CONCENTRATION OF RISK

6 Months Ended

Jun. 30, 2016

Notes to Financial Statements

NOTE 11 - CONCENTRATION OF RISK

Concentration

As of the date of this report, the Company had a single supplier for all of the machinery as part of its procurement process. This is due in part to the Company's limited product portfolio. As the Company expands its product portfolio, it expects to diversify its supply risk amongst multiple qualified suppliers.

Economic and Political Risk

The Company's operations in the PRC are subject to special considerations and significant risks not typically associated with companies in North America and Western Europe. These include risks associated with, among others, the political, economic, legal environment and foreign currency exchange. The Company's results may be adversely affected by changes in the political and social conditions in the PRC, and by changes in governmental policies with respect to laws and regulations, anti-inflationary measures, currency conversion, restriction on international remittances, and rates and methods of taxation, among other things.