SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-KSB
Annual Report Pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934
For the fiscal year ended: December 31, 2004
Commission File number: 000-30145
JOINTLAND DEVELOPMENT, INC.
-------------------------------
(Exact name of registrant as specified in its charter)
GLOBAL ASSETS & SERVICES, INC.
----------------------------------
(Former Name)
Florida 59-3723328
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State or Other Jurisdiction (I.R.S. Employer Identification
of incorporation or organization) Number)
Rooms 103-8, 12th Floor, Hang Seng Bldg., No. 77 Des Voeux Road
Central, Hong Kong, China
------------------------------------------------------------
(Address of principal Executive Offices Zip Code)
Registrant's telephone number, including area code: 011 852 2824 0008
Securities registered pursuant to Section 12(b) of the Act: None
Securities registered pursuant to Section 12(g) of the Act: None
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 ( )
Check if disclosure of delinquent filers pursuant to Item 405 of Regulation S-B
is not contained in this form, and no disclosure will 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-KSB or any amendment to
this Form 10-KSB. [X]
State issuer's revenues for its most recent fiscal year. $0
Small Business Disclosure Format:
__X____ Yes _______ No
As of December 31, 2004, 1,979,965 shares of common stock and no shares of
preferred stock were outstanding. The aggregate market value of the 629,955
shares of Stock held by non-affiliates of Registrant was $2,519,820 based upon a
closing price of $4.00 on December 30, 2004.
Documents incorporated by reference: (1) The Company's Registration
Statement on Form S-18 (33-41063-A).
TABLE OF CONTENTS
PART I PAGE
Item 1. Description of Business 1
Item 2. Description of Property 6
Item 3. Legal Proceedings 6
Item 4. Submission of Matters to a Vote of Security Holders 6
PART II
Item 5. Market for Common Equity and Related Stockholder Matters 6
Item 6. Management's Discussion and Analysis or Plan of Operation 7
Item 7. Financial Statements 10
Item 8. Changes in and Disagreements With Accountants on Accounting 10
and Financial Disclosure
Item 8A. Controls and Procedures 10
Item 8B. Other Information 10
PART III
Item 9. Directors, Executive Officers, Promoters and Control Persons;
Compliance with Section 16(a) of the Exchange Act 11
Item 10. Executive Compensation 12
Item 11. Security Ownership of Certain Beneficial Owners and Management 14
Item 12. Certain Relationships and Related Transactions 15
Item 13. Exhibits and Reports on Form 8-K 16
Item 14. Principal Accountant Fees & Services 18
SIGNATURES 19
Part I
Item 1. Description of Business
General Description of Company
------------------------------
History
--------
Jointland Development, Inc., ("the Company" or "AM&E") a Florida corporation
was organized in May 25, 1988 as Cornerstone Capital, Inc. and the name was
changed on September 22, 1990 to Chatham International, Inc. It completed an
initial public offering which commenced on November 14, 1991, comprised of
16,268 shares of Common Stock and One Zero Coupon U.S. Treasury-Backed
Obligation ("USTBO") with a maturity value of $1,000 at a price of $1,000. The
Registrant offered a maximum of 3,000 units and a minimum of 75 units on a best
efforts basis. The underwriter for the offering was Boe and Company formerly
known as SBV Securities, Inc. A total of 98 units was sold and net proceeds were
$67,770. The Company closed its offering May 14, 1992.
The Company intended upon completion of the public offering, to commence
operations as an export management company and provide a range of business
services and assistance to manufacturers desiring to do business in foreign
markets. The Company was unsuccessful in its efforts. The Company is presently
in the developmental stage.
In April 1996, Art Music and Entertainment, Inc. merged with Chatham
International, Inc. The Company changed its name to Art Music and Entertainment,
Inc. on April 5, 1996.
The Company utilized most of 1996 to further develop its business plan and
acquire the following companies, and develop business plans of each. All
subsidiaries were acquired under a stock exchange agreement which utilized a
$10.00 per share value for its stock.
a. International Jazz Hall of Fame Production Company, Inc. - 3/1/96
b. Marin Movies, Inc. - 3/5/96
c. Classical Music Collection, Inc. - 3/5/96
d. Octopus Entertainment, Inc. - 3/5/96
e. Spellbinder Productions, Inc. - 3/5/96
On March 5, 1996, the Old AME entered into an Agreement and Plan of
Reorganization with the International Art Group, Inc., ("Art Group") under the
terms of which the Old AME acquired all of the outstanding capital stock of Art
Group in exchange for 486,754 shares of Class H Convertible Preferred Stock of
the Old AME. Art Group is not conducting operations and is reportedly the owner
of an exclusive license from the government of the United States to publish and
distribute the only official artwork to commemorate the Quincentennial (500th
anniversary) of the discovery of America. In December 1996, the Company and the
former shareholder of International Art Group, Inc., rescinded and canceled the
merger, and 486,754 shares of the Company's Class H Preferred Stock issued to
effect the merger were returned to the Company. Revenues of $140,400 from sales
of certain of the artwork during 1996 remain with the Company.
1
Old AME executed an Agreement and Plan of Reorganization on March 1, 1996 with
the International Jazz Hall of Fame Production Co. Inc. ("Jazz"). The terms of
the agreement provided for the Old AME to acquire all of the outstanding common
shares of Jazz in exchange for 44,666.68 common shares and 22,807 Class I Voting
Convertible Preferred Shares of the Old AME. Jazz was conducting operations and
is the owner of lithographs of certain jazz artists. During 1996, the Company
realized $184,748 from sales of the jazz lithographs, and $29,247 from its
production of a Jazz Hall of Fame induction ceremony. In January 1997, the
Company and the Class I Convertible Preferred Shareholders agreed to exchange
such convertible preferred stock for 230,000 shares of the restricted common
shares of the Company, which shares were issued in October 1997.
On March 5, 1996, the Old AME signed an Agreement and Plan of Reorganization
with Marin Movies, Inc. ("Marin"). The provisions of the agreement provide for
Old AME to acquire all of the outstanding common stock of Marin in exchange for
2,800 shares of Class G Convertible Preferred Stock of the Old AME. Marin is not
conducting operations and is the owner of master videos of 300 public domain
movies. In January 1997, the Company and the Class G Convertible Preferred
Shareholders agreed to exchange such convertible preferred stock for 28,000
shares of the restricted common shares of the Company, which shares were issued
in October 1997.
An Agreement and Plan of Reorganization with Classical Music Collection, Inc.
("Classical") was executed by the Old AME on March 5, 1996. Under the terms of
the agreement the Old AME acquired all of the outstanding common stock of
Classical in exchange for 11,333.34 of the Old AME's common shares and 1,760 of
the Old AME's Class F Voting convertible Preferred shares. Classical is not
conducting operations and is the owner of certain master music recordings. In
January 1997, the Company and the Class F Convertible Preferred Shareholders
agreed to exchange such convertible preferred stock for 7,967 shares of the
restricted common shares of the Company, which shares were issued in October
1997.
All of the outstanding common stock of Octopus Entertainment, Inc., ("Octopus")
was acquired by the Old AME on March 5, 1996 under an Agreement and Plan of
Reorganization of same date. The outstanding common stock of Octopus was
acquired for 1,000 Class E Voting Convertible Preferred Stock of the Old AME.
