UNITED
STATES


SECURITIES
AND EXCHANGE COMMISSION


Washington,
D.C. 20549




FORM
10-K







x
            ANNUAL REPORT
      PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
      OF 1934For the fiscal year
      ended December 31, 2009Oro
            TRANSITION REPORT
      PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
      ACT OF 1934For the transition
      period from _____________ to
_____________




Commission
file number: 000-53268




CHINA WI-MAX COMMUNICATIONS,
INC.




(Exact
name of registrant as specified in its charter)





Nevada
            
            61-1504884State
      or other jurisdiction of
              incorporation
      or organization
            
            I.R.S.
      Employer
              Identification
      No.1905
      Sherman Street, Suite 335, Denver, Colorado 80203(Address
      of principal executive offices) (Zip Code)Registrant’s
      telephone number, including area code:
              303-993-8028Securities
      registered pursuant to Section 12(b) of the Act:Title
      of each class
              registered
            
            Name
      of each exchange on
                whichregisteredNot
      Applicable
            
            Not
      ApplicableSecurities
      registered pursuant to Section 12(g) of the Act:Common
      Stock
              (Title
      of class)








Indicate
by check mark if the registrant is a well-known seasoned issuer, as defined in
Rule 405 of the Securities Act.


Yes oNo x




Indicate
by check mark if the registrant is not required to file reports pursuant to
Section 13 or Section 15(d) of the Act.


Yes
oNo x




Indicate
by check mark whether the registrant (1) has filed all reports required to be
filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the
preceding 12 months (or for such shorter period that the registrant was required
to file such reports), and (2) has been subject to such filing requirements for
the past 90 days.





Yes xNo o





Indicate
by check mark if disclosure of delinquent filers pursuant to Item 405 of
Regulation S-K (ss. 229.405 of this chapter) is not contained herein, and will
not be contained, to the best of registrant’s knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form 10-K
or any amendment to this Form 10-K.


x





Indicate
by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer, or a smaller reporting
company.  See definitions of “large accelerated filer,” “accelerated
filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check
One).





Large
      accelerated filer
            o
            
            Accelerated
      filer
            oNon-accelerated
      filer
              (Do
      not check if a smaller reporting company)
            o
            
            Smaller
      reporting company
            x





Indicate
by check mark whether the Registrant is a shell company (as defined in Rule
12b-2 of the Exchange Act).


Yes oNo x





The
aggregate market value of voting stock held by non-affiliates of the registrant
was $0as
ofJune 30, 2009, as
the Company's Stock was not publicly trading on that date.





There
were 16,194,004 shares outstanding of the registrant’s Common Stock as of April
12, 2010.







TABLE
OF CONTENTS





PART
      IITEM
      1
            Business
            
            
            2ITEM
      1 A.
            Risk
      Factors
            
            
            11ITEM
      1 B.
            Unresolved
      Staff Comments
            
            
            22ITEM
      2
            Properties
            
            
            22ITEM
      3
            Legal
      Proceedings
            
            
            22ITEM
      4
            Submission
      of Matters to a Vote of Security Holders
            
            
            22PART
      IIITEM
      5
            Market
      for Registrant’s Common Equity, Related Stockholder Matters and Issuer
      Purchases of Equity Securities
            
            
            23ITEM
      6
            Selected
      Financial Data
            
            
            24ITEM
      7
            Management’s
      Discussion and Analysis of Financial Condition and Results of
      Operations
            
            
            24ITEM
      7 A.
            Quantitative
      and Qualitative Disclosures About Market Risk
            
            
            30ITEM
      8
            Financial
      Statements and Supplementary Data
            
            
            30ITEM
      9
            Changes
      in and Disagreements with Accountants on Accounting and Financial
      Disclosure
            
            
            43ITEM
      9 A.
            Controls
      and Procedures
            
            
            43ITEM
      9 A(T).
            Controls
      and Procedures
            
            
            43ITEM
      9B
            Other
      Information
            
            
            44PART
      IIIITEM
      10
            Directors,
      Executive Officers, and Corporate Governance
            
            
            45ITEM
      11
            Executive
      Compensation
            
            
            48ITEM
      12
            Security
      Ownership of Certain Beneficial Owners and Management and Related
      Stockholder Matters
            
            
            52ITEM
      13
            Certain
      Relationships and Related Transactions, and Director
      Independence
            
            
            53ITEM
      14
            Principal
      Accountant Fees and Services
            
            
            55PART
      IVITEM
      15
            Exhibits,
      Financial Statement Schedules
            
