Note 7 - Disposal of Joint Venture

6 Months Ended

Jun. 30, 2014

Notes

Note 7 - Disposal of Joint Venture

NOTE 7 – DISPOSAL OF JOINT VENTURE

By a Sale and Purchase Agreement dated June 26, 2014, L3D-HK sold its 45% equity interest in 3D Science & Cultural Products International Exchange Center to Excellent Plus Group Limited, an independent third party for a consideration of $250,000. The decision was made because the management did not have sufficient experience at managing a joint venture. The consideration of $250,000 was satisfied through the forgiveness of debt of the same amount due to Kingdom Industry Group Inc. The Agreement provided that the sale and purchase of the 45% equity interest would be effective as of April 1, 2014. The disposition resulted in a gain of $126,848, which was reported as “gain on disposal of joint venture” included in operating expense for the period ended June 30, 2014.

The Company determined that disposal of joint venture did not constitute a discontinued operation, as the Company anticipated that it will generate significant continuing cash flows from the customers of the disposed joint venture.