Octopus is not conducting operations and its sole assets are the ownership of
two trade names and certain "big-band" sheet music. In January 1997, the Company
and the Class E Convertible Preferred Shareholders agreed to exchange such
convertible preferred stock for 10,000 shares of the restricted common shares of
the Company, which shares were issued in October 1997. The transaction was
cancelled and rescinded in 1998.
Also on March 5, 1996, the Old AME executed an Agreement and Plan of
Reorganization with Spellbinder Productions, Inc. ("Spellbinder"), under which
the Old AME acquired all of the outstanding common stock of Spellbinder in
exchange for 9,533.34 common shares and 100,600 Class C Voting Convertible
Preferred shares of the Old AME. Spellbinder is not conducting operations, and
2
its sole asset is the music and related hardware for a music and illusionary
show copyrighted in 1990. In January 1997, the Company and the Class C
Convertible Preferred Shareholders agreed to exchange such preferred stock for
100,000 shares of the restricted common shares of the Company, which shares were
issued in October 1997. This subsidiary acquisition was rescinded in 1998 after
no activity or capital was produced.
The Company renegotiated in January 1997 with the former owners of the various
assets acquired by the respective classes of convertible preferred stock,
culminating in October 1997 with the exchange of all of the classes of issued
preferred stock for restricted common shares of the Company. The number of the
restricted common shares issued for each class of preferred shares is as
follows:
Retired Class G Preferred for 28,000 shares of common
Retired Class I Preferred for 230,000 shares of common
Retired Class F Preferred for 7,967 shares of common
Retired Class E Preferred for 10,000 shares of common
Retired Class C Preferred for 100,000 shares of common
Retired Class A Preferred for 380,000 shares of common
The Parent Company, AM&E had an affiliation with American Independent Network,
Inc. for television program broadcast time through the utilization of 30 second
commercial spots on the American Independent Network ("AIN"). Due to numerous
difficulties no advertising air time was ever used and the contract was
cancelled. The Company had planned on utilizing a portion of this air time to
sell its own products from its subsidiaries.
By the summer of 1997 AIN planned to be broadcasting its programming on
approximately 200 stations to close to 40 million households. AM&E intended to
create revenue by selling its commercial spots and its time slots for
programming. It did not achieve this goal, and ceased its operations in this
area in 1998.
The Company is a successor registrant pursuant to Section 12(g) 3 of the
Securities Exchange Act of 1934, by virtue of a statutory merger of the Parent,
Global Assets & Services, Inc. a Florida corporation, and its wholly owned
subsidiary, S.D.E. Holdings 3 Inc., a Nevada corporation, with Global Assets &
Services, Inc. being the survivor. There was no change to the issued and
outstanding shares of Global Assets & Services, Inc. and all shares of S.D.E.
Holdings 3 Inc. were retired by virtue of the merger.
On December 20, 2001, Global Assets & Services, Inc. completed a Share Purchase
Agreement with shareholders of S.D.E. Holdings 3 Inc. in which Global Assets &
Services, Inc., a Florida corporation, acquired all 500,000 shares outstanding
of the Registrant for the purposes of accomplishing a Merger of S.D.E. Holdings
3 Inc. and Global Assets & Services, Inc. The Merger was subsequently completed
on December 20, 2001.
3
Global Assets & Services, Inc. (the "Company"), in December 21, 2001 executed a
letter of intent to enter into a Software License Agreement with M-Cube
Corporation. Focus systems, Inc., publicly listed in the Tokyo OTC Market, is
the parent company of M-Cube Corporation, owning 50% of M-Cube Corporation. This
License was to market a new chaos theory encryption software package suitable
for internet communications and data security. A definitive Agreement for this
Software License was executed.
On May 16, 2002 Global Assets & Services executed a Software License Agreement
with M-Cube Corporation of Japan, a subsidiary of Focus Systems Corporation.
Focus Systems is a publicly listed company on the Tokyo JASDAQ Market with
symbol code 4662. The licensing agreement applies to a new chaos theory
encryption software package suitable for data security and wireless/internet
communications.
Epond Technologies
On August 25, 2003, Global Assets & Services entered into a License Agreement
with Koki Nagashima and Epond Inc., whereby Global Assets & Services issued
750,000 shares of restricted stock to Koki Nagashima and Koki Nagashima was to
receive 57.1% of the license fees of the licensed patent in exchange for
exclusive rights for the licened patent and its pertained rights to produce and
sell product using the invention in all known nations and territories of the
world. The Technology licensed is described as follows: The technology is a
next-generation information distribution system, which uses a PCMCIA card as its
core component.
Teaming Agreement
On July 23, 2001 Global Assets & Services signed a teaming agreement with
Geosystems Inc. to evaluate and market encryption software based on the C4S and
C4K technology to the government and commercial market.
On October 25, 2002, Global Assets & Services entered into a Contract Agreement
with GeoSystems, Inc., whereby GEO would provide to Global application
development, sale and distribution services, on a 5 year exclusive basis, for C4
encryption products under Global's license, for Federal Goverment and commercial
sectors. Global will provide either $500,000 or 400,000 shares of its restricted
common stock to capitalize the effort.
On February 3, 2003, the Contract Agreement with Geosystems was assigned to the
Cybrix Group, Inc. The Cybrix Group, Inc. and shareholders are the same as
Geosystems, Inc. No revenues were ever generated from this arrangement.
4
The Company signed a License for the North American Marketing rights for the
following patented products from Japan Junon System and Tomigel. Tomigel is an
inorganic soil-hardening agent that has been developed in order to harden any
kind of soil from volcanic ash and sea sand to industrial waste. Junon System is
a polystyrene(styrofoam) dissolving agent that quickly, safely, and
non-toxically dissolves polystyrene materials and turns them into a gel, while
maintaining the basic chemical composition of the polystyrene so it can be
recycled. None of these licenses ever generated contracts or revenues.
In August 2004, the Company formed a wholly owned subsidiary, Global Tech
Assets, Inc. in the State of Florida. The Company transferred all of its non-
operating licenses to the subsidiary and distributed all of the stock of Global
Tech Assets, Inc. as a dividend to the Company's shareholders of record as of
September 30, 2004.
The Company has no business operations, and the Company is seeking a business
acquisition which is able to utilize a public company.
The Company held an Annual Meeting of Shareholders on December 15,
2004. At this meeting, the shareholders holding a majority of shares approved
the following proposals.
1. To elect two directors to hold office until the next annual meeting
of shareholders and qualification of their respective successors.
2. To ratify the appointment of Michael Johnson & Co. as Independent
Accountants for the annual period ending December 31, 2004.
3. To change the Company's name to Jointland Development, Inc.
4. To authorize a reverse split of the Company's common stock on a
basis of up to one for fifty. Fractional shares were rounded up to the next
whole share.
Subsidiaries
------------
None.
Services
--------
None.
Competition
-----------
The Company will be in competition with many companies of much greater
experience, financial resources and long established businesses. There is no
assurance that the Company will have any success in competition with other
businesses.
5
Employees and Consultants
-------------------------
The Company presently has no salaried employees, and its Chairman of the
Board/President, Kexi Ku, and Secretary, Yi Tung Alice Anastasia Chan serve on
an as needed basis. These officers intend to devote only such time as necessary
to the business affairs of the Company.