            
            56SIGNATURES
            
            
            
            57








FORWARD
LOOKING STATEMENTS




This
document includes forward-looking statements, including, without limitation,
statements relating to China Wi-Max’s plans, strategies, objectives,
expectations, intentions and adequacy of resources.  These
forward-looking statements involve known and unknown risks, uncertainties, and
other factors that may cause China Wi-Max’s actual results, performance or
achievements to be materially different from any future results, performance or
achievements expressed or implied by the forward-looking
statements.  These factors include, among others, the following:
ability of China Wi-Max to implement its business strategy; ability to obtain
additional financing; China Wi-Max’s limited operating history; unknown
liabilities associated with future acquisitions; ability to manage growth;
significant competition; ability to attract and retain talented employees; and
future government regulations; and other factors described in this registration
statement or in other of China Wi-Max filings with the Securities and Exchange
Commission.  China Wi-Max is under no obligation, to publicly update
or revise any forward-looking statements, whether as a result of new
information, future events or otherwise.





PART
I





ITEM
1.  BUSINESS





China Wi-Max Communications,
Inc.





China
Wi-Max Communications, Inc. (“China Wi-Max” or “the Company”), incorporated in
the state of Nevada on July 5, 2006, is a development-stage Company focused on
providing commercial customers, specifically in first and second tier markets in
China with high-bandwidth broadband connections through wholly owned Chinese
subsidiary companies. China Wi-Max, through its wholly owned Chinese
subsidiaries and those contracts the subsidiaries have executed, is building and
operating metropolitan area Internet Protocol (IP) based broadband networks in
China.  China Wi-Max is using owned (through wholly owned
subsidiaries) equipment and optical fiber and licensed Wi-Max capable wireless
spectrum (through contracts its subsidiaries have executed with local Chinese
companies).  Although China Wi-Max operates through wholly owned
Chinese subsidiaries, it has direct and full control over these wholly owned
subsidiaries operations, subject to the laws and regulations of
China.





Broadband
networks established, owned and operated by China Wi-Max’s wholly owned Chinese
subsidiaries are designed to provide the reliability, redundancy, scalability,
and other features expected of a carrier class network.  China Wi-Max
believes these networks can bypass the local loop facilities of the local
exchange carrier to connect enterprise customers directly to the global
communications network.  At this time, China Wi-Max has one part- time
and four full-time employees in the United States, augmented by a number of
contract personnel and professional services organizations.





We are
subject to the reporting requirements under the Securities and Exchange Act of
1934, Section 13a.  We are registered under Section 12(g) of the
Securities Exchange Act of 1934.    As a result,
shareholders will have access to the information required to be reported by
publicly held companies under the Exchange Act and the regulations thereunder.
We intend to provide our shareholders with quarterly unaudited reports and
annual reports containing financial information prepared in accordance with U.S.
generally accepted accounting principles and audited by an independent
registered public accounting firm which will be accessible at the SEC website
(www.sec.gov)
or they can be requested by sending correspondence to 1905 Sherman Street, Suite
335, Denver, Colorado 80203.





ChinaWi-Max
maintains a website atwww.chinawi-max.com,which is not incorporated
in and is not a part of this report.




2


China Wi-Max
Strategy





China
Wi-Max has created a carrier class fiber optic and wireless telecommunications
network by combining licenses and assets owned or held by its wholly-owned
Chinese subsidiaries and contract relationships within China arranged by its
wholly-owned Chinese subsidiaries with other Chinese companies.  The
Company currently has two wholly-owned (100%) subsidiaries in China – 1) Beijing
Yuan Shan Da Chuan Business Development Ltd. (hereafter Da Chuan) and 2) Beijing
Yuan Shan Shi Dai Technology Ltd. (hereafter Shi Dai). Ownership of these two
entities was effectuated in September 2008.  Da Chuan has contractual
agreements with a local Chinese company, Beijing Gao Da Yang Guang Communication
Technology Ltd. (hereafter Gao Da) to use this local company’s licenses and
contract relationships to deliver wireless and “Value Added Telecommunications
Services”.





At this
time, under the direction of, and with funding from, China Wi-Max, Da Chuan and
Shi Dai have acquired optical fiber and have entered into contracts to
exclusively use wireless spectrum licenses in Beijing and Hangzhou (plus use of
a spectrum license in Shanghai) held by Gao Da. Da Chuan has entered into a
contract with Gao Da for the exclusive use of these wireless and other licenses
for the next 20 years. China Wi-Max has accounted for its 20-year contractual
relationship with Gao Da for wireless licenses as an intangible asset, as these
licenses are not held or owned by China Wi-Max.  The wireless licenses
are held by Gao Da.





