Astro Aerospace Ltd. - Annual Report: 2008 (Form 10-K)
U.S.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, 2008
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the transition period from ____________ to ____________
Commission File No. 333-149000
ONYX CHINA, INC.
(Exact name of Registrant as specified in its charter)
NEVADA 5023-06 98-0557091
(State or Other Jurisdiction of (Standard Industrial (IRS Employer
Incorporation or Organization) Classification) Identification Number)
Onyx China, Inc.
Kvartal 60, dom 23 apt. 18
Angarsk, Russia
Telephone: 7-904-125-4225
Facsimile: 1-775-562-8169 665830
(Address and telephone of principal executive offices) (Zip Code)
Securities registered pursuant Name of each exchange
to Section 12(b) of the Act on which registered
--------------------------- -------------------
None
Securities registered pursuant to Section 12(g) of the Act:
Common Stock, $0.001
(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 ( ) 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 Act, Yes ( ) 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
of 1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports) and (2) has been subject to such
filing requirements for the past 90 days.
Yes(X) No ( )
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K is not contained herein and will not be contained, to the best
of the registrant's knowledge, in definitive proxy or information statements
incorporated by references in Part III of this form 10-K or any amendment to
this form 10-K. (X)
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. (Check one):
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 Exchange Act). Yes( ) No (X)
As of March 19, 2009, the registrant had 5,050,000 shares of common stock
issued and outstanding. No market value has been computed based upon the fact
that no active trading market has been established as of March 19, 2009.
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ONYX CHINA, INC.
FORM 10-K
TABLE OF CONTENTS
Page
Part I.
ITEM 1: DESCRIPTION OF BUSINESS..............................................3
ITEM 1A: RISK FACTORS ........................................................5
ITEM 2: DESCRIPTION OF PROPERTY..............................................8
ITEM 3: LEGAL PROCEEDINGS....................................................8
ITEM 4: SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS..................8
Part II.
ITEM 5: MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS.............9
ITEM 6: MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION............9
ITEM 7: FINANCIAL STATEMENTS................................................12
ITEM 8: CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURES ..............................................22
ITEM 8A: CONTROLS AND PROCEDURES.............................................22
Part III
ITEM 9: DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS........22
ITEM 10: EXECUTIVE COMPENSATION..............................................23
ITEM 11: SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT......25
ITEM 12: CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS......................26
ITEM 13: PRINCIPAL ACCOUNTANT FEES AND SERVICES..............................26
ITEM 14: EXHIBITS............................................................26
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PART I
ITEM 1. DESCRIPTION OF BUSINESS
ONYX CHINA INC (“the Company”) was incorporated under the laws of the State of Nevada, U.S. on March 27, 2007. The Company is in the development stage as defined under Statement on Financial Accounting Standards No. 7, Development Stage Enterprises (“SFAS No.7”). We intend to commence business operations by distributing Russian porcelain product in Canada and the United States. Our business goal is to commence distribution and marketing of Russian porcelain to wholesales, retail stores and to general public in North America. As of the date of this Annual Report, we have not commenced business operations. We are in the process of developing a website that will offer Russian porcelain to distributors that are responsible for marketing and selling porcelain to chinaware and giftware stores and retail outlets. Our website will also offer our product directly to retail stores and to the general public.
We plan to market and distribute a comprehensive assortment of Russian porcelain produced by "Dulevsky Farfor" Company in the North American market. This porcelain will be offered at price marked-up from 20% to 30% of our cost.
Our goal is to serve the needs of North American porcelain and tea lovers by offering the most comprehensive collection of Dulevsky porcelain. In Russia, there are many factories specialized in making high end Porcelain. One of the largest of them is "Dulevsky Farfor". "Dulevsky Farfor" is also one of the oldest enterprises in Russia. It was founded in 1832 by merchant T.Y.Kuznetsov, and by the end of the 20th century has become an important porcelain enterprise, the equipment and the quality of the produced goods of which have been named the best in Europe. The innocent patterns "agashaes" and roses, the folk traditions of painting have become the starting point of all the types of the Dulevsky decoration. The Dulevsky porcelain is known for its luxuriance of bright colors; it is clean and clear and unique. That's why "Dulevsky Farfor" products are in high demand.
The Dulevsky porcelain is popular all over the world. Articles made by talented craftsmen have been awarded the gold medals at the industrial exhibitions in Paris (1889-1990) and in Turkey (1958), Grand-Prix in Reims (1903), Liege (1905) and New-York (1938). The sculpture of A. Sotnikov "Sokol" has been awarded Grand-Prix at the exhibition in Brussels (1958). The graphic picture of this sculpture has become the manufacturer's trademark of "Dulevsky Farfor". The works by Dulevo artists are kept in the museums and art galleries in many countries. They are well known by the art collectors of the entire world. "Dulevsky Farfor" is a technically equipped enterprise with a continuous work cycle. About 3,000 employees work for it. The artists from "Dulevsky Farfor" have been working on the invention of new forms and patterns. It is still one of the biggest factories in Europe producing high-quality porcelain.
One obvious advantage is the price; Russian porcelain is of high quality and low priced due to the lower cost of labor and abundance of raw material. Therefore, we can market and distribute it not only to chinaware and giftware stores, the primary buyers, but also to lower priced department stores.
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CONTRACT WITH OUR SUPPLIER
Our sole supplier, PC Dulevo Porcelain ("Dulevo") is a manufacturer and distributor of certain high-quality porcelain in Russia and other countries. We intend to market and distribute porcelain items to distributors, retail stores in the chinaware and giftware industry and the general public.
We executed a distribution contract ("Contract") dated November 15, 2007 with our suppler, Dulevo.
SALES AND MARKETING STRATEGY
We intend to rely on sales representatives to market our porcelain products. Initially, our director will conduct this marketing. We intend to focus on direct marketing efforts whereby our representatives will directly contact:
- distributors that are responsible for marketing and selling porcelain; and
- retail outlets such as chinaware, giftware and department stores.
These distributors and stores will be asked to sell our products to consumers. We will provide them with porcelain inventory at wholesale prices. They will then sell that inventory to consumers at retail prices, which are typically 30% higher than our cost.
We intend to contact as many distributors, retail chains, chinaware and giftware stores as we can in order to market our porcelain. We initially intend to focus our marketing efforts on larger department stores that have a high volume of customer traffic.
