory~~companies ~~agency~~and foreign companies legally established or controlled by such PRC companies, ~~determines~~enterprises or natural persons. Article 40 of the M&A Rules requires that ~~MOFCOM~~an offshore special purpose vehicle formed for overseas listing purposes and ~~CSRC~~controlled ~~approval~~directly or indirectly by PRC companies or individuals should obtain the approval of ~~our~~the ~~merger~~CSRC ~~was~~prior ~~required~~to orthe iflisting ~~other~~and ~~regulatory~~trading ~~obligations~~of ~~are~~such ~~imposed~~offshore ~~upon~~special purpose ~~us,~~vehicle’s wesecurities ~~may~~on ~~incur~~an ~~sanctions~~overseas stock exchange, ~~penalties~~especially in the event that the offshore special purpose vehicle acquires shares of or ~~additional~~equity interests in the PRC companies in exchange for the shares of offshore companies. On September 21, ~~costs~~2006, ~~which~~the ~~would~~CSRC ~~damage~~published ~~our~~on ~~business~~its official website procedures and filing requirements for offshore special purpose vehicles seeking CSRC approval of their overseas listings.

On November ~~August 8~~19, ~~2006~~2007, ~~six~~we ~~PRC~~completed ~~regulatory~~a ~~agencies~~merger transaction pursuant to a share exchange and stock purchase agreement, which resulted ~~including~~in ~~the~~our ~~MOFCOM~~current ownership and ~~the~~corporate ~~CSRC,~~structure. ~~promulgated~~We ~~the~~believe, ~~Rules~~based on ~~Acquisition~~the opinion of ~~Domestic~~our ~~Enterprises~~PRC bylegal ~~Foreign Investors~~counsel, orAllbright ~~the~~Law ~~M&A Rules~~Offices, that ~~regulations~~MOFCOM ~~with~~and ~~respect~~CSRC toapprovals were not required for our merger transaction or for the ~~mergers~~listing and ~~acquisitions~~trading of ~~domestic~~our ~~enterprises~~securities byon a ~~foreign~~trading ~~investors~~market ~~that~~because ~~became~~we ~~effective on~~are ~~September~~not 8,an ~~2006.~~offshore ~~Article~~special 11purpose ofvehicle ~~the~~that ~~M&A~~is ~~Rules~~directly ~~requires~~or indirectly controlled by PRC companies, or ~~enterprises~~individuals. orAlthough ~~natural~~the ~~persons~~merger toand ~~obtain~~acquisition ~~MOFCOM~~regulations ~~approval~~provide specific requirements and procedures, there are still many ambiguities in ~~order~~the tomeaning ~~effectuate~~of ~~mergers~~many orprovisions. ~~acquisitions~~Further ~~between~~regulations ~~PRC~~are ~~companies~~anticipated ~~and~~in ~~foreign~~the ~~companies~~future, ~~legally~~but ~~established~~until orthere ~~controlled~~has bybeen ~~such~~clarification ~~PRC~~either ~~companies~~by pronouncements, ~~enterprises~~regulation or ~~natural~~practice, ~~persons.~~there ~~Article~~is 40some ofuncertainty in the ~~M&A~~scope ~~Rules~~of ~~requires~~the ~~that~~regulations anand the ~~offshore~~regulators ~~special~~have ~~purpose~~wide ~~vehicle formed~~latitude ~~for~~in ~~overseas~~the ~~listing~~enforcement ~~purposes~~of the regulations and ~~controlled~~approval ~~directly~~of ortransactions. ~~indirectly~~If bythe ~~PRC~~MOFCOM, ~~companies~~CSRC or ~~individuals~~another PRC ~~should~~regulatory ~~obtain~~agency ~~the~~subsequently ~~approval of~~determines that the MOFCOM and CSRC ~~prior~~approvals towere ~~the~~required, ~~listing~~we ~~and~~may ~~trading~~face ofsanctions ~~such~~by ~~offshore~~the ~~special~~MOFCOM, CSRC ~~purpose~~or ~~vehicle’s~~another ~~securities~~PRC onregulatory anagency. ~~overseas~~If ~~stock~~this ~~exchange~~happens, these regulatory agencies may impose fines and penalties on our operations ~~especially~~in China, limit our operating privileges in ~~the~~China, ~~event~~delay ~~that~~or restrict the ~~offshore~~repatriation ~~special~~of ~~purpose~~proceeds ~~vehicle~~into ~~acquires~~China, ~~shares~~restrict or prohibit payment or remittance of dividends paid by Fujian Jintai Tourism, or ~~equity~~take ~~interests~~other inactions ~~the~~that ~~PRC~~could ~~companies~~damage inour business, financial ~~exchange~~condition, ~~for~~results of operations, reputation and prospects, as well as the ~~shares~~trading price of ~~offshore~~our ~~companies~~securities. OnIt ~~September~~is 21uncertain at this time to determine what, ~~2006~~if any, fines or penalties would be imposed for failure to obtain the ~~CSRC~~necessary ~~published~~approvals onbecause Circular ~~its~~10 ~~official~~does ~~website~~not ~~procedures~~expressly provide any provision with respect to fines or penalties and ~~filing~~ ~~requirements~~there ~~for~~has ~~offshore~~been ~~special~~no ~~purpose~~information ~~vehicles~~provided or ~~seeking~~published ~~CSRC~~precedent ~~approval~~established ofto ~~their~~indicate ~~overseas~~what ~~listings~~the fines or penalties would be.

OnCircular 10 ~~November~~mainly ~~19,~~governs ~~2007,~~the weforeign ~~completed~~investors aacquisition and merger ~~transaction~~ ~~pursuant~~of toChinese adomestic ~~share exchange and stock purchase agreement~~enterprises, ~~which~~including ~~resulted~~(a) inthe ~~our current ownership and corporate structure.~~acquisition Weof ~~believe, based on~~ the ~~opinion~~equities of ~~our~~ PRC ~~legal~~domestic ~~counsel,~~non-foreign ~~Allbright~~funded ~~Law~~enterprises ~~Offices,~~by ~~that~~foreign ~~MOFCOM~~investors; ~~and~~(b) ~~CSRC~~the ~~approvals~~subscription ~~were~~of ~~not~~the ~~required~~increased capital ~~for~~of ~~our~~a ~~merger~~PRC ~~transaction~~domestic orcompany ~~for~~by ~~the~~foreign ~~listing~~investors; and ~~trading~~(c) ofthe ~~our~~incorporation ~~securities~~of on a ~~trading~~foreign-funded ~~market~~enterprise ~~because~~by weforeign ~~are not an offshore~~investors ~~special~~by ~~purpose~~purchasing ~~vehicle~~the ~~that~~operating isassets ~~directly~~of ora ~~indirectly controlled by~~ PRC ~~companies~~domestic ~~or individuals~~enterprise. ~~Although~~We ~~the~~do ~~merger~~not ~~and~~believe ~~acquisition regulations~~that ~~provide~~Circular ~~specific~~10 ~~requirements~~is ~~and~~applicable ~~procedures,~~to ~~there~~us ~~are still many ambiguities in the meaning of many provisions. Further~~because: ~~regulations~~(i) ~~are~~Fujian ~~anticipated~~Jintai inTourism ~~the~~was ~~future,~~incorporated ~~but~~as ~~until~~foreign-funded ~~there~~enterprise ~~has~~on ~~been~~October ~~clarification either by pronouncements~~19, ~~regulation or practice~~2011, ~~there~~ iswith ~~some uncertainty in~~ the ~~scope~~approval of ~~the~~local ~~regulations~~Department of Commerce and ~~the~~Administration ~~regulators~~for ~~have~~Industry ~~wide~~and ~~latitude~~Commerce. inThere ~~the~~was ~~enforcement~~no ofacquisition ~~the regulations and approval~~ of ~~transactions. If~~ the ~~MOFCOM,~~equities ~~CSRC~~ or ~~another~~assets ~~PRC~~of ~~regulatory~~a ~~agency~~“PRC ~~subsequently determines that the MOFCOM and~~domestic ~~CSRC~~company” ~~approvals~~as ~~were~~such ~~required,~~term weis ~~may~~defined ~~face~~under ~~sanctions by~~ the ~~MOFCOM,~~new ~~CSRC~~M&A orRules; ~~another~~(ii) ~~PRC~~Both ~~regulatory~~Fujian ~~agency.~~Jintai IfTourism ~~this~~and ~~happens,~~Hong ~~these regulatory~~Kong ~~agencies~~Yi ~~may~~Tat ~~impose~~were incorporated ~~fines~~prior ~~and~~to ~~penalties~~the onimplementation ~~our~~of ~~operations~~Circular in10; ~~China,~~(iii) ~~limit~~Hong ~~our~~Kong ~~operating~~Yi ~~privileges~~Tat inwas ~~China,~~incorporated ~~delay~~for ~~or restrict~~ the ~~repatriation~~purpose of ~~proceeds into China, restrict~~ operating or ~~prohibit~~holding ~~payment~~the orequity ~~remittance~~ of ~~dividends paid by~~ Fujian Jintai Tourism,; or(iv) ~~take~~there ~~other~~is ~~actions~~no ~~that~~provision ~~could~~in ~~damage~~Circular ~~our~~10 ~~business,~~that ~~financial~~clearly ~~condition,~~classifies ~~results of operations, reputation and prospects,~~contractual asarrangements ~~well~~ as ~~the~~a ~~trading~~type ~~price~~ of ~~our~~transaction ~~securities.~~subject ~~It is uncertain at this time~~ to ~~determine~~regulation; ~~what,~~and if(v) ~~any,~~CSRC ~~fines~~currently orhas ~~penalties would be imposed for failure to obtain the necessary approvals because Circular 10 does~~ not ~~expressly~~issued ~~provide~~ any ~~provision~~definitive ~~with~~rule ~~respect to fines~~ or ~~penalties~~interpretation concerning ~~and~~whether ~~there~~overseas ~~has~~share ~~been~~exchange nolike ~~information~~the ~~provided~~Company’s orare ~~published~~subject ~~precedent established~~ to ~~indicate~~this ~~what the fines or penalties would be~~regulation.

Circular 10 mainly governs the foreign investors acquisition and merger of Chinese domestic enterprises, including (a) the acquisition of the equities of PRC domestic non-foreign funded enterprises by foreign investors; (b) the subscription of the increased capital of a PRC domestic company by foreign investors; and (c) the incorporation of a foreign-funded enterprise by foreign investors by purchasing the operating assets of a PRC domestic enterprise. We do not believe that Circular 10 is applicable to us because: (i) Fujian Jintai Tourism was incorporated as foreign-funded enterprise on October 19, 2011, with the approval of local Department of Commerce and Administration for Industry and Commerce. There was no acquisition of the equities or assets of a “PRC domestic company” as such term is defined under the new M&A Rules; (ii) Both Fujian Jintai Tourism and Hong Kong Yi Tat were incorporated prior to the implementation of Circular 10; (iii) Hong Kong Yi Tat was incorporated for the purpose of operating or holding the equity of Fujian Jintai Tourism; (iv) there is no provision in Circular 10 that clearly classifies contractual arrangements as a type of transaction subject to regulation; and (v) CSRC currently has not issued any definitive rule or interpretation concerning whether overseas share exchange like the Company’s are subject to this regulation.

19The M&A Regulations establish more complex procedures for some acquisitions of Chinese companies by foreign investors, which could make it more difficult for us to pursue growth through acquisition in China.

The M&A Regulations establish ~~more complex~~additional procedures ~~for~~and requirements that could make some acquisitions of ~~Chinese~~PRC companies by foreign investors, such as ours, more time-consuming and complex, including requirements in some instances that the approval of the Ministry of Commerce shall be required for transactions involving the shares of an offshore listed company being used as the acquisition consideration by foreign investors. In the future, ~~which~~we may grow our business in part by acquiring complementary businesses. Complying with the requirements of the M&A Regulations to complete such transactions could ~~make~~be ittime-consuming, ~~more~~and ~~difficult~~any ~~for~~required usapproval processes, including obtaining approval from the Ministry of Commerce, may delay or inhibit our ability to ~~pursue~~complete ~~growth~~such ~~through~~transactions, which ~~acquisition~~could inaffect ~~China~~our ability to expand our business or maintain our market share.

~~The M&A Regulations establish additional~~If ~~procedures~~the ~~and requirements that could make some acquisitions of~~ PRC ~~companies~~imposes byrestrictions ~~foreign~~designed ~~investors,~~to ~~such~~reduce ~~as ours~~inflation, more time-consuming and complex, including requirements in some instances that the approval of the Ministry of Commerce shall be required for transactions involving the shares of an offshore listed company being used as the acquisition consideration by foreign investors. In the future~~, we~~ ~~may~~economic ~~grow~~growth ~~our business~~ in ~~part by acquiring complementary businesses. Complying with~~ the ~~requirements~~PRC ~~of the M&A Regulations to complete such transactions~~ could be ~~time-consuming,~~severely ~~and~~curtailed ~~any required approval processes, including obtaining approval from the Ministry of Commerce, may delay or inhibit our ability to complete such transactions,~~ which could ~~affect~~hurt our ~~ability to expand our~~ business orand ~~maintain our market share~~profitability.

IfWhile the economy of the PRC ~~imposes~~has ~~restrictions~~experienced ~~designed~~rapid growth, this growth has been uneven among various sectors of the economy and in different togeographical ~~reduce~~areas ~~inflation,~~of ~~future~~the country. Rapid economic growth often can lead to growth in the supply of money and rising inflation. In order to control inflation in the past, the PRC ~~could~~has beimposed ~~severely~~controls ~~curtailed~~on ~~which~~bank ~~could~~credits, ~~hurt~~limits ~~our~~on ~~business~~loans for fixed assets and restrictions ~~profitability~~on state bank lending. Imposition of similar restrictions may lead to a slowing of economic growth, a decrease in travel among the population and less visitors to our tourist attractions.

~~While the economy of the PRC has experienced~~Fluctuations ~~rapid growth, this growth has been uneven among various sectors of the economy and~~ in ~~different~~exchange ~~geographical~~rates ~~areas~~could ofharm ~~the~~our ~~country. Rapid~~business ~~economic growth often can lead to growth in the supply of money~~ and ~~rising inflation. In order to control inflation in~~ the ~~past,~~ ~~the~~value ~~PRC has imposed controls on bank credits, limits on loans for fixed assets and restrictions on state bank lending. Imposition~~ of ~~similar restrictions may lead to a slowing of economic growth, a decrease in travel among the population and less visitors to~~ our ~~tourist attractions~~securities.

~~Fluctuations~~The value of our ordinary shares will be indirectly affected by the foreign exchange rate between U.S. dollars and RMB and between those currencies and other currencies in which our sales may be denominated. Because substantially all of our earnings and cash assets are denominated in RMB, fluctuations in the exchange ~~rates~~rate ~~could~~between ~~harm~~the U.S. dollar and the RMB will affect the relative purchasing power of these proceeds, our ~~business~~balance sheet and our earnings per share in U.S. dollars. In addition, appreciation or depreciation in the value of the RMB relative to the U.S. dollar would affect our ~~securities~~financial results reported in U.S. dollar terms without giving effect to any underlying change in our business or results of operations. Fluctuations in the exchange rate will also affect the relative value of any dividend we issue that will be exchanged into U.S. dollars as well as earnings from, and the value of, any U.S. dollar-denominated investments we make in the future. Since July 2005, the RMB has not been pegged to the U.S. dollar. Although the People’s Bank of China regularly intervenes in the foreign exchange market to prevent significant short-term fluctuations in the exchange rate, the RMB may appreciate or depreciate significantly in value against the U.S. dollar in the medium to long term. Moreover, it is possible that in the future PRC authorities may lift restrictions on fluctuations in the RMB exchange rate and lessen intervention in the foreign exchange market.

~~The value of our ordinary shares will be indirectly~~Very ~~affected~~limited byhedging ~~the~~transactions ~~foreign~~are ~~exchange~~available ~~rate between U.S. dollars and RMB and between those currencies and other currencies~~ in ~~which~~China ~~our sales~~to ~~may~~reduce ~~be denominated. Because substantially all of~~ our ~~earnings~~exposure ~~and~~to ~~cash assets are denominated in RMB, fluctuations in the~~ exchange rate ~~between the U~~fluctuations.S. ~~dollar~~To ~~and the RMB will affect the relative purchasing power of these proceeds~~date, ~~our~~we ~~balance~~have ~~sheet~~not ~~and~~entered ~~our~~into ~~earnings~~any ~~per~~hedging ~~share in U~~transactions.S. ~~dollars.~~While Inwe ~~addition,~~may ~~appreciation~~enter orinto ~~depreciation~~hedging transactions in the ~~value~~future, of the ~~RMB~~availability ~~relative~~and ~~to the U.S.~~effectiveness ~~dollar would affect our financial results reported in U.S. dollar terms without giving effect to any underlying change in our business or results~~ of ~~operations.~~these ~~Fluctuations~~transactions inmay ~~the exchange rate will also affect the relative value of any dividend we issue that will~~ be ~~exchanged into U.S. dollars as well as earnings from~~limited, and ~~the value of, any U.S. dollar-denominated investments~~ we ~~make~~may ~~in the future. Since July 2005, the RMB has~~ not ~~been~~be ~~pegged~~able to ~~the~~successfully ~~U.S.~~hedge ~~dollar.~~our ~~Although~~exposure ~~the~~at ~~People’s~~all. ~~Bank~~In ofaddition, ~~China~~our ~~regularly intervenes~~foreign incurrency ~~the foreign~~ exchange ~~market~~losses tomay ~~prevent~~be ~~significant~~magnified ~~short-term~~by ~~fluctuations~~PRC ~~in the~~ exchange ~~rate,~~control ~~the~~regulations ~~RMB~~that ~~may~~restrict ~~appreciate~~our orability ~~depreciate significantly in value against the U.S. dollar in the medium~~ to ~~long~~convert ~~term. Moreover, it is possible that in the future PRC authorities may lift restrictions on fluctuations in the~~ RMB ~~exchange~~into ~~rate and lessen intervention in the~~ foreign ~~exchange market~~ currencies.

~~Very limited hedging transactions are available~~Exchange incontrols ~~China~~that toexist ~~reduce our exposure to exchange rate fluctuations. To date, we have not entered into any hedging transactions. While we may enter into hedging transactions~~ in the ~~future,~~PRC ~~the availability and effectiveness of these transactions~~ may belimit ~~limited, and we may not be able to successfully hedge~~ our ~~exposure at all. In addition, our foreign currency exchange losses may be magnified by PRC exchange control regulations that restrict our~~ ability to ~~convert~~utilize ~~RMB~~our ~~into~~cash ~~foreign~~flow ~~currencies~~effectively.

We are subject to the PRC’s rules and regulations on currency conversion. In the PRC, the State Administration for Foreign Exchange, ~~controls~~or SAFE, regulates the conversion between Renminbi and foreign currencies. Currently, foreign investment enterprises, or FIEs, are required to apply to the SAFE for “Foreign Exchange Registration Certificates for FIEs.” As a result of our ownership of Fujian Jintai Tourism, Fujian Jintai Tourism is a FIE and is only able to use the proceeds from any foreign currency-dominated capital for the daily operation of the subsidiary and for the construction of the tourism destinations or for the purpose that ~~exist~~is described on the loan agreement documentation. With such registration certificates, which need to be renewed annually, FIEs are allowed to open foreign currency accounts including a “current account” and “capital account.” Currency conversion within the scope of the “current account,” such as remittance of foreign currencies for payment of dividends, can be effected without requiring the approval of the SAFE. However, conversion of currency in the “capital account,” including capital items such as direct foreign investment, loans and securities, still require approval of the SAFE. Further, any capital contributions to Fujian Jintai Tourism by its offshore shareholder must be approved by the Ministry of Commerce in China or its local counterpart. We have obtained such approval but cannot assure you that the PRC regulatory authorities will not impose further restrictions on the convertibility of the Renminbi or revoke our government approval at any time in the future. Any future restrictions on currency exchanges may limit our ability to ~~utilize~~use our cash flow ~~effectively~~for the distribution of dividends to our shareholders or to fund operations it may have outside of the PRC.

~~We are subject to the PRC’s rules and~~In ~~regulations~~August ~~on currency conversion. In the PRC~~2008, ~~the~~SAFE ~~State~~promulgated ~~Administration~~Circular ~~for Foreign Exchange~~142, ora ~~SAFE,~~notice ~~regulates~~regulating the conversion ~~between~~ ~~Renminbi~~by ~~and~~FIEs ~~foreign~~of ~~currencies. Currently,~~ foreign ~~investment~~currency ~~enterprises,~~into orRenminbi ~~FIEs,~~by ~~are~~restricting how ~~required to apply to~~ the ~~SAFE for~~converted ~~“Foreign~~Renminbi ~~Exchange~~may ~~Registration~~be ~~Certificates for FIEs~~used.” AsCircular a142 ~~result~~requires ofthat ~~our~~Renminbi ~~ownership~~converted offrom ~~Fujian Jintai Tourism, Fujian Jintai Tourism is a FIE and is only able to use~~ the ~~proceeds from any~~ foreign currency-dominated capital of ~~for~~a ~~the~~FIE ~~daily~~may ~~operation of~~only ~~the~~be ~~subsidiary~~used ~~and~~ for ~~the~~purposes ~~construction~~within of the ~~tourism~~business ~~destinations~~scope orapproved ~~for~~by the ~~purpose~~applicable ~~that~~government isauthority ~~described~~and onmay ~~the~~not ~~loan agreement~~be ~~documentation.~~used ~~With~~for ~~such~~equity ~~registration~~investments ~~certificates,~~within ~~which~~the ~~need~~PRC tounless bespecifically ~~renewed~~provided ~~annually,~~for ~~FIEs~~otherwise. ~~are~~In ~~allowed~~addition, toSAFE ~~open~~strengthened ~~foreign~~its ~~currency~~oversight ~~accounts~~over ~~including~~the aflow ~~“current account”~~ and ~~“capital~~use ~~account.”~~of ~~Currency~~Renminbi ~~conversion~~funds ~~within~~converted ~~the~~from ~~scope of~~ the ~~“current~~ ~~account,” such as remittance of~~ foreign ~~currencies~~currency-dominated ~~for~~capital ~~payment~~ of ~~dividends,~~a ~~can be effected without requiring the approval of the SAFE~~FIE. ~~However,~~The ~~conversion~~use of ~~currency in the “capital account,” including capital items~~ such asRenminbi ~~direct~~may ~~foreign~~not ~~investment,~~be ~~loans~~changed ~~and~~without ~~securities, still require~~ approval offrom ~~the~~ SAFE~~. Further~~, ~~any~~and ~~capital~~may ~~contributions~~not tobe ~~Fujian Jintai~~used ~~Tourism~~to byrepay ~~its~~Renminbi ~~offshore~~loans ~~shareholder~~if ~~must be approved by~~ the ~~Ministry~~proceeds of ~~Commerce~~such inloans ~~China~~have not oryet ~~its~~been ~~local counterpart~~used. WeViolations ~~have obtained~~of ~~such~~Circular ~~approval~~142 ~~but~~may ~~cannot~~result ~~assure~~in ~~you~~severe ~~that~~penalties, ~~the~~including ~~PRC~~substantial ~~regulatory~~fines ~~authorities~~as ~~will~~set ~~not~~forth ~~impose~~in ~~further restrictions on~~ the ~~convertibility~~ ofSAFE ~~the~~rules. ~~Renminbi~~Accordingly, orFujian ~~revoke~~Jintai ~~our~~Tourism ~~government~~is ~~approval~~only atable ~~any~~to ~~time~~use in the ~~future.~~proceeds ~~Any~~from ~~future~~any ~~restrictions~~foreign on currency-dominated ~~exchanges~~capital ~~may~~for ~~limit~~the ~~our~~daily ~~ability~~operation toof ~~use~~the ~~our~~subsidiary ~~cash~~and ~~flow~~ for the ~~distribution~~construction of ~~dividends~~the totourism ~~our~~destinations ~~shareholders~~ or tofor ~~fund~~the ~~operations~~purpose itthat ~~may~~is ~~have~~described ~~outside~~on of the ~~PRC~~loan agreement documentation.

In August 2008, SAFE promulgated Circular 142, a notice regulating the conversion by FIEs of foreign currency into Renminbi by restricting how the converted Renminbi may be used. Circular 142 requires that Renminbi converted from the foreign currency-dominated capital of a FIE may only be used for purposes within the business scope approved by the applicable government authority and may not be used for equity investments within the PRC unless specifically provided for otherwise. In addition, SAFE strengthened its oversight over the flow and use of Renminbi funds converted from the foreign currency-dominated capital of a FIE. The use of such Renminbi may not be changed without approval from SAFE, and may not be used to repay Renminbi loans if the proceeds of such loans have not yet been used. Violations of Circular 142 may result in severe penalties, including substantial fines as set forth in the SAFE rules. Accordingly, Fujian Jintai Tourism is only able to use the proceeds from any foreign currency-dominated capital for the daily operation of the subsidiary and for the construction of the tourism destinations or for the purpose that is described on the loan agreement documentation.20

20PRC regulation of loans and direct investment by offshore holding companies to PRC entities may delay or prevent us from using the cash flows to make loans or additional capital contribution to our PRC operating subsidiaries, which could materially and adversely affect our liquidity and our ability to fund and expand our business.

~~PRC~~In utilizing ~~regulation~~our ofcash ~~loans~~flow, we are permitted under PRC laws and ~~direct~~regulations ~~investment~~to provide funding to the PRC subsidiaries only through byloans ~~offshore~~or ~~holding~~capital ~~companies~~contributions, and to our affiliated PRC entities ~~may~~only ~~delay~~through orloans, ~~prevent~~in useach ~~from~~case ~~using~~subject ~~the~~to ~~cash~~satisfaction ~~flows~~of applicable government registration and approval requirements. We cannot assure you that we will be able to ~~make~~obtain ~~loans~~these government registrations or ~~additional~~approvals ~~capital contribution~~on a timely basis, if at all. In the event that we are prevented from using the funds to fund the operation of our PRC ~~operating~~ subsidiaries, ~~which~~we ~~could~~will ~~materially~~use ~~and~~our ~~adversely~~best ~~affect~~efforts ~~our~~to ~~liquidity~~obtain ~~and~~the ~~our~~required ~~ability~~approvals, however, we may not be able to ~~fund~~utilize the funds in the event that the PRC laws and ~~expand~~regulations ~~our~~do ~~business~~not permit it.

In utilizing our cash flow, we, ~~are~~as ~~permitted under~~an ~~PRC~~offshore ~~laws~~holding ~~and~~company ~~regulations~~of toour ~~provide~~PRC ~~funding~~operating tosubsidiaries, may use the ~~PRC~~cash ~~subsidiaries~~flow ~~only~~to ~~through~~make loans to our PRC subsidiaries, or make additional capital contributions, ~~and~~ to our ~~affiliated~~ PRC ~~entities~~subsidiaries. ~~only~~Any ~~through~~ loans, into ~~each~~our ~~case~~PRC subsidiaries are subject to ~~satisfaction~~PRC ofregulations ~~applicable government registration~~ and ~~approval requirements~~approvals. WeFor ~~cannot~~example, ~~assure~~loans ~~you~~by ~~that~~us weto ~~will~~finance bethe ~~able~~activities toof ~~obtain~~our ~~these~~PRC ~~government~~subsidiary, ~~registrations~~which oris ~~approvals on~~ a foreign-invested ~~timely basis~~enterprise, if atcannot ~~all.~~exceed Instatutory ~~the~~limits ~~event~~and ~~that~~must webe ~~are~~registered ~~prevented~~with ~~from~~SAFE ~~using~~or ~~the~~its ~~funds~~local tocounterpart, ~~fund~~and the accumulative ~~operation~~amount of ~~our~~foreign ~~PRC~~currency ~~subsidiaries,~~loans we will ~~use~~not ~~our best~~exceed ~~efforts~~the todifference ~~obtain~~between the ~~required~~total ~~approvals,~~investment ~~however,~~and ~~we may not be able to utilize~~ the ~~funds~~registered incapital of ~~the~~our ~~event that the~~ PRC ~~laws and~~subsidiary, ~~regulations~~which dois ~~not~~a ~~permit~~foreign-invested itenterprise.

~~In utilizing our cash flow, we, as an offshore~~We ~~holding company of our PRC operating subsidiaries,~~ may ~~use~~also ~~the~~decide ~~cash flow~~ to ~~make~~finance ~~loans to~~ our PRC ~~subsidiaries,~~subsidiary orby ~~make~~means ~~additional~~ of capital contributions ~~to our PRC subsidiaries~~. Any ~~loans~~additional tocapital ~~our~~contributions ~~PRC subsidiaries are subject~~ to ~~PRC regulations and approvals. For example, loans by us to finance the activities of~~ our PRC ~~subsidiary~~ subsidiaries, which isare a foreign-invested ~~enterprise~~enterprises, ~~cannot exceed statutory limits and~~ must be ~~registered~~approved ~~with~~by ~~SAFE or its local counterpart, and~~ the ~~accumulative amount of foreign currency loans will not exceed the difference between the total investment and the registered capital of our PRC subsidiary, which is a foreign-invested enterprise~~MOFCOM.

We cannot ~~may~~assure ~~also~~you ~~decide~~that towe ~~finance~~can ~~our~~obtain ~~PRC~~the ~~subsidiary by~~necessary ~~means~~government ofregistrations ~~capital~~or ~~contributions.~~approvals ~~Any~~on ~~additional~~a ~~capital~~timely ~~contributions~~basis, toif ~~our~~at ~~PRC subsidiaries~~all, ~~which~~with ~~are~~respect to ~~foreign-invested~~future ~~enterprises, must~~loans beor ~~approved~~capital contributions by ~~the~~us ~~MOFCOM~~to our PRC subsidiaries.

~~We cannot assure you that we can obtain the~~Regulations ~~necessary~~relating ~~government~~to ~~registrations~~offshore orinvestment ~~approvals~~activities onby aPRC ~~timely~~residents ~~basis,~~may iflimit atour ~~all,~~ability ~~with respect~~ to ~~future~~acquire ~~loans~~PRC orcompanies ~~capital~~and ~~contributions~~could adversely byaffect ~~us to~~ our ~~PRC subsidiaries~~business.