Presently, none of the officers receive salaries; however, they are paid
consulting fees in stock, and they are reimbursed for their expenses incurred in
their services as officers. There is no provision for any additional bonuses or
benefits. The Company anticipates that in the near future it may enter into
employment agreements with its officers. Although Directors do not receive
compensation for their services they may be reimbursed for expenses incurred in
attending Board meetings.
Item 2. Description of Property
The Company maintains its corporate records at Rooms 1203-8, 12th Floor, Hang
Seng Building, No. 77 Des Voeux Road, Central, Hong Kong, China.
Item 3. Legal Proceedings
The Company is not a party to any pending legal proceedings, as of date of this
report.
Item 4. Submission of Matters to a Vote of Security Holders
The Company held an Annual Meeting of Shareholders on December 15,
2004. At this meeting, the shareholders holding a majority of shares approved
the following proposals.
1. To elect two directors to hold office until the next annual meeting
of shareholders and qualification of their respective successors.
2. To ratify the appointment of Michael Johnson & Co. as Independent
Accountants for the annual period ending December 31, 2004.
3. To change the Company's name to Jointland Development, Inc.
4. To authorize a reverse split of the Company's common stock on a
basis of up to one for fifty. Fractional shares were rounded up to the next
whole share.
Part II
Item 5. Market for Common Equity and Related Stockholder Matters
The outstanding shares of Jointland Development, Inc. are presently traded
on the OTC Bulletin Board under the symbol JLDV.BB.
6
Common Stock Common Stock
2004 Bid High Bid Low
----------------------------------------------------------------
1st Quarter .05* .04*
2nd Quarter .10* .02*
3rd Quarter .08* .03*
4th Quarter 4.10 .05*
* Pre-reverse split one for fifty December 21, 2004.
Common Stock Common Stock
2003 Bid High Bid Low
----------------------------------------------------------------
1st Quarter .48 .10
2nd Quarter .16 .05
3rd Quarter .09 .04
4th Quarter .06 .04
The Company's shares trade over the counter on the OTC Bulletin Board Quotations
represent only prices between dealers and do not include retail markups,
markdowns or commissions and accordingly, may not represent actual transactions.
The Company estimates that as of December 31, 2004, there are approximately 285
stockholders of record of the Company's shares.
No dividends have been declared or paid by the Company and the Company presently
intends to retain all future earnings, if any, to finance the expansion and
development of its business.
Item 6. Management's Discussion and Analysis or Plan of Operation
Financial Condition
-------------------
During fiscal year 2004, the Company continued to be a development stage entity
with no sales and revenues. The company had no capital for operations and had
minimal business operations.
Financial Condition and Changes in Financial Condition
------------------------------------------------------
Liquidity and Capital Assets.
----------------------------
The Company's primary source of liquidity since inception has been from
funds raised during its initial capitalization. The company has no sources of
capital except to use its stock for private placements. The company will be
reliant upon loans from officers for any cash needs. No loan commitments have
been made by anyone.
The Company remains in the development stage and, since inception, has
experienced significant liquidity problems and has no significant capital
resources now and has stockholder's deficit of ($3,654,470) at December 31,
2004. The Company has no current assets and other assets consisting only of
intangible licenses at December 31, 2003.
The Company is unable to carry out any plan of business without funding.
The Company cannot predict to what extent its current lack of liquidity and
capital resources will impair the business or whether it will incur further
operating losses through business entity which the Company may eventually
acquire. There is no assurance that the Company can continue as a going concern
without substantial funding, for which there is no source.
The Company estimates it will require $25,000 to $30,000 to cover
legal, accounting, transfer and miscellaneous costs of being a reporting company
in the next fiscal year. The Company will have a cash shortfall for current
annual costs of at least $25,000 to $30,000, for which it has no source except
shareholder loans or contributions, none of which have been committed.
7
Results of Operations 2004 Compared to 2003
-------------------------------------------
Business operations were minimal and no revenues were generated in 2003 or
2003. The Company at year end had minimal cash. The Company needed cash or loans
from any sources, for any significant business operations.
During the fiscal year ended December 31, 2004, the Company incurred
general and administrative expenses of $556,182 compared to $746,134 in
expenses in 2003. The net loss was ($556,182) in 2004 compared to ($746,134)
in 2003. Loss per share was ($.31) in 2004 and ($1.00) in 2003.
The largest factors in expenses for the Company were consultant fees:
$492,347 in 2004 versus $265,600 in 2003 and, legal and accounting fees of
$63,835 in 2004 versus $25,531 in 2003. The Company incurred no officer/
director fees in 2004 compared to $435,000 in officer/director fees in 2003.
Evaluation of Internal and Disclosure Controls
----------------------------------------------
The management of the company has evaluated the effectiveness of the
issuer's disclosure controls and procedures as of a date within 90 days prior to
the filing date of the report (evaluation date) and have concluded that the
disclosure controls and procedures are adequate and effective based upon their
evaluation as of the evaluation date.
There were no significant changes in internal controls or in other factors
that could significantly affect internal controls subsequent to the date of the
most recent evaluation of such, including any corrective actions with regard to
significant deficiencies and material weaknesses.
NEED FOR ADDITIONAL FINANCING
The Company does not have capital sufficient to meet the Company's cash
needs, including the costs of compliance with the continuing reporting
requirements of the Securities Exchange Act of 1934. The Company will have to
seek loans or equity placements to cover such cash needs. Lack of its existing
capital may be a sufficient impediment to prevent it from accomplishing the goal
of carying out the business plan as it attempts its business plan, the Company's
needs for additional financing are likely to increase substantially. The Company
will need to raise additional funds to conduct any business activities in the
next twelve months.
No commitments to provide additional funds have been made by management
or other stockholders. Accordingly, there can be no assurance that any
additional funds will be available to the Company to allow it to cover its
expenses as they may be incurred.
8
Irrespective of whether the Company's cash assets prove to be
inadequate to meet the Company's operational needs, the Company might seek to
compensate providers of services by issuances of stock in lieu of cash.
The Company has no plans for any research and development in the next
twelve months. The Company has no plans at this time for purchases or sales of
fixed assets which would occur in the next twelve months.
The Company has no expectation or anticipation of significant changes
in number of employees in the next twelve months, however, if it achieves a
business acquisition, it may acquire or add employees of an unknown number in
the next twelve months.
The Company's auditor has issued a "going concern" qualification as
part of his opinion in the Audit Report.
There is substantial doubt about the ability of the Company to continue as
a "going concern." The Company has no developed business, capital of $58,897 and
debt in excess of $380,198 at year end, all of which is current, moderate cash,
no assets, and no capital commitments. The effects of such conditions could
easily be to cause the Company's bankruptcy.
The Company has incurred significant losses from operations for the year
ended December 31, 2004 totalling ($556,182,) and such losses are expected to
continue. In addition, the company has a $325,000 (approximately) working
capital deficit for the year ended December 31, 2004. The foregoing raises
substantial doubt about the Company's ability to continue as a going concern.