To enhance our sales and to advertise our product we plan to keep improving and developing our website to make it as "user friendly" as possible. Our website will offer a large array of porcelain products and by becoming a "one-stop shopping" destination will significantly enhance the efficiency of the purchasing process simultaneously reducing the time and cost of finding reasonably priced porcelain.
SHARE OF MARKET
Our expected share of the porcelain market is difficult to determine given that most chinaware distributors and porcelain stores are private businesses that have no duty to publicly disclose their revenue, and porcelain market is highly competitive. However, we believe that due to the vast size of this market in North America, our market share will likely be less than one percent.
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COMPLIANCE WITH GOVERNMENT REGULATION
We do not believe that government regulation will have a material impact on the way we conduct our business.
RESEARCH AND DEVELOPMENT EXPENDITURES
We have not incurred any other research or development expenditures since our incorporation.
SUBSIDIARIES
We do not have any subsidiaries.
PATENTS AND TRADEMARKS
We do not own, either legally or beneficially, any patents or trademarks.
Our shares of common stock trade on the Over-the-Counter Bulletin Board under the symbol: “OYXC.OB”
Please note that throughout this Annual Report, and unless otherwise noted, the words "we," "our," "us," the "Company,” or "Onyx China, Inc." refers to Onyx China, Inc.
ITEM 1A. RISK FACTORS
IF WE DO NOT OBTAIN ADDITIONAL FINANCING, OUR BUSINESS WILL FAIL.
As of December 31, 2008, we had cash in the amount of $4,827.We currently have no operations and no income. Our business plan calls for ongoing expenses in connection with marketing and sales of porcelain. We do not have sufficient funds on hand; therefore if we are unable to obtain additional funding we may have to delay the implementation of our business plan. The most likely source of future funds available to us is through the sale of additional shares of common stock or advances from our sole director. Any sale of share capital will result in the dilution to existing shareholders.
BECAUSE WE HAVE NOT COMMENCED BUSINESS OPERATIONS, WE FACE A HIGH RISK OF
BUSINESS FAILURE.
We were incorporated on March 27, 2007 and to date have been involved primarily in organizational activities. We have not earned revenues as of the date of this Annual Report and have incurred total losses of $27,773 from our incorporation to December 31, 2008.
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ANY ADDITIONAL FUNDING WE ARRANGE THROUGH THE SALE OF OUR COMMON STOCK WILL RESULT IN DILUTION TO EXISTING SHAREHOLDERS.
We must raise additional capital in order for our business plan to succeed. Our most likely source of additional capital will be through the sale of additional shares of common stock. Such stock issuances will cause stockholders' interests in our company to be diluted. Such dilution will negatively affect the value of an investors' shares.
IF WE ARE UNABLE TO RETAIN KEY PERSONNEL, THEN WE MAY NOT BE ABLE TO IMPLEMENT OUR BUSINESS PLAN
We depend on the services of our sole director, Dmitry Lyakutin, for the future success of our business. The loss of the services of Mr. Lyakutin could have an adverse effect on our business, financial condition and results of operations. We do not carry any key personnel life insurance policies on Mr. Lyakutin and we do not have a contract for his services.
U.S. INVESTORS MAY EXPERIENCE DIFFICULTIES IN ATTEMPTING TO EFFECT SERVICE OF PROCESS AND TO ENFORCE JUDGMENTS BASED UPON U.S. FEDERAL SECURITIES LAWS AGAINST THE COMPANY AND ITS SOLE NON-U.S. RESIDENT OFFICER AND DIRECTOR.
Our sole director and officer, Dmitry Lyakutin, is not a resident of the United States. Consequently, it may be difficult for investors to effect service of process on Mr. Lyakutin in the United States and to enforce in the United States judgments obtained in United States courts against Mr. Lyakutin based on the civil liability provisions of the United States securities laws. Since all our assets are located in Russia it may be difficult or impossible for U.S. investors to collect a judgment against us. As well, any judgment obtained in the United States against us may not be enforceable in the United States.
BECAUSE OUR DIRECTOR AND OFFICER OWNS 59.41% OF OUR OUTSTANDING COMMON STOCK, HE WILL MAKE AND CONTROL CORPORATE DECISIONS THAT MAY BE DISADVANTAGEOUS TO MINORITY SHAREHOLDERS.
Mr. Lyakutin, our director and officer, owns approximately 59.41% of the outstanding shares of our common stock. Accordingly, he will have significant influence in determining the outcome of all corporate transactions or other matters, including the election of directors, mergers, consolidations and the sale of all or substantially all of our assets, and also the power to prevent or cause a change in control. The interests of Mr. Lyakutin may differ from the interests of the other stockholders and may result in corporate decisions that are disadvantageous to other shareholders.
BECAUSE OUR DIRECTOR HAS OTHER BUSINESS INTERESTS, HE MAY NOT BE ABLE OR WILLING TO DEVOTE A SUFFICIENT AMOUNT OF TIME TO OUR BUSINESS OPERATIONS, CAUSING OUR BUSINESS TO FAIL.
Our president, Dmitry Lyakutin, intends to devote 40% of his business time to our affairs. It is possible that the demands on Dmitry Lyakutin from his other obligations could increase with the result that he would no longer be able to devote sufficient time to the management of our business. In addition, Dmitry Lyakutin may not possess sufficient time for our business if the demands of managing our business increase substantially beyond current levels.
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BECAUSE WE WILL PURCHASE OUR PRODUCTS FROM OVERSEAS, A DISRUPTION IN THE DELIVERY OF IMPORTED PRODUCTS MAY HAVE A GREATER EFFECT ON US THAN ON OUR COMPETITORS.
We will import all of our products form overseas. Because we import all of our products and deliver them directly to our customers, we believe that disruptions in shipping deliveries may have a greater effect on us than on competitors who manufacture and warehouse products in the United States or Canada. Deliveries of our products may be disrupted through factors such as:
(1) raw material shortages, work stoppages, strikes and political unrest;
(2) problems with ocean shipping, including work stoppages and shipping
container shortages;
(3) increased inspections of import shipments or other factors causing
delays in shipments; and
(4) economic crises, international disputes and wars.
Most of our competitors warehouse products they import from overseas, that allows them to continue delivering their products for the near term, despite overseas shipping disruptions. If our competitors are able to deliver products when we cannot, our reputation may be damaged and we may lose customers to our competitors.
BECAUSE WE ARE REQUIRED TO PURCHASE OUR PRODUCTS IN FOREIGN CURRENCY INSTEAD OF UNITED STATES DOLLARS, OUR BUSINESS CAN BE EFFECTED BY CURRENCY RATE FLUCTUATIONS.