~~Regulations~~In July ~~relating~~2014, SAFE promulgated the Circular on Issues Concerning Foreign Exchange Administration Over the Overseas Investment and Financing and Roundtrip Investment by Domestic Residents Via Special Purpose Vehicles, or Circular 37, which replaced Relevant Issues Concerning Foreign Exchange Control on Domestic Residents’ Corporate Financing and Roundtrip Investment through Offshore Special Purpose Vehicles, or Circular 75. Circular 37 requires PRC residents to register with local branches of SAFE in connection with their direct establishment or indirect control of an offshore entity, referred to in Circular 37 as ~~investment~~a ~~activities~~“special purpose vehicle” for the purpose of holding domestic or offshore assets or interests. Circular 37 further requires amendment to a PRC resident’s registration in the event of any significant changes with respect to the special purpose vehicle, such as an increase or decrease in the capital contributed by PRC individuals, share transfer or exchange, merger, division or other material event. Under these regulations, PRC residents’ failure to comply with specified registration procedures may ~~limit~~result ~~our~~in restrictions being imposed on the foreign exchange activities of the relevant PRC entity, including the payment of dividends and other distributions to its offshore parent, as well as restrictions on capital inflows from the offshore entity to the PRC entity, including restrictions on its ability to ~~acquire~~contribute additional capital to its PRC ~~companies~~subsidiaries. ~~and~~Further, failure to comply with the SAFE registration requirements could ~~adversely~~result ~~affect~~in ~~our~~penalties ~~business~~under PRC law for evasion of foreign exchange regulations.

~~In July 2014,~~As ~~SAFE~~Circular ~~promulgated~~37 ~~the~~is ~~Circular~~newly-issued, onit ~~Issues~~is ~~Concerning~~unclear ~~Foreign~~how ~~Exchange~~these ~~Administration~~regulations ~~Over~~will ~~the~~be ~~Overseas~~interpreted ~~Investment~~ and ~~Financing and~~implemented. ~~Roundtrip~~In ~~Investment~~addition, bydifferent ~~Domestic~~local SAFE ~~Residents~~branches ~~Via~~may ~~Special~~have ~~Purpose~~different ~~Vehicles,~~views orand ~~Circular~~procedures ~~37,~~as ~~which~~to ~~replaced~~the ~~Relevant~~interpretation ~~Issues Concerning~~and ~~Foreign~~implementation ~~Exchange~~of ~~Control~~the onSAFE ~~Domestic~~regulations, ~~Residents’ Corporate Financing~~ and it ~~Roundtrip~~may ~~Investment~~be ~~through~~difficult ~~Offshore Special~~for ~~Purpose~~our ~~Vehicles,~~ultimate shareholders or ~~Circular~~beneficial ~~75.~~owners ~~Circular~~who 37are ~~requires~~ PRC residents to ~~register~~provide ~~with~~sufficient ~~local branches of SAFE in connection~~supporting ~~with~~documents ~~their~~required ~~direct~~by ~~establishment~~the SAFE or ~~indirect~~to ~~control~~complete ofthe anrequired ~~offshore~~registration ~~entity,~~with ~~referred~~the toSAFE in ~~Circular 37 as~~ a ~~“special~~timely ~~purpose vehicle”~~manner, ~~for the purpose of holding domestic~~ or ~~offshore~~at ~~assets or interests~~all. ~~Circular~~Any ~~37 further requires amendment to a~~failure ~~PRC~~by ~~resident’s~~any ~~registration in the event~~ of ~~any~~our ~~significant~~shareholders ~~changes~~who ~~with~~is ~~respect~~a toPRC ~~the special purpose vehicle~~resident, ~~such as an increase~~ or ~~decrease~~is incontrolled ~~the capital contributed~~ by a PRC ~~individuals~~resident, ~~share~~to ~~transfer~~comply orwith ~~exchange,~~relevant ~~merger,~~requirements ~~division or other material~~under ~~event. Under~~ these regulations, ~~PRC~~could ~~residents’~~subject ~~failure~~us to ~~comply~~fines ~~with~~or ~~specified~~sanctions ~~registration procedures may result in restrictions being~~ imposed onby the ~~foreign exchange activities of the relevant~~ PRC ~~entity~~government, including ~~the payment of dividends and other distributions to its offshore parent, as well as~~ restrictions on ~~capital~~WFOE’s ability ~~inflows~~to ~~from~~pay ~~the~~dividends ~~offshore~~or ~~entity~~make distributions to ~~the~~us ~~PRC~~and ~~entity, including restrictions~~ on ~~its~~our ability to ~~contribute~~increase ~~additional~~our ~~capital~~investment toin ~~its PRC subsidiaries. Further, failure to comply with~~ the ~~SAFE registration requirements could result in penalties under PRC law for evasion of foreign exchange regulations~~WFOE.

~~As Circular~~Requirement 37of isstatutory ~~newly-issued,~~reserve itof iscertain ~~unclear~~amount ~~how~~of ~~these~~our ~~regulations~~net ~~will~~income bepursuant ~~interpreted and implemented. In addition, different local SAFE branches may have different views and procedures as~~ to ~~the~~PRC ~~interpretation~~regulation ~~and implementation of the SAFE regulations, and it~~ may be ~~difficult~~further ~~for~~restrict our ~~ultimate shareholders or beneficial owners who are~~ PRC ~~residents to provide sufficient supporting documents~~subsidiaries ~~required~~and byvariable ~~the~~interest ~~SAFE~~entity’s orability to ~~complete~~distribute ~~the~~profits ~~required registration with the SAFE in a timely manner, or at all. Any failure by any of our shareholders who is a PRC resident, or is controlled by a PRC resident,~~ to ~~comply with relevant requirements under these regulations could subject~~ us toand ~~fines~~have ora ~~sanctions~~material ~~imposed~~adverse byeffect ~~the PRC government, including restrictions~~ on ~~WFOE’s~~our ability to ~~pay dividends~~ orconduct ~~make distributions to us and on~~ our ~~ability to increase our investment in the WFOE~~business.

~~Requirement~~Under PRC laws and regulations, our subsidiaries in China, as wholly foreign-owned enterprises, are respectively required to set aside at least 10% of their accumulated after-tax profits each year, if any, to fund certain statutory reserve offunds, ~~certain~~until the aggregate amount of ~~our~~fund ~~net~~set ~~income~~aside ~~pursuant~~reaches to50% ~~PRC~~of ~~regulation~~the registered capital of each of the entities. These reserve funds are not distributable as cash dividends. It is unclear that if and what fine or penalties that a company may ~~further~~be ~~restrict~~subject to as a result of noncompliance of such requirement. As of December 31, 2013, each of our ~~PRC~~subsidiaries subject to the statutory reserve requirement has set aside 50% of its registered capital of the subsidiaries. Such statutory requirement could limit our subsidiaries and variable interest ~~entity’s~~ entity ability to ~~distribute~~pay ~~profits~~dividends or make other distributions to us and ~~have~~could amaterially ~~material~~and ~~adverse~~adversely ~~effect~~limit on our ability to grow that could be beneficial to our business, or otherwise fund and conduct our business.

Under PRC laws and regulations, our subsidiaries in China, as wholly foreign-owned enterprises, are respectively required to set aside at least 10% of their accumulated after-tax profits each year, if any, to fund certain statutory reserve funds, until the aggregate amount of fund set aside reaches 50% of the registered capital of each of the entities. These reserve funds are not distributable as cash dividends. It is unclear that if and what fine or penalties that a company may be subject to as a result of noncompliance of such requirement. As of December 31, 2013, each of our subsidiaries subject to the statutory reserve requirement has set aside 50% of its registered capital of the subsidiaries. Such statutory requirement could limit our subsidiaries and variable interest entity ability to pay dividends or make other distributions to us and could materially and adversely limit our ability to grow that could be beneficial to our business, or otherwise fund and conduct our business.21

21Fujian Yida Travel Service Co., Ltd. was formed on June 24, 2011 and there was a capital contribution made of 10 million RMB (approximately $1,570,000) which is 100% of its registered capital. No portion of this capital contribution was used to fund its statutory reserve fund because there is no need for Fujian Yida Travel Service Co., Ltd. to allocate any statutory reserve fund until it realizes a profit.

~~Fujian Yida Travel Service Co., Ltd. was formed~~Any onoutbreak ~~June 24, 2011 and there was a capital contribution made~~ of 10widespread ~~million~~public ~~RMB~~health ~~(approximately~~problem ~~$1,570,000)~~in ~~which~~the isPRC ~~100%~~could ofadversely ~~its~~affect ~~registered capital.~~our ~~No portion of this capital contribution was used to fund its statutory reserve fund because there is no need for Fujian Yida Travel Service Co~~operations.~~, Ltd. to allocate any statutory reserve fund until it realizes a profit.~~

~~Any~~There have been recent outbreaks of contagious disease such as bird flu (avian influenza), caused by the H7N9 virus, in certain parts of China, where all of our facilities are located and where all of our sales occur. Our business is dependent upon our ability to attract a large volume of visitors to our tourism destinations, and an outbreak of widespread public health problem in ~~the~~China, could ~~PRC~~have ~~could~~a ~~adversely~~negative ~~affect~~effect on our operations. Any such outbreak could have an impact on our operations as a result of:

~~There~~● ~~have~~quarantines ~~been~~or ~~recent~~closures ~~outbreaks~~ of ~~contagious~~ ~~disease~~our ~~such~~tourist asdestinations ~~bird~~● ~~flu (avian influenza), caused by~~ the ~~H7N9~~sickness ~~virus,~~or indeath ~~certain parts~~ of ~~China,~~ ~~where all of~~ our ~~facilities~~key ~~are~~officers ~~located~~ and ~~where all of our sales occur. Our business is dependent upon our ability to attract a large volume of visitors to our tourism destinations~~employees, and an● ~~outbreak~~a ofgeneral ~~widespread~~slowdown ~~public health problem~~ in ~~China,~~ ~~could~~the ~~have~~Chinese ~~a negative effect on our operations~~economy. ~~Any such outbreak could have an impact on our operations as a result of:~~

~~· quarantines or closures~~ Any of ~~our~~the ~~tourist~~foregoing ~~destinations~~events ·or ~~the~~other ~~sickness~~unforeseen orconsequences ~~death~~ of ~~our~~public ~~key~~health ~~officers~~problems ~~and~~could ~~employees,~~adversely ~~and~~affect ·our ~~a general slowdown in the Chinese economy~~operations.

~~Any~~Because Chinese law governs many of ~~the~~our ~~foregoing~~material ~~events~~agreements, we may not be able to enforce our rights within the PRC or ~~other~~elsewhere, ~~unforeseen~~which ~~consequences~~could ofresult ~~public~~in ~~health~~a ~~problems~~significant ~~could~~loss ~~adversely~~of ~~affect~~business, ~~our~~business ~~operations~~opportunities or capital.

~~Because~~ Chinese law governs many of our material agreements, wesome of which may ~~not~~be with Chinese governmental agencies. We cannot assure you that we will be able to enforce any of our ~~rights~~material ~~within~~agreements or that remedies will be available outside of the PRC. orThe ~~elsewhere~~system of laws and the enforcement of existing laws and contracts in the PRC may not be as certain in implementation and interpretation as in the United States. The Chinese judiciary is relatively inexperienced in enforcing corporate and commercial law, ~~which~~leading to a higher than usual degree of uncertainty as to the outcome of any litigation. The inability to enforce or obtain a remedy under any of our future agreements could result in a significant loss of business, business opportunities or capital.

~~Chinese law governs many of our material agreements,~~Because ~~some of which may be with Chinese governmental agencies. We cannot assure you that we will be able to enforce any of~~ our ~~material agreements~~funds orare ~~that~~held ~~remedies~~in ~~will~~banks ~~be available outside of the PRC. The system of laws and the enforcement of existing laws and contracts~~ in ~~the~~uninsured PRC ~~may~~bank ~~not~~accounts, ~~be as certain in implementation and interpretation as in~~ the ~~United~~failure ~~States. The Chinese judiciary is relatively inexperienced in enforcing corporate and commercial law, leading to a higher than usual degree~~ of ~~uncertainty as to the outcome of~~ any ~~litigation.~~bank ~~The~~in ~~inability~~which towe ~~enforce~~deposit ~~or obtain a remedy under any of~~ our ~~future~~funds ~~agreements~~ could ~~result in a significant~~affect ~~loss~~our ofability ~~business,~~to ~~business~~continue ~~opportunities~~in ~~or capital~~business.

~~Because~~Funds on ~~our~~deposit ~~funds~~at banks and other financial institutions in the PRC are ~~held~~often uninsured. A significant portion of our assets are in the form of cash deposited with banks in ~~uninsured~~ the PRC, and in the event of a bank ~~accounts~~failure, we may not have access to our funds on deposit. Depending upon the ~~failure~~amount of ~~any~~money ~~bank~~we maintain in ~~which~~a webank ~~deposit~~that fails, our ~~funds~~inability to have access to our cash could ~~affect~~impair our operations, ~~ability~~and, if we are not able to ~~continue~~access funds to pay our suppliers, employees and other creditors, we may be unable to continue in business.

~~Funds on deposit at banks and other financial~~Our ~~institutions~~business incould ~~the~~be ~~PRC~~severely ~~are~~harmed ~~often~~if ~~uninsured. A significant portion of our assets are in~~ the ~~form~~Chinese ofgovernment ~~cash~~changes ~~deposited~~its ~~with~~policies, ~~banks in the PRC~~laws, ~~and in the event of a bank failure~~regulations, wetax ~~may~~structure ~~not~~or ~~have~~its ~~access~~current interpretations ~~to our funds on deposit. Depending upon the amount~~ of ~~money we~~its ~~maintain in a bank that fails~~laws, ~~our~~rules ~~inability~~and toregulations ~~have~~relating ~~access~~ to our ~~cash could impair our~~ operations, ~~and, if we are not able to access funds to pay our suppliers, employees and other creditors, we may be unable to continue~~ in ~~business~~china.

Our business ~~could~~is belocated ~~severely~~in ~~harmed if~~Fujian, ~~the~~China ~~Chinese~~and ~~government~~virtually ~~changes~~all ~~its~~of ~~policies,~~our ~~laws,~~assets ~~regulations,~~are ~~tax~~located ~~structure~~in orChina. ~~its~~We ~~current~~generate ~~interpretations~~our sales revenue only from customers located in China. Our results of ~~its~~operations, ~~laws~~financial state of affairs and future growth are, ~~rules~~to a significant degree, subject to China’s economic, political and ~~regulations~~legal ~~relating~~development toand ~~our~~related uncertainties. Our operations inand ~~china.~~results could be materially affected by a number of factors, including, but not limited to

~~Our~~● ~~business~~Changes ~~is located~~ in ~~Fujian,~~policies ~~China~~by ~~and virtually~~the ~~all~~Chinese ofgovernment ~~our~~resulting ~~assets are located~~ in ~~China.~~changes ~~We generate our sales revenue only from customers located~~ in ~~China.~~laws ~~Our~~or ~~results of~~regulations ~~operations,~~or ~~financial~~the ~~state~~interpretation of ~~affairs~~laws ~~and~~or ~~future growth are~~regulations, to● achanges ~~significant~~in ~~degree~~taxation, ~~subject~~● tochanges ~~China’s~~in ~~economic~~employment restrictions, ~~political and~~● ~~legal~~import ~~development~~duties, and ~~related~~● ~~uncertainties.~~currency ~~Our operations and results could be materially affected by a number of factors, including, but not limited to~~revaluation.

·Over the ~~Changes~~past inseveral years, the Chinese government has pursued economic reform policies byincluding the encouragement of private economic activities and greater economic decentralization. If the Chinese government ~~resulting~~does innot ~~changes~~continue to pursue its present policies that encourage foreign investment and operations in ~~laws~~China, or ~~regulations~~if these policies are either not successful or are significantly altered, then our business could be harmed. Following the ~~interpretation~~Chinese government’s policy of ~~laws~~privatizing ormany ~~regulations~~state-owned enterprises, the ·Chinese ~~changes~~government inhas ~~taxation~~attempted to augment its revenues through increased tax collection. It also exercises significant control over China’s economic growth through the allocation of resources, ·controlling ~~changes~~payment of foreign currency-denominated obligations, setting monetary policy and providing preferential treatment to particular industries or companies. Continued efforts to increase tax revenues could result in ~~employment~~increased ~~restrictions~~taxation expenses being incurred by us. Economic development may be limited as well by the imposition of austerity measures intended to reduce inflation, ·the ~~import~~inadequate ~~duties~~development of infrastructure and the potential unavailability of adequate power and water supplies, transportation and ·communications. ~~currency~~In ~~revaluation~~addition, the Chinese government continues to play a significant role in regulating industry by imposing industrial policies.

Over the past several years, the Chinese government has pursued economic reform policies including the encouragement of private economic activities and greater economic decentralization. If the Chinese government does not continue to pursue its present policies that encourage foreign investment and operations in China, or if these policies are either not successful or are significantly altered, then our business could be harmed. Following the Chinese government’s policy of privatizing many state-owned enterprises, the Chinese government has attempted to augment its revenues through increased tax collection. It also exercises significant control over China’s economic growth through the allocation of resources, controlling payment of foreign currency-denominated obligations, setting monetary policy and providing preferential treatment to particular industries or companies. Continued efforts to increase tax revenues could result in increased taxation expenses being incurred by us. Economic development may be limited as well by the imposition of austerity measures intended to reduce inflation, the inadequate development of infrastructure and the potential unavailability of adequate power and water supplies, transportation and communications. In addition, the Chinese government continues to play a significant role in regulating industry by imposing industrial policies.22

22The Chinese laws and regulations which govern our current business operations are sometimes vague and uncertain and may be changed in a way that hurts our business.

~~The~~China’s legal system is a civil law system based on written statutes, in which system decided legal cases have little value as precedents, unlike the common law system prevalent in the United States. There are substantial uncertainties regarding the interpretation and application of Chinese laws and regulations, ~~which~~including but not limited to the laws and regulations governing our business, ~~govern~~or the enforcement and performance of our ~~current~~arrangements ~~business~~with ~~operations~~customers in the event of the imposition of statutory liens, death, bankruptcy and criminal proceedings. The Chinese government has been developing a comprehensive system of commercial laws, and considerable progress has been made in introducing laws and regulations dealing with economic matters such as foreign investment, corporate organization and governance, commerce, taxation and trade. However, because these laws and regulations are ~~sometimes~~relatively new, ~~vague~~and because of the limited volume of published cases and ~~uncertain~~judicial interpretation and their lack of force as precedents, interpretation and enforcement of these laws and regulations involve significant uncertainties. New laws and regulations that affect existing and proposed future businesses may also be ~~changed~~applied retroactively. We are considered an FIE under Chinese laws, and as a result, we must comply with Chinese laws and regulations. We cannot predict what effect the interpretation of existing or new Chinese laws or regulations may have on our business. If the relevant authorities find us to be in violation of Chinese laws or regulations, they would have broad discretion in dealing with such a ~~way~~violation, including, without limitation: levying fines; revoking our business and other licenses; requiring that ~~hurts~~we restructure our ownership or operations; and requiring that we discontinue any portion or all of our business.

~~China’s legal system is a civil law system~~A ~~based~~slowdown on written statutes, in which system decided legal cases have little value as precedents, unlike the common law system prevalent in the United States. There are substantial uncertainties regarding the interpretation and application of Chinese laws and regulations, including but not limited to the laws and regulations governing our business, or ~~the~~other ~~enforcement~~adverse ~~and~~developments ~~performance of our arrangements with customers~~ in the ~~event of the imposition of statutory liens, death, bankruptcy and criminal proceedings. The~~ Chinese ~~government has~~economy ~~been~~may ~~developing~~materially ~~a comprehensive system of commercial laws,~~ and ~~considerable~~adversely progress has been made in introducing laws and regulations dealing with economic matters such as foreign investment, corporate organization and governance, commerce, taxation and trade. However, because these laws and regulations are relatively new, and because of the limited volume of published cases and judicial interpretation and their lack of force as precedents, interpretation and enforcement of these laws and regulations involve significant uncertainties. New laws and regulations that affect existing and proposed future businesses may also be applied retroactively. We are considered an FIE under Chinese laws, and as a result, we must comply with Chinese laws and regulations. We cannot predict what effect the interpretation of existing or new Chinese laws or regulations may have on our ~~business.~~customers’ ~~If the~~demand ~~relevant~~for ~~authorities find us to be in violation of Chinese laws or regulations, they would have broad discretion in dealing with such a violation, including, without limitation: levying fines; revoking~~ our ~~business~~services and ~~other licenses; requiring that we restructure~~ our ~~ownership or operations; and requiring that we discontinue any portion or all of our~~ business.

AAll of our operations are conducted in China and all of our revenues are generated from sales to businesses operating in China. Although the Chinese economy has grown significantly in recent years, such growth may not continue. We do not know how sensitive we are to a slowdown in economic growth or other adverse ~~developments~~ changes in ~~the~~ Chinese economy which may ~~materially~~affect ~~and~~demand ~~adversely~~for ~~affect~~precision ~~our~~steel ~~customers’~~products. A slowdown in overall economic growth, an economic downturn or recession or other adverse economic developments in China may materially reduce the demand for our services and in turn reduce our ~~business~~results of operations.

~~All of our operations are conducted in China~~Failure ~~and all of our revenues are generated from sales~~ to ~~businesses~~comply ~~operating~~with ~~in China. Although~~ the ~~Chinese economy has grown significantly in recent years, such growth may not continue~~U.S. Weforeign docorrupt ~~not~~practices ~~know~~act ~~how~~and ~~sensitive we are to a slowdown in economic growth or other adverse changes in~~ Chinese ~~economy~~anti-corruption ~~which~~laws ~~may~~could ~~affect~~subject ~~demand~~us ~~for~~to ~~precision~~penalties ~~steel~~and ~~products. A slowdown in overall economic growth, an economic downturn or recession or~~ other adverse ~~economic developments in China may materially reduce the demand for our services and in turn reduce our results of operations~~consequences.

~~Failure~~Our executive toofficers, ~~comply~~employees and other agents may violate applicable law in connection with the marketing or sale of our products, including China’s anti-corruption laws and the U.S. Foreign Corrupt Practices Act, or the FCPA, which generally prohibits United States companies from engaging in bribery or other prohibited payments to foreign officials for the purpose of obtaining ~~corrupt~~or ~~practices~~retaining ~~act~~business. In addition, we are required to maintain records that accurately and ~~Chinese~~fairly ~~anti-corruption~~represent ~~laws~~our ~~could~~transactions and ~~subject~~have an adequate system of internal accounting controls. Foreign companies, including some that may compete with us, are not subject to ~~penalties~~these prohibitions, and therefore may have a competitive advantage over us. The PRC also strictly prohibits bribery of government officials. However, corruption, extortion, bribery, pay-offs, theft and other ~~adverse~~fraudulent ~~consequences~~practices occur from time-to-time in the PRC.

~~Our~~While we ~~executive~~intend ~~officers,~~to ~~employees~~implement ~~and~~measures ~~other agents~~to ~~may~~ensure ~~violate~~compliance ~~applicable~~with ~~law~~the inFCPA ~~connection~~and ~~with~~Chinese ~~the~~anti-corruption ~~marketing~~laws orby ~~sale~~all ofindividuals involved with our ~~products~~company, ~~including~~our ~~China’s~~employees ~~anti-corruption laws~~or ~~and~~other ~~the~~agents ~~U.S.~~may ~~Foreign~~engage ~~Corrupt~~in ~~Practices~~such ~~Act,~~conduct orfor ~~the FCPA,~~ which ~~generally~~we ~~prohibits~~might ~~United~~be ~~States~~held ~~companies~~responsible. ~~from~~If ~~engaging~~our inemployees ~~bribery~~ or other ~~prohibited~~agents ~~payments~~are found to ~~foreign~~have ~~officials~~engaged ~~for~~in ~~the~~such ~~purpose~~practices, ofwe ~~obtaining~~could orsuffer ~~retaining~~severe ~~business.~~penalties Inand ~~addition,~~other weconsequences ~~are~~that may ~~required~~have toa ~~maintain~~material ~~records~~adverse ~~that~~effect ~~accurately~~on ~~and~~our ~~fairly~~business, ~~represent~~financial ~~our~~condition ~~transactions~~ and ~~have~~results ~~an adequate system~~ of ~~internal accounting controls~~operations. ~~Foreign~~In ~~companies~~addition, ~~including~~our ~~some~~brand ~~that~~and ~~may compete with us~~reputation, our ~~are~~sales ~~not~~activities ~~subject~~or tothe ~~these~~price ~~prohibitions,~~of ~~and~~our ~~therefore~~ordinary ~~may have~~shares acould ~~competitive~~be ~~advantage~~adversely ~~over~~affected ~~us.~~if ~~The~~we ~~PRC~~become ~~also~~the ~~strictly~~target ~~prohibits bribery~~ of ~~government~~any ~~officials.~~negative ~~However, corruption, extortion,~~publicity ~~bribery,~~as ~~pay-offs,~~a ~~theft~~result ~~and~~of ~~other~~actions ~~fraudulent~~taken ~~practices~~by ~~occur~~our ~~from~~employees ~~time-to-time~~or inother ~~the PRC~~agents.

~~While we intend to implement measures to ensure~~We compliance with the FCPA and Chinese anti-corruption laws by all individuals involved with our company, our employees or other agents may engage in such conduct for which we might be held responsible. If our employees or other agents are found to have ~~engaged in~~not ~~such practices~~had, ~~we could suffer severe penalties~~ and ~~other~~do ~~consequences~~not ~~that~~intend ~~may~~to have ~~a material adverse effect on our business~~, ~~financial~~ ~~condition~~any ~~and~~current ~~results of operations. In addition, our brand and reputation, our sales activities~~ or ~~the~~historic ~~price~~experience ofwith ~~our ordinary~~non-compliance ~~shares~~with ~~could~~FCPA ~~be adversely affected if we become the target of any negative publicity as a result of actions taken by our employees~~ or ~~other~~Chinese ~~agents~~anti-corruption laws.

WeThe implementation ~~have~~of ~~not~~the ~~had,~~PRC ~~and~~labor docontract ~~not~~law ~~intend~~and toincreases ~~have, any~~in ~~current~~the orlabor ~~historic~~costs ~~experience~~in ~~with~~china ~~non-compliance~~may ~~with~~hurt ~~FCPA~~our orbusiness ~~Chinese~~and ~~anti-corruption laws~~profitability.

~~The~~Implementation ~~implementation~~of a labor contract law, effective January 1, 2008, imposed more stringent requirements on employers in relation to entry into fixed-term labort contracts, recruitment of temporary employees and dismissal of employees. In addition, under the ~~new~~then-promulgated ~~PRC~~Regulations ~~labor~~on Paid Annual Leave for Employees, which also became effective on January 1, 2008, employees ~~contract~~who worked continuously for more than one year are entitled to paid vacation ranging from 5 to 15 days, depending on the length of the employee’s service. Employees who waive such vacation entitlements at the request of the employer will be compensated for three times their normal daily salaries for each vacation day so waived. As a result of the new law and ~~increases~~regulations, our labor costs may increase. There is no assurance that disputes, work stoppages or strikes will not arise in the future. Increases in the labor costs inor ~~china~~future ~~may~~disputes ~~hurt~~with our employees could damage our business, ~~and~~financial ~~profitability~~condition or operating results.

A new labort contract law became effective on January 1, 2008 in China. It imposes more stringent requirements on employers in relation to entry into fixed-term labort contracts, recruitment of temporary employees and dismissal of employees. In addition, under the newly promulgated Regulations on Paid Annual Leave for Employees, which also became effective on January 1, 2008, employees who have worked continuously for more than one year are entitled to paid vacation ranging from 5 to 15 days, depending on the length of the employee’s service. Employees who waive such vacation entitlements at the request of the employer will be compensated for three times their normal daily salaries for each vacation day so waived. As a result of the new law and regulations, our labor costs may increase. There is no assurance that disputes, work stoppages or strikes will not arise in the future. Increases in the labor costs or future disputes with our employees could damage our business, financial condition or operating results.23

23Under the current EIT Law, China Yida and Hong Kong Yi Tat may be classified as “resident enterprises” of China, which may subject China Yida and Hong Kong Yi Tat to PRC income tax on their taxable global income.

~~Under~~China passed an Enterprise Income Tax Law, or the ~~current~~EIT Law, and its implementation regulations, both of which became effective on January 1, 2008. Under the EIT Law, an enterprise established outside of China ~~Yida~~with “de facto management bodies” within China is considered a “resident enterprise,” meaning that it can be treated in a manner similar to a Chinese domestic enterprise for enterprise income tax purposes. The implementing rules of the EIT Law define de facto management as “substantial and overall ~~Hong~~management ~~Kong~~and Yicontrol ~~Tat~~over ~~may~~the production and operations, personnel, accounting, and properties” of the enterprise. On April 22, 2009, the State Administration of Taxation issued the Notice Concerning Relevant Issues Regarding Cognizance of Chinese Investment Controlled Enterprises Incorporated Offshore as Resident Enterprises pursuant to Criteria of de facto Management Bodies, or the Notice, further interpreting the application of the EIT Law and its implementation with respect to non-Chinese enterprises or group controlled offshore entities. Pursuant to the Notice, an enterprise incorporated in an offshore jurisdiction and controlled by a Chinese enterprise or group will be classified as a “non-domestically incorporated resident ~~enterprises~~enterprise” if (i) its senior management in charge of daily operations reside or perform their duties mainly in China,; ~~which~~(ii) ~~may~~its ~~subject~~financial or personnel decisions are made or approved by bodies or persons in China; ~~Yida~~(iii) substantial assets and ~~Hong~~properties, ~~Kong~~accounting books, corporate Yichops, ~~Tat~~board and shareholder minutes are kept in China; and (iv) at least half of its directors with voting rights or senior management often resident in China. A resident enterprise would be generally subject to the uniform 25% enterprise income tax rate as to its worldwide income. Although the Notice is directly applicable to enterprises registered in an offshore jurisdiction and controlled by Chinese domestic enterprises or groups, it is uncertain whether the PRC tax authorities will make reference to the Notice when determining the resident status of other offshore companies, such as Fujian Jin Tai. Since substantially all of our management is currently based in China, it is likely we may be treated as a Chinese resident enterprise for enterprise income tax purposes. The tax consequences of such treatment are currently unclear, as they will depend on ~~their~~how ~~taxable~~local ~~global~~tax ~~income~~authorities apply or enforce the EIT Law or the implementation regulations.