Management's plans include seeking additional capital and/or debt financing or
the possible sale of the Company. There is no guarantee that additional capital
and/or debt financing will be available when and to the extent required, or that
if available, it will be on terms acceptable to the Company. The consolidated
financial statements do not include any adjustments that might result from the
outcome of this uncertainty.
9
The Company has received an opinion from its independent auditors containing an
explanatory paragraph that describes such auditors' uncertainty as to the
Company's ability to continue as a going concern due to the Company's negative
cash flow. As of the date the independent auditors rendered this opinion, the
Company did not have access to sufficient committed capital to meet the
Company's projected operating needs for at least the next twelve months. If the
Company does not achieve positive operating results within the next few months,
then it will require additional financing. If positive operating results are not
achieved in the short term, then the Company intends to take measures to reduce
expenditures so as to minimize its requirements for additional financing, which
financing may not be available on terms acceptable to the Company, if at all.
Such measures may include reduction of the Company's cost of operations and
restructuring employee compensation packages. There can be no assurance that the
Company will be able to generate internally or raise sufficient funds to
continue the Company's operations, or that the Company's independent auditors
will not issue another opinion with a going concern qualification. The Company's
consolidated financial statements do not include any adjustments to reflect the
possible future affects on the recoverability and classification of assets or
the amounts and classification of liabilities that may result from the Company's
possible inability to continue its operations.
Item 7. Financial Statements
Attached hereto and filed as part of this Form 10-KSB are the financial
statements required by Regulation SB. Please refer to pages F-1 through F-10.
Item 8. Changes in and Disagreements on Accounting and Financial Disclosure
In connection with audit of the two most recent fiscal years and through the
date of dismissed of the accountants, no disagreements exist with any former
accountant on any matter of accounting principles or practices, financial
statement disclosure, or auditing scope of procedure, which disagreements if not
resolved to the satisfaction of the former accountant would have caused them to
make reference in connection with his report to the subject of the
disagreement(s).
Item 8A. Control and Procedures
The management of the company has evaluated the effectiveness of the
issuer's disclosure controls and procedures as of December 31, 2004 (evaluation
date) and have concluded that the disclosure controls and procedures are
adequate and effective based upon their evaluation as of the evaluation date.
There were no changes in internal controls or in other factors that could
affect internal controls subsequent to December 31, 2004, including any
corrective actions with regard to significant deficiencies and material
weaknesses.
Item 8B. Other Information
None
10
Part III
Item 9. Directors, Executive Officers, Promoters and Control Persons; Compliance
with Section 16(a).
The directors and executive officers of the Company as of December 31, 2004, are
as follows:
Name Age Position Held Tenure
---- --- ------------- ------
Kexi Xu 42 President & Director Annual
Yi Tung Alice Anastasia Chan 37 Secretary & Director Annual
Mr. Xu Kexi, age 42, graduated from high school in Shanghai in 1982. Mr. Xu
was the supervisor of the Shanghai Textile Company from 1982 to 1985, the Export
Manager of Shengzhen China Import-Export Company from 1985-1990, the Manager of
Shanghai Galaxy Film Limited from 1990-1996. From 1996 to the present, Mr. Xu
has been the Chief Executive Officer of Shanghai Asia Loyalty Tradings Limited.
Miss Chan Yi Tung Alice Anastasia, age 37, graduated in 1995 from the
University of Minnesota, United States of America. She was the Administrative
Manager of Minghua Group Holdings Limited, a company listed on NASD's
Overt-the-Counter Bulletin Board in the United States of America until May 2002.
In the past, Miss Chan has worked as the Sales Manager for the KYH Steel Co.,
Limited, a steel stocklist in Hong Kong, and as the Administrative Officer of
B+B Asia Limited, a contractor in Hong Kong, with its parent company, located in
Germany. At present, Miss Chan is a director of Genuisoft Limited, a company
involved in the research, development, and production of remote surveillance
monitoring, data security, and wireless communication systems.
None of the above individuals have a criminal history or have had any adverse
securities actions taken against them.
The directors named above will serve until the next annual meeting of
the Company's stockholders. Thereafter, directors will be elected for one-year
terms at the annual stockholders' meeting. Officers will hold their positions at
the pleasure of the board of directors, absent any employment agreement, of
which none currently exists or is contemplated. There is no arrangement or
understanding between the directors and officers of the Company and any other
person pursuant to which any director or officer was or is to be selected as a
director or officer.
11
The directors and officers of the Company will devote such time to the Company's
affairs on an "as needed" basis, but less than 20 hours per month. As a result,
the actual amount of time which they will devote to the Company's affairs is
unknown and is likely to vary substantially from month to month.
Item 10. Executive Compensation.
The Company does not have any employee incentive stock option plans.
SUMMARY COMPENSATION TABLE OF EXECUTIVES
Annual Compensation Awards
Name and Year Consulting Bonus Other Annual Restricted Securities Long Term All Other
Principal Fees ($) or ($) Compensation ($) Stock Underlying Compensation Compensation
Position Salary Award(s)($) Options/SARs Option
-------- ---- -------- ------- ---------------- ----------- ------------ ------ -------------
Bertram(1) 2004 0 0 0 0 0 0 0
Cutler, 2003 0 0 0 30,000 0 0 0
President, 2002 0 0 0 20,000(2) 0 0 0
Director 2001 0 0 0 8,000 0 0 0
(resigned
2004)
========= ==== ========= ======== ================ =========== ============= ======= =============
Steve Oto, 2004 0 0 0 0 0 0 0
Secretary, 2003 0 0 0 20,000(2) 0 0 0
Director 2002 0 0 0 10,000 0 0 0
(Resigned 2001 0 0 0 0 0 0 0
Sept. 2004)
========= ==== ========= ======== ================ =========== ============= ======= =============
Kexi Xu,(1) 2004 0 0 0 0 0 0 0
President,
Director
========= ==== ========= ======== ================ =========== ============= ======= =============
Yi Tung 2004 0 0 0 0 0 0 0
Alice
Anastasia
Chan
Secretary,
Director
========= ==== ========= ======== ================ =========== ============= ======= =============
Officers 2004 0 0 0 0 0 0 0
as a Group 2003 0 0 0 50,000(2) 0 0 0
2002 0 0 0 606,000 0 0 0
========= ==== ========= ======== ================ =========== ============= ======= =============
12
(1) As of September 20, 2004, Bertram Cutler resigned as Director and President
of the Company. As of September 20, 2004, Mr. Xexi Xu was appointed
President and Director, and Miss Alice Chan was appointed Director of the
Company.
(2) Issued in lieu of salary.