Our supplier sells products in Russian rubles, so we are affected by changes in foreign exchange rates. To protect our business, we may enter into foreign currency exchange contracts with major financial institutions to hedge the overseas purchase transactions and limit our exposure to those fluctuations. If we are not able to successfully protect ourselves against those currency rate fluctuations, then our profits on the products subject to those fluctuations would also fluctuate and could cause us to be less profitable or incur losses, even if our business is doing well.
WE FACE SUBSTANTIAL COMPETITION FROM NUMEROUS SOURCES, MANY OF WHICH HAVE ACCESS TO BETTER RESOURCES.
Competition in sale of porcelain is intense. We compete with a diverse group of competitors ranging from Internet businesses to traditional brick-and-mortar companies, many of which have greater resources than we do. We believe that barriers to entry in this business are not significant and start-up costs are relatively low, so our competition may increase in the future. Our belief that there are minimal barriers to entry is based on our observation that operations such as ourselves do not require the ownership of warehouses, showrooms or factories to operate, which we think is because (i) our direct ship business can be operated with minimal warehousing needs and costs, which are significantly less than traditional models; (ii) wholesale product orders can be placed after receipt of client orders, in order to further reduce warehousing needs; (iii) samples can be shown to clients at little or no cost, without the necessity of showroom space for actual product; and (iv) all manufacturing can be done by third party suppliers, so there is no need to own or lease a manufacturing facility. New competitors may be able to launch new businesses similar to ours, and current competitors may replicate our business model, at a relatively low cost. If competitors with significantly greater resources than ours decide to replicate our business model, they may be able to quickly gain recognition and acceptance of their business methods, products and services through marketing and promotion. We may not have the resources to compete effectively with current or future competitors. If we are unable to effectively compete, we will lose sales to our competitors and our revenues will decline.
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FORWARD LOOKING STATEMENTS
This annual report contains forward- looking statements that involve risks and uncertainties. We use words such as anticipate, believe, plan, expect, future, intend and similar expressions to identify such forward looking statements. You should not place too much reliance on these forward-looking statements. Our actual results may differ materially from those anticipated in these forward- looking statements for many reasons, including the risks faced by us described in the "Risk Factors" section and elsewhere in this annual report.
ITEM 2. DESCRIPTION OF PROPERTY
The Company does not own or lease any property.
ITEM 3. LEGAL PROCEEDINGS
We are not currently involved in any legal proceedings and we are not aware of any pending or potential legal actions.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
There were no matters submitted to a vote of the security holders during the year ended December 31, 2008.
OTHER INFORMATION
DEPARTURE OF DIRECTORS OR PRINCIPAL OFFICERS; ELECTION OF DIRECTORS; APPOINTMENT OF PRINCIPAL OFFICERS.
On August 14, 2008, Ms. Eleonora Magerramova replaced Mr. Dmitry Lyakutin as corporate secretary, who had resigned in that capacity but remains a director of the Company.
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PART II
ITEM 5. MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
Our shares are quoted on the Over-the-Counter Bulletin Board (OTC BB) under the symbol " OYXC ". The market for our common stock is limited, and can be volatile.
There has been no active trading of our securities and therefore no high and low bid pricing. As of the date of this Annual report we had 30 shareholders of record.
DIVIDEND POLICY
No dividends have ever been declared by the Board of Directors on our common stock. Our losses do not currently indicate the ability to pay any cash dividends, and we do not indicate the intention of paying cash dividends either on our common stock in the foreseeable future.
We have no outstanding options.
ITEM 6. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
The following discussion should be read in conjunction with our audited financial statements and the related notes that appear elsewhere in this Annual Report. The following discussion contains forward-looking statements that reflect our plans, estimates and beliefs. Our actual results could differ materially from those discussed in the forward looking statements. Factors that could cause or contribute to such differences include, but are not limited to those discussed below and elsewhere in this Annual Report, particularly in the section entitled "Risk Factors". Our audited financial statements are stated in United States Dollars and are prepared in accordance with United States Generally Accepted Accounting Principles.
We are a development stage company and have not generated any revenue to date.
RESULTS OF OPERATIONS
We have incurred recurring losses to date. Our financial statements have been prepared assuming that we will continue as a going concern and, accordingly, do not include adjustments relating to the recoverability and realization of assets and classification of liabilities that might be necessary should we be unable to continue in operation.
We expect we will require additional capital to meet our long term operating requirements. We expect to raise additional capital through, among other things, the sale of equity or debt securities.
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FISCAL YEAR ENDED DECEMBER 31, 2008 COMPARED TO FISCAL YEAR ENDED DECEMBER 31, 2007.
Our net loss for fiscal year ended December 31, 2008 was ($25,840) compared to a net loss of ($1,933) during fiscal year ended December 31, 2007 (an increase of $23,907). During fiscal years ended December 31, 2008 and December 31, 2007, we did not generate any revenue.
During fiscal year ended December 31, 2008, we incurred expenses of $25,840 compared to $1,933 incurred during fiscal year ended December 31, 2007 (an increase of $23,907). These expenses incurred during fiscal year ended December 31, 2008 consisted of: bank charges and interest of $225 (2007: $504); filing and transfer agent fees of $12,874 (2007: $-0-); office expenses of $144 (2007: $-0-); Registered Agent Services fee of $0 (2007: $129); professional fees of $11,675 (2007: $-0-); Courier & Postage $60 (2007: $-0-) and miscellaneous charges of $862 (2007: $1,300).
Expenses incurred during fiscal year ended December 31, 2008 compared to fiscal year ended December 31, 2007 increased primarily due to the increased scale and scope of business operations. General and administrative expenses generally include corporate overhead, financial and administrative contracted services, marketing, and consulting costs.
The weighted average number of shares outstanding was 5,050,000 for fiscal year ended December 31, 2008.
LIQUIDITY AND CAPITAL RESOURCES
FISCAL YEAR ENDED DECEMBER 31, 2008
As at fiscal year ended December 31, 2008, our current assets were $4,827 and our current liabilities were $0. As at fiscal year ended December 31, 2008, current assets were comprised of $4,827 in cash.
As at fiscal year ended December 31, 2008, our total assets were $4,827 comprised entirely of current assets. The decrease in total assets during fiscal year ended December 31, 2008 from fiscal year ended December 31, 2007 was primarily due to the decrease in cash and cash equivalents relating to payment of our expenses.