~~China passed an Enterprise Income Tax Law,~~In oraddition, under the EIT Law, and ~~its~~ implementation regulations, ~~both~~PRC ofincome ~~which~~tax ~~became~~at ~~effective on January 1, 2008. Under~~ the ~~EIT~~rate ~~Law, an enterprise established outside~~ of ~~China~~10% ~~with “de facto management bodies” within China~~ is ~~considered~~applicable ato ~~“resident~~dividends ~~enterprise,”~~payable ~~meaning that it can be treated in a manner similar~~ to ainvestors ~~Chinese~~that ~~domestic~~are ~~enterprise for enterprise income tax purposes. The implementing rules of the EIT Law define de facto management as~~ “~~substantial~~non-resident ~~and~~enterprises” ~~overall management~~ (and ~~control~~that ~~over~~do ~~the~~not ~~production~~have ~~and operations,~~an ~~personnel,~~establishment ~~accounting,~~or ~~and~~place ~~properties”~~ of ~~the~~business ~~enterprise.~~in ~~On April 22, 2009,~~ the ~~State Administration of Taxation~~ ~~issued~~PRC, ~~the~~or ~~Notice~~that ~~Concerning~~have ~~Relevant~~such ~~Issues~~establishment ~~Regarding~~or ~~Cognizance~~place of ~~Chinese~~business ~~Investment~~but ~~Controlled Enterprises Incorporated Offshore as Resident Enterprises pursuant to Criteria of de facto Management Bodies, or~~ the ~~Notice,~~relevant ~~further~~income ~~interpreting~~is ~~the~~not ~~application of~~effectively ~~the~~connected ~~EIT Law and its implementation~~ with ~~respect to non-Chinese enterprises or group controlled offshore entities. Pursuant to~~ the ~~Notice, an enterprise incorporated in an offshore jurisdiction and controlled by a Chinese enterprise~~ establishment or ~~group~~place ~~will~~of ~~be classified as a “non-domestically incorporated resident enterprise” if (i~~business) ~~its~~to ~~senior~~the ~~management~~extent inthat ~~charge~~such ofdividends ~~daily~~have ~~operations reside or perform~~ their ~~duties~~source ~~mainly~~within inthe ~~China;~~PRC ~~(ii)~~unless ~~its~~there ~~financial~~is oran ~~personnel~~applicable ~~decisions~~tax ~~are made or approved by bodies or persons~~treaty inbetween ~~China;~~the ~~(iii)~~PRC ~~substantial assets~~ and ~~properties,~~the ~~accounting~~jurisdiction ~~books, corporate chops, board and shareholder minutes are kept~~ in ~~China;~~ ~~and~~which ~~(iv)~~an atoverseas ~~least~~holder ~~half~~resides ofwhich ~~its~~reduces ~~directors with voting rights~~ or ~~senior~~exempts ~~management often resident in China. A resident enterprise would be generally subject to~~ the ~~uniform~~relevant ~~25% enterprise income~~ tax ~~rate as to its worldwide income~~. ~~Although the Notice is directly applicable to enterprises registered in an offshore jurisdiction and controlled by Chinese domestic enterprises or groups~~Similarly, ~~it is~~ ~~uncertain~~any ~~whether~~gain ~~the~~realized ~~PRC~~on ~~tax authorities will make reference to~~ the ~~Notice~~transfer ~~when determining the resident status~~ of ~~other~~shares ~~offshore companies,~~by such asinvestors ~~Fujian Jin Tai. Since substantially all of our management~~ is ~~currently~~also ~~based~~subject into ~~China,~~the it10% isPRC ~~likely we may be treated as a Chinese resident enterprise for enterprise~~ income tax ~~purposes.~~if ~~The tax consequences of~~ such ~~treatment~~gain ~~are~~is ~~currently~~regarded ~~unclear,~~ as ~~they~~income ~~will~~derived ~~depend~~from onsources ~~how~~within ~~local tax authorities apply or enforce~~ the ~~EIT Law or the implementation regulations~~PRC.

InIf we ~~addition,~~are ~~under~~considered ~~the~~a ~~EIT~~PRC ~~Law~~“resident ~~and implementation regulations~~enterprise”, ~~PRC~~it ~~income~~is ~~tax~~unclear atwhether the ~~rate~~dividends ofwe ~~10%~~pay iswith ~~applicable~~respect to ~~dividends~~our ~~payable to investors that are “non-resident enterprises”~~shares, ~~(and~~or ~~that~~the dogain ~~not~~you ~~have~~may anrealize ~~establishment~~from orthe ~~place~~transfer of ~~business~~our ~~in the PRC~~shares, orwould ~~that~~be ~~have~~treated ~~such~~as ~~establishment or place of business but the relevant~~ income isderived ~~not~~from ~~effectively~~sources ~~connected~~within ~~with~~ the ~~establishment~~PRC orand be ~~place~~subject ~~of business)~~ to ~~the~~PRC ~~extent~~tax. ~~that~~If ~~such~~we ~~dividends have~~are ~~their~~required ~~source~~under ~~within~~ the ~~PRC~~EIT ~~unless~~Law ~~there~~to iswithhold anPRC ~~applicable~~income tax ~~treaty~~on ~~between~~our ~~the~~dividends ~~PRC~~payable ~~and~~to ~~the~~our ~~jurisdiction in which an overseas~~foreign ~~holder~~shareholders, ~~resides which reduces~~ or ~~exempts~~if ~~the~~you ~~relevant~~are ~~tax.~~required ~~Similarly,~~to ~~any~~pay ~~gain~~PRC ~~realized~~income tax on the transfer of your shares, ~~by such investors is also subject to~~ the ~~10%~~value ~~PRC~~of ~~income~~your ~~tax~~investment ifin ~~such~~our shares ~~gain~~may isbe ~~regarded~~materially asand ~~income~~adversely ~~derived from sources within the PRC~~affected.

~~If we are considered a PRC “resident~~Risks ~~enterprise”,~~Related ~~it is unclear whether the dividends we pay with respect~~ to ~~our~~Our ~~shares,~~Common or the gain you may realize from the transfer of our shares, would be treated as income derived from sources within the PRC and be subject to PRC tax. If we are required under the EIT Law to withhold PRC income tax on our dividends payable to our foreign shareholders, or if you are required to pay PRC income tax on the transfer of your shares, the value of your investment in our shares may be materially and adversely affected.Stock

~~Risks~~If our ~~Related~~common stock were delisted and determined to ~~Our~~be ~~Common~~a ~~Stock~~“penny stock,” a broker-dealer may find it more difficult to trade our common stock and an investor may find it more difficult to acquire or dispose of our common stock in the secondary market.

If our common stock were removed from listing with the NASDAQ, it may be subject to the so-called “penny stock” rules. The SEC has adopted regulations that define a “penny stock” to be any equity security that has a market price per share of less than $5.00, subject to certain exceptions, such as any securities listed on a national securities exchange. For any transaction involving a “penny stock,” unless exempt, the rules impose additional sales practice requirements on broker-dealers, subject to certain exceptions. If our common stock were delisted and determined to be a “penny stock,” a broker-dealer may find it more difficult to trade our common stock and an investor may find it more difficult to acquire or dispose of our common stock inon the secondary market. Investors in penny stocks should be prepared for the possibility that they may lose their whole investment.

~~If our common stock were removed from listing~~Our ~~with~~failure ~~the NASDAQ, it may be subject~~ to meet the ~~so-called~~listing ~~“penny~~requirements ~~stock” rules. The SEC has adopted regulations that define a “penny stock” to be any equity security that has a market price per share~~ of ~~less than $5.00, subject to certain exceptions, such as any securities listed on a national securities exchange. For any transaction involving a “penny stock,” unless exempt,~~ the ~~rules~~Nasdaq ~~impose~~Capital ~~additional~~Market ~~sales~~could ~~practice~~result ~~requirements~~in ~~on broker-dealers, subject to certain exceptions. If our common stock were delisted and determined to be~~ a ~~“penny stock,” a broker~~de-~~dealer~~listing ~~may find it more difficult to trade our common stock and an investor may find it more difficult to acquire or dispose~~ of our common stock ~~on the secondary market~~. ~~Investors in penny stocks should be prepared for the possibility that they may lose their whole investment.~~

~~Our~~If after ~~failure~~listing we fail to ~~meet~~satisfy the continued listing requirements of the ~~Nasdaq~~ NASDAQ Capital Market, such as the corporate governance requirements and the minimum closing bid price requirement, NASDAQ may take steps to de-list our common stock, which could ~~result~~impair your inability to sell or purchase our common stock when you wish to do so. In the event of a de-listing, we would take actions to restore our compliance with NASDAQ’s listing requirements, but we can provide no assurance that any such action taken by us would allow our common stock to become listed again, stabilize the market price or improve the liquidity of our common stock, prevent our common stock from dropping below the NASDAQ minimum bid price requirement or prevent future non-compliance with NASDAQ’s listing requirements.

If after listing we fail to satisfy the continued listing requirements of the NASDAQ Capital Market, such as the corporate governance requirements and the minimum closing bid price requirement, NASDAQ may take steps to de-list our common stock, which could impair your ability to sell or purchase our common stock when you wish to do so. In the event of a de-listing, we would take actions to restore our compliance with NASDAQ’s listing requirements, but we can provide no assurance that any such action taken by us would allow our common stock to become listed again, stabilize the market price or improve the liquidity of our common stock, prevent our common stock from dropping below the NASDAQ minimum bid price requirement or prevent future non-compliance with NASDAQ’s listing requirements.24

24Our common stock is subject to price volatility unrelated to our operations.

~~Our~~The market price of our common stock could fluctuate substantially due to a variety of factors, including market perception of our ability to achieve our planned growth, quarterly operating results of other companies in the same industry, trading volume in our common stock, changes in general conditions in the economy and the financial markets or other developments affecting our competitors or us. In addition, the stock market is subject to extreme price and volume fluctuations. This volatility ~~unrelated~~has had a significant effect on the market price of securities issued by many companies for reasons unrelated to their operating performance and could have the same effect on our ~~operations~~common stock.

~~The market price of our common stock could~~ITEM fluctuate substantially due to a variety of factors, including market perception of our ability to achieve our planned growth, quarterly operating results of other companies in the same industry, trading volume in our common stock, changes in general conditions in the economy and the financial markets or other developments affecting our competitors or us1B. InUNRESOLVED ~~addition,~~STAFF ~~the stock market is subject to extreme price and volume fluctuations~~COMMENTS. This volatility has had a significant effect on the market price of securities issued by many companies for reasons unrelated to their operating performance and could have the same effect on our common stock.

~~ITEM 1B~~Not applicable. ~~UNRESOLVED STAFF COMMENTS.~~

~~Not~~ITEM 2. ~~applicable~~PROPERTIES.

25Our principal executive offices are located at 28/F, Yifa Building, No.111, Wusi Road, Fuzhou, Fujian Province, PRC. The office space is approximately 800 square meters in area. The lease renews annually at an annual rate of approximately $8,800, which is the market rate in that area.

~~ITEM~~We currently 2.operate ~~PROPERTIES~~and manage four tourist destinations , including “City of Caves,” “Yang-sheng Paradise,” “Hua’an Tulou Cluster” and “Yunding Park.” Summaries of their respective location are as follows:

~~Our~~● ~~principal~~City ~~executive~~of ~~offices~~Caves ~~are~~project is located at ~~28/F,~~in ~~Yifa~~Fengyi ~~Building~~County, Nowest of Xinyu City.~~111,~~ ~~Wusi~~● ~~Road,~~The ~~Fuzhou~~Yang-sheng Paradise project is located approximately two (2) kilometers from Zhangshu’s downtown, ~~Fujian~~and ~~Province~~within one hour travel from the adjacent airport of Nanchang, ~~PRC~~the capital city of Jiangxi Province. The ~~office~~Jiangxi ~~space~~Province isZhangshu City Yang-sheng Tourism Development Project Investment Agreement refers to our ability to obtain land use rights for approximately ~~800~~3,000 ~~square~~mu ~~meters~~through ~~in area~~a public listing transaction which means that the local government will submit our land use proposal along with our plan and project to the Department of Land Reserve for a public listing with China Yida as the only participant. Upon approval, we will be able to obtain the land-use rights. Additional 3,000 mu that is not subject to this land-use right will be leased from the local government which will give us management rights of the land The ~~lease~~Company ~~renews~~has ~~annually~~obtained atapproximately an130 ~~annual~~acres ~~rate~~of land use rights for the Yang-sheng Paradise project and is in the process of obtaining additional land use rights. ● Hua’an Tulou is approximately $8one hour and half drive away from Xiamen City,~~800,~~ ~~which~~Fujian Province. ● Yunding Park is approximately thirty (30) km from Fuzhou, the ~~market~~capital ~~rate~~city inof ~~that~~Fujian ~~area~~Province.

~~We currently operate and manage five tourist~~As ~~destinations, including “City~~ of ~~Caves”,~~December ~~“Yang-sheng Paradise”~~31, ~~“the Great Golden Lake~~2015,” ~~“Hua’an Tulou~~summaries ~~Cluster”~~ and ~~“Yunding~~analysis ~~Park.”~~of ~~Summaries~~the property rights of ~~their~~each ~~respective~~tourist ~~location~~destination are as follows:

● City of Caves project is located in Fengyi County, west of Xinyu City. ● The Yang-sheng Paradise project is located approximately two (2) kilometers from Zhangshu’s downtown, and within one hour travel from the adjacent airport of Nanchang, the capital city of Jiangxi Province. The Jiangxi Province Zhangshu City Yang-sheng Tourism Development Project Investment Agreement refers to our ability to obtain land use rights for approximately 3,000 mu through a public listing transaction which means that the local government will submit our land use proposal along with our plan and project to the Department of Land Reserve for a public listing with China Yida as the only participant. Upon approval, we will be able to obtain the land-use rights. Additional 3,000 mu that is not subject to this land-use right will be leased from the local government which will give us management rights of the land The Company has obtained approximately 130 acres of land use rights for the Yang-sheng Paradise project and is in the process of obtaining additional land use rights. ● The Great Golden Lake is located in Taining, surrounding Sanming and Nanping of Fujian Province and Nanchang of Jiangxi Province. ● Hua’an Tulou is approximately one hour and half drive away from Xiamen City, Fujian Province. ● Yunding Park is approximately thirty (30) km from Fuzhou, the capital city of Fujian Province.

	Land Use Rights	Management Rights
City of Caves	Yes-approximately 10 acres, we are in the process of obtaining more land use right	Yes
Yang-sheng Paradise	Yes – approximately 132 acres. We are in the process of obtaining more land use right.	Yes
Hua’an Tulou	No.	Yes
Yunding Park	Yes - approximately 32 acres	Yes

~~As of December 31, 2014, summaries and analysis of the property rights of each tourist destination are as follows:~~25

	Land Use Rights	Management Rights
City of Caves	Yes-approximately 10 acres, we are in the process of obtaining more land use right	Yes
Yang-sheng Paradise	Yes – approximately 132 acres. We are in the process of obtaining more land use right.	Yes
Great Golden Lake	No.	Yes
Hua’an Tulou	No.	Yes
Yunding Park	Yes - approximately 32 acres	Yes

Through the agreements, we are entitled to obtain land-use rights of approximately 2,026 acres for our Yang-sheng Paradise, Yunding Park, and City of Caves destinations. By the end of 2015, we obtained a total of approximately 32 acres of land use rights (no ownership) for Yunding Park and 132 acres of land use rights (no ownership) for Yang-sheng Paradise. We expect to be able to obtain all the rights within three years. The cost of the land will vary depending on the location. We expect the cost of the land to be between RMB 20,000 and RMB 600,000 per Mu which is equal to $515 and $15,444 per acre. The large discrepancy in price is because land prices vary depending on the description of the land. Typically, residential land is valued highest and the industrial land is the cheapest. We will try to obtain the land at the most favorable price by classifying the land as for industrial use or commercial use, when possible. However, it is uncertain as to how the PRC government will classify the land.

~~Through~~Land bidding ~~the~~process ~~agreements,~~is weusually ~~are~~as ~~entitled~~follows: ~~to obtain~~the ~~land-use~~government ~~rights~~releases ofthe ~~approximately~~notice ~~2,026~~of ~~acres~~listed ~~for~~land ~~our Yang-sheng Paradise~~transfer, ~~Yunding~~announcing ~~Park,~~such ~~and City of Caves destinations.~~information Byas the ~~end~~proposed ~~of 2014, we obtained a total of approximately 32 acres of~~ land ~~use~~transfer ~~rights~~situation, ~~(no~~bidding ~~ownership)~~qualifications ~~for Yunding Park~~ and ~~132~~application ~~acres of~~materials; ~~land~~each ~~use~~bidder ~~rights~~is ~~(no~~required ~~ownership) for Yang-sheng Paradise. We expect~~ to bepay ~~able to obtain all~~ the deposit ~~rights~~and ~~within~~submit ~~three~~bidding ~~years.~~application ~~The cost~~materials ofwhich ~~the land~~ will ~~vary depending on the location. We expect the cost of the land to~~ be ~~between~~reviewed ~~RMB 20,000~~ and ~~RMB~~compared ~~600,000~~by ~~per Mu~~the ~~which~~government; ~~is equal to $515~~ and ~~$15,444~~finally ~~per acre. The large discrepancy in price is because land prices vary depending on~~ the ~~description~~government ofwill ~~the~~select ~~land. Typically, residential land is valued highest and~~ the ~~industrial~~most ~~land~~competitive isbidder ~~the cheapest. We will try~~ to ~~obtain~~confirm the land at ~~the~~transaction ~~most~~and ~~favorable~~sign ~~price~~a by“state-owned ~~classifying the~~ land ~~as for industrial~~ use orrights ~~commercial~~transfer contract.” ~~use,~~The ~~when~~local ~~possible.~~governments ~~However,~~will itrefund isthe ~~uncertain as~~deposit toafter ~~how~~submitting the ~~PRC~~relatively ~~government~~land ~~will~~documents ~~classify~~to ~~the land~~governments.

~~Land~~It is ~~bidding~~anticipated ~~process~~that iswe ~~usually~~will ashave ~~follows:~~ the ~~government~~land ~~releases~~use ~~the~~rights ~~notice~~for ofthe ~~listed~~tourism ~~land~~property ~~transfer,~~for ~~announcing~~forty ~~such~~(40) ~~information~~years asfrom the ~~proposed~~date ~~land~~of ~~transfer situation,~~acquisition. ~~bidding~~Even ~~qualifications~~though ~~and~~the application ~~materials;~~has ~~each~~been ~~bidder~~submitted ~~is required~~ to ~~pay~~ the ~~deposit~~local ~~and~~government ~~submit bidding application materials which will be reviewed~~ and ~~compared~~land byauthority, the ~~government;~~processing ~~and~~time ~~finally~~is ~~the~~uncertain. ~~government~~ We will ~~select~~provide ~~the~~disclosure ~~most~~once ~~competitive~~we ~~bidder~~have toofficially ~~confirm~~ obtained the land ~~transaction and sign a “state-owned land~~ use rights ~~transfer~~from ~~contract.”~~the ~~The~~ local ~~governments~~government ~~will refund the deposit after submitting the relatively land documents to governments~~authorities.

ItWe do isnot ~~anticipated~~need ~~that~~to weobtain ~~will have~~ the land use rights ~~for~~to manage the ~~tourism~~Golden ~~property~~Lake, ~~for~~Tulou ~~forty~~and ~~(40)~~Yunding ~~years~~Park. ~~from~~As ~~the~~to ~~date~~Yang-Sheng Paradise and the City of ~~acquisition.~~Caves, ~~Even~~we ~~though~~started the ~~application~~road ~~has~~construction ~~been~~toward ~~submitted~~the tourist sites, but have not started the site construction. We do not need to obtain the ~~local~~land ~~government~~use ~~and~~rights ~~land~~to ~~authority~~Yang-Sheng Paradise, the ~~processing~~City ~~time~~of isCaves ~~uncertain.~~before we can proceed with our site construction. We anticipate our grand opening for these destinations will ~~provide~~occur ~~disclosure~~by ~~once~~the 3rd quarter of 2014 but we ~~have~~do ~~officially~~not anticipate ~~obtained~~that we will have the land -use rights ~~from~~at ~~the~~that ~~local government authorities~~time.

WeFenyi Yida dohas ~~not~~made ~~need~~advance payments of $380,000 to ~~obtain~~the local government of Fenyi County for the acquisition of land use rights relatives to ~~manage~~ the ~~Golden~~City ~~Lake,~~of ~~Tulou~~Caves ~~and~~tourist ~~Yunding Park~~destination. AsThe ~~to Yang~~land-~~Sheng~~use ~~Paradise~~rights ~~and~~the company obtained from Fenyi belonged to the ~~City~~local offarmers. ~~Caves~~Pursuant to relevant PRC regulations, weFenyi ~~started~~government should compensate the ~~road~~local ~~construction toward~~farmers before issuing the ~~tourist~~land ~~sites~~use rights to the company, these ~~but~~compensations ~~have~~are ~~not~~part ~~started~~of the ~~site~~Company’s ~~construction~~land expenditure. WeFenyi dogovernment ~~not~~is ~~need~~willing to ~~obtain~~reimburse ~~the~~this part of land expenditure ~~use~~for ~~rights~~the Company, but the reimbursement procedure takes very long time. Therefore, the Company decided to ~~Yang-Sheng~~compensate ~~Paradise,~~the local farmers for the ~~City~~Fenyi ofgovernment ~~Caves~~first ~~before~~in weorder ~~can~~to ~~proceed~~speed ~~with~~up ~~our~~the ~~site~~process ~~construction.~~of Weland ~~anticipate~~use ~~our~~rights. ~~grand~~The ~~opening~~Company ~~for~~did ~~these~~not ~~destinations~~enter ~~will~~any ~~occur~~agreement bywith Fenyi government about the ~~3rd~~compensation ~~quarter~~prepayment. ofFenyi ~~2014~~government ~~but~~orally weagrees doto ~~not~~repay ~~anticipate~~the ~~that~~Company weby installment. ~~will~~The ~~have~~local government has already reimbursed compensations prepayment to the ~~land-use~~Company ~~rights~~in atfull ~~that~~by ~~time~~December 31, 2013.

~~Fenyi Yida has made advance payments of $380,000~~There tois ~~the~~no ~~local~~law ~~government~~or ofregulation ~~Fenyi~~stating ~~County~~that ~~for~~we ~~the~~do ~~acquisition~~not ofneed land use rights ~~relatives~~before tocommencing ~~the~~construction ~~City~~on ofthese ~~Caves tourist destination~~projects. However, ~~The~~in ~~land-use~~practice, ~~rights~~because ~~the~~we ~~company~~have ~~obtained from Fenyi belonged to~~ the ~~local~~management ~~farmers.~~rights ~~Pursuant~~ to ~~relevant~~these ~~PRC regulations~~destinations, ~~Fenyi government~~we ~~should~~are ~~compensate~~not ~~the~~required ~~local~~to ~~farmers~~obtain ~~before issuing the~~ land ~~use~~certificates ~~rights~~before commencing toconstruction. ~~the~~The ~~company,~~management ~~these~~rights ~~compensations~~entitle ~~are~~us ~~part of~~ the ~~Company’s~~right ~~land~~to ~~expenditure.~~develop ~~Fenyi~~the ~~government~~project isand ~~willing~~ to ~~reimburse~~receive ~~this~~any ~~part~~profits ~~of land expenditure for the Company,~~generated ~~but~~from the ~~reimbursement procedure takes very long time~~construction. ~~Therefore~~However, ~~the~~we ~~Company~~do ~~decided~~not tohave ~~compensate~~ownership ~~the~~to ~~local farmers for~~ the ~~Fenyi government~~construction ~~first~~because inwe ~~order~~do tonot ~~speed~~have up the ~~process of~~ land use rights. The Company is ~~did~~under ~~not~~procedure ~~enter~~to ~~any~~obtain ~~agreement~~its ~~with~~land ~~Fenyi~~use ~~government about the compensation prepayment~~right. ~~Fenyi~~If ~~government~~we ~~orally~~eventually ~~agrees~~fail to ~~repay~~obtain ~~the~~land ~~Company~~use byright, ~~installment.~~we ~~The~~may ~~local~~fail ~~government~~to ~~has~~obtain ownership ~~already~~to ~~reimbursed~~the ~~compensations~~construction, ~~prepayment~~buildings toand improvements we make on the ~~Company~~land inif ~~full~~it ~~amount~~proceed bywith ~~December~~the ~~31,~~construction ~~2013~~before obtaining land-use rights.

26We do not need to obtain the land-use rights for the relevant properties to manage the Golden Lake, Tulou and Yunding Park locations because the local PRC governments allow us to operate and manage the property without having the land-use rights. We expect to apply for the land-use rights but at the present time only have management rights of the properties. In general, the land use right is an exclusive property right granted under PRC Property law, pursuant to which a company has right to develop the land, for example, build a restaurant and hotel, etc., while the management rights are granted under the specific agreement, we only have the rights to manage the destinations, cannot rent the land or build any construction building on the land without local government’s approval.

~~There is no law or regulation~~ITEM ~~stating that we do not need land use rights before commencing construction on these projects~~3. ~~However,~~LEGAL ~~in practice, because we have the management rights to these destinations, we are not required to obtain land certificates before commencing construction~~PROCEEDINGS. The management rights entitle us the right to develop the project and to receive any profits generated from the construction. However, we do not have ownership to the construction because we do not have the land use rights. The Company is under procedure to obtain its land use right. If we eventually fail to obtain land use right, we may fail to obtain ownership to the construction, buildings and improvements we make on the land if it proceed with the construction before obtaining land-use rights.

~~We do not need to obtain the land-use rights for the relevant properties to manage the Golden Lake~~Currently, ~~Tulou and Yunding Park locations because the local PRC governments allow~~ uswe toknow ~~operate and manage the property without having the land-use rights. We expect to apply for the land-use rights but at the present time only have management rights~~ of ~~the~~no ~~properties. In general~~material, ~~the land use right is an exclusive property right granted under PRC Property law~~active, ~~pursuant~~pending toor ~~which~~threatened aproceeding ~~company~~against ~~has right to develop the land~~us, ~~for~~or ~~example,~~our ~~build a restaurant and hotel~~subsidiaries, ~~etc., while~~nor ~~the management rights~~ are ~~granted under the specific agreement,~~ we ~~only~~involved ~~have~~as ~~the~~a ~~rights to manage the destinations, cannot~~plaintiff ~~rent~~in ~~the land or build~~ any ~~construction~~material ~~building~~proceeding onor ~~the~~pending ~~land without local government’s approval~~litigation.

ITEM 3 4. ~~LEGAL~~MINE ~~PROCEEDINGS~~SAFETY DISCLOSURES.

~~Currently, we know of no material, active,~~Not ~~pending or threatened proceeding against us, or our subsidiaries, nor are we involved as a plaintiff in any material proceeding or pending litigation~~applicable.

~~ITEM 4. MINE SAFETY DISCLOSURES.~~26

~~Not applicable.~~PART II

27ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES.

~~PART II~~Market Information

~~ITEM~~Our common 5stock is listed on the NASDAQ Capital Market exchange under the symbol “CNYD.” ~~MARKET~~The ~~FOR~~table ~~REGISTRANT’S~~below ~~COMMON~~sets ~~EQUITY,~~forth ~~RELATED~~the high ~~STOCKHOLDER~~and ~~MATTERS~~low ~~AND~~sales ~~ISSUER~~prices ~~PURCHASES~~for OFour ~~EQUITY~~common ~~SECURITIES~~stock for the period indicated as reported on the NASDAQ Capital Market.

Market Information

	Common Stock Market Price
Financial Quarter Ended	High ($)		Low ($)

December 31, 2015		3.20		2.21
September 30, 2015		3.33		2.95
June 30, 2015		4.50		2.16
March 31, 2015		2.63		1.92

December 31, 2014		3.05		2.22
September 30, 2014		4.20		3.03
June 30, 2014		4.24		2.67
March 31, 2014		7.24		3.13

Our common stock is listed on the NASDAQ Capital Market exchange under the symbol “CNYD.” The table below sets forth the high and low sales prices for our common stock for the period indicated as reported on the NASDAQ Capital Market.Holders

	Common Stock Market Price
Financial Quarter Ended	High ($)		Low ($)
December 31, 2014		3.05		2.22
September 30, 2014		4.20		3.03
June 30, 2014		4.24		2.67
March 31, 2014		7.24		3.13
December 31, 2013		6.90		2.57
September 30, 2013		9.40		4.00
June 30, 2013		4.23		4.00
March 31, 2013		4.27		3.29

At March 30, 2016, there were approximately 270 shareholders of record of our common stock. This does not reflect the number of persons or entities who held stock in nominee or “street” name through various brokerage firms.

Holders of common stock do not have cumulative voting rights. Therefore, holders of a majority of the shares of common stock voting for the election of directors can elect all of the directors. Holders of our common stock representing a majority of the voting power of our capital stock issued and outstanding and entitled to vote, represented in person or by proxy, are necessary to constitute a quorum at any meeting of our stockholders. A vote by the holders of a majority of our outstanding shares is required to effectuate certain fundamental corporate changes such as liquidation, merger or an amendment to our Articles of Incorporation.

AtAlthough there ~~March~~are ~~20,~~no ~~2015,~~provisions ~~there~~in ~~were~~our ~~approximately 206~~charter ~~shareholders~~or ofby-laws ~~record~~that ofmay ~~our~~delay, ~~common~~defer ~~stock.~~or ~~This~~prevent ~~does~~a ~~not~~change ~~reflect~~in ~~the~~control, ~~number~~we ofare ~~persons~~authorized, orwithout shareholder ~~entities~~approval, ~~who~~to ~~held~~issue shares of preferred stock inthat ~~nominee~~ may contain rights or ~~“street”~~restrictions ~~name~~that ~~through~~could ~~various~~have ~~brokerage~~this ~~firms~~effect.

Holders of common stock doare ~~not~~entitled ~~have~~to ~~cumulative voting~~share ~~rights.~~in ~~Therefore,~~all ~~holders~~dividends ofthat ~~a majority of~~ the ~~shares~~board of ~~common~~directors, ~~stock~~in ~~voting~~its ~~for~~discretion, ~~the~~declares ~~election~~from oflegally ~~directors can elect all~~available ~~of the directors~~funds. ~~Holders~~In ofthe ~~our~~event ~~common stock representing a majority~~ of ~~the~~liquidation, ~~voting~~dissolution ~~power~~or ofwinding ~~our~~up, ~~capital~~each ~~stock~~outstanding ~~issued~~share ~~and~~entitles ~~outstanding and~~its ~~entitled~~holder to ~~vote,~~participate ~~represented~~pro rata in ~~person~~all orassets bythat ~~proxy,~~remain ~~are~~after ~~necessary~~payment toof ~~constitute~~liabilities aand ~~quorum~~after atproviding ~~any~~for ~~meeting~~each class of ~~our~~stock, ~~stockholders. A~~if ~~vote~~any, byhaving preference over the ~~holders~~common ofstock. aHolders ~~majority~~ of our ~~outstanding~~common ~~shares~~stock ishave ~~required~~no topre-emptive ~~effectuate~~rights, ~~certain~~no ~~fundamental~~conversion ~~corporate~~rights ~~changes~~and ~~such as~~there ~~liquidation,~~are ~~merger~~no orredemption provisions anapplicable ~~amendment~~ to our ~~Articles~~common ~~of Incorporation~~stock.

