Commitments and Contingencies

12 Months Ended

Dec. 31, 2012

Commitments and Contingencies [Abstract]

COMMITMENTS AND CONTINGENCIES

NOTE 14 – COMMITMENTS AND CONTINGENCIES

Economic and Political Risks

The majority of the Company’s operations are conducted in the PRC. Accordingly, the Company’s business, financial condition and results of operations may be influenced by the political, economic and legal environment in the PRC, and by the general state of the PRC economy. 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 and 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, remittances abroad, and rates and methods of taxation.

Operating Lease Commitment

On January 1, 2013, the Company renewed it’s lease of factory and office space from Jiangsu Ever-Glory under an operating lease which expires on December 31, 2013, at an annual rental of RMB314,000 ($50,000). For the years ended December 31, 2012 and 2011, the Company recognized rental expense in the amounts of approximately $49,000 and $48,000, respectively.

The Company leases retail space, warehouse and office facilities under operating leases expiring on various dates through 2016.The majority of the Company’s retail leases are for twelve-month periods and provide for contingent rents, which are determined as a percentage of gross sales in excess of specified levels. The Company records a rent liability in the consolidated balance sheets and the corresponding rent expense when management determines that achieving the specified levels during the fiscal year is probable. Total rent expense was $39,005,167 and $18,479,141 for the years ended December 31, 2012 and 2011, respectively.  Future minimum lease payments for leases with initial or remaining noncancelable lease terms in excess of one year are as follows:

Year ending December 31,

2013	$	152,000
2014		162,000
2015		174,000
2016		186,000
	$	674,000

Legal Proceedings

There is no material pending legal proceeding to which the Company is a party.