Stockholders’ equity decreased from $30,667 for fiscal year ended December 31, 2007 to $4,827 for fiscal year ended December 31, 2008.
CASH FLOWS FROM OPERATING ACTIVITIES
We have not generated positive cash flows from operating activities. For fiscal year ended December 31, 2008, net cash flows used in operating activities was ($25,840) consisting primarily of a net loss of ($25,840). For fiscal year ended December 31, 2007, net cash flows from operating activities was $1,933 consisting primarily of a net loss of ($1,933).
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CASH FLOWS FROM FINANCING ACTIVITIES
We have financed our operations primarily from the issuance of equity. For fiscal year ended December 31, 2008, we did not generate cash flow from financing activities, compared to $32,600 for fiscal year ended December 31, 2007. Cash flows from financing activities for fiscal year ended December 31, 2007 consisted of $32,600 in sale of common stock.
We expect that working capital requirements will continue to be funded through a combination of our existing funds and further issuances of securities. Our working capital requirements are expected to increase in line with the growth of our business.
PLAN OF OPERATION AND FUNDING
Existing working capital, further advances and debt instruments, and anticipated cash flow are expected to be adequate to fund our operations over the next three months. We have no lines of credit or other bank financing arrangements. Generally, we have financed operations to date through the proceeds of the private placement of equity. In connection with our business plan, management anticipates additional increases in operating expenses and capital expenditures relating to: (i) acquisition of inventory; and (ii) working capital. We intend to finance these expenses with further issuances of securities, and debt issuances. Thereafter, we expect we will need to raise additional capital and generate revenues to meet long-term operating requirements. Additional issuances of equity or convertible debt securities will result in dilution to our current shareholders. Further, such securities might have rights, preferences or privileges senior to our common stock. Additional financing may not be available upon acceptable terms, or at all. If adequate funds are not available or are not available on acceptable terms, we may not be able to take advantage of prospective new business endeavors or opportunities, which could significantly and materially restrict our business operations.
MATERIAL COMMITMENTS
As of the date of this Annual Report, we do not have any material commitments.
PURCHASE OF SIGNIFICANT EQUIPMENT
We do not intend to purchase any significant equipment during the next twelve months.
OFF-BALANCE SHEET ARRANGEMENTS
As of the date of this Annual Report, we do not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to investors.
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GOING CONCERN
The independent auditors' report accompanying our December 31, 2008 and December 31, 2007 financial statements contains an explanatory paragraph expressing substantial doubt about our ability to continue as a going concern. The financial statements have been prepared "assuming that we will continue as a going concern," which contemplates that we will realize our assets and satisfy our liabilities and commitments in the ordinary course of business.
ITEM 7. FINANCIAL STATEMENTS
INDEX
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
BALANCE SHEETS AS AT DECEMBER 31, 2008 AND DECEMBER 31, 2007
STATEMENTS OF OPERATIONS FOR THE FISCAL YEARS ENDED DECEMBER 31, 2008 AND DECEMBER 31, 2007 AND FOR THE PERIOD MARCH 27, 2007 (DATE OF INCEPTION) TO DECEMBER 31, 2008
STATEMENT OF STOCKHOLDERS’ EQUITY FOR THE PERIOD MARCH 27, 2007 (DATE OF INCEPTION) TO DECEMBER 31, 2008
STATEMENTS OF CASH FLOWS FOR THE FISCAL YEARS ENDED DECEMBER 31, 2008 AND DECEMBER 31, 2007 AND FOR THE PERIOD MARCH 27, 2007 (DATE OF INCEPTION) TO DECEMBER 31, 2008
NOTES TO THE FINANCIAL STATEMENTS
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MOORE & ASSOCIATES, CHARTERED
ACCOUNTANTS AND ADVISORS
PCAOB REGISTERED
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Board of Directors
Onyx China, Inc.
(A Development Stage Company)
We have audited the accompanying balance sheets of Onyx China, Inc. (A Development Stage Company) as of December 31, 2008 and 2007, and the related statements of operations, stockholders’ equity and cash flows for the year ended December 31, 2008, and from inception on March 27, 2007 through December 31, 2007, and from inception on March 27, 2007 through December 31, 2008. These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements based on our audits.
We conducted our audit in accordance with standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Onyx China, Inc. (A Development Stage Company) as of December 31, 2008 and 2007, and the related statements of operations, stockholders’ equity and cash flows for the year ended December 31, 2008, and from inception on March 27, 2007 through December 31, 2007, and from inception on March 27, 2007 through December 31, 2008, in conformity with accounting principles generally accepted in the United States of America.
The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 2b to the financial statements, the Company has accumulated deficit of $27,773 as at December 31, 2008, which raises substantial doubt about its ability to continue as a going concern. Management’s plans concerning these matters are also described in Note 2b. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.