Although there are no provisions in our charter or by-laws that may delay, defer or prevent a change in control, we are authorized, without shareholder approval, to issue shares of preferred stock that may contain rights or restrictions that could have this effect.Dividends

~~Holders of common stock~~ There are ~~entitled~~no torestrictions ~~share~~ in ~~all~~our ~~dividends~~articles ~~that the board~~ of ~~directors,~~incorporation inor ~~its~~bylaws ~~discretion,~~that ~~declares~~prevent us from ~~legally~~declaring ~~available funds~~dividends. InThe ~~the~~Delaware ~~event~~General Corporation ~~of liquidation~~Law, ~~dissolution~~ ~~or winding up~~however, ~~each~~does ~~outstanding~~prohibit ~~share~~us ~~entitles~~from ~~its~~declaring ~~holder~~dividends towhere, ~~participate pro rata in all assets that remain~~ after ~~payment of~~giving ~~liabilities~~effect ~~and~~to ~~after~~the ~~providing~~distribution ~~for each class~~ of ~~stock, if any, having preference over~~ the ~~common stock. Holders of our common stock have no pre-emptive rights, no conversion rights and there are no redemption provisions applicable to our common stock.~~dividend:

~~Dividends~~1. We would not be able to pay our debts as they become due in the usual course of business; or

~~There~~2. Our ~~are~~total noassets ~~restrictions~~would inbe ~~our~~less ~~articles~~than ~~of incorporation~~the orsum ~~bylaws~~of ~~that~~our ~~prevent~~total usliabilities ~~from~~plus ~~declaring~~the ~~dividends.~~amount ~~The~~that ~~Delaware~~would ~~General~~be ~~Corporation~~needed ~~Law,~~to ~~however,~~satisfy ~~does~~the ~~prohibit~~rights usof ~~from~~shareholders ~~declaring~~who ~~dividends~~have ~~where,~~preferential ~~after~~rights ~~giving~~superior ~~effect~~ to ~~the~~those ~~distribution~~receiving of the ~~dividend:~~distribution.

1There are restrictions on how our operating subsidiaries may pay dividends. WeOur ~~would~~board of directors has not bedeclared ~~able~~a todividend ~~pay~~on our common ~~debts~~stock asduring the last two fiscal years or the subsequent interim period. We currently anticipate that we will retain any ~~they~~future ~~become~~earnings ~~due~~for use in our business. Consequently, we do not anticipate paying any cash dividends in the ~~usual~~foreseeable ~~course~~future. The payment of ~~business;~~dividends in the future will depend upon our results of operations, as well as our short-term and long-term cash availability, working capital, working capital needs and other factors, as determined by our board of directors. Currently, except as may be provided by applicable laws, there are no contractual or other restrictions on our ability to pay dividends if we were to decide to declare and pay them.

~~2. Our total assets would be less than the~~Securities ~~sum~~Authorized offor ~~our~~Issuance ~~total~~Under ~~liabilities~~Equity ~~plus~~Compensation ~~the amount that would be needed to satisfy the rights of shareholders who have preferential rights superior to those receiving the distribution.~~Plans

~~There are restrictions on how our operating~~For ~~subsidiaries~~information ~~may pay dividends. Our board of directors has not declared a dividend~~ on ~~our~~Securities ~~common~~Authorized ~~stock~~for ~~during~~Issuance ~~the~~Under ~~last~~Equity ~~two~~Compensation ~~fiscal years~~Plans, orplease ~~the~~see ~~subsequent~~Part ~~interim period. We currently anticipate that we will retain any future earnings for use in our business. Consequently~~III, weItem do12 ~~not~~Security ~~anticipate paying any cash dividends in the foreseeable future. The payment of dividends in the future~~Ownership ~~will depend upon our results~~ of ~~operations,~~Certain asBeneficial ~~well~~Owners ~~as our short-term~~ and ~~long-term~~Management ~~cash availability, working capital, working capital needs~~ and ~~other~~Related ~~factors,~~Stockholder ~~as determined by our board of directors~~Matters. ~~Currently, except as may be provided by applicable laws, there are no contractual or other restrictions on our ability to pay dividends if we were to decide to declare and pay them.~~

~~Securities Authorized for Issuance Under~~Recent ~~Equity~~Sales ~~Compensation~~of ~~Plans~~Unregistered Securities

For information on Securities Authorized for Issuance Under Equity Compensation Plans, please see Part III, Item 12 Security Ownership of Certain Beneficial Owners and Management and Related Stockholder MattersNone.

~~Recent Sales of Unregistered Securities~~27

~~None~~ITEM 6. SELECTED FINANCIAL DATA.

28Not applicable because we are a small reporting company.

ITEM 6 7. ~~SELECTED~~MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL ~~DATA~~CONDITIONS AND RESULTS OF OPERATIONS.

~~Not~~The following ~~applicable~~discussion ~~because~~should webe ~~are~~read in conjunction with the Consolidated Financial Statements and Notes thereto appearing elsewhere in this Form 10-K. The following discussion contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 relating to future events or our future performance. Actual results may materially differ from those projected in the forward-looking statements as a ~~small~~result ~~reporting~~of certain risks and uncertainties ~~company~~set forth in this prospectus. Although management believes that the assumptions made and expectations reflected in the forward-looking statements are reasonable, there is no assurance that the underlying assumptions will, in fact, prove to be correct or that actual results will not be different from expectations expressed in this report.

~~ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITIONS AND RESULTS OF OPERATIONS.~~Overview

~~The following discussion should be read~~We inwere ~~conjunction~~formed ~~with~~on ~~the~~June ~~Consolidated~~4, ~~Financial~~1999, ~~Statements~~as ~~and~~Apta ~~Notes~~Holdings, ~~thereto appearing elsewhere in this Form 10-K~~Inc., ~~The~~to ~~following discussion~~serve ~~contains~~as ~~forward-looking~~a ~~statements~~vehicle ~~within~~to ~~the~~effect ~~meaning~~a ofmerger, ~~Section~~capital ~~27A~~stock ofexchange, ~~the~~asset ~~Securities Act of 1933 and Section 21E~~acquisition ofor ~~the~~other ~~Securities~~similar ~~Exchange~~business ~~Act~~combination ofwith ~~1934~~a ~~relating~~company tohaving ~~future~~its ~~events~~primary oroperations ~~our~~in ~~future~~the ~~performance~~PRC. ~~Actual~~On ~~results~~November ~~may~~19, ~~materially~~2007, ~~differ from~~we ~~those projected in~~ consummated the ~~forward-looking~~acquisition ~~statements as a result~~ of ~~certain~~Keenway ~~risks~~Limited, ~~and~~Hong ~~uncertainties~~Kong ~~set~~Yi ~~forth~~Tat inInternational ~~this~~Investment ~~prospectus~~Co. ~~Although~~, ~~management~~Ltd ~~believes~~(“Hong ~~that~~Kong ~~the~~Yi ~~assumptions~~Tat”), ~~made~~ and ~~expectations reflected in~~ the then ~~forward-looking~~shareholders ~~statements~~of ~~are~~Keenway ~~reasonable~~Limited, ~~there~~ isincluding noMinhua ~~assurance~~Chen, ~~that~~Yanling ~~the underlying assumptions will~~Fan, inXinchen ~~fact~~Zhang, ~~prove~~Extra toProfit beInternational ~~correct~~Limited, orand Lucky ~~that~~Glory ~~actual~~International ~~results~~Limited, ~~will~~received ~~not~~shares beof ~~different from~~our ~~expectations~~common ~~expressed in this report~~stock.

~~Overview~~After disposition of our advertising business, our current business consists solely of tourism. Our tourism business has been the primary source of our revenue since the first quarter of 2014.

We ~~were~~currently ~~formed~~operate onHua’An ~~June~~Tulou cluster 4,(“Tulou” ~~1999~~or tothe ~~serve~~“Earth Buildings”) tourist destination (which is certified as a ~~vehicle~~World toCulture ~~effect~~Heritage), Yunding aRecreational ~~merger~~Park (Large-scale National Recreational Park), ~~capital~~covering ~~stock~~over ~~exchange~~300 square kilometers, ~~asset~~and ~~acquisition~~China orYang-Sheng ~~other~~Paradise. As ~~similar~~of ~~business~~December ~~combination~~31, ~~with~~2015, athrough ~~company~~our ~~having its~~wholly ~~primary~~owned ~~operations~~subsidiaries in China, we have entered into two cooperation agreements respectively with the ~~PRC.~~local OnChinese ~~November~~government 19agents, ~~2007~~namely, we(i) ~~consummated~~ the ~~acquisition~~Jiangxi ofProvince ~~Keenway~~Zhangshu ~~Limited~~Municipal Government, ~~Hong~~and ~~Kong~~(ii) Yithe ~~Tat~~Fenyi ~~International~~County, ~~Investment~~Xinyu CoCity, Jiangxi Province Government. Under these agreements, ~~Ltd~~we have obtained the right to invest in the construction and development of China Yang-sheng (~~“Hong~~Nourishing ~~Kong~~Life) YiParadise ~~Tat~~Project (“Yang-sheng Paradise”) (consist of: (a) Salt Water Hot Spring SPA & Health Center, (b) Yang-sheng Holiday Resort, (c) World Yang-sheng Cultural Museum, (d) International Camphor Tree Garden, (e) Chinese Medicine and ~~the~~Herb ~~then~~Museum, ~~shareholders~~(f) ofYang-sheng ~~Keenway~~Sports ~~Limited~~Club, ~~including~~(g) ~~Minhua~~Old ~~Chen~~Town of Chinese Traditional Medicine, ~~Yanling~~and (h) various ~~Fan,~~other ~~Xinchen~~Yang-sheng ~~Zhang~~related projects and tourism real estate projects) with a forty (40) year exclusive right to develop, ~~Extra~~operate and ~~Profit~~manage ~~International~~a ~~Limited~~variety of caves, hot springs and ~~Lucky~~other ~~Glory~~natural ~~International~~and ~~Limited~~cultural tourist resources identified in the Meng Mountain area, and ~~received~~various ~~shares~~caves and tourist resources of ~~our~~the ~~common~~Dagang ~~stock~~Mountain located in Fenyi County, Xinyu City, Jiangxi Province (“City of Caves”).

~~We currently operate Hua’An Tulou~~The ~~cluster~~revenue ~~(“Tulou”~~from ortourism ~~the~~has ~~“Earth~~been ~~Buildings”)~~increasing. ~~tourist~~However, ~~destination~~any ~~(which~~increase isin ~~certified~~tourism asrevenue awill ~~World~~depend ~~Culture Heritage),~~on ~~Yunding~~the ~~Recreational~~progress ~~Park~~we ~~(Large-scale~~make ~~National~~in ~~Recreational~~developing our ~~Park),~~existing ~~covering~~and ~~over~~new ~~300~~projects ~~square~~in ~~kilometers,~~our ~~and~~other ~~China Yang-Sheng~~tourist ~~Paradise~~destinations. AsOur oftourism ~~December~~business ~~31,~~is ~~2014~~seasonal, ~~through~~although ~~our wholly owned subsidiaries in China,~~ we have ~~entered~~visitors ~~into two~~to ~~cooperation~~our ~~agreements~~parks ~~respectively~~throughout ~~with~~ the ~~local~~year. ~~Chinese~~In ~~government agents~~2015, ~~namely,~~we ~~(i)~~will ~~the~~continue ~~Jiangxi~~to ~~Province~~develop ~~Zhangshu Municipal Government,~~ and ~~(ii)~~construct the ~~Fenyi~~new ~~County, Xinyu City,~~ Jiangxi ~~Province~~projects ~~Government.~~such ~~Under~~as ~~these~~the ~~agreements, we have~~second ~~obtained~~phase ~~the right to invest in the~~ construction ~~and development~~ of ~~China~~ Yang-sheng ~~(Nourishing Life)~~ Paradise ~~Project (“Yang-sheng~~and ~~Paradise”) (including~~ the ~~projects:~~City ~~(a)~~of ~~Salt~~Caves. ~~Water~~The ~~Hot~~first ~~Spring~~phase SPA & Health Center, (b) Yang-sheng Holiday Resort, (c) World Yang-sheng Cultural Museum, (d) International Camphor Tree Garden, (e) Chinese Medicine and Herb Museum, (f) Yang-sheng Sports Club, (g) Old Town of ~~Chinese~~City ~~Traditional Medicine, and (h) various other Yang-sheng related projects and tourism real estate projects) with a forty (40) year exclusive right to develop, operate and manage a variety~~ of ~~caves,~~Caves ~~hot springs and other natural and cultural tourist resources identified~~ in ~~the~~Jiangxi ~~Meng~~was ~~Mountain~~completed ~~area,~~ and ~~various~~opened ~~caves~~to ~~and tourist resources of~~ the ~~Dagang~~public ~~Mountain located~~ in ~~Fenyi County~~May, ~~Xinyu City, Jiangxi Province (“City of Caves”)~~2015.

~~Advertising business had been our~~Factors ~~primary~~Affecting source of revenue prior to January 2013 because the tourism business experienced serious disruptions from flooding and severe weather while the new advertisement regulatory restriction was not enforced by the local government. Our tourism business has become the primary source of our revenue since first quarter of 2013 as we discontinued the advertising business during the first quarter of 2013. The revenue from advertising has ceased as the new advertisement regulatory restrictions are enforced. The revenue from tourism has been increasing. However, any increase in tourism revenue will depend on the recovery of Great Golden Lake from flooding and the progress we make in developing our existing and new projects in our other tourist destinations. Our tourism business is seasonal, although we have visitors to our parks throughout the year. In 2015, we will continue to develop and construct the new Jiangxi projects i.e. the second phase construction of Yang-sheng Paradise and the City of Caves. As of December 31, 2014, the first phase of City of Caves in Jiangxi had been completed and is expected to open in the second quarter of 2015.Performance

~~Factors~~Our revenue ~~Affecting~~is ~~Our~~driven ~~Performance~~by the reputation of our tourist destinations. We strive to provide quality tourist attractions that offer our visitors diverse entertainment, including catering, hotel, transportation, and shopping. We generate our revenue from our visitors and tourists. We incur many costs associated with operating the tourist business, including, administration fees, land use rights expenses, and revenue sharing fees, etc.

~~For~~We began ~~the~~to ~~tourism~~generate ~~business, our~~ revenue isafter ~~driven by~~ the ~~reputation~~grand openings of ~~our~~Yang-sheng ~~tourist~~Paradise, ~~destinations.~~which Weopened ~~strive~~in toOctober ~~present quality tourist attractions that offer our visitors diverse entertainment~~2014, ~~including catering, hotel, transportation,~~ and ~~shopping.~~the Wegrand ~~generate our revenue from our visitors and tourists.~~openings Weof ~~incur~~City ~~many~~of ~~costs associated with operating the tourist business~~Caves, ~~including,~~which ~~administration~~opened ~~fees,~~in ~~business~~May ~~traveling~~2015. ~~fees,~~We ~~land use~~expect ~~rights~~Yunding ~~fees,~~will ~~and~~continue ~~revenue~~to ~~sharing fees~~grow.

We began to generate revenue after the grand openings of Yang-sheng Paradise which opened in October 2013, due to the terrible weather, financial funding and the difficult level of the cave construction, City of Caves has postponed the trial opening in the first quarter of 2015, we believe that we will be able to maintain the high gross profit margins in the tourism segment. Also, we expect Yunding to continue to grow. Our tourism business has become the primary source of our revenue since first quarter of 2013.28

29Discontinued Operations

~~Discontinued~~On August ~~Operations~~26, 2014, Hong Kong Yi Tat entered into a certain share transfer agreement with Fujian Taining Great Golden Lake Tourism Economic Development Industrial Co., Ltd. (the “Purchaser”), pursuant to which Hong Kong Yi Tat sold 100% of its equity interest in Fujian Jintai to the Purchaser for a price of RMB 228,801,359, or approximately $37 million.

~~On June 3, 2013, Yida (Fujian) Tourism~~Net ~~Group~~loss ~~Limited.~~from ~~(“Fujian~~the ~~Yida”),~~discontinued ~~our~~operations ~~subsidiary,~~was ~~entered~~$0 ~~into~~and ~~a stock transfer agreement with Anhui Xingguang Investment Group Ltd (“Anhui Xingguang”)~~$616,732 ~~pursuant~~for tothe ~~which~~years ~~Fujian~~ended ~~Yida~~December ~~transferred its 60% interest in Anhui Yida Tourism Development Co. Ltd. (“Anhui Yida”) to Anhui Xingguang for RMB 60 million~~31, or2015 ~~$9.72 million. Anhui Xingguang also assumed all the assets~~ and ~~liabilities~~2014, ~~of Anhui Yida~~respectively.

OnAs a ~~August~~result ~~26,~~of ~~2014,~~the ~~Hong~~share ~~Kong~~transactions Yidescribed ~~Tat~~above, ~~entered into~~the aResults ~~certain~~of ~~share~~Operation ~~transfer~~set ~~agreement~~forth ~~with~~below ~~Fujian~~do ~~Taining~~not ~~Great~~reflect ~~Golden~~the ~~Lake~~operations ~~Tourism~~for Fujian ~~Economic~~Jintai. ~~Development~~The ~~Industrial~~results ~~Co.,~~of ~~Ltd. (the~~operations “of Fujian ~~Tainingr”),~~Jintai ~~pursuant~~have tobeen ~~which~~presented ~~Hong~~as ~~Kong~~discontinued Yioperations. ~~Tat~~Therefore, ~~sold~~management’s discussion ~~100%~~and ofanalysis ~~its~~set ~~equity~~forth ~~interest~~herein inbelow ~~Fujian~~are ~~Jintai to~~based ~~the~~only ~~Purchaser~~on ~~for~~the aresults ~~price~~ of ~~RMB~~continuing ~~228,801,359, or approximately $37 million~~operations.

~~Net loss from the discontinued operations was~~Results ~~$616,732~~of ~~and $643,355 for the years ended December 31, 2014 and 2013, respectively.~~Operations

~~As a result of the share transactions described above, the~~ Results of ~~Operation~~Operations ~~set~~for ~~forth below does not reflect~~ the ~~operations~~years ~~for~~ended ~~Fujian~~December ~~Jintai~~31, ~~Anhui~~2015 ~~Yida~~ and its wholly owned subsidiaries: Bengbu (Yida) Real Estate Development Co., Ltd. (“Bengbu Yida”) and Bengbu (Yida) Investment Co., Ltd. (“Bengbu Investment”). The results of operations of Fujian jintai, Anhui Yida and its subsidiaries have been presented as discontinued operations. Therefore, management’s discussion and analysis set forth herein below are based on the results of continuing operations.2014

~~Results~~The following table presents a summary of ~~Operations~~operating information for the years ended December 31, 2015 and 2014:

Results of Operations for the years ended December 31, 2014 and 2013

								Increase/		Increase/
		For the year Ended						(Decrease)		(Decrease)
(All amounts, other than		December 31,						U.S. Dollar		Percentage
percentage, in U.S. Dollar)		2015			2014			($)		(%)
Net revenue	$	14,509,124		$	13,124,152		$	1,384,972		10.55
Cost of revenue		9,562,829			9,053,904			508,925		5.62
Gross profit		4,946,295			4,070,248			876,047		21.52

Selling expenses		9,528,549			10,037,292			(508,743	)	(5.07	)
General and administrative expenses		6,839,614			7,595,484			(755,870	)	(9.95	)
Impairment of long-lived assets		–			4,384,335			(4,384,335	)	(100.00	)
Loss from operations		(11,421,868	)		(17,946,863	)		6,524,995		(36.36	)
Other expense, net		(504,975	)		(394,144	)		(110,831	)	28.12
Interest income		14,219			10,672			3,547		33.24
Interest expense		(8,240,163	)		(8,207,752	)		(32,411	)	0.39
Net loss from continuing operations		(20,152,787	)		(26,538,087	)		6,385,300		(24.06	)
Net loss from discontinued operations		–			(7,127,362	)		7,127,362		(100.00	)

Net loss	$	(20,152,787	)	$	(33,665,449	)	$	13,512,662		(40.14	)

Prior to July 2013, the Company was organized into two main business segments, tourism and advertisement. The following table presents a summary of operating information for the years ended December 31, 2014 and 2013:29

(All amounts, other than	For The Years Ended						Increase/ (Decrease)			Increase/ (Decrease)
percentage, in U.S.	December 31,						U.S. Dollar			Percentage
Dollar)	2014			2013			($)			(%)
Net revenue
Advertisement	$	-		$	2,910,612		$	(2,910,612	)		(100.00	)
Tourism		13,124,152			9,457,821			3,666,331			38.77
Total net revenue		13,124,152			12,368,433			755,719			6.11
Cost of revenue
Advertisement		-			2,045,765			(2,045,765	)		(100.00	)
Tourism		9,053,904			4,214,436			4,839,468			114.83
Total cost of revenue		9,053,904			6,260,201			2,793,703			44.63
Gross profit		4,070,248			6,108,232			(2,037,984	)		(33.36	)
Selling expenses		10,037,292			9,582,502			454,790			4.75
General and administrative expenses		7,595,484			7,527,230			68,254			0.91
Loss from operations		(13,562,528	)		(11,001,500	)		(2,561,028	)		23.28
Other expense, net		(394,144	)		(119,700	)		(274,444	)		229.28
Interest income		10,672			82,821			(72,149	)		(87.11	)
Interest expense		(8,207,752	)		(5,538,473	)		(2,669,279	)		48.20
Less: Provision for income tax		-			133,323			(133,323	)		(100.00	)
Net loss from continuing operations		(22,153,752	)		(16,710,175	)		(5,443,577	)		32.58
Net (loss) income from discontinued operations		(7,127,362	)		355,778			(7,483,140	)		(2103.32	)
Net loss		(29,281,114	)		(16,354,397	)		(12,926,717	)		79.04
Net loss attributable to non-controlling interest:		-			102,215			(102,215	)		(100.00	)
Net loss attributable to China Yida Holding Co.	$	(29,281,114	)	$	(16,252,182	)	$	(13,028,932	)		80.17

Net Revenue

30Net revenue from continuing operations increased by approximately $1.38 million or approximately 10.55%, from approximately $13.12 million for the year ended December 31, 2014 to approximately $14.51 million for the year ended December 31, 2015, including approximately $9.11 million from Yunding Park, a decrease of $1.18 million or 11%, $0.48 million from Hua’an Tulou, a decrease of $0.15 million or 24%, $3.33 million from China Yang-sheng paradise, an increase of $1.13 million or 52%, and $1.58 million from the City of Caves, an increase of $1.58 million or 100%, for the year ended December 31, 2015, as compared to 2014. The primary sources of the revenues are ticket sales, tour shuttle bus fees, accommodation and sales from restaurants. The increase in tourism business was primarily due to the revenue increase at China Yang-sheng paradise and the City of Caves due to effective marketing and promotions that led to an increase in number of visitors. We provided deeper ticket discount due to the fierce competition among the destinations and the decreased tourist consumption. We expect the fierce competition and the reduced tourist consumption to continue in the near future.

~~Net~~Cost of Revenue

~~Net~~Cost ~~revenue~~of ~~from~~revenues ~~continuing operations~~ increased by approximately $0.7551 million or approximately 65.1162%, from approximately $129.3705 million for the year ended December 31, ~~2013~~2014 to approximately $139.12 56 million for the year ended December 31, ~~2014~~2015. The increase in ~~net~~cost of revenue was primarily due to ~~the~~an increase in the ~~revenue~~depreciation cost ~~from~~of ~~tourism~~City ~~revenue~~of Caves, which was ~~partially~~opened ~~offset~~to bypublic ~~the decrease~~ in ~~advertisement~~May, ~~revenue~~2015.

~~Advertisement~~Gross profit

~~Advertisement~~Gross profit ~~revenue~~increased ~~decreased by~~ approximately $20.9188 million, or ~~100~~approximately 21.52%, from approximately $24.9107 million for the year ended December 31, ~~2013~~2014 to approximately $04.95 million for the year ended December 31, 2015. Our gross profit margin was approximately 34.09% for the year ended December 31, 2015, compared to gross profit margin of approximately 31.01% for the year ended December 31, 2014, representing an increase of approximately 3 percentage points. The ~~decrease~~increase of gross profit margin was ~~caused~~primarily bydue to the ~~termination~~revenue ofincrease ~~the~~at ~~advertisement~~China ~~business~~Yang-sheng inparadise ~~2013~~and the City of Caves.

We generated no sales from the “Journey through China on the Train” program for the year ended December 31, 2014 as compared to approximately $0.06 million for the year ended December 31, 2013. The Company lost all its advertising clients since the railway program was broadcasted manually by train attendants and we had no control over the frequency of program broadcasting. We terminated “Journey through China on the Train” program in March 2013.30

~~Tourism~~Selling Expenses

~~Tourism~~Selling ~~revenue~~expenses ~~increased~~were by approximately $~~3.66 million or approximately 38.77% from approximately $~~9.4653 million for the year ended December 31, ~~2013~~2015, compared to approximately $1310.12 04 million for the year ended December 31, 2014, ~~including approximately $10.29 million from Yunding Park, an increase of $1.65 million~~ orwhich ~~19%,~~represents ~~$0.63 million from Hua’an Tulou,~~ a decrease of approximately $0.0551 million, or ~~7%,~~approximately ~~and $2~~5.~~20 million from China Yang-sheng paradise, an increase of $2~~07%.06 ~~million~~The ordecrease ~~1471%,~~in ~~for~~selling ~~the~~expense ~~year~~was ~~ended~~primarily due ~~December 31, 2014, as compared~~ to the ~~same~~decrease ~~period~~ in ~~2013.~~variable ~~The~~costs, ~~primary sources~~including ofoperation ~~the~~costs ~~revenues~~of ~~are ticket sales, tour~~ shuttle ~~bus~~buses ~~fees, accommodation~~ and ~~sales~~cable ~~from~~cars, ~~restaurants.~~hotel ~~The~~maintaining ~~increase~~costs, ~~in tourism~~and ~~business~~marketing ~~was~~expenses ~~primarily due to the revenue increase~~ at China Yang-sheng paradise, ~~the newly opened tourism destinations~~Yunding, and ~~Yunding Park~~Tulou ~~due~~during ~~to effective marketing promotion activities and advertisement that led to an increase in number of tourists. We provided deeper ticket discount due to~~ the ~~fierce~~year ~~competition~~ended ~~among~~December ~~the~~31, ~~destinations and the decreased tourist consumption had also decreased~~2015. The gross revenue increased due to the increase in the number of tourists attracted by the reduced ticket fee. We expect the fierce competition and the reduced tourist consumption to continue in the near future.

~~Cost~~General and ofAdministrative ~~Revenue~~Expenses

~~Cost~~General ofand ~~revenues~~administrative ~~increased by approximately~~expenses ~~$2.79~~were ~~million or~~ approximately ~~44.63%, from approximately~~ $6.2684 million for the year ended December 31, ~~2013~~2015, compared to approximately $97.05 60 million for the year ended December 31, 2014., ~~The~~which ~~increase~~represents ina ~~cost~~decrease of ~~revenue~~approximately ~~was~~$0.76 ~~primarily~~million, ~~due~~or toapproximately ~~the~~9.95%. ~~increase~~This indecrease ~~cost~~was ofdue ~~revenue~~to the decrease of ~~tourism,~~administrative ~~partially~~expenses ~~offset~~for bythe aoperation ~~decrease~~of inYunding ~~cost~~Park ofand ~~revenue~~City of ~~advertisement~~Caves during the year ended December 31, 2015.

~~Advertisement~~Interest expense

~~Cost of revenue from advertisement decreased~~Interest byexpense ~~approximately~~was ~~$2.05 million or 100%, from~~ approximately $28.0524 million for the year ended December 31, ~~2013~~2015, torepresenting a increase of approximately $0.03 million or approximately 0.39%, compared to approximately $8.21 million for the year ended December 31, 2014. AsThe weincrease ~~terminated~~was ~~advertisement~~primarily due ~~business~~to inthe ~~2013,~~more ~~there~~bank ~~was~~loans noobtained ~~cost~~by ~~incurred~~the ~~with~~Company ~~for~~in the year ended December 31, ~~2014~~2015.

~~Tourism~~Net Loss

~~Cost~~As a result of ~~revenue~~the ~~from~~above ~~tourism~~factors, ~~increased~~we byexperienced ~~approximately~~a ~~$4.84~~net ~~million~~loss orof approximately ~~114.83%, from approximately~~ $420.2115 million for the year ended December 31, ~~2013~~2015 as compared to a net loss of approximately $933.0567 million for the year ended December 31, 2014, representing a decrease of loss of approximately $13.52 million or approximately 40.14%. The ~~increase~~ decrease in net loss was primarily ~~due~~attributable to the ~~increase~~revenue ~~in tourists~~ increase at China Yang-sheng ~~paradise ,~~ Paradise and ~~the~~City ~~increase~~ of ~~depreciation~~Caves ~~cost~~ for the ~~construction~~year ~~completed~~ended inDecember ~~China~~31, ~~Yang-sheng~~2015 ~~paradise~~as ~~during~~compared to the year ended December 31, 2014, and the loss incurred from disposal of ~~2013~~Fujian Jintai for the year ended December 31, 2014.

~~Gross profit~~31

~~Gross profit decreased approximately $2.04~~Liquidity ~~million,~~and orCapital approximately 33.36%, from approximately $6.11 million for the year ended December 31, 2013 to $4.07 million for the year ended December 31, 2014. Our gross margin was approximately 31.01% for the year ended December 31, 2014, compared to gross profit margin of approximately 49.39% for the year ended December 31, 2013, representing a decrease of approximately18 percentage points.Resources

~~Advertisement~~Our consolidated financial statements are prepared using generally accepted accounting principles in the United States of America applicable to a going concern, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. We have incurred significant negative cash flows from operative activities, and continuing net losses and working capital deficits that allow it to continue as a going concern. Our ability to continue as a going concern is dependent on out ability to obtain adequate capital to fund operating losses until it becomes profitable. If we are unable to obtain adequate capital, we could be forced to cease operations. The accompanying consolidated financial statements do not include any adjustments that might be necessary if we are unable to continue as a going concern.

