NOTE 9 - WARRANTS

In connection with the Subscription Agreement, the Company also issued warrants to acquire an aggregate 2,800,000 shares of its common stock with an exercise price of $1.80 to three individuals on January 10, 2013. All such warrants are exercisable at any time in whole or in part within 12 months of the date of the Subscription Agreement. The fair value of the warrants was calculated using the Black-Scholes options pricing model using the following assumptions: volatility of 27.98%, risk free interest rate of 0.14%, and expected term of one year. The fair value of the warrants was $72,724, and such amount is classified in the equity section.

On April 15, 2013, warrants to acquire an aggregate 2,500,000 shares at $1.80 per share were exercised for a cash payment of $4,500,000 to the Company.

Following is a summary of the status of warrant activities as of September 30, 2013:

			Weighted Average
	Warrants Outstanding		Exercise Price		Average Remaining Life in Years
Outstanding, January 1, 2013		1,388,358	$	1.57		2.04

Granted		2,800,000		1.80		0.25
Forfeited
Exercised		(2,500,000)		1.80
Outstanding, September 30, 2013		1,688,358	$	1.61		1.11