/s/ Moore & Associates, Chartered
Moore & Associates Chartered
Las Vegas, Nevada
March 13, 2009
6490 West Desert Inn Rd, Las Vegas, NV 89146 (702) 253-7499 Fax (702) 253-7501
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ONYX CHINA INC (A Development Stage Company) Balance Sheets | |||||||||
Assets | |||||||||
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Current Assets |
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| Cash |
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| $ | 4,827 | $ | 30,667 | ||
Total Assets |
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| $ | 4,827 | $ | 30,667 | |||
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Liabilities and Stockholders’ Equity | |||||||||
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Current Liabilities |
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| Accounts payable and accrued liabilities |
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| $ | - | $ | - | ||
| Total Current Liabilities |
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| $ | - | $ | - | ||
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Stockholders’ Equity |
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| Common stock, $0.001par value, 75,000,000 shares authorized; |
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| 5,050,000 shares issued and outstanding |
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| 5,050 |
| 5,050 | ||
| Additional paid-in-capital |
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| 27,550 |
| 27,550 | ||
| Deficit accumulated during the development stage |
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| (27,773) |
| (1,933) | ||
Total stockholders’ equity |
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| 4,827 |
| 30,667 | |||
Total liabilities and stockholders’ equity |
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| $ | 4,827 | $ | 30,667 | |||
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| The accompanying notes are an integral part of these financial statements. | ||||||||
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ONYX CHINA INC (A Development Stage Company) Statements of Operations | ||||||||
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| Year Ended December 31, 2008 |
| From Inception on March 27, 2007 to December 31,2007 |
| From Inception on March 27, 2007 through December 31, 2008 | |
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Expenses | ||||||||
| General and Administrative Expenses |
| $ 25,840 |
| $ 1,933 |
| $ 27,773 | |
Total Expenses |
| $ 25,840 |
| $ 1,933 |
| $ 27,773 | ||
Net (loss) before Income Taxes |
| $ (25,840) |
| $ (1,933) |
| $ (27,773) | ||
Income Tax Expense |
| $ - |
| $ - |
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Net (loss) |
| $ (25,840) |
| $ (1,933) |
| $ (27,773) | ||
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(Loss) per share – Basic and diluted |
| $ (0.00) |
| $ (0.00) |
|
| ||
|
|
|
|
|
|
|
| |
Weighted Average Number of Common Shares Outstanding |
| 5,050,000 |
| 4,449,643 |
|
| ||
|
|
|
|
|
| |||
The accompanying notes are an integral part of these financial statements. | ||||||||
| ||||||||
- 15 -
ONYX CHINA INC (A Development Stage Company) Statement of Stockholders’ Equity From Inception on March 27, 2007 to December 31, 2008 | |||||||||
|
| Number of Common Shares | Amount | Additional Paid-in- Capital |
| Deficit accumulated During development stage | Total Stockholders’ Equity | ||
|
|
|
|
|
|
|
| ||
April 20, 2007 |
|
|
|
|
|
|
| ||
Common shares issued for cash at $0.002 |
| 3,000,000 | $ 3,000 | $ 3,000 |
| $ - | $ 6,000 | ||
May 8, 2007 |
|
|
|
|
|
|
| ||
Common shares issued for cash at $0.002 |
| 800,000 | 800 | 800 |
| - | 1,600 | ||
May 16, 2007 |
|
|
|
|
|
|
| ||
Common shares issued for cash at $0.02 |
| 1,250,000 | 1,250 | 23,750 |
|
| 25,000 | ||
Net (loss) |
| - | - | - |
| (1,933) | (1,933) | ||
Balance as of December 31, 2007 | 5,050,000 | 5,050 | 27,550 | (1,933) | 30,667 | ||||
Net (Loss) | - | - | - |
| (25,840) | (25,840) | |||
Balance as of December 31, 2008 | 5,050,000 | $ 5,050 | $ 27,550 |
| $ (27,773) | $ 4,827 | |||
The accompanying notes are an integral part of these financial statements.
- 16 -
ONYX CHINA INC (A Development Stage Company) Statements of Cash Flows | |||||||||
|
|
| Year Ended December 31, 2008 |
| From Inception on March 27, 2007 to December 31, 2007 |
| From Inception on March 27, 2007 to December 31, 2008 | ||
Operating activities |
|
|
|
|
| ||||
| Net (loss) | $ | (25,840) | $ | (1,933) | $ | (27,773) | ||
| Net cash (used) for operating activities |
| (25,840) |
| (1,933) |
| (27,773) | ||
|
|
|
|
|
|
| |||
Financing activities |
|
|
|
|
|
| |||
| Sale of common stock |
|
|
| 32,600 |
| 32,600 | ||
| Net cash provided by financing activities |
|
|
| 32,600 |
| 32,600 | ||
|
|
|
|
|
|
|
| ||
Net increase (decrease) in cash and equivalents |
| (25,840) |
| 30,667 |
| 4,827 | |||
|
|
|
|
|
|
| |||
Cash and equivalents at beginning of the period |
| 30,667 |
| - |
| - | |||
Cash and equivalents at end of the period | $ | 4,827 | $ | 30,667 | $ | 4,827 | |||
|
|
|
|
|
|
|
| ||
|
|
|
|
|
|
|
| ||
| Supplemental cash flow information: |
|
|
|
|
|
| ||
|
|
|
|
|
|
|
| ||
| Cash paid for: |
|
|
|
|
|
| ||
|
|
|
|
|
|
|
| ||
| Interest | $ | - |
|
| $ | - | ||
| Taxes | $ | - |
|
| $ | - | ||
|
|
|
|
|
| ||||
|
|
|
|
|
| ||||
Non-Cash Activities | $ | - |
|
| $ | - | |||
| |||||||||
The accompanying notes are an integral part of these financial statements. | |||||||||
- 17 -
ONYX CHINA INC
(A Development Stage Company)
Notes To The Financial Statements
December 31, 2008
1. ORGANIZATION AND BUSINESS OPERATIONS
ONYX CHINA INC (“the Company”) was incorporated under the laws of the State of Nevada, U.S. on March 27, 2007. The Company is in the development stage as defined under Statement on Financial Accounting Standards No. 7, Development Stage Enterprises (“SFAS No.7”) and its efforts are primarily devoted marketing and distributing chinaware to North American market. The Company has not generated any revenue to date and consequently its operations are subject to all risks inherent in the establishment of a new business enterprise. For the period from inception, March 27, 2007 through December 31, 2008 the Company has accumulated losses of $27,773.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
a)Basis of Presentation
The financial statements of the Company have been prepared in accordance with generally accepted accounting principles in the United States of America and are presented in US dollars.
b) Going Concern
These financial statements have been prepared on a going concern basis which assumes the Company will be able to realize its assets and discharge its liabilities in the normal course of business for the foreseeable future. The Company has incurred losses since inception resulting in an accumulated deficit of $27,773 as at December 31, 2008 and further losses are anticipated in the development of its business raising substantial doubt about the Company's ability to continue as a going concern. The ability to continue as a going concern is dependent upon the Company generating profitable operations in the future and/or to obtain the necessary financing to meet its obligations and repay its liabilities arising from normal business operations when they come due. Management intends to finance operating costs over the next twelve months with existing cash on hand and loans from directors and or private placement of common stock.
c) Cash and Cash Equivalents
The Company considers all highly liquid instruments with a maturity of three months or less at the time of issuance to be cash equivalents.
d) Use of Estimates and Assumptions
The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.
e) Foreign Currency Translation
The Company's functional currency and its reporting currency is the United States dollar.
f) Financial Instruments
The carrying value of the Company's financial instruments approximates their fair value because of the short maturity of these instruments.
g) Stock-based Compensation
Stock-based compensation is accounted for at fair value in accordance with SFAS No. 123 and 123 (R). To date, the Company has not adopted a stock option plan and has not granted any stock options.
- 18 -
ONYX CHINA INC
(A Development Stage Company)
Notes To The Financial Statements
December 31, 2008
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
h) Income Taxes
Income taxes are accounted for under the assets and liability method. Deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carry forwards. Deferred tax assets and liabilities are measured using enacted tax rates in effect for the year in which those temporary differences are expected to be recovered or settled.
i) Basic and Diluted Net Loss per Share
The Company computes net loss per share in accordance with SFAS No. 128,"Earnings per Share". SFAS No. 128 requires presentation of both basic and diluted earnings per share (EPS) on the face of the income statement.
