EQUITY |
12 Months Ended |
|---|---|
Dec. 31, 2024 | |
| Equity [Abstract] | |
| EQUITY | 17. EQUITY
(a) Common stock and Additional Paid In Capital
The Company was established under the laws of the British Virgin Islands on October 25, 2021. The authorized number of Ordinary Shares was with par value of $ per share. As of December 31, 2021, the Company’s shareholders have not funded the capital of the Ordinary Shares in British Virgin Islands and recorded subscription receivable as of December 31, 2021. The Company’s shareholders have funded the $50,000 capital in British Virgin Islands in October and November, 2022.
Upon the Reorganization event described in Note 1, on March 14, 2022, the Company issued the Ordinary Shares of common stock with par value of $ in exchange for all outstanding common stock of Jiangsu Lobo. The Reorganization has been accounted for at historical cost and prepared on the basis as if the Reorganization had become effective as of the beginning of the first period presented in the accompanying financial statements of the Company.
On March 1, 2023, the Company effected a one thousand-for-one subdivision of shares to shareholders, which increased the total number of authorized and issued ordinary shares of to , and decreased the par value of ordinary shares from $ to $. Then the shareholders surrendered a pro-rata number of ordinary shares of to the Company for no consideration and thereafter cancelled. Following the surrender, the issued and outstanding ordinary shares were of par value of $ per share. All share and per share data as of December 31, 2022, and for the year ended December 31, 2022 are presented on a retroactive basis.
On September 15, 2023, the Company issued shares on a pro-rata basis to the existing shareholders as stock dividend. The fair value of the stock dividend is determined to be $2,212,000 at $ per ordinary share. As of October 15, 2023, the Company has ordinary shares authorized, with ordinary shares issued and outstanding. The stock dividend, all share and per share data as of December 31, 2022, and for the year ended December 31, 2022 are retroactively adjusted.
In March 21, 2024, the Company issued shares of common stock at $ per share for a total of $5,520,000 gross processed in its Initial Public Offering (IPO). Net proceeds from the IPO was $3,180,963 including $500,000 indemnification escrow funds recorded in restricted cash, net of expenses primarily including legal fees and audit fees.
On December 11, 2024, the Company issued shares of common stock at par value of $ per share to the investors of the convertible note. Refer to Note 14 for details.
(b) Statutory Reserve
The Company is required to make appropriations to certain reserve funds, comprising the statutory surplus reserve and the discretionary surplus reserve, based on after-tax net income determined in accordance with generally accepted accounting principles of the PRC (“PRC GAAP”). Net income after taxation can be made up for the cumulative prior years’ losses, if any before allocated to the “Statutory reserve”. Appropriations to the statutory surplus reserve are required to be at least 10% of the after-tax net income determined in accordance with PRC GAAP until the reserve is equal to 50% of the entity’s registered capital. Appropriations to the discretionary surplus reserve are made at the discretion of the board of directors of the Company. As of December 31, 2024 and 2023, statutory reserve provided were $464,637 and $521,566, respectively.
(d) Non-controlling interest
As of December 31, 2023, the Company’s non-controlling interest represented 15% equity interest of Wuxi Jinbang, which was established in October 2002. Non-contolling interest is as of December 31, 2024 upon sale of Wuxi Jinbang.
(e) Dividends
The Company through its PRC subsidiaries paid cash dividends of nil and nil to its shareholders for the years ended December 31, 2024 and 2023, respectively.
On September 15, 2023, the Company issued shares on a pro-rata basis to the existing shareholders. The Company determined the fair value of the stock dividend is $2,212,000, and retrospectively adjusted the stock dividend to the consolidated financial statements as of December 31, 2022, respectively.
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