NOTE 12 COMMITMENTS AND CONTINGENCIES

(A)	Commitments

1. Rental Lease Commitment

The Company's existing rental leases do not contain significant restrictive provisions. The following is a schedule by year of future minimum lease obligations under non-cancelable rental operating leases as of December 31, 2013:

Fiscal years ending December 31,

2014	$	131,476
2015		-
2016		-
Thereafter		-
Total	$	131,476

Rental expense for the years ended December 31, 2013, 2012 and 2011 was $183,365, $205,299 and $52,097 respectively. The provision of rental expenses in connection with the Chengtian litigation amounting to $137,307 was recovered during the year ended December 31, 2011.

2. Annual Advertising Operating Rights Fee Commitment

The Company, through its PRC operating companies, has acquired advertising rights from third parties to operate different types of advertising panels for certain periods.

The following table sets forth the estimated future annual commitment of the Company with respect to the advertising operating rights of panels that the Company held as of December 31, 2013:

Fiscal years ending December 31,
2014	$	2,310,416
2015		1,386,860
2016		882,992
Thereafter		-
Total	$	4,580,268

(B) Contingencies

The Company accounts for loss contingencies in accordance with ASC Topic 450 and other related guidelines. Set forth below is a description of certain loss contingencies as of December 31, 2013 and management's opinion as to the likelihood of loss in respect of loss contingency.

The Company derived all its revenues mainly from its operation of the 52 roadside advertising panels along Nanjing Road in Shanghai, China (the "Shanghai Road Project") for the year ended December 31, 2012. On March 19, 2013, Yi Gao received a legal letter dated March 18, 2013 from the legal counsel of Shanghai Chuangtian Advertising Company Limited ("Chuangtian"), the authorizing party of the Shanghai Road Project. The letter alleged Yi Gao had not paid the right fees of RMB1,157,000 (equivalent to approximately US$184,400 at the then-prevailing exchange rate) on February 15, 2013 for the period from April 1, 2013 to June 30, 2013 pursuant to the concession right contract, such that Yi Gao breached the concession right contract and Chuangtian can exercise its rights to terminate this contract on March 18, 2013. The legal letter also demanding the payment of right fees totaling RMB52,000 (equivalent to approximately US$8,290 at the then-prevailing exchange rate) together with late payment surcharges of RMB94,900 (equivalent to approximately US$15,100 at the then-prevailing exchange rate) and electricity charges of RMB34,345 (equivalent to approximately US$5,470 at the then-prevailing exchange rate) before March 28, 2013.

On March 28, 2013, Yi Gao transferred the assets rights of the LED panels to Chuangtian. On April 12, 2013, Yi Gao received a notice from the People's Court of Huangpu District, Shanghai that Chuangtian, as plaintiff, had initiated a contract dispute against Yi Gao seeking an aggregate of RMB216,900 (equivalent to approximately US$34,500 at the then-prevailing exchange rate) for unpaid right fees, penalty and electricity charges. The Company had not operated the respective advertising panels pursuant to the concession right contract started on April 1, 2013. On December 26, 2013, the People's Court of Huangpu District, Shanghai made a judgment to affirm that Yi Gao and Chuangtian reached an agreement to settle the case. As a result, Yi Gao is liable to pay an aggregate of RMB150,000 (equivalent to approximately US$24,470 at the then-prevailing exchange rate) to Chuangtian. On February 17, 2014, Yi Gao paid RMB150,000 to Chuangtian.

On March 27, 2013, Yi Gao received a legal letter dated March 27, 2013 from the legal counsel of Chuangtian, customer of the Shanghai Road Project, alleged to terminate the advertising contract on March 18, 2013 and demanding the refund of advertising fee for the period from April 1, 2013 to June 30, 2013 totaling RMB202,500 (equivalent to approximately US$32,300 at the then-prevailing exchange rate) before March 30, 2013. On April 12, 2013, Yi Gao received a notice from the People's Court of Huangpu District, Shanghai that Chuangtian, as plaintiff, had initiated a contract dispute against Yi Gao seeking an aggregate of RMB202,500 (equivalent to approximately US$32,300 at the then-prevailing exchange rate) for refund of advertising fee. On December 26, 2013, the People's Court of Huangpu District, Shanghai made a judgment to affirm that Yi Gao and Chuangtian reached an agreement to settle the case. As a result, Yi Gao is liable to refund an aggregate of RMB150,000 (equivalent to approximately US$24,470 at the then-prevailing exchange rate) to Chuangtian. On February 17, 2014, Yi Gao paid RMB150,000 to Chuangtian.

On July 5, 2013, Yi Gao received a notice from the People's Court of Huangpu District, Shanghai that Shanghai Shenpu advertising Co. Ltd ("Shenpu"), as plaintiff, had initiated a contract dispute against Yi Gao seeking an aggregate of RMB1,807,215 (equivalent to approximately US$291,000 at the then-prevailing exchange rate) for unpaid rights fee, penalty and production cost. On August 7, 2013, Yi Gao received a court verdict from the People's Court of Huangpu District, Shanghai that Yi Gao is liable to repay the unpaid fee of RMB650,000, penalty and production cost. On August 26, 2013, Yi Gao submitted an appeal to People's Court of Huangpu District, Shanghai that the penalty calculated is not reasonable. On November 13, 2013, Yi Gao withdrew the appeal. As a result, Yi Gao is liable to pay an aggregate of RMB765,463 (equivalent to approximately US$124,870 at the then-prevailing exchange rate) to Shenpu. On February 19, 2014, Yi Gao paid RMB45,221 to Shenpu.