Basic EPS is computed by dividing net loss available to common shareholders (numerator) by the weighted average number of shares outstanding (denominator) during the period. Diluted EPS gives effect to all potentially dilutive common shares outstanding during the period. Diluted EPS excludes all potentially dilutive shares if their effect is anti-dilutive.
j) Fiscal Periods
The Company's fiscal year end is December 31.
k) Recent Accounting Pronouncements
In May 2008, the Financial Accounting Standards Board (“FASB”) issued SFAS No. 163, “Accounting for Financial Guarantee Insurance Contracts-and interpretation of FASB Statement No. 60”. SFAS No. 163 clarifies how Statement 60 applies to financial guarantee insurance contracts, including the recognition and measurement of premium revenue and claims liabilities. This statement also requires expanded disclosures about financial guarantee insurance contracts. SFAS No. 163 is effective for fiscal years beginning on or after December 15, 2008, and interim periods within those years. SFAS No. 163 has no effect on the Company’s financial position, statements of operations, or cash flows at this time.
In May 2008, the Financial Accounting Standards Board (“FASB”) issued SFAS No. 162, “The Hierarchy of Generally Accepted Accounting Principles”. SFAS No. 162 sets forth the level of authority to a given accounting pronouncement or document by category. Where there might be conflicting guidance between two categories, the more authoritative category will prevail. SFAS No. 162 will become effective 60 days after the SEC approves the PCAOB’s amendments to AU Section 411 of the AICPA Professional Standards. SFAS No. 162 has no effect on the Company’s financial position, statements of operations, or cash flows at this time.
In March 2008, the Financial Accounting Standards Board, or FASB, issued SFAS No. 161, Disclosures about Derivative Instruments and Hedging Activities—an amendment of FASB Statement No. 133. This standard requires companies to provide enhanced disclosures about (a) how and why an entity uses derivative instruments, (b) how derivative instruments and related hedged items are accounted for under Statement 133 and its related interpretations, and (c) how derivative instruments and related hedged items affect an entity’s financial position, financial performance, and cash flows. This Statement is effective for financial statements issued for fiscal years and interim periods beginning after November 15, 2008, with early application encouraged. The Company has not yet adopted the provisions of SFAS No. 161, but does not expect it to have a material impact on its consolidated financial position, results of operations or cash flows.
- 19 -
ONYX CHINA INC
(A Development Stage Company)
Notes To The Financial Statements
December 31, 2008
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
In December 2007, the SEC issued Staff Accounting Bulletin (SAB) No. 110 regarding the use of a "simplified" method, as discussed in SAB No. 107 (SAB 107), in developing an estimate of expected term of "plain vanilla" share options in accordance with SFAS No. 123 (R), Share-Based Payment. In particular, the staff indicated in SAB 107 that it will accept a company's election to use the simplified method, regardless of whether the company has sufficient information to make more refined estimates of expected term. At the time SAB 107 was issued, the staff believed that more detailed external information about employee exercise behavior (e.g., employee exercise patterns by industry and/or other categories of companies) would, over time, become readily available to companies. Therefore, the staff stated in SAB 107 that it would not expect a company to use the simplified method for share option grants after December 31, 2007. The staff understands that such detailed information about employee exercise behavior may not be widely available by December 31, 2007. Accordingly, the staff will continue to accept, under certain circumstances, the use of the simplified method beyond December 31, 2007. The Company currently uses the simplified method for “plain vanilla” share options and warrants, and will assess the impact of SAB 110 for fiscal year 2009. It is not believed that this will have an impact on the Company’s consolidated financial position, results of operations or cash flows.
In December 2007, the FASB issued SFAS No. 160, Noncontrolling Interests in Consolidated Financial Statements—an amendment of ARB No. 51. This statement amends ARB 51 to establish accounting and reporting standards for the noncontrolling interest in a subsidiary and for the deconsolidation of a subsidiary. It clarifies that a noncontrolling interest in a subsidiary is an ownership interest in the consolidated entity that should be reported as equity in the consolidated financial statements. Before this statement was issued, limited guidance existed for reporting noncontrolling interests. As a result, considerable diversity in practice existed. So-called minority interests were reported in the consolidated statement of financial position as liabilities or in the mezzanine section between liabilities and equity. This statement improves comparability by eliminating that diversity. This statement is effective for fiscal years, and interim periods within those fiscal years, beginning on or after December 15, 2008 (that is, January 1, 2009, for entities with calendar year-ends). Earlier adoption is prohibited. The effective date of this statement is the same as that of the related Statement 141 (revised 2007). The Company will adopt this Statement beginning March 1, 2009. It is not believed that this will have an impact on the Company’s consolidated financial position, results of operations or cash flows.
In December 2007, the FASB, issued FAS No. 141 (revised 2007), Business Combinations.’This Statement replaces FASB Statement No. 141, Business Combinations, but retains the fundamental requirements in Statement 141. This Statement establishes principles and requirements for how the acquirer: (a) recognizes and measures in its financial statements the identifiable assets acquired, the liabilities assumed, and any noncontrolling interest in the acquiree; (b) recognizes and measures the goodwill acquired in the business combination or a gain from a bargain purchase; and (c) determines what information to disclose to enable users of the financial statements to evaluate the nature and financial effects of the business combination. This statement applies prospectively to business combinations for which the acquisition date is on or after the beginning of the first annual reporting period beginning on or after December 15, 2008. An entity may not apply it before that date. The effective date of this statement is the same as that of the related FASB Statement No. 160, Noncontrolling Interests in Consolidated Financial Statements. The Company will adopt this statement beginning March 1, 2009. It is not believed that this will have an impact on the Company’s consolidated financial position, results of operations or cash flows.