~~Gross~~Management’s ~~profit~~Plan ~~from advertisement decreased by approximately $0.86 million, or 100%, from approximately $0.86 million for the year ended December 31, 2013~~ to ~~$0 for the year~~Continue ~~ended~~as ~~December~~a ~~31,~~Going 2014. Gross margin from advertisement was 0% for the year ended December 31, 2014, compared to approximately 29.71% for the year ended December 31, 2013. The decrease was because of the termination of our advertisement business in 2013.Concern

31In order to continue as a going concern, we will need, among other things, additional capital resources. Management’s plans to obtain such resources for us include (1) obtaining capital from the sale of its substantial assets, (2) generating and recovery of tourism revenue, and (3) short-term and long-term borrowings from banks, stockholders or other related party(ies). However, management cannot provide any assurance that we will be successful in accomplishing any of its plans.

~~Tourism~~Our ability to continue as a going concern is dependent upon its ability to successfully accomplish the plans described in the preceding paragraph and eventually to secure other sources of financing and attain profitable operations.

Gross profit from tourism decreased approximately $1.17 million, or approximately 22.37%, from approximately $5.24 million for the year ended December 31, 2013 to approximately $4.07 million for the year ended December 31, 2014. Our ~~gross margin from tourism was approximately 31.01% for the year ended December~~ ~~31,~~principal ~~2014,~~source ~~compared to gross profit margin~~ of ~~approximately~~liquidity ~~55.44% for~~ during the year ended December 31, ~~2013. The decrease of gross margin~~ 2015 was primarily ~~attributable to~~ the ~~increase~~proceeds offrom ~~the cost of revenue in connection to the increase in sales activities at China Yang~~long-~~sheng paradise,~~term ~~and the increase of depreciation cost for the construction completed in China Yang-sheng paradise during the year of 2013~~loans.

~~Selling~~As ~~Expenses~~of December 31, 2015, we had cash and cash equivalents of approximately $5.48 million as compared to approximately $0.96 million as of December 31, 2014, representing an increase of $4.52 million. Our principal source of liquidity during the year ended December 31, 2015 was primarily the net proceeds from long-term loans of approximately $52.43 million.

~~Selling expenses were approximately $10.04~~As ~~million~~of ~~for the year ended~~ December 31, ~~2014,~~2015 ~~compared~~and ~~to approximately $9.58 million for the year ended December 31~~2014, ~~2013,~~our ~~which represents~~working ancapital ~~increase~~deficits ofwere approximately $01.4675 million, orand ~~approximately 4~~$35.~~75%.~~89 ~~The increase in selling expense was primarily due to the increase in variable costs and advertisement expenses at China Yang-sheng paradise during the year ended December 31~~million, ~~2014~~respectively.

~~General~~The following ~~and~~table ~~Administrative~~sets ~~Expenses~~forth a summary of our cash flows for the periods indicated:

General and administrative expenses were approximately $7.60 million for the year ended December 31, 2014, compared to approximately $7.53 million for the year ended December 31, 2013, which represents an increase of approximately $0.07 million, or approximately 0.91%. This slight increase was due to the increase of administrative expenses for the operation of China Yang-sheng paradise, City of Caves, and Yunding Park during the year ended December 31, 2014.

	For the year Ended December 31,
	2015			2014

Net cash used in operating activities of continuing operations	$	(9,823,697	)	$	(10,310,402	)
Net cash (used in) provided by investing activities of continuing operations	$	(8,033,425	)	$	27,021,410
Net cash provided (used in) by financing activities of continuing operations	$	22,762,082		$	(2,957,250	)
Net cash used in discontinued operations	$	-		$	(15,019,129	)

~~Interest expense.~~32

~~Interest~~Net cash ~~expense~~used in operating activities of continuing operations was approximately $89.21 82 million for the year ended December 31, ~~2014~~2015, ~~representing an increase of approximately $2.67 million or approximately 48.2%,~~ compared to ~~the~~ approximately $510.5431 million for the year ended December 31, ~~2013~~2014. The ~~increase~~decrease inof ~~interest~~$0.49 ~~expense~~million cash used was primarily due ~~because~~to ~~part~~the ofnet ~~the~~loss ~~interest~~of ~~expense~~$20.15 million for the year ended December 31, ~~2013~~2015 ~~was~~as ~~capitalized~~compared asto ~~part~~the net loss of ~~construction~~$33.67 million for the inyear ~~progress.~~ended December 31, 2014.

~~Income~~Net cash ~~Tax~~used in investing activities of continuing operations was approximately $8.03 million for the year ended December 31, 2015, compared to approximately $27.02 million of cash provided by investing activities for the year ended December 31, 2014. The decrease of approximately $35.05 million was primarily due to the proceeds received from disposal of our discontinued entity, Fujian Jintai, of $35.57 million during the year ended December 31, 2014.

~~Income~~Net ~~tax~~cash ~~was~~provided by financing activities of continuing operations amounted to approximately $022.76 million for the year ended December 31, ~~2014~~2015, ~~representing~~compared ato ~~decrease of~~ approximately $02.1396 million or ~~100%,~~of ~~compared~~cash toused ~~the~~in ~~approximately~~financing ~~$0.13~~activities ~~million income tax~~ for the year ended December 31, ~~2013~~2014, representing an increase of approximately $25.72 million. The ~~decrease~~increase in net cash provided by financing activities was mainly due to the ~~income~~ increase in net proceeds received from ~~tourism~~bank ~~was~~loans ~~negative~~of in$51.62 ~~2014~~million, ~~and~~offset weby ~~did~~the ~~not~~increase ~~generate~~in ~~any~~repayment ~~revenue~~of ~~from~~related ~~our~~party ~~advertising~~loans ~~business~~of in$25.34 ~~2014,~~million ~~while~~during the ~~income~~year ~~tax~~ended ofDecember ~~2013~~31, ~~was~~2015, ~~resulted~~as ~~from~~compared ~~our~~to ~~income~~the ~~from~~year ~~advertising~~ended ~~business~~December 31, 2014.

~~Net Loss~~Bank loans

As ~~a result of the above factors, we have net~~ ~~loss~~ of ~~approximately $29.28 million for the year ended~~ December 31, ~~2014 as compared to net loss of approximately $16.35 million for the year ended December 31~~2015, ~~2013, representing an increase of loss of approximately $12.93 million or approximately 79.08%. The increase of loss was primarily attributable to~~ the ~~decrease~~Company inhad ~~advertisement~~nine ~~revenue~~bank ~~due~~loans tofrom ~~the~~three ~~termination~~institutional oflenders ~~our~~for ~~advertisement business in July 2013,~~ the ~~increase~~development ~~in cost~~ of ~~revenue~~tourism ~~and general and administrative expenses in connection with the operation of China Yang-sheng paradise for the year ended December 31~~destinations, ~~2014~~ as ~~compared with that for the year ended December 31, 2013.~~follows:

~~Liquidity~~1. A loan for approximately $1.85 million from Fujian Haixia Bank (formerly known as Merchant bank of Fuzhou). The loan bears interest at 8.245% per annum, and ~~Capital~~is ~~Resources~~due on June 29, 2016, collateralized by the personal guarantees of two of the Company’s directors.

~~Our~~2. ~~principal~~A ~~source~~loan offor ~~liquidity~~approximately ~~during~~$35.43 ~~the year~~million ~~ended~~from China Minsheng Banking Corp, Ltd. It bears interest rate at 9% per annum. $12,323,428 (RMB 80,000,000) and $23,106,428 (RMB 150,000,000) will be due in each twelve-month period as of December 31, ~~2014~~2018 ~~was~~and 2019, respectively. It is secured by the ~~proceeds~~land ~~from~~use ~~disposal~~right of ~~Fujian~~Jiangxi ~~Jintai~~Zhangshu, and collateralized by the personal guarantees by two of the Company’s directors.

As3. ofA ~~December~~loan 31for approximately $28.34 million from China Construction Bank. It bears interest at 6.55% per annum. $1,540,429 ~~2014~~(RMB 10,000,000), we$3,080,857 ~~had~~(RMB ~~cash and~~20,000,000), ~~cash~~$3,080,857 ~~equivalents~~(RMB of20,000,000), ~~approximately~~$4,621,286 (RMB 30,000,000), $~~0.96~~4,621,286 ~~million~~(RMB as30,000,000), ~~compared~~$6,161,714 to(RMB ~~approximately~~40,000,000), and $~~2.16~~5,237,457 ~~million~~(RMB 34,000,000) will be due in each twelve-month period as of December 31, ~~2013~~ 2016, ~~representing~~2017, a2018, ~~decrease~~2019, of2020, ~~$1.2~~2021, ~~million.~~and ~~Our~~2022, ~~principal~~respectively. ~~source~~It ofis ~~liquidity~~secured ~~during~~by the ~~year~~fixed ~~ended~~assets ~~December~~of 31Fujian Yida, ~~2014~~and ~~was proceeds~~collateralized ~~from~~by ~~disposal~~the ofpersonal ~~Fujian~~guarantees ~~Jintai~~of two of ~~approximately~~the ~~$35.57~~Company’s ~~million~~directors.

As of December 31, 2014 and 2013, our working capital deficits were approximately $35.89 million and $43.04 million, respectively.

A loan for approximately $27.2 million from Industrial and Commercial Bank of China Limited. The loan bears interest at from 7.07% per annum, and is due on December 16, 2021. It is collateralized by the land use rights of Jiangxi Fenyi, guaranteed by Fujian Yida, and personal guarantees by two of the Company’s directors. Deferred financing costs of $539,150 (RMB 3.50 million) was paid in order to obtain such additional debt used to construct the resort project. These fees were deferred and amortized on a straight line basis over the life of the debt. The balance amounted to $402,657 as of December 31, 2015.

A loan for approximately $26.19 million from China Minsheng Banking Corp, Ltd. It bears interest rate at 8.5% per annum. $4,621,286 (RMB 30,000,000), $6,161,714 (RMB 40,000,000), $6,161,714 (RMB 40,000,000), and $9,242,571 (RMB 60,000,000) will be due in each twelve-month period as of December 31, 2017, 2018, 2019 and 2020, respectively. It is collateralized by the right to collect resort ticket sales at China Yang-sheng Paradise resort, guaranteed by Fujian Xinhengji Advertisement Co., Ltd, Fujian Yida, Yongtai Yunding, Jiangxi Fenyi, and personal guarantees by two of the Company’s directors as additional collateral.

326. A loan for approximately $4 million from China Construction Bank. It bears interest at 7.86% per annum. $616,171 (RMB 4,000,000) will be due in each twelve-month period as of December 31, 2016, 2017, 2018, 2019, 2020, 2021, respectively and $308,086 (RMB 2,000,000) will be due in the twelve-month period as of December 31, 2022. It is secured by the fixed assets of Fujian Yida, and collateralized by the personal guarantees of two of the Company’s directors.

The following table sets forth a summary of our cash flows for the years indicated:

7.	A loan for approximately $4 million from China Construction Bank. It bears interest at 7.86% per annum, $616,171 (RMB 4,000,000) will be due in each twelve-month period as of December 31, 2016, 2017, 2018, 2019, 2020, 2021, respectively and $308,086 (RMB 2,000,000) will be due in the twelve-month period as of December 31, 2022. It is secured by the fixed assets of Fujian Yida, and collateralized by the personal guarantees of two of the Company’s directors.

8.	A loan for approximately $3.39 million from China Construction Bank. It bears interest at 7.86% per annum. $462,129 (RMB 3,000,000) will be due in each twelve-month period as of December 31, 2016, 2017, 2018, and 2019, respectively, $616,171 (RMB 4,000,000), $616,171 (RMB 4,000,000), and $308,086 (RMB 2,000,000) will be due in each twelve-month period as of December 31, 2020, 2021, and 2022, respectively. It is secured by the fixed assets of Fujian Yida, and collateralized by the personal guarantees of two of the Company’s directors.

	For the years ended December 31,
	2014			2013
Net cash used in operating activities of continuing operations	$	(11,114,907	)	$	(9,426,342	)
Net cash provided by (used in) investing activities of continuing operations	$	27,825,916		$	(66,170,882	)
Net cash (used in) provided by financing activities of continuing operations	$	(2,957,250	)	$	74,290,727
Net cash used in discontinued operations	$	(15,019,128	)	$	(2,971,600	)

A loan for approximately $3.39 million from China Construction Bank. It bears interest at 7.86% per annum. $154,043 (RMB 1,000,000), $308,086 (RMB 2,000,000), $462,129 (RMB 3,000,000), $616,171 (RMB 4,000,000), $616,171 (RMB 4,000,000), $616,171 (RMB 4,000,000), and $616,171 (RMB 4,000,000) will be due in each twelve-month period as of December 31, 2016, 2017, 2018, 2019, 2020, 2021, and 2022, respectively. It is secured by the fixed assets of Fujian Yida, and collateralized by the personal guarantees of two of the Company’s directors.

Net cash used in operating activities of continuing operations was approximately $11.11 million for the year ended December 31, 2014, compared to approximately $9.43 million for the year ended December 31, 2013. The decrease of $1.68 million was primarily due to the net loss of $29.28 million for the year ended December 31, 2014 as compared to the net loss of $16.35 million for the year ended December 31, 2013.33

~~Net cash provided by investing activities of~~In ~~continuing operations was approximately $27.83 million for~~ the ~~year~~coming ~~ended~~12 ~~December 31~~months, ~~2014, compared to~~ the ~~net~~Company ~~cash~~has ~~used in investing activities of continuing operations of~~ approximately $665.1724 million ~~for~~in ~~the~~bank ~~year~~loans ~~ended~~that ~~December~~will ~~31, 2013~~mature. ~~The~~We ~~increase~~plan ~~of approximately $94 million was primarily due~~ to ~~the~~replace ~~decrease~~these ~~of $64.32 million of cash used in construction cost, and the increase of proceeds~~loans ~~from~~with ~~disposal~~new ofbank ~~discontinued~~loans ~~entities of approximately $25.95 million. The cash used~~ in ~~construction related to China Yang-sheng paradise in year 2013 was~~ approximately ~~$71.09 million while~~ the ~~net~~same ~~cash~~aggregate ~~used in construction related to City of Caves in year 2014 was approximately $6~~amounts.77 million. In 2013, the proceeds from disposal of Anhui Yida and its subsidiaries were approximately $9.62 million, while the proceeds from disposal of Jintai in 2014 were approximately $35.57 million.

~~Net cash used in financing activities of continuing~~We ~~operations~~believe ~~amounted~~we tocan ~~approximately~~arrange ~~$2.96 million~~ for the ~~year~~projects’ ~~ended~~funding ~~December~~based ~~31,~~upon ~~2014, compared to~~ the ~~net~~actual cash ~~provided~~flow byexpenditures ~~financing activities of continuing operations of approximately $74.29 million for the year ended December 31~~required, ~~2013,~~which ~~representing~~means awe ~~decrease~~expect ofto ~~approximately~~be ~~$77.25~~able ~~million.~~to ~~The~~accelerate ~~decrease in net cash provided by financing activities was mainly because~~ the ~~decrease~~construction ofas ~~$39.87 million~~we inhave ~~net~~more ~~proceeds~~cash ~~from~~flow ~~bank~~and ~~loans~~we ~~from~~can ~~$40.68~~slow ~~million~~down ~~(total proceeds from loans of $59.73 million netting total repayment of loans of $19.05 million off) during~~ the ~~year~~construction ~~ended~~if ~~December~~and ~~31,~~when ~~2013~~we toare ~~$0.81 million (total proceeds from loans of $53.36 million~~lacking ~~netting total repayment of loans of $52~~funds.~~55 million off) during the year ended December 31, 2014.~~

~~Bank~~Obligations Under ~~loans~~Material Contracts

AsBelow is ofa ~~December~~table ~~31,~~setting ~~2014,~~forth the Company’s ~~had~~material ~~seven bank~~contractual ~~loans~~obligations ~~from~~as ~~three institutional lenders for the development~~ of ~~the~~December ~~tourism~~31, ~~destinations.~~2015:

1. A loan for approximately $1.95 million from Fujian Haixia Bank (formerly known as Merchant bank of Fuzhou). The loan bears interest at 9.6% per annum, and is due on June 20, 2015.

			Payment due by period
Contractual Obligations		Total		1 year		1-3 years		3-5 years		More than 5 years*

Bank Loans	$	133,798,543	$	5,237,457	$	33,427,299	$	52,528,611	$	42,605,176
Operating Lease Obligations		935,670		47,537		51,540		51,716		784,877
Total	$	134,734,213	$	5,284,994	$	33,478,839	$	52,580,327	$	43,390,053

2.*Representing Agross ~~loan~~amount ~~for~~to ~~approximately $37.45 million from China Minsheng Banking Corp, Ltd. It bears interest rate at 9% per annum. $13,026,982 (RMB 80,000,000) and $24,425,592 (RMB 150,000,000) will~~ be ~~due in each twelve-month period as of December 31~~repaid, not ~~2018~~netting ~~and 2019, respectively. It is secured by the land use right~~ of ~~Jiangxi~~deferred ~~Zhangshu,~~financing ~~and~~costs ~~collateralized by the personal guarantees by two~~ of ~~the Company’s directors.~~$402,657

3.Compensation For AUsing ~~loan~~Natural ~~for~~Resources approximately $31.26 million from China Construction Bank. It bears interest at 6.55% per annum. $1,302,698 (RMB 8,000,000), $1,628,373 (RMB 10,000,000), $3,256,746 (RMB 20,000,000), $3,256,746 (RMB 20,000,000), $4,885,118 (RMB 30,000,000), $4,885,118 (RMB 30,000,000), $6,513,491(RMB 40,000,000) and $5,536,467 (RMB 34,000,000) will be due in each twelve-month period as of December 31, 2015, 2016, 2017, 2018, 2019, 2020, 2021 and 2022, respectively. It is secured by the fixed assets of Fujian Yida, and collateralized by the personal guarantees of two of the Company’s directors.Commitments

4.In December A2008, ~~loan~~Tulou ~~for~~entered ~~approximately~~into ~~$4.89~~a ~~million~~Tourist ~~from~~Resources ~~China~~Development ~~Construction~~Agreement ~~Bank.~~with Itthe ~~bears~~Hua’an ~~interest~~County atGovernment ~~7.86%~~(“Hua’an Government”) ~~per~~related ~~annum.~~to ~~$651,349~~paying ~~(RMB~~compensation ~~4,000,000)~~fees ~~will~~to bethe ~~due~~Hua’an inGovernment ~~each~~for ~~twelve-month~~using ~~period~~natural asresources ofin ~~December~~Tulou. The Company ~~31,~~agreed ~~2015,~~to ~~2016,~~pay ~~2017,~~(1) ~~2018,~~16% ~~2019,~~of ~~2020~~gross ~~and~~ticket ~~2021~~sales ~~respectively,~~in ~~and~~the ~~$325,675~~first ~~(RMB~~five years; (2~~,000,000~~) ~~will~~20% beof ~~due~~gross ticket sales in the ~~twelve-month~~second ~~period~~five years; as(3) 23% of ~~December~~gross ~~31,~~ticket ~~2022~~sales ~~respectively.~~in Itthe isthird ~~secured~~five byyears; (4) 25% of gross ticket sales in the ~~fixed~~fourth ~~assets~~five years; (5) 28% of ~~Fujian~~gross ~~Yida,~~ticket sales in the fifth five years; (6) 30% at twenty-six years and ~~collateralized~~thereafter bywhen the ~~personal~~ticket ~~guarantees~~price of ~~two~~the ofClusters is ~~the~~expected ~~Company’s~~to ~~directors~~be RMB60 ($9.50 USD) or above per person.

5.The Company Apaid ~~loan for~~ approximately $~~4.07 million from China Construction Bank. It bears interest at 7.86% per annum. $488~~46,~~512~~703 ~~(RMB 3,000,000) will be due in each twelve-month period as of December 31, 2015, 2016, 2017, 2018~~ and ~~2019 respectively,~~ $~~651~~56,~~349 (RMB 4~~891,~~000,000)~~ ~~will be due in each twelve-month period as of December 31, 2020 and 2021~~ respectively, ~~and~~to ~~$325,675~~the ~~(RMB~~Hua’an ~~2,000,000)~~Government ~~will~~for ~~be due in~~ the ~~twelve-month~~years ~~period~~ended ~~as of~~ December 31, 2015 ~~2022.~~and ~~It is secured by the fixed assets of Fujian Yida~~2014, ~~and~~which ~~collateralized~~payments bywere ~~the~~recorded ~~personal~~as ~~guarantees~~selling ~~of two of the Company’s directors~~expenses.

6. A loan for approximately $3.75 million from China Construction Bank. It bears interest at 7.86% per annum. $162,837 (RMB 1,000,000), $162,837 (RMB 1,000,000), $325,675 (RMB 2,000,000), $488,512 (RMB 3,000,000), $651,349 (RMB 4,000,000), $651,349 (RMB 4,000,000), $651,349 (RMB 4,000,000) and $651,349 (RMB 4,000,000) will be due in each twelve-month period as of December 31, 2015, 2016~~, 2017, 2018, 2019, 2020, 2021 and 2022, respectively. It is secured by the fixed assets of Fujian Yida, and collateralized by the personal guarantees of two of the Company’s directors.~~ Outlook

7.In A2016, ~~loan~~we ~~for~~will ~~approximately~~continue ~~$4.89~~the ~~million~~development of ~~from~~two ~~China~~new ~~Construction~~tourism ~~Bank.~~projects, Itthe ~~bears~~Yang-sheng ~~interest~~Paradise atin ~~7.86%~~Zhangshu ~~per~~City, ~~annum.~~Jiangxi ~~$$651~~province,~~349~~ ~~(RMB~~and ~~4,000,000)~~the ~~will~~City beof ~~due~~Caves in ~~each~~Fenyi ~~twelve-month~~City, Jiangxi ~~period~~province, aswhich ofrepresent ~~December~~our ~~31,~~commitment ~~2015,~~to ~~2016,~~expanding ~~2017,~~our ~~2018,~~business ~~2019,~~operations ~~2020~~by ~~and~~applying ~~2021~~our ~~respectively,~~current ~~and~~business ~~$325,675~~model ~~(RMB~~to the ~~2,000,000)~~development ~~will~~of beother ~~due~~valuable intourist ~~the~~destinations ~~twelve-month~~outside ~~period~~Fujian asprovince ofand ~~December~~throughout ~~31, 2022~~China. ItNow isthat ~~secured by~~ the ~~fixed~~Company ~~assets~~has more ofcash ~~Fujian~~generated ~~Yida,~~from ~~and~~two ~~collateralized~~new byopened ~~the~~tourism ~~personal~~sites, ~~guarantees~~we ofwill ~~two~~continue ofto develop the ~~Company’s directors~~projects.

33Critical Accounting Policies

InThe preparation of consolidated financial statements in conformity with accounting principles generally accepted in the ~~coming~~United 12States requires ~~months~~our management to make assumptions, weestimates, ~~have~~and ~~approximately~~judgments that affect the amounts reported, including the notes thereto, $5and related disclosures of commitments and contingencies, if any.21 ~~million~~We inhave ~~bank~~identified ~~loans~~certain accounting policies that ~~will~~are ~~mature~~significant to the preparation of our consolidated financial statements. WeThese ~~plan~~accounting policies are important for an understanding of our financial condition and results of operations. Critical accounting policies are those that are most important to ~~replace~~the ~~these~~portrayal of ~~loans~~our ~~with~~financial ~~new~~condition ~~bank~~and ~~loans~~results of operations and require management’s difficult, subjective, or complex judgment, often as a result of the need to make estimates about the effect of matters that are inherently uncertain and may change in ~~approximately~~subsequent periods. Certain accounting estimates are particularly sensitive because of their significance to financial statements and because of the ~~same~~possibility ~~aggregate~~that future events affecting the estimate may differ significantly from management’s current judgments. ~~amounts~~We believe the following critical accounting policies involve the most significant estimates and judgments used in the preparation of our consolidated financial statements.

We believe we can arrange funding for the projects based on the actual cash flow expenditures, which means we can accelerate the construction when we have more cash flows and we can slow down the construction when we are lack of funds.34

~~Obligations~~Basis of ~~Under Material Contracts~~presentation

~~Below~~The preparation isof afinancial ~~table~~statements ~~setting~~in ~~forth~~conformity with accounting principles generally accepted in the ~~Company~~United States requires our management to make assumptions, estimates, and judgments that affect the amounts reported, including the notes thereto, and related disclosures of commitments and contingencies, if any. We have identified certain accounting policies that are significant to the preparation of our financial statements. These accounting policies are important for an understanding of our financial condition and results of operations. Critical accounting policies are those that are most important to the portrayal of our financial condition and results of operations and require management’s ~~material~~difficult, ~~contractual obligations~~subjective, or complex judgment, often as a result of ~~December~~the ~~31,~~need ~~2014:~~to make estimates about the effect of matters that are inherently uncertain and may change in subsequent periods. Certain accounting estimates are particularly sensitive because of their significance to financial statements and because of the possibility that future events affecting the estimate may differ significantly from management’s current judgments. We believe the following critical accounting policies involve the most significant estimates and judgments used in the preparation of our financial statements.

			Payment due by period
Contractual Obligations	Total		1 year		1-3 years		3-5 years		More than 5 years
Bank Loans	$	88,257,804	$	5,210,793	$	8,956,051	$	50,316,719	$	23,774,241
Operating Lease Obligations		1,146,343		123,862		77,470		54,574		890,437
Total	$	89,404,147	$	5,334,655	$	9,033,521	$	50,371,293	$	24,664,678

Principles of consolidation

~~Compensation~~The accompanying ~~For~~consolidated ~~Using~~financial ~~Nature~~statements ~~Resources~~include the accounts of China Yida and its wholly-owned subsidiaries Keenway Limited, ~~Commitments~~Hong Kong Yi Tat, Fuyu, Fujian Yida, Tulou, YongtaiYunding, Jiangxi Zhangshu, Jiangxi Fenyi, Yida Travel, Fenyi Development, Zhangshu Development, Zhangshu Investment, Yida Arts, Yunding Hotel, Jiangxi Travel and the accounts of the Company’s variable interest entity, Fujian Jiaoguang. All significant inter-company accounts and transactions have been eliminated in consolidation.

~~In December 2008, Tulou entered into a Tourist~~Consolidation Resources Development Agreement with Hua’an County Government (“Hua’an government”) which is related to pay compensation fees for using natural resources in Tulou. The Company agreed to pay (1) 16% of ~~gross~~Variable ~~ticket~~Interest sales in the first five years; (2) 20% of gross ticket sales in the second five years; (3) 23% of gross ticket sales in the third five years; (4) 25% of gross ticket sales in the fourth five years; (5) 28% of gross ticket sales in the fifth five years; (6) 30% in twenty six years and thereafter when the ticket price of the Clusters is RMB60 ($9.50 USD) or above per person.Entities

~~The~~According to ~~Company~~the ~~paid~~requirements ~~approximately~~of ~~$56~~ASC 810,~~891~~ ~~and~~an Interpretation of Accounting Research Bulletin No. 51 that requires a Variable Interest Entity ~~$60~~("VIE"),~~973~~ tothe Company has evaluated the ~~Hua’~~economic relationships of Fujian Jiaoguang which signed an ~~government~~exclusive ~~for~~right agreement with the ~~years~~Company. ~~ended~~Therefore, ~~December~~Fujian ~~31,~~Jiaoguang ~~2014~~is ~~and~~considered ~~2013~~to be a VIE, ~~respectively~~as defined by ASC Topic 810-10, ~~and~~of ~~recorded~~which asthe ~~selling~~Company is ~~expenses~~the primary beneficiary.

~~2015~~The carrying ~~Outlook~~amount and classification of Fujian Jiaoguang’s assets and liabilities included in the Consolidated Balance Sheets are as follows:

After termination of our advertising business in July 2013, we have been focusing on the tourism business. In 2014, we continued the construction and development of two new tourism projects, the Yang-sheng Paradise in Zhangshu City, Jiangxi province, and the City of Caves in Fenyi City, Jiangxi province, which represent our commitment to expanding our business operations by applying our current business model to the development of other valuable tourist destinations outside Fujian province and throughout China. We expect to open City of Caves to the public in the second quarter of 2015. We expect to fund our operations with cash from operations and bank loans.

	December 31, 2015		December 31, 2014
Total current assets *	$	17,865,630	$	4,407,430
Total assets	$	17,872,871	$	4,415,085
Total current liabilities #	$	26,607,548	$	13,352,110
Total liabilities	$	26,607,548	$	13,352,110

~~Critical~~* Includes ~~Accounting~~intercompany ~~Policies~~receivables of $16,979,261 and $4,342,251 as at December 31, 2015 and 2014, respectively, to be eliminated upon consolidation.

~~The preparation of consolidated financial statements~~# inIncludes ~~conformity~~intercompany ~~with~~payables ~~accounting~~of ~~principles generally accepted in the United States requires our management to make assumptions~~$26, ~~estimates~~580, 316 and ~~judgments that affect the amounts reported~~$13, ~~including the notes thereto~~321,547 ~~and~~as ~~related~~December ~~disclosures of commitments and contingencies~~31, if ~~any.~~2015 We have identified certain accounting policies that are significant to the preparation of our consolidated financial statements. These accounting policies are important for an understanding of our financial condition and ~~results of operations. Critical accounting policies are those that are most important to the portrayal of our financial condition and results of operations and require management’s difficult~~2014, ~~subjective~~respectively, ~~or complex judgment, often as a result of the need~~ to ~~make~~be ~~estimates about the effect of matters that are~~eliminated ~~inherently~~upon ~~uncertain and may change in subsequent periods~~consolidation. Certain accounting estimates are particularly sensitive because of their significance to financial statements and because of the possibility that future events affecting the estimate may differ significantly from management’s current judgments. We believe the following critical accounting policies involve the most significant estimates and judgments used in the preparation of our consolidated financial statements.

34Although Fujian Jiaoguang no longer had revenues, its bank account had to be maintained with certain cash flows to support its expenses. As such, Fujian Jiaoguang transferred funds from and to the Company’s directly-owned subsidiaries, which resulted in intercompany receivables and payables. Since Fujian Jiaoguang is a variable interest entity subject to consolidation, the balances of its intercompany receivables and payables are eliminated against the corresponding account balances at the Company’s directly-owned subsidiaries at the consolidation level.

