CHINA GREEN, INC. (NASDAQ:CHGN)

China Green, Inc set to go public

Company Snapshot:

Landscaping consultancy and project management, and eco-friendly hotel consultancy and development.

Industry Snapshot:

• With approximately one-quarter of the world’s population, the PRC is a major contributor to the carbon dioxide emissions which have been linked to global warming. Global warming has been proven to be the cause of many geographical changes that have negatively affected our world. As a result, many governments and activist groups are raising awareness about global warming and promoting conservation with regard to our environment.
  
• On December 11, 2007, the Kyoto Protocol was adopted and enacted on February 16, 2005. The purpose of the Kyoto Protocal is to effectively reduce greenhouse gas (GHG) emissions. Under the Protocol, developed countries, including China, have agreed to reduce their collective GHG emission by 5.2% from their GHG level recorded in 1990. Subsequently, in December 2009, the Copenhagen Summit was held to address a framework for climate change mitigation beyond the Kyoto Protocol’s expiration in 2012. The resulting Copenhagen Accord proposed that developed countries and the world to raise USD 30 billion between the years 2010 to 2012 and USD 100 billion by the year 2020, respectively, to help developing countries reduce carbon emissions.
  
• Non-governmental organizations (NGO) and activists groups have also promoted global awareness on climate change and low carbon living. In September 2005, the Stop Climate Chaos coalition was launched in the UK to highlight the issue of climate change. The organization was able to attract a supporter base of over 11 million people that spans over 100 organizations. Many other environmental activist groups such as the National Wildlife Federation, the World Wide Fund for Nature and Friends of the Earth are also helping to spread the same message.
  
• The Eco-Friendly industry is widely recognized by governmental and non-governmental sectors. Services that can be provided to customers are far-reaching. We position ourselves as a full-service company within our industry.

Post Merger Share Calculation:

•                      6,514,750: Pre IPO outstanding shares
• 1,000,000 to 1,400,000: Newly issued shares of Common Stock  
•                           98,000: Shares from warrants associated with private placement

GeoTeam® best effort calculation of total post IPO shares assuming full conversions:  7,612,750 to 8,012,750

Proposed offering price per share: $5.00

Listing information:

We intend to apply for the listing of our common stock on the NASDAQ Capital Market under the trading symbol “CHGN”.

Underwriter: Grandview Capital, Inc.

Financial Snapshot:

• Revenue for the nine months ended March 31, 2010 was $10,583,682 as compared to $8,647,436 for the nine months ended March 31, 2009, an increase of $1,936,246 or approximately 22.4%. 
   
• We had net income of $5,190,715 for the nine months ended March 31, 2010 as compared to net income $4,656,516 for the nine months ended March 31, 2009, representing an increase of $534,199 or approximately 11.5%.
  
  
  

This increase in 2009 general and administrative expenses was mainly due to a $2,568,750 ($0.49 EPS) increase in provision for share-based compensation and a $50,063 increase in legal and professional fees we incurred in operations. The Company has entered into various stock-based compensation agreements to issue a total of 856,250 common shares to five individuals for management and consultancy services provided. These shares are valued at $3.00 per share in the Regulation S Private Placement. Although stock-based compensation will be part of our overall compensation scheme in the future, we do not expect large issuances, such as the above-mentioned amount, to occur on a regular basis.

A glimpse at some of the investors involved in the IPO. If our calculations are corrects the Wong(s) could take in $1.77 million in "consulting" fees.