- 20 -
ONYX CHINA INC
(A Development Stage Company)
Notes To The Financial Statements
December 31, 2008
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
In February 2007, the FASB, issued SFAS No. 159, The Fair Value Option for Financial Assets and Liabilities—Including an Amendment of FASB Statement No. 115. This standard permits an entity to choose to measure many financial instruments and certain other items at fair value. This option is available to all entities. Most of the provisions in FAS 159 are elective; however, an amendment to FAS 115 Accounting for Certain Investments in Debt and Equity Securities applies to all entities with available for sale or trading securities. Some requirements apply differently to entities that do not report net income. SFAS No. 159 is effective as of the beginning of an entities first fiscal year that begins after November 15, 2007. Early adoption is permitted as of the beginning of the previous fiscal year provided that the entity makes that choice in the first 120 days of that fiscal year and also elects to apply the provisions of SFAS No. 157 Fair Value Measurements. The Company will adopt SFAS No. 159 beginning March 1, 2008 and is currently evaluating the potential impact the adoption of this pronouncement will have on its consolidated financial statements.
In September 2006, the FASB issued SFAS No. 157, Fair Value Measurements This statement defines fair value, establishes a framework for measuring fair value in generally accepted accounting principles (GAAP), and expands disclosures about fair value measurements. This statement applies under other accounting pronouncements that require or permit fair value measurements, the Board having previously concluded in those accounting pronouncements that fair value is the relevant measurement attribute. Accordingly, this statement does not require any new fair value measurements. However, for some entities, the application of this statement will change current practice. This statement
is effective for financial statements issued for fiscal years beginning after November 15, 2007, and interim periods within those fiscal years. Earlier application is encouraged, provided that the reporting entity has not yet issued financial statements for that fiscal year, including financial statements for an interim period within that fiscal year. The Company will adopt this statement March 1, 2008, and it is not believed that this will have an impact on the Company’s consolidated financial position, results of operations or cash flows.
3. COMMON STOCK
The authorized capital of the Company is 75,000,000 common shares with a par value of $ 0.001 per share.
In April 2007, the Company issued 3,000,000 shares of common stock at a price of $0.002 per share for total cash proceeds of $6,000.
In May 2007, the Company issued 800,000 shares of common stock at a price of $0.002 per share for total cash proceeds of $1,600.
In May 2007, the Company also issued 1,250,000 shares of common stock at a price of $0.02 per share for total cash proceeds of $25,000.
During the period March 27, 2007 (inception) to December 31, 2008, the Company sold a total of 5,050,000 shares of common stock for total cash proceeds of $32,600.
4. INCOME TAXES
As of December 31, 2008, the Company had net operating loss carry forwards of approximately $27,773 that may be available to reduce future years’ taxable income through 2028. Future tax benefits which may arise as a result of these losses have not been recognized in these financial statements, as their realization is determined not likely to occur and accordingly, the Company has recorded a valuation allowance for the deferred tax asset relating to these tax loss carry-forwards.
5. CONTRACT
On November 15, 2007 the Company made a contract with PC “Dulevo Porcelain” (Contract # 174) to purchase chinaware products directly from manufacturer and market and distribute the products in North America.
6. REGISTRATION STATEMENT
On February 1, 2008, the Company filed a registration statement on Form SB-2 with the Securities and Exchange Commission (the "SEC") . On February 27, 2008, the registration statement was declared effective by the SEC.
- 21 -
ITEM 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURES
There have been none.
ITEM 8A. CONTROLS AND PROCEDURES
FINANCIAL DISCLOSURE CONTROLS AND PROCEDURES
An evaluation was conducted under the supervision and with the participation of our management, including Mr. Lyakutin, our Chief Executive Officer and our
Chief Financial Officer of the effectiveness of the design and operation of our disclosure controls and procedures as of December 31, 2008. Based on that evaluation, Mr. Lyakutin concluded that our disclosure controls and procedures were not effective as of such date to ensure that information required to be disclosed in the reports that we file or submit under the Exchange Act, is recorded, processed, summarized and reported within the time periods specified in SEC rules and forms. Such officer also confirmed that there was no change in our internal control over financial reporting during the year ended December 31, 2008 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.
We maintain "disclosure controls and procedures," as such term is defined in
Rule 13a-15(e) under the Securities Exchange Act of 1934 (the "Exchange Act"),
that are designed to ensure that information required to be disclosed in our
Exchange Act reports is recorded, processed, summarized and reported within the
time periods specified in the Securities and Exchange Commission rules and
forms, and that such information is accumulated and communicated to our
management, including our Chief Executive Officer/Chief Financial Officer, as
appropriate, to allow timely decisions regarding required disclosure. We
conducted an evaluation (the "Evaluation"), under the supervision and with the
participation of our Chief Executive Officer/Chief Financial Officer of the
effectiveness of the design and operation of our disclosure controls and
procedures ("Disclosure Controls") as of the end of the period covered by this
report pursuant to Rule 13a-15 of the Exchange Act. The evaluation of our
disclosure controls and procedures included a review of the disclosure controls'
and procedures' objectives, design, implementation and the effect of the
controls and procedures on the information generated for use in this report. In
the course of our evaluation, we sought to identify data errors, control
problems or acts of fraud and to confirm the appropriate corrective actions, if
any, including process improvements, were being undertaken. Our Chief Executive
Officer/Chief Financial Officer concluded that, as of the end of the period
covered by this Annual report, our disclosure controls and procedures were effective and were operating at the reasonable assurance level.
AUDIT COMMITTEE
Our Board of Directors has not established an audit committee. The respective
role of an audit committee has been conducted by our Board of Directors. We are
contemplating establishment of an audit committee during fiscal year 2009. When
established, the audit committee's primary function will be to provide advice
with respect our financial matters and to assist our Board of Directors in
fulfilling its oversight responsibilities regarding finance, accounting, and
legal compliance. The audit committee's primary duties and responsibilities will
be to: (i) serve as an independent and objective party to monitor our financial
reporting process and internal control system; (ii) review and appraise the
audit efforts of our independent accountants; (iii) evaluate our quarterly
financial performance as well as its compliance with laws and regulations; (iv)
oversee management's establishment and enforcement of financial policies and
business practices; and (v) provide an open avenue of communication among the
independent accountants, management and our Board of Directors.
- 22 -
PART III
ITEM 9. DIRECTORS AND EXECUTIVE OFFICERS
Our executive officers and directors and their respective ages as of the date
of this annual report is as follows:
Name Age Position with the Company
---- --- -------------------------
Dmitry Lyakutin 33 President/Chief Executive Officer,
Treasurer, Chief Financial Officer,
Principal Accounting Officer and a
Director
Eleonora Magerramova 24 Secretary
BUSINESS EXPERIENCE
The following is a brief account of the education and business experience of our
director, executive officer and key employee during at least the past five
years, indicating his principal occupation during the period, and the name and
principal business of the organization by which he was employed, and including
other directorships held in reporting companies.