Option/SAR Grants Table (None)
Aggregated Option/SAR Exercises in Last Fiscal Year an FY-End Option/SAR value
(None)
Long Term Incentive Plans - Awards in Last Fiscal Year (None)
DIRECTOR COMPENSATION FOR LAST FISCAL YEAR
(Except for compensation of Officers who are also Directors which Compensation
is listed in Summary Compensation Table of Executives)
Cash Compensation Security Grants
Name Annual Meeting Consulting Number Number of
Retainer Fees ($) Fees/Other of Securities
Fees ($) Fees ($) Restricted Underlying
Shares (#) Options/SARs(#)
------------------------------ ---------- ---------------- --------------- ------------------------------ ---------------
A. Kexi Xu 2004 0 0 0 0 0
2003 0 0 0 0 0
2002 0 0 0 0 0
B. Yi Tung Alice Anastasia Chan 2004 0 0 0 0 0
2003 0 0 0 0 0
2002 0 0 0 0 0
B. Saburo Oto 2004 0 0 0 0 0
(resigned 2004) 2003 0 0 0 0 0
2002 0 0 0 0 0
C. Bertram Cutler 2004 0 0 0 0 0
(resigned 2004) 2003 0 0 0 0 0
2002 0 0 0 0 0
D. Frances McCrimmon 2004 0 0 0 0 0
(resigned 2004) 2003 0 0 0 0 0
2002 0 0 0 10,000 0
E. Directors as a Group 2004 0 0 0 0 0
2003 0 0 0 10,000 0
2002 0 0 0 0 0
============================== ========= ================ =============== ================== ============= =================
13
Option/SAR Grants Table (None)
Aggregated Option/SAR Exercises in Last Fiscal Year an FY-End Option/SAR
value (None)
Long Term Incentive Plans - Awards in Last Fiscal Year (None)
Option/SAR Grants Table
Name Number of Securities % of Total Exercise Expiration
Underlying Options/SARs or Price Date
Options/SARs Granted to Employees ($/Sh)
Granted (#) in Fiscal Year
-------------------------------------------------------------------------------------------------------------------
None
Aggregated Option/SAR Exercises in Last Fiscal Year
and FY-End Option/SAR value
Name Shares Value Number of Securities Value of Unexercised
Acquired Realized Underlying In the Money
on ($) Unexercised Options/SARs at FY-
Exercise Options/SARs at FY- End ($) Exercisable/
(#) End (#) Exercisable/ Unexercisable
Unexercisable
---------------------------------------------------------------------------------------------------------------------
None
Item 11. Security Ownership of Certain Beneficial Owners and Management and
Related Stockholder Matters
The following table sets forth information, as of December 31, 2004, with
respect to the beneficial ownership of the Company's common stock (or Preferred
Convertible Stock which would represent 5% or more of the Company's common
stock) by each person known by the Company to be the beneficial owner of more
than five percent of the outstanding common stock, and by current officers and
directors of the Company. There were 1,979,965 shares issued and outstanding at
December 31, 2004.
14
a.) Officers and Directors
Stock Title Name and Address Amount of Beneficial Percentage
of Class of Beneficial Owner Ownership of Class
-------- ------------------- --------- --------
Common Praise Direct Holdings LTD 1,000,000 50.5%
(Beneficially Kexi Xu,
President & Director)
Common Yi Tung Alice Anastasia Chan 0 0%
(Secretary & Director)
Common Shen Tiojuan 200,000 10.1%
Top Harmony Holdings, LTD. 150,000 7.5%
(beneficially Kin Man Chan)
All Officers and 1,000,000 50.5%
Directors as a Group
(2 Persons)
Item 12. Certain Relationships and Related Transactions
Praise Direct Holdings, LTD., beneficially owned by Kexi Xu, President and
Director, purchased 50,000,000 shares for $250,000 in September 2004. (Pre-
reverse split one for 50.)
Shen Tiojuan purchased 10,000,000 shares in November 2004 in a private placement
at $.015 per share (pre-reverse split one for 50).
Top Harmony Holdings, LTD. received 7,500,000 shares in November 2004 (pre-
reverse split one for 50) for consulting services rendered.
15
Part IV
Item 13. Exhibits
(a) The following exhibits and financial statement schedules are filed as
exhibits to this Report:
Exhibits
Exhibit # Description Location/Page Number
--------- ----------------------------------- -----------------------------------
3.1 Articles of Incorporation Exhibit to Registration
Statement filed November
14, 1991 by Registrant on Form S-18
3.2 Bylaws of Registrant Exhibit to Registration
Statement filed November
14, 1991 by Registrant on Form S-18
3.3 Articles of Amendment As filed in Exhibit herewith
10.1 Articles of Amendment to Articles Exhibit listed under hardship exemption
of Incorporation of Art Music as provided in Rule 202 of Regulation
& Entertainment, Inc. and Cert. of S-T. Hardship Exemption grant date:
Designation, Preferences, Rights and 5/27/97
Limitation of Classes C, E, F, G, H, I
Convertible Preferred Stock
10.2 Articles of Incorporation of Art Music Exhibit listed under hardship exemption
& Entertainment with attachments as provided in Rule 202 of Regulation
S-T. Hardship Exemption grant date:
5/27/97
10.3 Articles of Amendment to Articles of Exhibit listed under hardship exemption
Incorporation of Chatham International, as provided in Rule 202 of Regulation
Inc. S-T. Hardship Exemption grant date:
5/27/97
10.4 Articles of Incorporation of Cornerstone Exhibit listed under hardship exemption
Capital, Inc. as provided in Rule 202 of Regulation
S-T. Hardship Exemption grant date:
5/27/97
10.5 Articles of Incorporation of International Exhibit listed under hardship exemption
Jazz Hall of Fame Production Co., Inc. as provided in Rule 202 of Regulation
S-T. Hardship Exemption grant date:
5/27/97
16
10.6 Articles of Incorporation of Exhibit listed under hardship
exemption as provided in Rule 202
Octopus Entertainment, Inc. of Regulation S-T. Hardship
Exemption grant date: 5/27/97
10.7 Articles of Amendment to Articles of Exhibit listed under hardship exemption
Incorporation of Octopus Entertainment, as provided in Rule 202 of Regulation
Inc. S-T. Hardship Exemption grant date:
5/27/97
10.8 Articles of Incorporation of Marin Exhibit listed under hardship exemption
Movies, Inc. as provided in Rule 202 of Regulation
S-T. Hardship Exemption grant date:
5/27/97
10.9 Articles of Amendment to Articles of Exhibit listed under hardship exemption
Incorporation of Marin Movies, Inc. as provided in Rule 202 of Regulation
S-T. Hardship Exemption grant date:
5/27/97
10.10 Articles of Incorporation of Classical Exhibit listed under hardship exemption
Music Collection, Inc. as provided in Rule 202 of Regulation
S-T. Hardship Exemption grant date:
5/27/97
10.11 Articles of Amendment to Articles of Exhibit listed under hardship exemption
Incorporation of Classical Music as provided in Rule 202 of Regulation
Collection, Inc. S-T. Hardship Exemption grant date:
5/27/97
10.12 Articles of Incorporation of Spellbinder Exhibit listed under hardship exemption
Productions, Inc. and Articles of as provided in Rule 202 of Regulation
Amendment to Articles of Incorporation S-T. Hardship Exemption grant date:
5/27/97
10.13 Bylaws of Art Music & Exhibit listed under hardship exemption
Entertainment, Inc. as provided in Rule 202 of Regulation
S-T. Hardship Exemption grant date:
5/27/97
10.14 Certificate of Name Change Exhibit listed under hardship exemption
as provided in Rule 202 of Regulation
S-T. Hardship Exemption grant date:
5/27/97
10.15 Articles of Amendment to Articles of Exhibit listed under hardship exemption
Incorporation of Chatham International, as provided in Rule 202 of Regulation
Inc. S-T. Hardship Exemption grant date:
5/27/97
17
10.16 Agreement and Plan of Reorganization Exhibit listed under hardship exemption
of AM&E, Inc. and IJHFPC as provided in Rule 202 of Regulation
S-T. Hardship Exemption grant date:
5/27/97
10.17 License Agreement for PCMCIA Based Distribution
System
10.18 License Agreement for Tomigel & Junon Systems
31 Sarbanes-Oxley Certification
32 Sarbanes-Oxley Certification
Item 14. Principal Accountant Fees and Services
General. Michael Johnson & Co., LLC, CPAs ("MJC") is the Company's principal
auditing accountant firm. The Company's Board of Directors has considered
whether the provisions of audit services is compatible with maintaining MJC's
independence.