~~Basis~~ Use of ~~presentation~~estimates and assumptions

The preparation of the consolidated financial statements in conformity with accounting principles generally accepted in the United States ~~requires~~of ~~our~~America (“U.S. GAAP”) requires management to make ~~assumptions,~~ estimates, and ~~judgments~~assumptions that affect the ~~amounts~~ reported, ~~including~~amounts of ~~the~~assets ~~notes~~and ~~thereto,~~liabilities and ~~related~~disclosure ~~disclosures~~ of ~~commitments~~contingent assets and ~~contingencies, if~~liabilities ~~any.~~at ~~We have identified certain accounting policies that are significant to~~ the ~~preparation~~date of ~~our~~the consolidated financial statements~~. These~~ ~~accounting~~and ~~policies~~the ~~are~~amount ~~important for an understanding~~ of ~~our~~revenues ~~financial~~and ~~condition~~expenses ~~and~~during ~~results~~the ofreporting ~~operations~~periods. ~~Critical~~Management ~~accounting policies~~makes ~~are~~these ~~those~~estimates ~~that~~using ~~are~~the ~~most~~best ~~important~~information available toat the ~~portrayal~~time ofthe ~~our~~estimates ~~financial~~are ~~condition~~made. ~~and~~However, actual results ofcould ~~operations~~differ ~~and~~materially ~~require~~from ~~management’s difficult,~~those ~~subjective,~~results. orThe ~~complex~~most ~~judgment,~~significant estimates ~~often~~reflected asin ~~a result of~~ the ~~need~~consolidated tofinancial ~~make~~statements ~~estimates~~include ~~about~~depreciation, ~~the~~useful ~~effect~~lives of ~~matters~~property ~~that are inherently uncertain~~ and ~~may~~equipment, ~~change~~deferred income intaxes, ~~subsequent~~useful ~~periods.~~life ~~Certain accounting estimates are particularly sensitive because~~ of ~~their significance~~intangible toassets ~~financial statements~~ and ~~because~~contingencies. ofEstimates ~~the~~and ~~possibility~~assumptions ~~that~~are ~~future~~periodically ~~events~~reviewed ~~affecting~~and the ~~estimate may differ significantly~~ ~~from~~effects ~~management’s~~of ~~current~~revisions ~~judgments.~~are Wereflected ~~believe~~in the ~~following~~consolidated ~~critical~~financial ~~accounting~~statements ~~policies~~in ~~involve~~ the ~~most~~period ~~significant~~they ~~estimates and~~are ~~judgments~~determined ~~used~~to inbe ~~the preparation of our financial statements~~necessary.

~~Principles of consolidation~~35

~~The accompanying consolidated financial statements~~Property ~~include the accounts of China Yida~~ and its wholly-owned subsidiaries Keenway Limited, Hong Kong Yi Tat, Fuyu, Fujian Yida, Tulou, Yongtai Yunding, Jiangxi Zhangshu, Jiangxi Fenyi, Yida Travel, Fenyi Development, Zhangshu Development, Zhangshu Investment, Yida Arts, Yunding hotel, Jiangxi Travel and the accounts of its variable interest entity, Fujian Jiaoguang. All significant inter-company accounts and transactions have been eliminated in consolidation.equipment

~~Consolidation~~Property and equipment are recorded at cost less accumulated depreciation. Gains or losses on disposals are reflected as gain or loss in the year of ~~Variable~~disposal. ~~Interest~~The ~~Entities~~cost of improvements that extends the life of property, and equipment are capitalized. These capitalized costs may include structural improvements, equipment, and fixtures. All ordinary repair and maintenance costs are expensed as incurred.

~~According to the requirements of ASC 810, an~~Depreciation ~~Interpretation~~for offinancial ~~Accounting~~reporting ~~Research~~purposes ~~Bulletin~~is ~~No.~~provided 51using ~~that~~the ~~requires~~straight-line amethod ~~Variable~~over ~~Interest Entity ("VIE"),~~ the ~~Company~~estimated ~~has evaluated~~useful ~~the~~lives ~~economic relationships~~ of ~~Fujian Jiaoguang which signed an exclusive right agreement with~~ the ~~Company.~~assets ~~Therefore,~~or lease ~~Fujian~~term ~~Jiaoguang is considered to be a VIE,~~ as ~~defined by ASC Topic 810-10, of which the Company is the primary beneficiary.~~follows:

The carrying amount and classification of Fujian Jiaoguang’s assets and liabilities included in the Consolidated Balance Sheets are as follows:

Building	20 years
Electronic Equipment	5 to 8 years
Transportation Equipment	8 years
Office Furniture	5 to 8 years
Leasehold Improvement and Attractions	Lesser of term of the lease or the estimated useful lives of the assets

	December 31, 2014		December 31,2013
Total current assets *	$	4,407,430	$	12,244,845
Total assets	$	4,415,085	$	12,252,536
Total current liabilities #	$	13,352,110	$	11,193,422
Total liabilities	$	13,352,110	$	11,193,422

Intangible assets

*Intangible assets ~~Including~~consist ~~intercompany~~of ~~receivables~~acquisition of $4management rights of tourism destinations,~~342,251~~ commercial airtime rights and ~~$12,231,075~~land asuse atrights ~~December~~for tourism 31destinations. These intangible assets are amortized on a straight line basis over their respective lease periods. The lease period of management rights, ~~2014~~commercial airtime rights and ~~2013,~~land ~~respectively~~use rights is 30 years, to3 beyears ~~eliminated~~and in40 ~~consolidation~~years, respectively.

~~# Including intercompany payables of $13,321,547 and $11,169,092 as at December 31, 2014 and 2013, respectively, to be eliminated in consolidation.~~Impairment

~~Although~~The Company ~~Fujian~~reviews ~~Jiaoguang~~long-lived noassets ~~longer~~for ~~had~~impairment ~~revenues, its~~whenever ~~bank~~events ~~account~~or ~~still~~changes ~~has~~in tocircumstances beindicate ~~maintained~~that ~~active~~the ~~with~~carrying ~~certain~~amount of ~~cash~~an ~~flows~~asset tomay ~~support~~not ~~its~~be ~~expenses.~~recoverable Asthrough ~~such,~~the ~~Fujian~~estimated ~~Jiaoguang~~undiscounted ~~transferred funds~~cash ~~from~~flows ~~and~~expected to ~~the~~result ~~Company’s~~from ~~directly-owned~~the ~~subsidiaries,~~use ~~which resulted in intercompany receivables~~ and ~~payables. Since~~eventual ~~Fujian~~disposition ~~Jiaoguang~~of isthe aassets. ~~variable~~Whenever ~~interest~~any ~~entity~~such ~~subject~~impairment ~~to consolidation~~exists, ~~the~~an ~~balances~~impairment ofloss ~~its~~will ~~intercompany~~be ~~receivables~~recognized ~~and~~for ~~payables are eliminated against~~ the ~~corresponding~~amount ~~account~~by ~~balances at~~ which the ~~Company’s~~carrying ~~directly-owned~~value ~~subsidiaries~~exceeds at the ~~consolidation level~~fair value.

~~Use~~Assets are grouped and evaluated at the lowest level for their identifiable cash flows that are largely independent of the cash flows of other groups of assets. The Company considers historical performance and future estimated results in its evaluation of potential impairment and then compares the carrying amount of the asset to the future estimated cash flows expected to result from the use of the asset. If the carrying amount of the asset exceeds estimated expected undiscounted future cash flows, the Company measures the amount of impairment by comparing the carrying amount of the asset to its fair value. The estimation of fair value is generally measured by discounting expected future cash flows at the rate the Company utilizes to evaluate potential investments. The Company estimates fair value based on the information available, judgments and ~~assumptions~~projections, as necessary. Management reassessed and recorded impairment loss of $4,384,335 for the year ended December 31, 2014. There was no additional impairment for the year ended December 31, 2015.

~~The preparation of the consolidated financial~~Revenue 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 consolidated financial statements and the amount of revenues and expenses during the reporting periods. Management makes these estimates using the best information available at the time the estimates are made. However, actual results could differ materially from those results. The most significant estimates reflected in the consolidated financial statements include depreciation, useful lives of property and equipment, deferred income taxes, useful life of intangible assets and contingencies. Estimates and assumptions are periodically reviewed and the effects of revisions are reflected in the consolidated financial statements in the period they are determined to be necessary.recognition

35Revenue is recognized at the date of service rendered to customers when a formal arrangement exists, the price is fixed or determinable, the services rendered, no other significant obligations of the Company exist and collectability is reasonably assured. Payments received before satisfaction of all of the relevant criteria for revenue recognition are recorded as unearned revenue.

~~Property~~Revenues from advance tourism destinations ticket sales are recognized when the tickets are used. Revenues from our contractors who have tourism contracts with us are generally recognized over the period of the applicable agreements commencing when the contractors are first contracted to bring tourists to visit the tourism destinations. The Company also sells admission and ~~equipment~~activities tickets for a tourism destination in cases where the Company has management rights over the destination.

~~Property~~The Company ~~and~~has ~~equipment~~no ~~are~~allowance ~~recorded~~for atproduct ~~cost less~~returns ~~accumulated~~or ~~depreciation.~~sales ~~Gains~~discounts orbecause ~~losses~~services onthat ~~disposals~~ are ~~reflected~~rendered asand ~~gain~~accepted orby ~~loss in~~ the ~~year of disposal. The cost of~~customers ~~improvements~~are ~~that~~normally ~~extends~~not ~~the~~refundable ~~life of property,~~ and ~~equipment~~discounts are ~~capitalized.~~normally ~~These~~not ~~capitalized~~granted ~~costs~~after ~~may~~service ~~include~~has ~~structural~~been ~~improvements, equipment, and fixtures~~rendered. ~~All ordinary repair and maintenance costs are expensed as incurred.~~

~~Depreciation for financial reporting purposes is provided using the straight-line method over the estimated useful lives of the assets or lease term as follows:~~36

Building	20 years
Electronic Equipment	5 to 8 years
Transportation Equipment	8 years
Office Furniture	5 to 8 years
Leasehold Improvement and Attractions	Lesser of term of the lease or the estimated useful lives of the assets

Profit sharing costs are recorded as cost of revenue. Profit sharing arrangements with the local governments for the management rights (see Note 14):

~~Intangible~~For the ~~assets~~year ended December 31, 2015

Intangible assets consist of acquisition of management right of tourism destinations, commercial airtime rights and land use rights for tourism destinations. They are amortized on the straight line basis over their respective lease periods. The lease period of management right, commercial airtime rights and land use rights is 30 years, 3 years and 40 years, respectively.

	Tulou

Gross receipts	$	483,359

Profit sharing costs		-
Nature resource compensation expenses		46,703
Total paid to the local governments		46,703

Net receipts	$	436,656

~~Impairment~~For the year ended December 31, 2014

The Company reviews long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable through the estimated undiscounted cash flows expected to result from the use and eventual disposition of the assets. Whenever any such impairment exists, an impairment loss will be recognized for the amount by which the carrying value exceeds the fair value.

	Tulou

Gross receipts	$	631,660

Profit sharing costs		-
Nature resource compensation expenses		56,891
Total paid to the local governments		56,891

Net receipts	$	574,769

Assets are grouped and evaluated at the lowest level for their identifiable cash flows that are largely independent of the cash flows of other groups of assets. The Company considers historical performance and future estimated results in its evaluation of potential impairment and then compares the carrying amount of the asset to the future estimated cash flows expected to result from the use of the asset. If the carrying amount of the asset exceeds estimated expected undiscounted future cash flows, the Company measures the amount of impairment by comparing the carrying amount of the asset to its fair value. The estimation of fair value is generally measured by discounting expected future cash flows as the rate the Company utilizes to evaluate potential investments. The Company estimates fair value based on the information available, judgments and projections are considered necessary. There was no impairment of long-lived assets as of December 31, 2014 and 2013.37

~~Revenue~~Foreign currency ~~recognition~~translation

~~Revenue~~The Company isuses ~~recognized~~the atUnited ~~the~~States ~~date~~dollar of("U.S. ~~service~~dollars") for financial reporting purposes. The Company's subsidiaries ~~rendered~~maintain totheir ~~customers~~books ~~when~~and arecords ~~formal~~in ~~arrangement~~their ~~exists~~functional currency, being the ~~price~~primary iscurrency ~~fixed~~of orthe ~~determinable~~economic environment in which their operations are conducted. In general, ~~the~~for ~~services~~consolidation ~~rendered~~purposes, nothe ~~other~~Company ~~significant~~translates the subsidiaries' assets and liabilities ~~obligations~~into ofU.S. dollars using the ~~Company~~applicable ~~exist~~exchange ~~and~~rates ~~collectability~~prevailing isat ~~reasonably~~the ~~assured.~~balance ~~Payments~~sheet ~~received~~dates, ~~before~~and ~~satisfaction~~the statements of ~~all~~income ofare translated at average exchange rates during the reporting periods. Gain or loss on foreign currency transactions are reflected ~~relevant~~on ~~criteria~~the ~~for~~income ~~revenue~~statement. ~~recognition~~Gain or loss on financial statement translation from foreign currency are recorded as ~~unearned~~a ~~revenue~~separate component in the equity section of the balance sheet and is included as part of accumulated other comprehensive income. The functional currency of the Company and its subsidiaries in China is the Chinese Renminbi.

~~Revenues from advance tourism destinations~~Income ticket sales are recognized when the tickets are used. Revenues from our contractors who have tourism contracts with us are generally recognized over the period of the applicable agreements commencing with the tourists visiting the tourism destinations. The Company also sells admission and activities tickets for a tourism destination which the Company has the management right.taxes

~~The~~Income taxes ~~Company~~are ~~sold~~accounted for under the ~~television~~asset ~~airtime~~and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities ~~third~~and ~~parties~~their respective tax bases and operating loss and tax credit carry forwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The ~~Company~~effect ~~recorded~~on ~~advertising~~deferred ~~sales~~tax ~~when~~assets ~~advertisements~~and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. A valuation allowance is recognized if it is more likely than not that some portion, or all, of a deferred tax asset will not be realized. There were ~~aired~~no deferred income tax assets As of December 31, 2015 and 2014, respectively.

The Company applied the provisions of ASC 740-10-50, “Accounting For Uncertainty In Income Taxes,” which provides clarification related to the process associated with accounting for uncertain tax positions recognized in our financial statements. Audit periods remain open for review until the statute of limitations has nopassed. ~~allowance~~The completion of review or the expiration of the statute of limitations for ~~product~~a ~~returns~~given audit period could result in an adjustment to the Company’s liability for income taxes. Any such adjustment could be material to the Company’s results of operations for any given quarterly or ~~sales~~annual ~~discounts~~period ~~because~~based, ~~services~~in ~~that~~part, upon ~~are~~the ~~rendered~~results ~~and~~of ~~accepted~~operations byfor the ~~customers~~given ~~are~~period. ~~normally~~At ~~not~~December ~~refundable~~31, ~~and~~2015, ~~discounts~~management ~~are~~considered that the Company had no uncertain ~~normally~~tax ~~not~~positions ~~granted~~and ~~after~~will ~~service~~continue ~~has~~to ~~been~~evaluate ~~rendered~~for uncertain positions in the future.

36China Yida is subject to U.S. Federal and California state examination by tax authorities for years after 2008, and the PRC tax authority for years after 2007.

~~Profit sharing costs are recorded as cost of revenue. Profit sharing arrangements with the local governments for the management rights (see Note 14):~~38

~~For~~Fair values ~~the~~of ~~year~~financial ~~ended December 31, 2014~~instruments

	Tulou
Gross receipts	$	631,660
Profit sharing costs		-
Nature resource compensation expenses		56,891
Total paid to the local governments		56,891
Net receipts	$	574,769

The carrying amounts reported in the consolidated financial statements for current assets and currently liabilities approximate fair value due to the short-term nature of these financial instruments. The carrying amount of long-term loans approximates fair value since the interest rates associated with the debts approximate the current market interest rates.

~~For~~The Company adopted ASC 820-10, “Fair Value Measurements and Disclosures,” which establishes a single authoritative definition of fair value and a framework for measuring fair value and expands disclosure of fair value measurements for both financial and nonfinancial assets and liabilities. This standard defines fair value, provides guidance for measuring fair value and requires certain disclosures. This standard does not require any new fair value measurements, but discusses valuation techniques, such as the ~~year~~market ~~ended~~approach ~~December~~(comparable 31market prices), ~~2013~~the income approach (present value of future income or cash flows) and the cost approach (cost to replace the service capacity of an asset or replacement cost). For purposes of ASC 820-10-15, nonfinancial assets and nonfinancial liabilities would include all assets and liabilities other than those meeting the definition of a financial asset or financial liability as defined in ASC-820-10-15-15-1A.

	Tulou
Gross receipts	$	681,587
Profit sharing costs		-
Nature resource compensation expenses		60,973
Total paid to the local governments		60,973
Net receipts	$	620,614

Stock-based compensation

~~Foreign~~The Company ~~currency~~records ~~translation~~stock-based compensation expense pursuant to ASC 718-10, "Share Based Payment Arrangement," which requires companies to measure compensation cost for stock-based employee compensation plans at fair value at the grant date and recognize the expense over the employee's requisite service period. The Company’s expected volatility assumption is based on the historical volatility of Company’s stock or the expected volatility of similar entities. The expected life assumption is primarily based on historical exercise patterns and employee post-vesting termination behavior. The risk-free interest rate for the expected term of the option is based on the U.S. Treasury yield curve in effect at the time of grant.

~~The Company uses the United States dollar ("U.S.~~Stock-based ~~dollars")~~compensation ~~for~~expense ~~financial~~is ~~reporting~~recognized ~~purposes.~~based ~~The~~on ~~Company's~~awards ~~subsidiaries~~expected ~~maintain~~to ~~their~~vest, ~~books~~ and ~~records~~there inwere ~~their~~no ~~functional currency,~~estimated ~~being~~forfeitures ~~the~~as ~~primary currency of~~ the ~~economic~~Company ~~environment in which their operations are conducted. In general, for consolidation~~has ~~purposes,~~a ~~the~~short ~~Company~~history ~~translates~~of ~~the~~issuing ~~subsidiaries' assets and liabilities into U~~options.S. ~~dollars~~ASC ~~using~~718-10 ~~the~~requires ~~applicable~~forfeitures ~~exchange~~to ~~rates prevailing~~be estimated at the ~~balance~~time ~~sheet~~of ~~dates,~~grant and ~~the~~revised ~~statements~~in ~~of income are translated at average exchange rates during the reporting~~subsequent periods., ~~Gain~~if ornecessary, ~~loss~~if onactual ~~foreign~~forfeitures ~~currency~~differ ~~transactions are reflected on the income statement. Gain or loss on financial statement translation~~ from ~~foreign~~those ~~currency are recorded as a separate component in the equity section of the balance sheet and is included as part of accumulated other comprehensive income~~estimates. ~~The functional currency of the Company and its subsidiaries in China is the Chinese Renminbi.~~

~~Income~~Recent accounting ~~taxes~~pronouncements

~~Income~~In February ~~taxes~~25, ~~are~~2016, ~~accounted~~FASB ~~for~~issued ~~under~~ASU-2016-02-Leases. Topic 842 is to establish the ~~asset~~principles that lessees and lessors shall apply to report useful information to users of financial statements about the amount, timing, and ~~liability~~uncertainty ~~method~~of cash flows arising from a lease. ~~Deferred~~The ~~tax~~FASB ~~assets~~is issuing this Update to increase transparency and ~~liabilities~~comparability ~~are~~among ~~recognized~~organizations ~~for~~by recognizing lease assets and lease liabilities on the ~~future~~balance ~~tax~~sheet ~~consequences~~and ~~attributable~~disclosing tokey ~~differences~~information about leasing arrangements. Topic 842 affects any entity that enters into a lease (as that term is defined in this Update), with some specified scope exemptions. The guidance in this Update supersedes Topic 840, Leases. The main difference between previous GAAP and Topic 842 is the ~~financial~~recognition ~~statement~~of ~~carrying~~lease ~~amounts~~assets and lease liabilities by lessees for those leases classified as operating leases under previous GAAP. The core principle of ~~existing~~Topic 842 is that a lessee should recognize the assets and liabilities that arise from leases. All leases create an asset and ~~their~~a ~~respective~~liability ~~tax~~for the ~~bases~~lessee in accordance with FASB Concepts Statement No. 6, Elements of Financial Statements, and, ~~operating~~therefore, recognition of those ~~loss~~lease assets and ~~tax~~lease ~~credit~~liabilities ~~carry~~represents ~~forwards.~~an ~~Deferred~~improvement ~~tax~~over previous GAAP, which did not require lease assets and lease liabilities to ~~are~~be ~~measured~~recognized ~~using~~for ~~enacted~~most ~~tax~~leases. ~~rates~~A ~~expected~~lessee should recognize in the statement of financial position a liability to ~~apply~~make lease payments (the lease liability) and a right-of-use asset representing its right to ~~taxable~~use ~~income~~the inunderlying asset for the ~~years~~lease interm. ~~which~~When ~~those~~measuring assets ~~temporary~~and ~~differences~~liabilities ~~are~~arising ~~expected~~from a lease, a lessee (and a lessor) should include payments to be ~~recovered~~made in optional periods only if the lessee is reasonably certain to exercise an option to extend the lease or ~~settled.~~not ~~The~~to ~~effect~~exercise onan ~~deferred~~option to terminate the lease. ~~tax~~Similarly, optional payments to purchase the underlying asset should be included in the measurement of lease assets and lease liabilities only ofif athe ~~change~~lessee inis ~~tax~~reasonably ~~rates~~certain to exercise that purchase option. Reasonably certain is ~~recognized~~a inhigh ~~income~~threshold that is consistent with and intended to be applied in the ~~period~~same ~~that~~way ~~includes~~as the ~~enactment~~reasonably ~~date~~assured threshold in the previous leases guidance. AIn ~~valuation~~addition, also consistent with the previous leases guidance, a lessee (and a lessor) should ~~allowance~~exclude ismost ~~recognized~~variable iflease itpayments isin ~~more~~measuring ~~likely~~lease assets and lease liabilities, other than ~~not~~those that ~~some~~depend ~~portion,~~on an index or ~~all,~~a rate or are in substance fixed payments. For leases with a term of 12 months or less, a ~~deferred~~lessee ~~tax~~is ~~asset~~permitted ~~will~~to make an accounting policy election by class of underlying asset not beto ~~realized~~recognize lease assets and lease liabilities. If a lessee makes this election, ~~There~~it ~~were~~should norecognize ~~deferred~~lease ~~income~~expense ~~tax~~for ~~assets~~such asleases ofgenerally on a straight-line basis over the lease term. The amendments in this Update are effective for fiscal years beginning after December 3115, ~~2014~~2018, ~~and~~including ~~2013,~~interim ~~respectively~~periods within those fiscal years. The Company is still in the process of evaluating future impact of adopting this standard.

In November 20, 2015, FASB issued ASU-2015-17-Income Taxes. The ~~Company~~Board ~~applied~~is ~~the~~issuing ~~provisions~~this Update as part of ~~ASC~~its ~~740-10-50,~~initiative to ~~“Accounting~~reduce ~~For~~complexity ~~Uncertainty~~in Inaccounting ~~Income~~standards ~~Taxes”,~~(the ~~which~~Simplification ~~provides~~Initiative). ~~clarification~~The ~~related~~objective toof the ~~process~~Simplification ~~associated~~Initiative ~~with~~is to identify, evaluate, and improve areas of generally accepted accounting principles (GAAP) for ~~uncertain~~which ~~tax~~cost ~~positions~~and ~~recognized~~complexity incan be ~~our~~reduced while maintaining or improving the usefulness of the information provided to users of financial statements. Current ~~Audit~~GAAP ~~periods~~requires ~~remain~~an ~~open~~entity ~~for~~to ~~review~~separate ~~until~~deferred ~~the~~income ~~statute~~tax ofliabilities ~~limitations has~~and ~~passed.~~assets ~~The~~into ~~completion~~current and noncurrent amounts in a classified statement of ~~review~~financial orposition. To simplify the ~~expiration~~presentation of deferred income taxes, the ~~statute~~amendments ofin ~~limitations~~this Update ~~for~~require athat ~~given~~deferred ~~audit~~tax ~~period~~liabilities ~~could~~and ~~result~~assets be classified as noncurrent in ana classified statement of financial ~~adjustment~~position. The amendments in this Update apply to ~~the~~all ~~Company’s~~entities ~~liability~~that ~~for~~present ~~income~~a ~~taxes~~classified statement of financial position. ~~Any~~The current ~~such~~requirement ~~adjustment~~that ~~could~~deferred betax ~~material~~liabilities toand ~~the~~assets ~~Company’s~~of ~~results~~ a tax-paying component of ~~operations~~an ~~for~~entity ~~any~~be ~~given~~offset ~~quarterly~~and orpresented as ~~annual~~a ~~period~~single ~~based,~~amount inis ~~part,~~not ~~upon~~affected by the ~~results~~amendments ofin ~~operations~~this ~~for~~Update. For public business entities, the ~~given~~amendments ~~period.~~in Atthis ~~December~~Update ~~31,~~are ~~2014,~~effective ~~management~~for ~~considered~~financial ~~that~~statements ~~the~~issued ~~Company~~for ~~had~~annual noperiods ~~uncertain~~beginning ~~tax~~after ~~positions~~December 15, 2016, and ~~will~~interim periods ~~continue~~within tothose ~~evaluate~~annual periods. Earlier application is permitted for ~~uncertain~~all entities as of the beginning of an interim or ~~positions~~annual reporting period. The Company is still in the process of evaluating future impact of adopting this standard.

~~China~~In ~~Yida~~April 7, 2015, FASB issued ASU-2015-03-Interest-Imputation of Interest. The Board is ~~subject~~issuing this Update as part of its initiative to Ureduce complexity in accounting standards (the Simplification Initiative).S The objective of the Simplification Initiative is to identify, evaluate, and improve areas of generally accepted accounting principles (GAAP) for which cost and complexity can be reduced while maintaining or improving the usefulness of the information provided to users of financial statements. ~~Federal~~To simplify presentation of debt issuance costs, the amendments in this Update require that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. The recognition and ~~California~~measurement guidance for debt issuance ~~state~~costs ~~examination~~are not affected by ~~tax~~the ~~authorities~~amendments in this Update. For public business entities, the amendments in this Update are effective for financial statements issued for fiscal years beginning after ~~2008~~December 15, 2015, and ~~the~~interim ~~PRC~~periods ~~tax~~within ~~authority~~those ~~for~~fiscal years. The ~~after~~Company ~~2007~~has adapted this standard and the debt liability as of December 31, 2015 has been presented net of debt issuance costs.

3739

~~Fair~~In ~~values~~February 18, 2015, FASB issued ASU 2015-02-Consolidation (Topic 810). The amendments in this Update affect reporting entities that are required to evaluate whether they should consolidate certain legal entities. All legal entities are subject to reevaluation under the revised consolidation model. Specifically, the amendments: (1) Modify the evaluation of ~~financial~~whether ~~instruments~~limited partnerships and similar legal entities are variable interest entities (VIEs) or voting interest entities; (2) Eliminate the presumption that a general partner should consolidate a limited partnership; (3) Affect the consolidation analysis of reporting entities that are involved with VIEs, particularly those that have fee arrangements and related party relationships; (4) Provide a scope exception from consolidation guidance for reporting entities with interests in legal entities that are required to comply with or operate in accordance with requirements that are similar to those in Rule 2a-7 of the Investment Company Act of 1940 for registered money market funds. The amendments in this Update are effective for public business entities for fiscal years, and for interim periods within those fiscal years, beginning after December 15, 2015. The Company is still in the process of evaluating future impact of adopting this standard.

~~The~~In ~~carrying~~August ~~amounts~~2014, ~~reported~~FASB inissued ~~the~~ASU ~~consolidated~~2014-15 ~~financial~~- ~~statements~~Presentation ~~for~~of ~~current~~Financial ~~assets~~Statements ~~and~~- ~~currently~~Going ~~liabilities~~Concern ~~approximate~~(Subtopic ~~fair~~205-40). ~~value~~The ~~due~~amendments toin ~~the~~this ~~short-term~~Update ~~nature~~states ofthe ~~these~~disclosure of ~~financial~~uncertainties ~~instruments~~about an entity’s ability to continue as a going concern. ~~The~~An ~~carrying~~entity’s ~~amount~~management ofshould ~~long-term~~evaluate ~~loans~~whether there ~~approximates~~are ~~fair~~conditions ~~value~~or ~~since~~events, considered in the ~~interest~~aggregate, ~~rates~~that ~~associated~~raise ~~with~~substantial doubt about the entity’s ability to continue as a going concern within one year after the ~~debts~~date ~~approximate~~that the ~~current~~financial ~~market~~statements ~~interest~~are ~~rates~~issued (or available to be issued). When management identifies conditions or events that raise substantial doubt, management should consider whether its plans will alleviate the substantial doubt.

~~The~~When ~~Company~~substantial ~~adopted~~doubt ~~ASC~~is ~~820-10,~~raised ~~“Fair~~but ~~Value~~is ~~Measurements~~alleviated ~~and~~by ~~Disclosures”~~management’s plans, ~~which~~the ~~establishes~~entity ashould ~~single~~disclose ~~authoritative~~following ~~definition~~information: of(a) ~~fair~~Principal ~~value~~conditions ~~and~~or ~~a framework for~~events ~~measuring~~that ~~fair~~raised ~~value~~substantial ~~and~~doubt ~~expands~~(before ~~disclosure~~consideration of ~~fair~~management’s ~~value~~plans); measurements for both financial and nonfinancial assets and liabilities. This standard defines fair value, provides guidance for measuring fair value and requires certain disclosures. This standard does not require any new fair value measurements, but discusses valuation techniques, such as the market approach (~~comparable market prices~~b), ~~the~~Management’s ~~income~~evaluation ~~approach~~of ~~(present~~the ~~value~~ significance of ~~future~~those ~~income~~conditions or ~~cash~~events ~~flows)~~in ~~and~~relation ~~the cost approach (cost~~ to ~~replace~~ the ~~service capacity~~entity’s ofability anto ~~asset~~meet orits ~~replacement~~obligations; ~~cost~~(c). ~~For~~Management’s ~~purposes~~plans ~~of ASC 820-10-15, nonfinancial assets and nonfinancial liabilities would~~that ~~include~~alleviated ~~all assets and liabilities other than those meeting~~ the ~~definition~~substantial ~~of a financial asset or financial liability as defined in ASC-820-10-15-15-1A~~doubt.

~~Stock-based~~When ~~compensation~~substantial doubt is raised but is not alleviated by management’s plans, an entity should include a statement in the footnotes indicating that there is substantial doubt about the entity’s ability to continue as a going concern within one year after the date that the financial statements are issued (or available to be issued), and disclose the following information: (a) Principal conditions or events that raise substantial doubt; (b) Management’s evaluation of the significance of those conditions or events in relation to the entity’s ability to meet its obligations; (c) Management’s plans that are intended to mitigate the conditions or events that raise the substantial doubt.