Dmitry Lyakutin has acted as our sole director and officer since our incorporation on March 27, 2007. He devotes close to 40% of his time to planning and organizing activities for Onyx China, Ink. Mr. Lyakutin graduated with a Bachelor Degree in Business from Baikal State Economic University in December 1998. From December 1998 to January 2003, Mr. Lyakutin was employed as Assistant Manager for Taiga Co, Ltd, a private Russian wholesale company involved in distributing glassware, china, crystal and crockery. Mr. Lyakutin was responsible for organization of wholesale and retail trade, customer relations with providers and consumers, marketing and advertising. From January 2003 to February 2007, he has worked as General Manager for Santex Corporation, a private Russian company that sells sanitary engineering equipment, water supply and sewerage materials in Russia and abroad. Since February 2007, Mr. Lyakutin has been a director of Income LLC, a real estate limited liability company in Russia.
Eleonora Magerramova has acted as our secretary since August 14, 2008. She graduated with a Bachelor Degree in Japanese language from Irkutsk State Foreign Language University in June 2006. Since that time, Ms. Magerramova has been self-employed as sole proprietor and involved in wholesale trade.
FAMILY RELATIONSHIPS
There are no family relationships among our directors or officers.
- 23 -
INVOLVEMENT IN CERTAIN LEGAL PROCEEDINGS
During the past five years, none of our directors, executive officers or persons
that may be deemed promoters is or have been involved in any legal proceeding
concerning: (i) any bankruptcy petition filed by or against any business of
which such person was a general partner or executive officer either at the time
of the bankruptcy or within two years prior to that time; (ii) any conviction in
a criminal proceeding or being subject to a pending criminal proceeding
(excluding traffic violations and other minor offenses); (iii) being subject to
any order, judgment or decree, not subsequently reversed, suspended or vacated,
of any court of competent jurisdiction permanently or temporarily enjoining,
barring, suspending or otherwise limiting involvement in any type of business,
securities or banking activity; or (iv) being found by a court, the Securities
and Exchange Commission or the Commodity Futures Trading Commission to have
violated a federal or state securities or commodities law (and the judgment has
not been reversed, suspended or vacated).
SIGNIFICANT EMPLOYEES
We have no significant employees other than the officers and directors described above.
ITEM 10. EXECUTIVE COMPENSATION
SUMMARY COMPENSATION TABLE
Name &
Dmitry Lyakutin,
Title:
President, CEO, CFO, Treasurer and Director
Year:
2008 2007
Salary:
0 0
Bonus:
0 0
Stock Awards:
0 0
Option Awards:
0 0
Non-Equity
Incentive Plan
Compensation:
0 0
Change in Pension
Value and Non-Qualified
Deferred Compensation
Earnings:
0 0
All Other Compensation: 0 0
Totals:
0 0
Name &
Eleonora Magerramova,
Title:
Secretary
Year:
2008 2007
Salary:
0 0
Bonus:
0 0
Stock Awards:
0 0
Option Awards:
0 0
Non-Equity
Incentive Plan
Compensation:
0 0
Change in Pension
Value and Non-Qualified
Deferred Compensation
Earnings:
0 0
All Other Compensation: 0 0
Totals:
0 0
- 24 -
STOCK OPTION GRANTS
As of the date of this Annual Report we have not granted any stock options to the executive officers since our inception.
EMPLOYMENT AND CONSULTING AGREEMENTS
As of the date of this Annual Report, we have not entered into any contractual
agreements with our executive officers or directors.
ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table provides the name and addresses of each person known to us to own more than 5% of our outstanding common stock as of the date of this Annual report and by the officer and director, individually. Except as otherwise indicated, all shares are owned directly.
Amount of
Title of Name and Address Beneficial Percent
Class of Beneficial Owner Ownership of Class
----- ------------------- --------- --------
Common Dmitry Lyakutin 3,000,000 59.41%
Stock President, Chief Executive
Officer Treasurer
and Director
Kvartal 60, dom 23 apt. 18
Angarsk, Russia
Common Eleonora Magerramova 50,000 0.99%
Stock Secretary
Krasnyh Madyar St, 105-22
Irkutsk, Russia 664047
Common All officers and directors 3,050,000 60.40%
Stock as a group that consists of
two people
The percent of class is based on 5,050,000 shares of common stock issued and outstanding as of the date of this Annual report.
- 25 -
ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.
None of the following parties has, since our date of incorporation, had any material interest, direct or indirect, in any transaction with us or in any presently proposed transaction that has or will materially affect us:
{circle}Any director or officer;
{circle}Any person as a nominee for election as a director;
{circle}Any person who beneficially owns, directly or indirectly,
shares carrying more than 10% of the voting rights attached
to our outstanding shares of common stock;
{circle}Any member of the immediate family of any of the foregoing
persons.
ITEM 13. PRINCIPAL ACCOUNTING FEES AND SERVICES
During fiscal year ended December 31, 2008, we incurred approximately $7,775 in fees to our principal independent accountants for professional services rendered in connection with the audit of our financial statements for fiscal year ended December 31, 2008 and for the review of our financial statements for the quarters ended March 31, 2008, June 30, 2008 and September 30, 2008.
During fiscal year ended December 31, 2008, we did not incur any other fees for professional services rendered by our principal independent accountant for all other non-audit services which may include, but is not limited to, tax-related services, actuarial services or valuation services.
ITEM 14. EXHIBITS
The following exhibits are filed as part of this Annual Report.
Exhibit No. Document
----------- --------
3.1 Articles of Incorporation*
3.2 Bylaws*
31.1 Certification of Chief Executive Officer Pursuant to Rule
13a-14(a) or 15d-14(a) of the Securities Exchange Act.
31.2 Certification of Chief Financial Officer Pursuant to Rule
13a-14(a) or 15d-14(a) of the Securities Exchange Act.
32.1 Certification of Chief Executive Officer and Chief
Financial Officer Under Section 1350 as Adopted Pursuant to
Section 906 of the Sarbanes-Oxley Act.
* filed as an exhibit to our registration statement on Form SB-2
dated February 1, 2008
- 26 -
SIGNATURES
In accordance with the requirements of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
ONYX CHINA, INC.
Dated: March 19, 2009 By: /s/ Dmitry Lyakutin
----------------------------------
Dmitry Lyakutin,
President/Chief Executive Officer
Dated: March 19, 2009 By: /s/ Dmitry Lyakutin
----------------------------------
Dmitry Lyakutin
Treasurer/Chief Financial Officer
- 27 -