Audit Fees. MJC billed the Company $4,000 for the following
professional services: audit of the annual financial statement of the Company
for the fiscal year ended December 31, 2004. MJC billed the Company $3,000 for
the 2003 audit.
There were no audit related fees in 2004 or 2003. There were no tax
fees or other fees in 2004 or 2003.
The Company's Board acts as the audit committee and had no
"pre-approval policies and procedures" in effect for the auditors' engagement
for the audit year 2004 and 2003.
All audit work was performed by the auditors' full time employees.
18
Signatures
Pursuant to the requirements of Section 13 or 15(d) of the Securities and
Exchange Act of 1934, the Registrant had duly caused this Report to be signed on
its behalf by the undersigned thereunto duly authorized.
Dated: April 26, 2005
JOINTLAND DEVELOPMENT, INC.
By: /s/ Kexi Xu
----------------------------------
Kexi Xu, President
Pursuant to the requirements of the Securities Exchange Act of 1934, this Report
has been signed by the following persons in the capacities and on the dates
indicated.
Signature Title Date
--------- ----- ----
/s/ Xu President/Director
--------------------------------- & Chief Executive Officer April 25, 2005
Kexi Xu
Directors:
/s/ Kexi Xu
--------------------------------- April 25, 2005
Kexi Xu
/s/ Yi Tung Alice Anastasia Chan
--------------------------------- April 25, 2005
Yi Tung Alice Anastasia Chan
19
JOINTLAND DEVELOPMENT, INC.
(Formerly Global Assets & Services, Inc.)
(A Development Stage Company)
Financial Statements
December 31, 2004 and 2003
INDEPENDENT AUDITOR'S REPORT
Board of Directors
Jointland Development, Inc.
Hong Kong
We have audited the accompanying balance sheets of Jointland Development, Inc.,
(Formerly Global Assets & Services, Inc.) (a development stage company), as of
December 31, 2004 and 2003, and the related statements of operations,
stockholders' equity, and cash flows for the years ended December 31, 2004 and
2003 and for the period from May 25, 1988 (inception) to December 31, 2004.
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 audits "in accordance with standards of the Public Company
Accounting Oversight Board (United States)" as outlined in PCAOB Auditing
Standard No. 1. 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 JLDV, Inc., (a development
stage company) as of December 31, 2004 and 2003 and the results of their
operations and their cash flows for the years ended December 31, 2004 and 2003,
and the period May 25, 1988 (inception) to December 31, 2004, in conformity with
accounting principles generally accepted in the United States.
The accompanying financial statements have been prepared assuming that the
Company will continue as a going concern. As discussed in the Note 6 to the
financial statements the Company is in the development stage, and will require
funds from profitable operations, from borrowings, or from sale of equity
securities to execute its business plan. Management's plans in regard to these
matters are also described in Note 6. These factors raise substantial doubt
about its ability to continue as a going concern. The financial statements do
not include any adjustments that might result from this uncertainty.
/s/ Michael Johnson & Co., LLC
Michael Johnson & Co., LLC
Denver, Colorado
April 14, 2005
F-1
JOINTLAND DEVELOPMENT, INC.
(Formerly Global Assets & Services, Inc.)
(A Development Stage Company)
Balance Sheets
December 31,
2004 2003
---------------- ---------------
ASSETS;
Current Assets:
Cash $ 58,879 $ 332
---------------- ---------------
Total Current Assets 58,879 332
---------------- ---------------
TOTAL ASSETS $ 58,879 $ 332
================ ===============
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
Current Liabilities:
Accounts Payable and Accrued Liabilities $ - $ 21,795
Notes Payable 230,198 31,175
---------------- ---------------
Total Current Liabilities 230,198 52,970
---------------- ---------------
Stockholders Equity:
Common stock, $.001 par value, 100,000,000 shares
authorized, 1,979,965 shares issued and outstanding 1,981 630
in 2004 629,955 shares outstanding in 2003
Additional Paid-In Capital 3,480,670 3,044,520
Deficit accumulated during the
development stage (3,653,970) (3,097,788)
---------------- ---------------
Total Stockholders Equity (Deficit) (171,319) (52,638)
---------------- ---------------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT) $ 58,879 $ 332
================ ===============
The accompanying notes are an integral part of these financial statements.
F-2
JOINTLAND DEVELOPMENT, INC.
(Formerly Global Assets & Services, Inc.)
(A Development Stage Company)
Statements of Operations
May 25,
1988
Year Ended (Inception) to
December 31, December 31,
2004 2003 2004
----------------- ----------------- -----------------
Revenue:
Revenue $ - $ - $ 846,545
(Less) Cost of Sales - - (336,524)
----------------- ----------------- -----------------
Total Income - - 510,021
----------------- ----------------- -----------------
Operating Expenses
Doubtful Accounts - - 34,469
Consultants Fees 492,347 265,600 2,189,459
Legal and Accounting Fees 43,265 20,125 160,473
Advertising - - 14,542
Directors and Officers Fees - 435,000 1,409,500
Telephone - 2,596 30,412
Travel - 11,909 19,409
Rent - 5,498 52,594
Other General Expenses 20,570 5,406 249,077
----------------- ----------------- -----------------
Total Expenses 556,182 746,134 4,159,935
----------------- ----------------- -----------------
Net Loss From Operations (556,182) (746,134) (3,649,914)
----------------- ----------------- -----------------
Other Income
Interest Expense - - (8,577)
Interest Income - - 4,021
----------------- ----------------- -----------------
Net Loss $ (556,182) $ (746,134) $ (3,654,470)
================= ================= =================
Per Share Information:
Weighted average number
of common shares outstanding 1,779,965 629,955
----------------- -----------------
Net Gain (Loss) per common share $ (0.31) $ (1.00)
================= =================
The accompanying notes are an integral part of these financial statements.
F-3
JOINTLAND DEVELOPMENT, INC.
(Formerly Global Assets & Services, Inc.)