The ~~Company~~amendments ~~records~~in ~~stock-based~~this ~~compensation expense~~Update ~~pursuant~~are ~~to ASC 718-10, "Share Based Payment Arrangement ” which requires companies to measure compensation~~effective ~~cost~~ for ~~stock-based~~the ~~employee~~annual ~~compensation~~period ~~plans~~ending atafter ~~fair~~December ~~value~~15, at2016, ~~the~~and ~~grant~~for ~~date~~annual periods and ~~recognize~~interim ~~the~~periods ~~expense~~thereafter. ~~over~~Early ~~the employee's~~application ~~requisite~~is ~~service period~~permitted. The Company’s ~~expected volatility assumption~~ is ~~based~~still onin the ~~historical~~process ~~volatility~~ of ~~Company’s stock~~evaluating orfuture ~~the~~impact ~~expected volatility~~ of ~~similar~~adopting ~~entities.~~this ~~The expected life assumption is primarily based on historical exercise patterns and employee post-vesting termination behavior~~standard. ~~The risk-free interest rate for the expected term of the option is based on the U.S. Treasury yield curve in effect at the time of grant.~~

Stock-based compensation expense is recognized based on awards expected to vest, and there were no estimated forfeitures as the Company has a short history of issuing options. ASC 718-10 requires forfeitures to be estimated at the time of grant and revised in subsequent periods, if necessary, if actual forfeitures differ from those estimates.40

~~Recent~~ Inflation ~~accounting~~and ~~pronouncements~~Seasonality

~~In August 2014, FASB issued ASU 2014-15 - Presentation~~Our ofoperating ~~Financial~~results ~~Statements~~and -operating ~~Going~~cash ~~Concern~~flows ~~(Subtopic~~historically ~~205-40).~~have ~~The~~not ~~amendments~~been inmaterially ~~this~~affected ~~Update~~by ~~states~~inflation ~~the disclosure of uncertainties about an entity’s ability to continue as a going concern. An entity’s management should evaluate whether there are conditions~~ or events, considered in the aggregate, that raise substantial doubt about the entity’s ability to continue as a going concern within one year after the date that the financial statements are issued (or available to be issued)seasonality. ~~When management identifies conditions or events that raise substantial doubt, management should consider whether its plans will alleviate the substantial doubt.~~

~~When substantial doubt is raised but is alleviated~~Off byBalance ~~management’s~~Sheet plans, the entity should disclose following information: (a) Principal conditions or events that raised substantial doubt (before consideration of management’s plans); (b) Management’s evaluation of the significance of those conditions or events in relation to the entity’s ability to meet its obligations; (c) Management’s plans that alleviated the substantial doubt.Arrangements

~~When~~We do ~~substantial doubt is raised but is~~ not ~~alleviated~~ byhave ~~management’s~~any ~~plans,,~~off anbalance ~~entity~~sheet ~~should~~arrangements ~~include a statement in the footnotes indicating~~ that ~~there~~have isor ~~substantial doubt~~are ~~about~~reasonably ~~the~~likely ~~entity’s ability~~ to ~~continue~~have as a ~~going~~current ~~concern~~or ~~within~~future ~~one~~effect ~~year~~on ~~after~~our ~~the date that the~~ financial ~~statements~~ ~~are~~condition, ~~issued~~changes ~~(or~~in ~~available~~financial ~~to be issued)~~condition, ~~and~~sales ~~disclose the following information: (a) Principal conditions~~ or ~~events~~expenses, ~~that~~results ~~raise substantial doubt; (b) Management’s evaluation~~ of ~~the~~operations, ~~significance~~liquidity ofor ~~those~~capital ~~conditions~~expenditures, or ~~events in relation to the entity’s ability~~capital toresources ~~meet its obligations; (c) Management’s plans~~ that are ~~intended~~material to ~~mitigate~~an ~~the~~investment ~~conditions~~in orour ~~events that raise the substantial doubt~~securities.

~~The amendments in this Update are effective~~ITEM ~~for the annual period ending after December 15, 2016, and for annual periods and interim periods thereafter~~7A. ~~Early~~QUANTITATIVE ~~application is~~AND ~~permitted.~~QUALITATIVE ~~The~~DISCLOSURES ~~Company~~ABOUT isMARKET ~~still in progress of evaluating future impact of adopting this standard~~RISK.

38Not applicable because we are a small reporting company.

In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606). The core principle of the guidance is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. To achieve the core principle, an entity should apply the following steps:41

~~Step~~ITEM 8. 1:FINANCIAL ~~Identify~~STATEMENTS ~~the~~AND ~~contract(s)~~SUPPLEMENTARY ~~with a customer~~DATA.

~~Step 2: Identify the performance obligations~~PART in1 ~~the~~- ~~contract.~~FINANCIAL INFORMATION

~~Step~~Item 1. 3:Financial ~~Determine the transaction price~~Statements.

~~Step 4: Allocate the transaction price to the~~CHINA ~~performance~~YIDA ~~obligations~~HOLDING, inCO. ~~the~~AND ~~contract.~~SUBSIDIARIES

~~Step 5: Recognize revenue when (or as) the~~CONSOLIDATED ~~entity~~FINANCIAL ~~satisfies a performance obligation.~~STATEMENTS

~~An entity should disclose sufficient information~~Index to ~~enable~~consolidated ~~users of~~ financial statements to understand the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. For a public entity, the amendments in this Update are effective for annual reporting periods beginning after December 15, 2016, including interim periods within that reporting period. Early application is not permitted. For all other entities (nonpublic entities), the amendments in this Update are effective for annual reporting periods beginning after December 15, 2017, and interim periods within annual periods beginning after December 15, 2018. A nonpublic entity may elect to apply this guidance earlier. The Company has begun evaluating future impact of adopting this standard on the Company’s consolidated financial position and operating results.

In April 2014, the FASB issued ASU 2014-08, Presentation of Financial Statements (Topic 205) and Property, Plant, and Equipment (Topic 360). The amendments in this Update change the requirements for reporting discontinued operations in Subtopic 205-20. A discontinued operation may include a component of an entity or a group of components of an entity, or a business or nonprofit activity. A disposal of a component of an entity or a group of components of an entity is required to be reported in discontinued operations if the disposal represents a strategic shift that has (or will have) a major effect on an entity’s operations and financial results. The amendments in this Update require an entity to present, for each comparative period, the assets and liabilities of a disposal group that includes a discontinued operation separately in the asset and liability sections, respectively, of the statement of financial position. The amendments in this Update require a public business entity and a not-for-profit entity that has issued, or is a conduit bond obligor for, securities that are traded, listed, or quoted on an exchange or an over-the-counter market to provide disclosures about a disposal of an individually significant component of an entity that does not qualify for discontinued operations presentation in the financial statements. The amendments in this Update require all other entities to provide disclosures about a disposal of an individually significant component of an entity that does not qualify for discontinued operations presentation in the financial statements. The amendments in this Update expand the disclosures about an entity’s significant continuing involvement with a discontinued operation. Those disclosures are required until the results of operations of the discontinued operation in which an entity retains significant continuing involvement are no longer presented separately as discontinued operations in the statement where net income is reported (or statement of activities for a not-for-profit entity). The adoption of this standard is not expected to have a material impact on the Company’s consolidated financial position and results of operations.

	Page
Report of Independent Registered Public Accounting Firm	F-2

Consolidated Balance Sheets as of December 31, 2015 and 2014	F-3

Consolidated Statements of Income and Comprehensive Income for the years ended December 31, 2015 and 2014	F-4

Consolidated Statements of Equity for the years ended December 31, 2015 and 2014	F-5

Consolidated Statements of Cash Flows for the years ended December 31, 2015 and 2014	F-6

Notes to the Consolidated Financial Statements	F-7 - F-28

~~In January 2014, the FASB issued ASU 2014~~F-02, Intangibles-Goodwill and Other (Topic 350): Accounting for Goodwill. The amendments in this Update allow an accounting alternative for the subsequent measurement of goodwill. An entity within the scope of the amendments that elects the accounting alternative in this Update should amortize goodwill on a straight-line basis over 10 years, or less than 10 years if the entity demonstrates that another useful life is more appropriate. An entity that elects the accounting alternative is further required to make an accounting policy election to test goodwill for impairment at either the entity level or the reporting unit level. Goodwill should be tested for impairment when a triggering event occurs that indicates that the fair value of an entity (or a reporting unit) may be below its carrying amount. The disclosures required under this alternative are similar to existing U.S. generally accepted accounting principles (GAAP). However, an entity that elects the accounting alternative is not required to present changes in goodwill in a tabular reconciliation. The accounting alternative, if elected, should be applied prospectively to goodwill existing as of the beginning of the period of adoption and new goodwill recognized in annual periods beginning after December 15, 2014, and interim periods within annual periods beginning after December 15, 2015. Early application is permitted. The adoption of this standard is not expected to have a material impact on the Company’s consolidated financial position and results of operations.1

39REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

InTo ~~December 2013,~~ the ~~FASB issued ASU 2013-12, “Definition of a Public Business Entity”. The~~ Board ~~has decided that it should proactively determine which entities would be within the scope~~ of ~~the~~Directors ~~Private Company Decision-Making Framework: A Guide for Evaluating Financial Accounting~~ and ~~Reporting~~Stockholders ~~for Private Companies (Guide). This will aim to minimize the inconsistency and complexity~~ of: ~~having~~China ~~multiple~~Yida ~~definitions of~~Holding, ~~or a diversity in practice as to what constitutes, a nonpublic entity and public entity within U~~Co.S. generally accepted accounting principles (GAAP) on a going-forward basis. This Update addresses those issues by defining public business entity. The Accounting Standards Codification includes multiple definitions of the terms nonpublic entity and public entity. The amendment in this Update improves U.S. GAAP by providing a single definition of public business entity for use in future financial accounting and reporting guidance. The amendment does not affect existing requirements. There is no actual effective date for the amendment in this Update. However, the term public business entity will be used in Accounting Standards Updates which are the first Updates that will use the term public business entity. The adoption of this standard is not expected to have a material impact on the Company’s consolidated financial position and results of operations.

InWe have ~~July~~audited ~~2013,~~ the ~~FASB~~accompanying ~~issued~~consolidated ~~ASU~~balance ~~2013-11, “Income~~sheets ~~Taxes (Topic 740): Presentation~~ of anChina ~~Unrecognized~~Yida ~~Tax Benefit When a Net Operating Loss Carryforward~~Holding, ~~a Similar Tax Loss, or a Tax Credit Carryforward Exists~~Co.” Anand ~~unrecognized~~Subsidiaries ~~tax benefit, or a portion of an unrecognized tax benefit, should be presented in~~ (the ~~financial statements~~ “Company”) as aof ~~reduction~~December ~~to a deferred tax asset. To the extent a net operating loss carryforward~~31, a ~~similar~~2015 ~~tax~~and ~~loss~~2014, orand ~~a tax credit carryforward is not available at~~ the ~~reporting~~related ~~date~~consolidated ~~under~~statements ~~the tax law~~ of ~~the applicable jurisdiction to settle any additional~~ income ~~taxes that would result from the disallowance of a tax position or the tax law of the applicable jurisdiction does not require the entity to use,~~ and ~~the~~comprehensive ~~entity does not intend to use~~income, ~~the~~equity ~~deferred~~and ~~tax~~cash ~~asset~~ flows for ~~such purpose,~~ the ~~unrecognized~~years ~~tax~~then ~~benefit should be presented in the financial statements as a liability and should not be combined with deferred tax assets~~ended. The ~~assessment~~Company’s ofmanagement ~~whether a deferred tax asset~~ is ~~available~~responsible is based on the unrecognized tax benefit and deferred tax asset that exist at the reporting date and should be made presuming disallowance of the tax position at the reporting date. For public entities, the guidance is effective prospectively for ~~reporting~~these ~~periods~~consolidated ~~beginning~~financial ~~after December 15, 2013~~statements. ~~For~~Our ~~nonpublic~~responsibility ~~entities, the guidance~~ is ~~effective prospectively for reporting periods beginning after December 15, 2014. Early adoption is permitted. The adoption of this standard is not expected~~ to ~~have~~express aan ~~material~~opinion ~~impact~~ on ~~the~~these ~~Company’s~~ consolidated financial ~~position and~~statements ~~results~~based ofon ~~operations~~our audits.

InWe conducted ~~February~~our ~~2013,~~audit ~~the~~in ~~FASB~~accordance ~~issued~~with ~~ASU~~the ~~2013-02, “Comprehensive~~standards ~~Income (Topic 220): Reporting~~ of ~~Amounts~~the ~~Reclassified~~Public ~~Out~~Company ofAccounting ~~Accumulated~~Oversight ~~Other~~Board ~~Comprehensive~~(United ~~Income~~States).~~” This~~ ~~ASU~~Those ~~does~~standards require ~~not~~that ~~change~~we ~~the~~plan ~~current~~and ~~requirements~~perform ~~for~~the ~~reporting~~audit ~~net~~to ~~income~~obtain orreasonable ~~other~~assurance ~~comprehensive~~about ~~income~~whether inthe financial statements~~. However,~~ ~~this~~are ~~guidance~~free ~~requires an entity to provide information about the amounts reclassified out~~ of ~~accumulated other comprehensive~~material ~~income by component~~misstatement. InThe ~~addition,~~Company ~~an entity~~ is not required to ~~present~~have, ~~either~~nor onwere ~~the~~we ~~face~~engaged ofto ~~the statement where net income is presented or in the notes~~perform, ~~significant~~an ~~amounts~~audit ~~reclassified out~~ of ~~accumulated~~its ~~other~~internal ~~comprehensive~~control ~~income~~over byfinancial reporting. ~~the~~Our ~~respective~~audit ~~line~~included ~~items~~consideration of ~~net~~ ~~income~~internal ~~but~~control ~~only~~over iffinancial ~~the~~reporting ~~amount~~as ~~reclassified~~a isbasis ~~required~~for ~~under~~designing ~~U.S.~~audit ~~GAAP~~procedures that toare beappropriate ~~reclassified to net income~~ in ~~its entirety in~~ the ~~same~~circumstances, ~~reporting~~but ~~period.~~not ~~For~~for ~~other~~the ~~amounts~~purpose ~~that~~of ~~are~~expressing ~~not~~an ~~required~~opinion ~~under~~on ~~U.S.~~the ~~GAAP~~effectiveness toof bethe ~~reclassified~~Company’s internal incontrol ~~their~~over ~~entirety~~financial toreporting. ~~net income~~Accordingly, anwe ~~entity~~express isno ~~required~~such toopinion. ~~cross-reference~~An toaudit ~~other~~also ~~disclosures~~includes ~~required~~examining, ~~under~~on ~~U.S.~~a ~~GAAP~~test basis, ~~that~~evidence ~~provide~~supporting ~~additional~~the ~~detail about those~~ amounts. ~~For~~and ~~public~~disclosures ~~entities,~~in the ~~guidance~~financial isstatements, ~~effective~~assessing ~~prospectively~~accounting ~~for~~principles ~~reporting~~used ~~periods~~and ~~beginning after December 15,~~significant ~~2012.~~estimates ~~For~~made ~~nonpublic~~by ~~entities~~management, ~~the~~as ~~guidance~~well isas ~~effective~~evaluating ~~prospectively~~the ~~for~~overall ~~reporting~~financial ~~periods~~statement ~~beginning after December 15, 2013~~presentation. ~~Early~~ ~~adoption~~We isbelieve ~~permitted.~~that ~~The~~our ~~adoption~~audit ~~of this standard is not expected to have~~ provide a ~~material~~reasonable ~~impact~~basis onfor ~~the~~our ~~Company’s consolidated financial position and results of operations~~opinion.

~~Inflation~~In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the consolidated financial position of China Yida Holding, Co. and ~~Seasonality~~Subsidiaries as of December 31, 2015 and 2014, and the consolidated results of their operations and their cash flows for the years then ended in conformity with accounting principles generally accepted in the United States of America.

~~Our~~The accompanying ~~operating~~consolidated ~~results~~financial ~~and~~statements ~~operating~~have been prepared assuming that the Company will continue as a going concern. As described in Note 2 of the consolidated financial statements, the Company has incurred significant negative cash flows from operating ~~historically~~activities, ~~have~~and continuing net losses and working capital deficits. The Company’s viability is dependent upon its ability to obtain future financing and the success of its future operations. These matters raise substantial doubt about the Company’s ability to continue as a going concern. Management’s plan in regard to these matters is also described in Note 2 to the consolidated financial statements. The consolidated financial statements do not ~~been~~include ~~materially~~any ~~affected~~adjustments bythat ~~inflation~~might orresult ~~seasonality~~from the outcome of this uncertainty.

~~Off~~/s/ ~~Balance~~KCCW ~~Sheet~~Accountancy ~~Arrangements~~Corp.

~~We do not have any off balance sheet arrangements~~Diamond ~~that have or are reasonably likely to have a current or future effect on our financial condition~~Bar, ~~changes~~California ~~in financial condition, sales or expenses, results of operations, liquidity or capital expenditures, or capital resources that are material to an investment in our securities.~~

~~ITEM~~March ~~7A.~~30, ~~QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.~~2016

~~Not applicable because we are a small reporting company.~~F-2

40CHINA YIDA HOLDING CO. AND SUBSIDIARIES

~~ITEM~~CONSOLIDATED BALANCE ~~8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.~~SHEETS

CHINA YIDA HOLDING, CO. AND SUBSIDIARIES

	December 31,		December 31,
	2015		2014
			(Restated)
ASSETS
Current assets
Cash and cash equivalents	$	5,481,292	$	958,664
Accounts receivable		272,703		343,807
Other receivables, net		201,394		148,828
Advances and prepayments		536,308		838,933
Prepayment - current portion		845,922		832,207
Total current assets		7,337,619		3,122,439

Property and equipment, net		167,176,293		177,225,357
Intangible assets, net		42,777,443		46,419,350
Long-term prepayments		1,426,135		2,032,764
Total assets	$	218,717,490	$	228,799,910

LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
Short-term loans	$	1,848,514	$	1,954,047
Long-term debt, current portion		3,388,943		3,256,746
Accounts payable		396,318		713,414
Accrued expenses and other payables		1,338,021		1,364,863
Due to related parties		2,082,013		31,680,942
Taxes payable		34,785		38,922
Total current liabilities		9,088,594		39,008,934

Long-term debt		128,158,429		83,047,011
Total liabilities		137,247,023		122,055,945

Commitments and contingencies (Note 14)

Equity
Preferred stock ($0.0001 par value, 10,000,000 shares authorized, none issued and outstanding)		-		-
Common stock ($0.001 par value, 100,000,000 shares authorized, 3,914,580 and 3,914,580 shares issued and outstanding as of December 31, 2015 and December 31, 2014, respectively)		3,915		3,915
Additional paid in capital		49,163,705		49,163,705
Accumulated other comprehensive income		12,388,257		17,508,968
Retained earnings		17,365,260		37,518,047
Statutory reserve		2,549,330		2,549,330
Total equity		81,470,467		106,743,965
Total liabilities and equity	$	218,717,490	$	228,799,910

~~CONSOLIDATED~~The accompanying ~~FINANCIAL~~notes ~~STATEMENTS~~are an integral part of these consolidated financial statements.

~~Index to consolidated financial statements~~F-3

	Page
Report of Independent Registered Public Accounting Firm	F-1
Consolidated Balance Sheets as of December 31, 2014 and 2013	F-2
Consolidated Statements of Income and Comprehensive Income for the years ended December 31, 2014 and 2013	F-3
Consolidated Statements of Equity for the years ended December 31, 2014 and 2013	F-4
Consolidated Statements of Cash Flows for the years ended December 31, 2014 and 2013	F-5
Notes to the Consolidated Financial Statements	F-6 - F-32

CHINA YIDA HOLDING CO. AND SUBSIDIARIES

41CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME

~~Audit~~FOR •THE ~~Tax•~~YEARS ~~Consulting~~ENDED •DECEMBER ~~Financial Advisory Registered with Public Company Accounting Oversight Board (PCAOB)~~31

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

	2015			2014
Net revenue	$	14,509,124		$	13,124,152

Cost of revenue		9,562,829			9,053,904

Gross profit		4,946,295			4,070,248

Operating expenses
Selling expenses		9,528,549			10,037,292
General and administrative expenses		6,839,614			7,595,484
Impairment of long-lived assets		-			4,384,335

Total operating expenses		16,368,163			22,017,111

Loss from operations		(11,421,868	)		(17,946,863	)

Other income (expense)
Other (expense) income, net		(504,975	)		(394,144	)
Interest income		14,219			10,672
Interest expense		(8,240,163	)		(8,207,752	)

Total other expenses		(8,730,919	)		(8,591,224	)

Loss before income tax and non-controlling interest		(20,152,787	)		(26,538,087	)

Less: Provision for income tax		-			-

Net loss from continuing operations		(20,152,787	)		(26,538,087	)

Discontinued operation
Loss from discontinued operations, net of income taxes		-			(616,732	)
Loss on disposal of subsidiary, net of income taxes		-			(6,510,630	)

Net loss from discontinued operations, net of income taxes		-			(7,127,362	)

Net loss	$	(20,152,787	)	$	(33,665,449	)

Other comprehensive income (loss)
Foreign currency translation loss		(5,120,711	)		(879,782	)

Comprehensive loss	$	(25,273,498	)	$	(34,545,231	)

Amounts attributable to common stockholders:
Net loss from continuing operations, net of income taxes	$	(20,152,787	)	$	(26,538,087	)
Net loss from discontinued operations, net of income taxes		-			(7,127,362	)
Net loss attributable to common stockholders	$	(20,152,787	)	$	(33,665,449	)

Net loss attributable to common stockholders per share - basic and diluted:
- Basic & diluted earnings/(loss) per share from continuing operations	$	(5.15	)	$	(6.78	)
- Basic & diluted earnings/(loss) per share from discontinued operations	$	-		$	(1.82	)
- Basic & diluted earnings/(loss) per share attributable to common stockholders	$	(5.15	)	$	(8.60	)

Weighted average shares outstanding
- Basic		3,914,580			3,914,580
- Diluted		3,914,580			3,914,580

ToThe accompanying ~~the~~notes ~~Board~~are ofan ~~Directors~~integral ~~and~~part ~~Stockholders~~ of: ~~China~~these ~~Yida~~consolidated ~~Holding,~~financial Costatements.

We have audited the accompanying consolidated balance sheets of China Yida Holding, Co. and Subsidiaries (the “Company”) as of December 31, 2014 and 2013, and the related consolidated statements of income and comprehensive income, equity and cash flows for the years then ended. The Company’s management is responsible for these consolidated financial statements. Our responsibility is to express an opinion on these consolidated financial statements based on our audits.F-4

WeCHINA ~~conducted~~YIDA ~~our~~HOLDING ~~audit in accordance with the standards of the Public Company Accounting Oversight Board (United States)~~CO. ~~Those~~AND standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audit included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provide a reasonable basis for our opinion.SUBSIDIARIES

~~In our~~CONSOLIDATED ~~opinion,~~STATEMENTS ~~the~~OF consolidated financial statements referred to above present fairly, in all material respects, the consolidated financial position of China Yida Holding, Co. and Subsidiaries as of December 31, 2014 and 2013, and the consolidated results of their operations and their cash flows for the years then ended in conformity with accounting principles generally accepted in the United States of America.EQUITY

~~The~~FOR ~~accompanying~~THE ~~consolidated~~YEARS ~~financial~~ENDED ~~statements~~DECEMBER ~~have been prepared assuming that the Company will continue as a going concern. As described in Note 2 of the consolidated financial statements~~31, ~~the~~2015 ~~Company~~AND has incurred significant negative cash flows from operative activities, and continuing net losses and working capital deficits. The Company’s viability is dependent upon its ability to obtain future financing and the success of its future operations. These matters raise substantial doubt about the Company’s ability to continue as a going concern. Management’s plan in regard to these matters is also described in Note 2 to the consolidated financial statements. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.2014

/s/ KCCW Accountancy Corp.

							Accumulated
	Common Stock				Additional		other								Non-
	Number of shares		Par Value		paid-in capital		comprehensive income			Retained earnings			Statutory reserve		controlling interest		Total

Balance at December 31, 2013		3,914,580	$	3,915	$	49,163,705	$	18,388,750		$	71,183,496		$	2,549,330	$	-	$	141,289,196
Foreign currency translation		-		-		-		(879,782	)		-			-		-		(879,782	)
Net loss for the year ended December 31, 2014		-		-		-		-			(33,665,449	)		-		-		(33,665,449	)
Balance at December 31, 2014		3,914,580		3,915		49,163,705		17,508,968			37,518,047			2,549,330		-		106,743,965
Foreign currency translation		-		-		-		(5,120,711	)		-			-		-		(5,120,711	)
Net loss for the year ended December 31, 2015		-		-		-		-			(20,152,787	)		-		-		(20,152,787	)
Balance at December 31, 2015		3,914,580	$	3,915	$	49,163,705	$	12,388,257		$	17,365,260		$	2,549,330	$	-	$	81,470,467

~~Diamond~~The accompanying ~~Bar,~~notes ~~California~~are ~~March~~an ~~31,~~integral ~~2015~~part of these consolidated financial statements.

F-15

CHINA YIDA HOLDING CO. AND SUBSIDIARIES ~~CONSOLIDATED BALANCE SHEETS~~

	December 31,		December 31,
	2014		2013
ASSETS
Current assets
Cash and cash equivalents	$	958,664	$	2,157,738
Accounts receivable		343,807		571,637
Other receivables, net		148,828		268,835
Advances and prepayments		838,933		1,361,194
Prepayment - current portion		832,207		659,050
Current assets of discontinued operations		-		587,329
Total current assets		3,122,439		5,605,783
Property and equipment, net		181,613,405		182,719,628
Intangible assets, net		46,419,350		47,837,641
Long-term prepayments		2,032,764		2,707,374
Non-current assets of discontinued operations		-		37,730,857
Total assets	$	233,187,958	$	276,601,283
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
Short-term loans	$	1,954,047	$	2,454,108
Long-term debt, current portion		3,256,746		6,871,502
Accounts payable		713,414		565,694
Accrued expenses and other payables		1,364,863		1,019,391
Due to related parties		31,680,942		35,596,962
Taxes payable		38,922		27,895
Current liabilities of discontinued operations		-		2,110,055
Total current liabilities		39,008,934		48,645,607
Long-term debt		83,047,011		78,531,462
Non-current liabilities of discontinued operations		-		8,135,018
Total liabilities		122,055,945		135,312,087
Equity
Preferred stock ($0.0001 par value, 10,000,000 shares authorized, none issued and outstanding)		-		-
Common stock ($0.001 par value, 100,000,000 shares authorized, 3,914,580 and 3,914,580 shares issued and outstanding as of December 31, 2014 and 2013, respectively)		3,915		3,915
Additional paid in capital		49,163,705		49,163,705
Accumulated other comprehensive income		17,512,681		18,388,750
Retained earnings		41,902,382		71,183,496
Statutory reserve		2,549,330		2,549,330
Total equity		111,132,013		141,289,196
Total liabilities and equity	$	233,187,958	$	276,601,283

CONSOLIDATED STATEMENTS OF CASH FLOWS

The accompanying notes are an integral part of these consolidated financial statements.

	2015			2014
				(Restated)
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss	$	(20,152,787	)	$	(33,665,449	)
Net loss from discontinued operations		-			616,732
Adjustments to reconcile net income to net cash provided by operating activities:
Loss on disposal of discontinued operation		-			6,510,630
Depreciation		8,077,212			8,476,262
Amortization		1,182,820			1,192,192
Amortization of long-term prepayments		1,052,882			804,506
Impairment of long-lived assets		-			4,384,335
Changes in operating assets and liabilities:
Accounts receivable		54,753			224,949
Other receivables, net		(63,162	)		90,911
Advances and prepayments		268,181			515,433
Accounts payable		(290,324	)		150,255
Accrued expenses and other payables		48,848			349,953
Taxes payable		(2,120	)		38,889
Net cash used in continuing operations		(9,823,697	)		(10,310,402	)
Net cash provided by discontinued operations		-			705,499
Net cash used in operating activities		(9,823,697	)		(9,604,903	)

CASH FLOWS FROM INVESTING ACTIVITIES
Proceeds from disposal of discontinued entity		-			35,570,385
Additions to property and equipment		(7,579,476	)		(8,229,799	)
Increase in long-term prepayments for acquisition of property, equipment and land use rights		(453,949	)		(319,176	)
Net cash (used in) provided by continuing operations		(8,033,425	)		27,021,410
Net cash provided by discontinued operations		-			471,410
Net cash (used in) provided by investing activities		(8,033,425	)		27,492,820

CASH FLOWS FROM FINANCING ACTIVITIES
Payment of deferred financing costs		(561,906	)		-
Proceeds from short-term loans		1,926,535			4,555,586
Repayment of short-term loans		(1,926,535	)		(5,043,685	)
Proceeds from long-term loans		56,190,599			48,807,057
Repayment of long-term loans		(3,759,954	)		(47,508,257	)
Repayment of proceeds from loans from related parties		(29,106,657	)		(3,767,951	)
Net cash provided by continuing operations		22,762,082			(2,957,250	)
Net cash used in discontinued operations		-			(16,196,038	)
Net cash provided by (used in) financing activities		22,762,082			(19,153,288	)

EFFECT OF EXCHANGE RATE CHANGES ON CASH		(382,332	)		(187,465	)

NET INCREASE IN CASH AND CASH EQUIVALENTS		4,522,628			(1,452,836	)

CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD		958,664			2,415,575	(1)
CASH AND CASH EQUIVALENTS, ENDING OF PERIOD	$	5,481,292		$	962,739	(2)

SUPPLEMENTAL DISCLOSURES:
Cash paid during the period for:
Income tax	$	-		$	-
Interest	$	8,240,163		$	8,207,752

F-(1) Included cash and cash equivalents from continuing and discontinued operations of $2,157,738 and $257,837, respectively. (2) Included cash and cash equivalents from continuing and discontinued operations of $958,664 and $4,075 respectively.

~~CHINA~~The accompanying ~~YIDA~~notes ~~HOLDING~~are ~~CO.~~an ~~AND~~integral ~~SUBSIDIARIES~~part ~~CONSOLIDATED~~of ~~STATEMENTS~~these OFconsolidated ~~INCOME~~financial ~~AND COMPREHENSIVE INCOME FOR THE YEARS ENDED DECEMBER 31~~statements.

	2014			2013
Net revenue
Advertisement	$	-		$	2,910,612
Tourism		13,124,152			9,457,821
Total net revenue		13,124,152			12,368,433
Cost of revenue
Advertisement		-			2,045,765
Tourism		9,053,904			4,214,436
Total cost of revenue		9,053,904			6,260,201
Gross profit		4,070,248			6,108,232
Operating expenses
Selling expenses		10,037,292			9,582,502
General and administrative expenses		7,595,484			7,527,230
Total operating expenses		17,632,776			17,109,732
Loss from operations		(13,562,528	)		(11,001,500	)
Other income (expense)
Other expense, net		(394,144	)		(119,700	)
Interest income		10,672			82,821
Interest expense		(8,207,752	)		(5,538,473	)
Total other expenses		(8,591,224	)		(5,575,352	)
Loss before income tax and non-controlling interest		(22,153,752	)		(16,576,852	)
Less: Provision for income tax		-			133,323
Net loss from continuing operations		(22,153,752	)		(16,710,175	)
Discontinued Operation
Loss from discontinued operations, net of income taxes		(616,732	)		(643,355	)
(Loss) gain on disposal of subsidiary, net of income taxes		(6,510,630	)		999,133
Net (loss) income from discontinued operations, net of income taxes		(7,127,362	)		355,778
Net loss		(29,281,114	)		(16,354,397	)
Net loss attributable to non-controlling interest:
Net loss from discontinued operation		-			102,215
Net loss attributable to China Yida Holding Co.	$	(29,281,114	)	$	(16,252,182	)
Net loss	$	(29,281,114	)	$	(16,354,397	)
Other comprehensive income
Foreign currency translation (loss) gain		(876,069	)		4,308,861
Comprehensive loss		(30,157,183	)		(12,045,536	)
Comprehensive income attributable to non-controlling interest		-			390,730
Comprehensive loss attributable to China Yida Holding Co.	$	(30,157,183	)	$	(11,654,806	)
Amounts attributable to common stockholders:
Net loss from continuing operations, net of income taxes		(22,153,752	)		(16,710,175	)
Net (loss) income from discontinued operations, net of income taxes		(7,127,362	)		457,993
Net loss attributable to common stockholders		(29,281,114	)		(16,252,182	)
Net loss attributable to common stockholders per share - basic and diluted:
- Basic & diluted earnings/(loss) per share from continuing operations	$	(5.66	)	$	(4.27	)
- Basic & diluted earnings/(loss) per share from discontinued operations	$	(1.82	)	$	0.12
- Basic & diluted earnings/(loss) per share attributable to common stockholders	$	(7.48	)	$	(4.15	)
Weighted average shares outstanding
- Basic		3,914,580			3,914,580
- Diluted		3,914,580			3,914,580

F-6

~~The~~CHINA YIDA ~~accompanying~~HOLDING, ~~notes~~CO. ~~are~~AND ~~an integral part of these consolidated financial statements.~~SUBSIDIARIES

~~F-3~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

~~CHINA YIDA HOLDING CO~~1. ORGANIZATION AND ~~SUBSIDIARIES~~DESCRIPTION ~~CONSOLIDATED STATEMENTS~~ OF ~~EQUITY FOR THE YEARS ENDED DECEMBER 31, 2014 AND 2013~~BUSINESS

	Common Stock				Additional		Accumulated other								Non-
	Number of shares		Par Value		paid-in capital		comprehensive income			Retained earnings			Statutory reserve		controlling interest			Total
Balance at December 31, 2012		3,914,580	$	3,915	$	49,163,705	$	13,791,374		$	87,435,678		$	2,549,330	$	5,789,048		$	158,733,050
Foreign currency translation		-		-		-		4,597,376			-			-		(288,515	)		4,308,861
Deconsolidation of Anhui Yida		-		-		-		-			-			-		(5,398,318	)		(5,398,318	)
Net loss for the year ended December 31, 2013		-		-		-		-			(16,252,182	)		-		(102,215	)		(16,354,397	)
Balance at December 31, 2013		3,914,580	$	3,915	$	49,163,705	$	18,388,750		$	71,183,496		$	2,549,330	$	-		$	141,289,196
Foreign currency translation		-		-		-		(876,069	)		-			-		-			(876,069	)
Net loss for the year ended December 31, 2014		-		-		-		-			(29,281,114	)		-		-			(29,281,114	)
Balance at December 31, 2014		3,914,580	$	3,915	$	49,163,705	$	17,512,681		$	41,902,382		$	2,549,330	$	-		$	111,132,013

China Yida Holding Co. (“China Yida”) and its subsidiaries (collectively the "Company,” “we,” “us,” or “our”) engage in the tourism and advertisement businesses in the People’s Republic of China.

~~The~~Keenway Limited ~~accompanying~~was ~~notes~~incorporated ~~are~~under the laws of the Cayman Islands on May 9, 2007 for the purpose of functioning as an ~~integral~~off-shore ~~part~~holding company to obtain ownership interests in Hong Kong Yi Tat International Investment Co., Ltd (“Hong Kong Yi Tat”), a company incorporated under the laws of ~~these~~Hong ~~consolidated~~Kong. Immediately ~~financial~~prior ~~statements~~to the Merger (defined below), Mr. Chen Minhua and his wife, Ms. Fan Yanling, were the majority shareholders of Keenway Limited.

~~F-4~~On November 19, 2007, we entered into a share exchange and stock purchase agreement with Keenway Limited, Hong Kong Yi Tat, and with the shareholders of Keenway Limited at that time, including Chen Minhua, Fan Yanling, Zhang Xinchen, Extra Profit International Limited, and Lucky Glory International Limited (collectively, the “Keenway Limited Shareholders”), pursuant to which in exchange for all of their shares of Keenway Limited common stock, the Keenway Limited Shareholders received 18,180,649 newly issued shares (or 90,903,246 shares prior to the reverse stock split on November 16, 2012) of our common stock and 728,359 shares (or 3,641,796 shares prior to the reverse stock split on November 16, 2012) of our common stock which was transferred from some of our then existing shareholders (the “Merger”). As a result of the closing of the Merger, the Keenway Limited Shareholders owned approximately 94.5% of our then issued and outstanding shares on a fully diluted basis and Keenway Limited became our wholly owned subsidiary.

~~CHINA~~Hong Kong ~~YIDA~~Yi ~~HOLDING~~Tat COwas incorporated as the holding company of our operating entities, Fujian Jintai Tourism Development Co., ~~AND~~Ltd., ~~SUBSIDIARIES~~and Fujian ~~CONSOLIDATED~~Jiaoguang ~~STATEMENTS~~Media OFCo., ~~CASH~~Ltd., ~~FLOWS~~Yida (Fujian) Tourism Group Limited, and Fujian Yida Tulou Tourism Development Co., Ltd. (“Tulou”). Hong Kong Yi Tat does not have any other operation.

	2014			2013
				(Restated)
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss	$	(29,281,114	)	$	(16,354,397	)
Loss from discontinued operations		616,732			643,356
Adjustments to reconcile net income to net cash provided by operating activities:
Loss (gain) on disposal of discontinued operation		6,510,630			(999,133	)
Depreciation		8,476,262			5,014,150
Amortization		1,192,192			1,656,201
Amortization of financing costs		-			609,897
Changes in operating assets and liabilities:
Accounts receivable		224,949			(381,179	)
Other receivables, net		90,911			(106,431	)
Advances and prepayments		515,433			(44,510	)
Accounts payable		150,255			508,534
Accrued expenses and other payables		349,953			496,683
Taxes payable		38,889			(469,513	)
Net cash used in continuing operations		(11,114,907	)		(9,426,342	)
Net cash provided by (used in) discontinued operations		705,499			(300,087	)
Net cash used in operating activities		(10,409,408	)		(9,726,429	)
CASH FLOWS FROM INVESTING ACTIVITIES
Proceeds from disposal of discontinued entities		35,570,385			9,616,155
Additions to property and equipment		(8,229,799	)		(74,668,705	)
Change in long-term prepayments for acquisition of property, equipment and land use rights		485,330			(1,118,332	)
Net cash provided by (used in) continuing operations		27,825,916			(66,170,882	)
Net cash provided by (used in) discontinued operations		471,410			(552,054	)
Net cash provided by (used in) investing activities		28,297,326			(66,722,936	)
CASH FLOWS FROM FINANCING ACTIVITIES
Repayment of obligation under airtime rights commitment		-			(1,572,953	)
Proceeds from short-term loans		4,555,586			6,457,550
Repayment of short-term loans		(5,043,685	)		(5,650,356	)
Proceeds from long-term loans		48,807,057			53,274,785
Repayment of long-term loans		(47,508,257	)		(13,399,416	)
(Repayment of) proceeds from loans from related parties		(3,767,951	)		35,181,117
Net cash (used in) provided by continuing operations		(2,957,250	)		74,290,727
Net cash used in discontinued operations		(16,196,038	)		(2,119,459	)
Net cash (used in) provided by financing activities		(19,153,288	)		72,171,268
EFFECT OF EXCHANGE RATE CHANGES ON CASH		(187,466	)		170,863
NET DECREASE IN CASH AND CASH EQUIVALENTS		(1,452,836	)		(4,107,234	)
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD		2,415,575	(1)		6,572,995	(2)
CASH AND CASH EQUIVALENTS, ENDING OF PERIOD	$	962,739	(3)	$	2,465,761	(4)
SUPPLEMENTAL DISCLOSURES:
Non-cash investing activities:
Transfer from advances and prepayments to intangible assets	$	-		$	439,629
Cash paid during the period for:
Income tax	$	-		$	133,323
Interest	$	8,207,752		$	8,428,741

Fujian Jintai Tourism Development Co., Ltd. (“Fujian Jintai”) has a wholly owned subsidiary, Fuzhou Hongda Commercial Services Co., Ltd., (“Hongda”). The operation of Fujian Jintai is to develop the Great Golden Lake, one of our tourism destinations.

Hongda does not have any operation except for owning 100% of the ownership interest in Fuzhou Fuyu Advertising Co., Ltd. (1“Fuyu”) which ~~Included~~is ~~cash~~engaged ~~and~~in ~~cash~~the ~~equivalents~~operations ~~from~~of ~~continuing~~our media business. On March 15, 2010, Hongda entered into an equity transfer agreement with Fujian Yunding Tourism Industrial Co., Ltd, (currently known as Yida (Fujian) Tourism Group Limited, “Fujian Yunding”), pursuant to which Fujian Yunding acquired 100% of the issued and ~~discontinued~~outstanding ~~operations~~shares of $2Fuyu from Hongda at the aggregate purchase price of RMB 3,~~157~~000,~~738~~000. As a result, Fujian Yunding became the 100% holding company of Fuyu. Hongda ceased business and ~~$257~~deregistered on December 2,~~837,~~ ~~respectively~~2011.

Fujian Jintai originally also owned 100% of the ownership interest in Fujian Yintai Tourism Co., Ltd. (2“Yintai”). ~~Included~~On ~~cash~~March 15, ~~and~~2010, ~~cash~~Fujian ~~equivalents~~Jintai ~~from~~entered ~~continuing~~into an equity transfer agreement with Fujian Yunding, pursuant to which Fujian Yunding acquired 100% of the issued and ~~discontinued~~outstanding ~~operations~~common stock of $3Yintai from Fujian Jintai at the aggregate purchase price of RMB 5,~~542~~000,~~460~~000. As ~~and~~a $3result,~~030~~ Yintai became a wholly owned subsidiary of Fujian Yunding. Yintai was deregistered on November 18,~~535,~~ ~~respectively~~2010.

Fujian Yida Tulou Tourism Development Co., Ltd.’s (3“Tulou”) ~~Included~~primary ~~cash~~business ~~and~~relates ~~cash~~to ~~equivalents~~the ~~from~~operation ~~continuing~~of the Hua’An ~~and~~Tulou ~~discontinued~~cluster, ~~operations~~one of ~~$958,664~~our ~~and~~tourism ~~$4,075 respectively~~destinations.

On April 12, 2010, our operating subsidiary “Fujian Yunding Tourism Industrial Co., Ltd.” changed its name to “Yida (4Fujian) ~~Included~~Tourism ~~cash~~Group ~~and~~Limited” ~~cash~~for ~~equivalents~~our ~~from~~expanding ~~continuing~~business ~~and~~in ~~discontinued~~ operations of ~~$2,157,738~~domestic tourism destinations in China by acquiring new tourism destinations. Yida (Fujian) Tourism Group Limited’s (“Fujian Yida”) primary business relates to the operations of our Yunding tourism destination and ~~$308~~all of our newly engaged tourism destinations,~~023,~~ ~~respectively~~and the management of our media business.

~~The~~On March ~~accompanying~~16, ~~notes~~2010, ~~are~~Fujian anYida ~~integral~~formed ~~part~~a ofwholly ~~these~~owned ~~consolidated~~subsidiary, Yongtai Yunding Resort Management Co., Ltd. (“Yongtai Yunding”) ~~financial~~which ~~statements~~currently has no material business operations. We plan to develop Yongtai Yunding into a business entity primarily focusing on the operations of our Yunding tourism destination.

~~F-5~~Fujian Jiaoguang Media Co., Ltd. (“Fujian Jiaoguang”) and the Company’s contractual relationship comply with the requirements of the Accounting Standard Codification ("ASC") 810, to consolidate Fujian Jiaoguang’s financial statements as a Variable Interest Entity. During the current period, Fujian Jiaoguang had no material business operations.

~~CHINA~~Fuzhou ~~YIDA~~Fuyu ~~HOLDING~~Advertising Co., COLtd. ~~AND~~(“Fuyu”) ~~SUBSIDIARIES~~concentrates on the mass media segment of our business. Its primary business is focused on advertisements, including media publishing, television, cultural and artistic communication activities, and performance operation and management activities.

~~NOTES~~On TOApril ~~CONSOLIDATED~~15, ~~FINANCIAL~~2010, ~~STATEMENTS~~we entered into agreement with Anhui Xingguang Group to set up a subsidiary - Anhui Yida Tourism Development Co., Ltd. ("Anhui Yida") by investing 60% of the equity interest, and Anhui Xingguang Group owns 40% of the equity interest of Anhui Yida. The total paid-in capital of Anhui Yida was $14,687,307 (equals RMB 100 million). Anhui Yida's primary business relates to the operation of our tourism destinations, specifically, Ming dynasty culture tourist destination.

~~1. ORGANIZATION AND DESCRIPTION OF BUSINESS~~F-7

~~China~~CHINA ~~Yida~~YIDA ~~Holding~~HOLDING, CoCO. ~~(“China~~AND ~~Yida”) and its subsidiaries (collectively the "Company”, “we”, “us”, or “our”) engage in tourism and advertisement businesses in the People’s Republic of China.~~SUBSIDIARIES

~~Keenway~~NOTES ~~Limited~~TO ~~was~~CONSOLIDATED ~~incorporated~~FINANCIAL under the laws of the Cayman Islands on May 9, 2007 for the purpose of functioning as an off-shore holding company to obtain ownership interests in Hong Kong Yi Tat International Investment Co., Ltd (“Hong Kong Yi Tat”), a company incorporated under the laws of Hong Kong. Immediately prior to the Merger (defined below), Mr. Chen Minhua and his wife, Ms. Fan Yanling, were the majority shareholders of Keenway Limited.STATEMENTS

~~On November~~1. ~~19,~~ORGANIZATION ~~2007,~~AND weDESCRIPTION ~~entered~~OF ~~into~~BUSINESS a share exchange and stock purchase agreement with Keenway Limited, Hong Kong Yi Tat, and with the shareholders of Keenway Limited at that time, including Chen Minhua, Fan Yanling, Zhang Xinchen, Extra Profit International Limited, and Lucky Glory International Limited (~~collectively, the “Keenway Limited Shareholders”~~CONTINUED), pursuant to which in exchange for all of their shares of Keenway Limited common stock, the Keenway Limited Shareholders received 18,180,649 newly issued shares (or 90,903,246 shares prior to the reverse stock split on November 16, 2012) of our common stock and 728,359 shares (or 3,641,796 shares prior to the reverse stock split on November 16, 2012) of our common stock which was transferred from some of our then existing shareholders (the “Merger”). As a result of the closing of the Merger, the Keenway Limited Shareholders owned approximately 94.5% of our then issued and outstanding shares on a fully diluted basis and Keenway Limited became our wholly owned subsidiary.

~~Hong~~On ~~Kong~~July Yi6, ~~Tat~~2010, ~~was~~Fujian ~~incorporated~~Yida asformed ~~the~~a ~~holding~~wholly ~~company~~owned ~~of our operating entities~~subsidiary, ~~Fujian~~Jiangxi ~~Jintai~~Zhangshu (Yida) Tourism Development Co., Ltd., ~~and~~(“Jiangxi ~~Fujian~~Zhangshu”) ~~Jiaoguang~~which ~~Media~~currently Cohas no material business operations. The initial paid-in capital of Jiangxi Zhangshu was $2,937,461 (RMB ~~Ltd~~20 million). On July 5, ~~Yida~~2011, (Fujian) ~~Tourism~~Yida ~~Group~~and ~~Limited,~~Fuyu further injected capital amounted to RMB 49 million and RMB1 million, respectively, to Jiangxi Zhangshu. On March 20, 2012, Fujian Yida ~~Tulou~~and ~~Tourism~~Fuyu ~~Development~~further Coinjected capital amounted to RMB 29.,4 ~~Ltd~~million and RMB 0.6 million, respectively, to Jiangxi Zhangshu, and the total paid-in capital increased to $15,842,337 (~~“Tulou”~~RMB100 million). ~~Hong~~ ~~Kong~~We Yiplan ~~Tat~~to ~~does~~develop ~~not~~Jiangxi ~~have~~Zhangshu ~~any~~into ~~other~~a ~~operation~~business entity primarily focusing on the operations of a new tourist destination.

~~Fujian~~On ~~Jintai~~July ~~Tourism~~7, ~~Development Co.~~2010, ~~Ltd. (“~~Fujian ~~Jintai”)~~Yida ~~has~~formed a wholly owned subsidiary, ~~Fuzhou~~Jiangxi ~~Hongda~~Fenyi ~~Commercial~~(Yida) ~~Services~~ Tourism Development Co., Ltd., (“~~Hongda~~Jiangxi Fenyi”) which currently has no material business operations. The ~~operation~~initial paid-in capital of Jiangxi Fenyi was $1,762,477 (RMB 12 million). On July 7, 2011, Fujian ~~Jintai~~Yida isfurther injected capital amounted to ~~develop~~RMB 48 million to Jiangxi Fenyi and the ~~Great~~total ~~Golden~~paid-in ~~Lake~~capital increased to $9,391,876 ~~one~~(RMB of60 ~~our~~million). ~~tourism~~We plan to develop Jiangxi Fenyi into a business entity ~~destinations~~primarily focusing on the operations of a new tourist destination.

~~Hongda~~On ~~does~~June ~~not~~24, ~~have~~2011, ~~any~~Fujian ~~operation~~Yida ~~except~~formed ~~for~~a ~~owning~~wholly ~~100%~~owned ofsubsidiary, ~~the~~Fujian ~~ownership~~Yida ~~interest~~Travel inService ~~Fuzhou Fuyu Advertising~~ Co., Ltd. (the “~~Fuyu~~Yida Travel”). ~~which~~The istotal ~~engaged~~ paid-in ~~the~~capital ~~operations~~ of ~~our~~Yida ~~media~~Travel ~~business.~~was ~~On March 15~~$1, ~~2010~~546,670 ~~Hongda~~(RMB ~~entered~~10 ~~into~~million). Its anprimary ~~equity~~business ~~transfer~~is ~~agreement~~to conduct domestic ~~with~~and ~~Fujian~~international ~~Yunding~~traveling ~~Tourism~~services ~~Industrial~~in ~~Co.~~China, ~~Ltd,~~including ~~(currently~~operating ~~known~~the asdirect ~~Yida~~sales ~~(Fujian)~~of ~~Tourism~~travel ~~Group~~services ~~Limited,~~for ~~“Fujian~~our ~~Yunding”),~~current tourist ~~pursuant~~destinations toat ~~which~~the ~~Fujian~~Great ~~Yunding~~Golden ~~acquired~~Lake, ~~100%~~Yunding ofRecreational ~~the~~Park, ~~issued~~ and ~~outstanding~~Hua’An ~~shares~~Tulou ofCluster, ~~Fuyu~~and ~~from~~our ~~Hongda~~three attourist ~~the aggregate purchase~~destinations ~~price~~currently ofunder ~~RMB 3~~construction,~~000,000. As~~ aMing ~~result,~~Dynasty ~~Fujian~~Entertainment ~~Yunding~~World, ~~became~~China ~~the~~Yang-sheng ~~100%~~(Nourishing ~~holding~~Life) ~~company~~Paradise, ~~of Fuyu. Hongda ceased business~~ and ~~deregistered~~the onCity ~~December~~of ~~2, 2011~~Caves.

~~Fujian~~On ~~Jintai~~May ~~originally~~11, ~~also~~2012, ~~owned~~Jiangxi ~~100%~~Zhangshu offormed ~~the~~a ~~ownership~~wholly ~~interest~~owned insubsidiary, ~~Fujian~~Zhangshu ~~Yintai~~(Yida) ~~Tourism~~Real Estate Development Co., Ltd. (“~~Yintai~~Zhangshu Development”). OnThe ~~March 15,~~total ~~2010,~~paid-in ~~Fujian~~capital ~~Jintai~~of ~~entered~~Zhangshu ~~into~~Development anwas ~~equity transfer agreement with Fujian Yunding~~$792,532 ~~pursuant to which Fujian Yunding acquired 100% of the issued and outstanding common stock of Yintai from Fujian Jintai at the aggregate purchase price of~~ (RMB 5~~,000,000~~ million). As aIts ~~result,~~primary ~~Yintai~~business ~~became~~is ato conduct ~~wholly~~business ~~owned subsidiary~~ of ~~Fujian~~real ~~Yunding. Yintai~~estate ~~was~~development ~~deregistered~~and onsales ~~November~~in ~~18, 2010~~China.

~~Fujian~~On May 16, 2012, Anhui Yida ~~Tulou~~formed ~~Tourism~~a wholly owned subsidiary, Bengbu (Yida) Real Estate Development Co., Ltd.’s (the “~~Tulou~~Bengbu Yida”). ~~primary~~The ~~business~~total ~~relates~~paid-in tocapital ~~the operation~~ of ~~the~~Bengbu ~~Hua’An Tulou~~Yida ~~cluster~~was $1,268,050 ~~one~~(RMB 8 million). Its primary business is to conduct business of ~~our~~real ~~tourism~~estate ~~destinations~~development in China.

On ~~April~~May 1222, ~~2010~~2012, ~~our~~Jiangxi ~~operating~~Zhangshu ~~subsidiary~~formed ~~“Fujian~~a ~~Yunding~~wholly ~~Tourism~~owned ~~Industrial~~subsidiary, Zhangshu (Yida) Investment Co., Ltd.” ~~changed~~(the ~~its name to~~ “~~Yida (Fujian)~~Zhangshu ~~Tourism Group Limited~~Investment”). The ~~for~~total ~~our expanding business~~ paid-in ~~operations~~capital of ~~domestic~~Zhangshu ~~tourism~~Investment ~~destinations~~was in$792,532 ~~China by acquiring new tourism destinations. Yida~~ (~~Fujian)~~RMB ~~Tourism~~5 ~~Group Limited’s (“Fujian Yida”~~million). Its primary business ~~relates~~is to ~~the~~ ~~operations~~conduct ofreal ~~our Yunding tourism destination and all of our newly engaged tourism destinations~~estate investment, ~~and~~project ~~the~~ management ofand ~~our media~~consulting ~~business~~in China.

On ~~March~~June 166, ~~2010~~2012, ~~Fujian~~Jiangxi ~~Yida~~Fenyi formed a wholly owned subsidiary, ~~Yongtai~~Fenyi ~~Yunding~~(Yida) ~~Resort Management~~ Property Development Co., Ltd. (“~~Yongtai Yunding~~Fenyi Development”) ~~which~~. ~~currently~~The ~~has~~total nopaid-in ~~material~~capital ~~business~~of ~~operations.~~Fenyi WeDevelopment ~~plan~~was to$792,532 ~~develop~~(RMB ~~Yongtai~~5 ~~Yunding~~million). ~~into~~Its aprimary business ~~entity~~is ~~primarily~~to ~~focusing~~conduct onbusiness ~~the~~of ~~operations~~real ofestate ~~our~~development ~~Yunding~~and ~~tourism~~sales ~~destination~~in China.

~~Fujian~~On ~~Jiaoguang~~July ~~Media~~20, 2012, Anhui Yida formed a wholly owned subsidiary, Bengbu (Yida) Investment Co., Ltd. (“~~Fujian~~Bengbu ~~Jiaoguang~~Investment”). The ~~and~~total ~~the~~paid-in ~~Company’s~~capital ~~contractual relationship comply with the requirements~~ of ~~the~~Bengbu ~~Accounting~~Investment ~~Standard~~was ~~Codification~~$792,532 (~~"ASC")~~RMB ~~810,~~5 tomillion). ~~consolidate~~Its ~~Fujian~~primary ~~Jiaoguang’s~~business ~~financial~~is ~~statements~~to ~~as a Variable~~conduct ~~Interest~~real ~~Entity.~~estate ~~During the current period~~investment, project ~~Fujian~~management ~~Jiaoguang~~and ~~had~~consulting noin ~~material business operations~~China.

~~Fuzhou~~On ~~Fuyu~~July ~~Advertising~~30, 2012, Fujian Yida formed a wholly owned subsidiary, Fujian (Yida) Culture and Tourism Performing Arts Co., Ltd. (“~~Fuyu~~Yida Arts”). ~~concentrates~~The ontotal ~~the~~paid-in ~~mass~~capital ~~media segment~~ of ~~our~~Yida ~~business. Its~~Arts ~~primary business~~was ~~is focused on advertisements~~$792,532 ~~including~~(RMB ~~media~~5 ~~publishing,~~million). ~~television,~~Its ~~cultural~~primary ~~and~~business ~~artistic~~is to ~~communication~~operate ~~activities,~~performance and ~~performance~~show ~~operation~~events ~~and~~at ~~management~~Yunding ~~activities~~Park.

On ~~April~~June 153, ~~2010~~2013, weFujian Yida entered into a stock transfer agreement with Anhui Xingguang Investment Group ~~to set up a subsidiary - Anhui Yida Tourism Development Co.,~~ Ltd. (~~"Anhui Yida"~~“Purchaser”) by, pursuant ~~investing~~to ~~60%~~which ofFujian ~~the~~Yida ~~equity~~agreed ~~interest,~~to ~~and~~transfer ~~Anhui~~its ~~Xingguang Group owns 40~~60% ~~of the equity~~ interest of ~~Anhui Yida. The total paid-~~in ~~capital of~~ Anhui Yida ~~was~~to ~~$14,687,307~~the ~~(equals~~Purchaser ~~RMB~~for ~~100~~60 million). ~~Anhui~~RMB, ~~Yida's~~or ~~primary business~~$9.72 ~~relates~~million, toThe ~~the~~Purchaser ~~operation~~assumed ofall ~~our~~the ~~tourism~~assets ~~destinations,~~and ~~specifically,~~liabilities ~~Ming~~of ~~dynasty~~Anhui ~~culture tourist destination~~Yida.

FOn June 26, 2013, Fujian Yida formed a wholly owned subsidiary, Yunding Hotel Management Co., Ltd. (“Yunding Hotel”). The total paid-6in capital of Yunding Hotel was $4,860,000 (RMB 30 million). Its primary business is to operate and manage the hotel and its facilities at Yunding Park. The subsidiary has changed its name, Ant Colony Hotel Co., Ltd. on April 17, 2015.

~~CHINA~~On ~~YIDA~~June ~~HOLDING~~24, CO2014, Jiangxi Zhangshu formed a wholly owned subsidiary, Jiangxi Yida Travel Service Co., ~~AND~~Ltd ~~SUBSIDIARIES~~(“Jiangxi Travel”). The total paid-in capital of Zhangshu Development was $48,691 (RMB 0.3 million). Its primary business is to conduct domestic and international traveling services in China.

~~NOTES~~On TOAugust ~~CONSOLIDATED~~26, ~~FINANCIAL~~2014, ~~STATEMENTS~~Hong Kong Yi Tat entered into a certain share transfer agreement with Fujian Taining Great Golden Lake Tourism Economic Development Industrial Co., Ltd. (the “Purchaser”), pursuant to which Hong Kong Yi Tat agreed to sell 100% of its equity interest in Fujian Jintai to the Purchaser for a price of RMB 228,801,359, or approximately $37 million.

~~1. ORGANIZATION AND DESCRIPTION OF BUSINESS (CONTINUED)~~F-8

OnCHINA ~~July~~YIDA 6HOLDING, ~~2010, Fujian Yida formed a wholly owned subsidiary, Jiangxi Zhangshu (Yida) Tourism Development Co~~CO., ~~Ltd.~~AND (“Jiangxi Zhangshu”) which currently has no material business operations. The initial paid-in capital of Jiangxi Zhangshu was $2,937,461 (RMB 20 million). On July 5, 2011, Fujian Yida and Fuyu further injected capital amounted to RMB 49 million and RMB1 million, respectively, to Jiangxi Zhangshu. On March 20, 2012, Fujian Yida and Fuyu further injected capital amounted to RMB 29.4 million and RMB 0.6 million, respectively, to Jiangxi Zhangshu, and the total paid-in capital increased to $15,842,337 (RMB100 million). We plan to develop Jiangxi Zhangshu into a business entity primarily focusing on the operations of a new tourist destination.SUBSIDIARIES

OnNOTES ~~July~~TO 7,CONSOLIDATED ~~2010,~~FINANCIAL Fujian Yida formed a wholly owned subsidiary, Jiangxi Fenyi (Yida) Tourism Development Co., Ltd. (“Jiangxi Fenyi”) which currently has no material business operations. The initial paid-in capital of Jiangxi Fenyi was $1,762,477 (RMB 12 million). On July 7, 2011, Fujian Yida further injected capital amounted to RMB 48 million to Jiangxi Fenyi and the total paid-in capital increased to $9,391,876 (RMB 60 million). We plan to develop Jiangxi Fenyi into a business entity primarily focusing on the operations of a new tourist destination.STATEMENTS

~~On June 24, 2011, Fujian Yida formed a wholly owned subsidiary, Fujian Yida Travel Service Co~~2., ~~Ltd~~GOING (the “Yida Travel”). The total paid-in capital of Yida Travel was $1,546,670 (RMB 10 million). Its primary business is to conduct domestic and international traveling services in China, including operating the direct sales of travel services for our current tourist destinations at the Great Golden Lake, Yunding Recreational Park, and Hua’An Tulou Cluster, and our three tourist destinations currently under construction, Ming Dynasty Entertainment World, China Yang-sheng (Nourishing Life) Paradise, and the City of Caves.CONCERN

OnThe ~~May~~Company’s ~~11,~~consolidated ~~2012,~~financial ~~Jiangxi~~statements ~~Zhangshu~~are

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