(A Development Stage Company)
Stockholders' Equity (Deficit)
December 31, 2004
Deficit
COMMON STOCKS Additional Accum. During Total
Paid-In Development Stockholders'
# of Shares Amount Capital Stage Equity (Deficit)
------------- ----------- -------------- -------------- ----------------
Balance - December 31, 1997 87,955 88 208,875 (208,963) -
------------- ----------- -------------- -------------- --------------
Balance - December 31, 1998 87,955 88 208,875 (208,963) -
------------- ----------- -------------- -------------- --------------
Balance - December 31, 1999 87,955 88 208,875 (208,963) -
------------- ----------- -------------- -------------- --------------
Balance - December 31, 2000 87,955 88 208,875 (208,963) -
------------- ----------- -------------- -------------- --------------
Issuance of stock for services 12/11 68,000 68 3,332 - 3,400
Loss for year - - - (39,462) (39,462)
------------- ----------- -------------- -------------- --------------
Balance - December 31, 2001 155,955 156 212,207 (248,425) (36,062)
------------- ----------- -------------- -------------- --------------
Issuance of stock for cash 3/28 400 1 1,999 - 2,000
Issuance of stock for services 3/28 136,000 136 679,864 - 680,000
Issuance of stock for services 4/2 20,000 20 99,980 - 100,000
Issuance of stock for services 6/18 10,000 10 49,990 - 50,000
Issuance of stock for services 7/12 14,200 14 71,023 - 71,037
Issuance of stock for Asset Acquisition 8/12 35,000 35 656,215 - 656,250
Issuance of stock for services 8/12 11,800 12 58,988 - 59,000
Issuance of stock for cash 9/18 1,600 1 19,999 - 20,000
Issuance of stock for services 10/15 98,900 99 494,401 - 494,500
Loss for year - - - (2,103,229) (2,103,229)
------------- ----------- -------------- -------------- --------------
Balance - December 31, 2002 483,855 484 2,344,666 (2,351,654) (6,504)
------------- ----------- -------------- -------------- --------------
Issuance of stock for services 1/15 55,500 55 254,945 - 255,000
Issuance of stock for services 3/11 52,600 53 254,947 - 255,000
Issuance of stock for services 4/20 2,000 2 9,998 - 10,000
Issuance of stock for services 5/28 36,000 36 179,964 - 180,000
Loss for year - - - (746,134) (746,134)
------------- ----------- -------------- -------------- --------------
Balance - December 31, 2003 629,955 630 3,044,520 (3,097,788) (52,638)
------------- ----------- -------------- -------------- --------------
Issuance of stock for cash 1,000,000 1,000 249,000 - 250,000
Issuance of stock for services 150,000 150 37,350 - 37,500
Split Adjustment 10 1 - - 1
Issuance of Stock for cash 200,000 200 149,800 - 150,000
Loss for year - - - (556,182) (556,182)
------------- ----------- -------------- -------------- --------------
Balance - December 31, 2004 1,979,965 $ 1,981 $3,530,870 $(3,653,970) $ (171,319)
============= =========== ============== ============== ==============
All stocks shown reflect a 1 for 50 reverse stock split
The accompanying notes are an integral part of these financial statements.
F-4
JOINTLAND DEVELOPMENT, INC.
(Formerly Global Assets & Services, Inc.)
(A Development Stage Company)
Stockholders' Equity (Deficit)
December 31, 2004
May 25, 1988
Year Ended (Inception) to
December 31, December 31,
2004 2003 2004
--------------- --------------- -----------------
Cash Flows from Operating Activities:
Net Loss $ (556,182) $ (746,134) $ (3,653,970)
Issuance of common stock for services 37,500 700,000 2,195,437
Adjustments to reconcile net loss to cash used in
operating activities:
Increase (decrease) in accounts payable (21,795) 13,926 -
--------------- --------------- -----------------
Net Cash Used by Operating Activities (540,477) (32,208) (1,458,533)
--------------- --------------- -----------------
Cash Flows from Financing Activities:
Proceeds from Notes Payble 199,023 31,175 380,198
Issuance of common stock for Asset Acquisition - - 656,250
Issuance of common stock 400,001 - 480,964
--------------- --------------- -----------------
Net Cash Provided by Financing Activities 599,024 31,175 1,517,412
--------------- --------------- -----------------
Net Increase (Decrease) in Cash & Cash Equivalents 58,547 (1,033) 58,879
Beginning Cash & Cash Equivalents 332 1,365 -
--------------- --------------- -----------------
Ending Cash & Cash Equivalents $ 58,879 $ 332 $ 58,879
=============== =============== =================
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
Cash paid for Interest $ - $ - $ 8,577
=============== =============== =================
Cash paid for Income Taxes $ - $ - $ -
=============== =============== =================
NON-CASH TRANSACTIONS
Common stock issued in exchange for services $ 37,500 $ 700,000 $ 2,195,437
=============== =============== =================
The accompanying notes are an integral part of these financial statements.
F-5
JOINTLAND DEVELOPMENT, INC.
(Formerly Global Assets & Services, Inc.)
(A Development Stage Company)
Notes to Financial Statements
December 31, 2004
Note 1 - Organization and Summary of Significant Accounting Policies:
-----------------------------------------------------------
Organization:
------------
Art, Music and Entertainment, Inc. ("Company") (formerly Chatham International,
Inc.) was organized originally as Cornerstone Capital, Inc., under the laws of
the State of Florida as a corporation on May 25, 1988. On September 22, 1990
the Company changed its name to Chatham International, Inc. On April 5, 1996
the Board of Directors of the Company authorized the name of Company to be
changed from Chatham International, Inc. to Art, Music and Entertainment, Inc.,
in connection with a merger, discussed elsewhere herein, with an entity of the
same name. Such change was filed with the Secretary of State of Florida on July
18, 1996. On July 24, 2001 the Board of Directors met in a special meeting to
authorize the name change to Global Assets and Services, Inc. On December 27,
2004 Global Assets & Services, Inc. filed a name change with the State of
Florida, the new name of the corporation is Jointland Development, Inc. with
offices in Hong Kong.
In December 2001 Global Assets & Services merged with SDE 3 Holdings, Inc.
Global Assets & Services is the surviving Corporation and all shares of stock
outstanding in SDE 3 Holdings, Inc. are retired concurrent with the merger.
Basis of Presentation - Development Stage Company:
-------------------------------------------------
The Company has not earned significant revenues from limited principal
operations. Accordingly, the Company" activities have been accounted for as
those of a "Development Stage Enterprise" as set forth in Financial Accounting
Standards Board Statement No. 7 ("SFAS 7"). Among the disclosures required by
SFAS 7 are that the Company's financial statements be identified as those of a
development stage company, and that the statements of operations, stockholders'
equity (deficit) and cash flows disclose activity since the date of the
Company's inception.
Cash and Cash Equivalents:
-------------------------
The Company considers all highly liquid debt instruments, purchased with an
original maturity of three months or less, to be cash equivalents.
Use of Estimates:
----------------
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 revenue and expenses during
the reporting period. Actual results could differ from those estimates.
F-6
JOINTLAND DEVELOPMENT, INC.
(Formerly Global Assets & Services, Inc.)
(A Development Stage Company)
Notes to Financial Statements
December 31, 2004
Note 1 - Organization and Summary of Significant Accounting Policies (Cont):
------------------------------------------------------------------
Net Loss Per Share:
------------------
Net loss per share is based on the weighted average number of common shares and
common shares equivalents outstanding during the period.
Other Comprehensive Income:
--------------------------
The Company has no material components of other comprehensive income (loss), and
accordingly, net loss is equal to comprehensive loss in all periods.
Note 2 - Federal Income Taxes:
--------------------
The Company has made no provision for income taxes because there has been no
income generated since 1997 for financial statements or tax purposes.
The Financial Accounting Standards Board (FASB) has issued Statement of
Financial Accounting Standards Number 109 ("SFAS 109"). "Accounting for Income
Taxes", which requires a change from the deferred method to the asset and
liability method of accounting for income taxes. Under the asset and liability
method, deferred income taxes are recognized for the tax consequences of
"temporary differences" by applying enacted statutory tax rates applicable to
future years to differences between the financial statement carrying amounts and
the tax basis of existing assets and liabilities.
Deferred tax assets
Net operating loss carryforwards $ 3,653,970
Valuation allowance (3,653,970)
--------------
Net deferred tax assets $ 0
==============
At December 31, 2004, the Company had net operating loss carryforwards of
approximately $3,653,970 for federal income tax purposes. These carryforwards if
not utilized to offset taxable income will begin to expire in 2010.
F-7
JOINTLAND DEVELOPMENT, INC.
(Formerly Global Assets & Services, Inc.)
(A Development Stage Company)
Notes to Financial Statements
December 31, 2004
Note 3 - Capital Stock Transactions:
--------------------------
The authorized capital stock of the Company is 100,000,000 shares of common
stock at $.001 par value. During the period ended December 31, 2004, the Company
issued 7,500,000 shares of common stock for compensation for consulting fees and
50,000,000 shares of common stock for cash and 10 shares of common stock for
director compensation. On December 16, 2004, the Board of Directors authorized a
reverse stock split of 1 for 50, this is reflected in the equity report.
Note 4 - Segment Information:
-------------------
Jointland Development, Inc. operates primarily in a single operating segment,
the asset management and capital raising business.
Note 5 - Subsequent Event:
----------------
In January 2005 the Company started negotiations to purchase a portion of Anhui
Zhongan Real Estate Development Co., LTD, a real estate development company in
China.
Note 6 - Going Concern:
-------------
The financial statements of the Company have been presented on the basis that
they are a going concern, which contemplates the realization of assets and the
satisfaction of liabilities in the normal course of business. The Company has an
accumulated deficit at December 31, 2004 of $3,653,970.
The future success of the Company is likely dependent on its ability to attain
additional capital, or to find an acquisition to add value to its present
shareholders and ultimately, upon its ability to attain future profitable
operations. There can be no assurance that the Company will be successful in
obtaining such financing, or that it will attain positive cash flow from
operations. Management believes that actions presently being taken to revise the
Company's operating and financial requirements provide the opportunity for the
Company to continue as a going concern.
Note 7 - Financial Accounting Developments:
---------------------------------
Recent Accounting Pronouncements
In February 2003, the Financial Accounting Standards Board ("FASB") issued SFAS
No. 150, "Accounting for Certain Financial Instruments with Characteristics of
Both Liabilities and Equity" (SFAS No. 150). The provisions of SFAS No. 150 are
effective for financial instruments entered into or modified after May 31, 2003,
and otherwise are effective at the beginning of the first interim period
beginning after June 15, 2003, except for mandatorily redeemable financial
instruments of nonpublic entities. The Company has not issued any financial
instruments with such characteristics.
F-8
JOINTLAND DEVELOPMENT, INC.
(Formerly Global Assets & Services, Inc.)
(A Development Stage Company)
Notes to Financial Statements
December 31, 2004
Note 7 - Financial Accounting Developments (Cont)
----------------------------------------
In December 2003, the FASB issued FASB Interpretation No. 146 (revised December
2003, "Consolidation of Variable Interest Entities" (FIN No. 146R), which
addresses how a business enterprise should evaluated whether it has a
controlling interest in an entity through means other than voting rights and
accordingly should consolidate the entity. FIN No. 146R replaces FASB
Interpretation No. 46, "Consolidation of Variable Interest Entities", which was
issued in January 2003. Companies are required to apply FIN No. 46 R to variable
interests in variable interest entities (VIEs') created after December 31, 2003.
For variable interest in VIEs created before January 1, 2004, the Interpretation
is applied beginning January 1, 2005. For any VIEs that must be consolidated
under FIN No. 146R that was created before January 1, 2004, the assets,
liabilities, and non-controlling interest of the VIE initially are measured at
their carrying amounts with any difference between the net amount added to the
balance sheet and any previously recognized interest being recognized as the
cumulative effect of an accounting change. If determining the carrying amounts
is not practicable, fair value at the date FIN No. 146R first applies may be
used to measure the assets, liabilities, and non-controlling interest of the
VIE. The Company does not have any interest in any VIE.
In December 2004, the FASB issued SFAS No. 123R (revised 2004), "Share Based
Payment" which amends FASB Statement No. 123 and will be effective for public
companies for interim or annual periods after June 15, 2005. The new standard
will require entities to expense employee stock options and other share-based
payments. The new standard may be adopted in one of three ways - the modified
prospective transition method, a variation of the modified prospective
transition method or the modified retrospective transition method. The Company
is to evaluate how it will adopt the standard and evaluate the effect that the
adoption of SFAS 123R will have on our financial position and results of
operations.
In November 2004, the FASB issued SFAS No. 151, "Inventory Costs, an amendment
of ARB No. 43, Chapter." This statement amends the guidance in ARB No. 43,
Chapter 4, Inventory Pricing, to clarify the accounting for abnormal amounts of
idle facility expense, freight, handling cost, and wasted material (spoilage).
Paragraph 5 of ARB No. 43, Chapter 4, previously stated that "under some
circumstances, items such as idle facility expense, excessive spoilage, double
freight, and rehandling costs may be so abnormal as to require treatment as
current period charges." SFAS No. 151 requires that those items be recognized as
current-period charges regardless of whether they meet the criterion of "so
abnormal". In addition, this statement requires that allocation of fixed
production overheads to costs of conversion be based on the prospectively and
are effective for inventory costs incurred during fiscal years beginning after
June 15, 2005, with earlier application permitted for inventory costs incurred
during fiscal years beginning after the date this Statement is issued. The
adoption of SFAS No. 151 is not expected to have a material impact on the
Company's financial position and results of operations.
F-9
JOINTLAND DEVELOPMENT, INC.
(Formerly Global Assets & Services, Inc.)
(A Development Stage Company)
Notes to Financial Statements
December 31, 2004
Note 7 - Financial Accounting Developments (Cont)
----------------------------------------
In December 2004, the FASB issued SFAS No. 153, "Exchanges of Non-monetary
Assets, an amendment of APB Opinion No. 29". The guidance in APB Opinion No. 29,
Accounting for Non-monetary Transactions, is based on the principle that
exchanges of non-monetary assets should be measured based on the fair value of
assets exchanged. The guidance in that Opinion, however, included certain
exceptions to that principle. This Statement amends Opinion 29 to eliminate the
exception for non-monetary exchanges of similar productive asserts that do not
have commercial substance. A non-monetary exchange has commercial substance if
the future cash flows of the entity are expected to change significantly as a
result of the exchange. SFAS No. 153 is effective for non-monetary exchanges
occurring in fiscal periods beginning after June 15, 2005. The adoption of SFAS
No. 153 is not expected to have a material impact on the Company's financial
position and results of operations.
Note 8 - Notes Payable - Related Parties:
-------------------------------
Note payable to Praire Direct Holding, money advanced to
pay expenses of Company, non-interest bearing, due upon demand. 230,749
---------
Total Notes Payable $230,749
========
F-10