Starting
in January 2008, China Wi-Max began a 10% Convertible Promissory Note
offering.  As a result of such offering, China Wi-Max received
$3,026,424, through December 31, 2009.  The funds raised from this
offering have been used to purchase the optical fiber inn Beijing and Hangzhou,
have been used to facilitate Gao Da’s purchase of spectrum licenses in Beijing,
Hangzhou and Shanghai, and have been used to complete the initial deployment of
the fiber optics connectivity in Beijing during 2008.





In the
future, in order to fully complete the China Wi-Max business plan described
herein, China Wi-Max will need to raise at least a subsequent round of $2 to $5
million through equity, debt, or a combination thereof during
2010.  The plan is to use these funds to acquire additional optical
fiber assets and use of wireless spectrum in up to eight additional markets in
2010 through its wholly-owned subsidiary companies and associated contract
arrangements, as well as starting up the operations in Hangzhou and Shanghai and
expanding the Beijing network.





Overview of Current
Corporate Structure





The
following chart represents an overview of the corporate structure that is being
employed by China Wi-Max as it executes its business plan:





Please
refer to Exhibit 99.1 – Appendix A





China
Wi-Max’s wholly-owned Chinese subsidiaries are operating in China through the
use of owned assets and contractual relationships with local companies such as
Gao Da that have Value Added Telecommunications Licenses and/or hold wireless
spectrum licenses.




Da Chuan
was established as a wholly-owned foreign entity of the Company in September of
2008.  Da Chuan is the primary interface with end-customers in China
through a contract executed between it and Gao Da, whereby Da Chuan is to manage
all aspects of Gao Da’s assets and business. This includes the contract executed
between Gao Da and Beijing Long Teng Jia Xun Network Technology Ltd. (hereafter
Long Teng), a value added telecommunications license holder, whereby Gao Da can
provide value added telecommunications services.  The contract between
Gao Da and Long Teng specifically establishes Da Chuan as the servicing agent
for customers of Gao Da.  When customers sign their service contracts,
there will be three parties to the contract.  At this time, the three
parties are the customer receiving service, Da Chuan as the servicing company
and Long Teng as the value added telecommunications services
licensee.





In
addition, Da Chuan has entered into a contract with Shi Dai, to utilize Shi
Dai’s optical fiber and other network assets.  Da Chuan will operate
all aspects of the networks and business on behalf of Gao Da and Shi
Dai.  This will include, but not be limited to: sales, marketing,
customer service, customer billing, collection, network management, equipment
specification, other engineering services, etc.  All customer payments
will be collected by Da Chuan.  Various contracts define the services
to be rendered and amounts to be paid from and to the various parties and the
associated terms of such payments. At this time, all end-customers serviced by
Da Chuan on behalf of Gao Da will be customers under Long Teng’s ISP
license.  Da Chuan’s Board of Directors and management have been
appointed by China Wi-Max.




3





Shi Dai
was initially established as a locally-owned Chinese entity, and 100% of the
outstanding shares of Shi Dai were acquired by China Wi-Max in September of
2008.  Shi Dai currently holds fiber optic cable deeds for Beijing and
Hangzhou.  Going forward, Shi Dai holds or will hold fiber optic cable
assets and such other physical assets as are needed in order to establish and
operate the networks to be deployed in China.  Shi Dai’s Board of
Directors and management have been appointed by China Wi-Max.




Gao Da
was established in China as a locally-owned Chinese entity.  China
Wi-Max’s wholly-owned Chinese subsidiaries will operate in conjunction with Gao
Da on a contract basis.  Da Chuan has entered into an exclusive
20-year contract to manage all aspects of Gao Da’s assets and business.
Currently, Gao Da has two full-time employees, and business activities have been
funded  by China Wi-Max.  Any portion of the advances that
have been used for expense purposes have been recorded as expense in China
Wi-Max financial statements. Gao Da holds wireless spectrum licenses for
Beijing, Hangzhou and Shanghai, which were funded by China Wi-Max. The licenses
are being utilized by Da Chuan pursuant to a contractual rights
agreement.  Gao Da has issued a Declaration of Trust to China Wi-Max
as Beneficiary pledging all Gao Da shares to China Wi-Max.




Material Terms of
Contracts:





There are
three primary contracts at this time that enable China Wi-Max to operate the
business in China through its wholly-owned Chinese subsidiaries.





The first
contract is between Shi Dai and Da Chuan.  This twenty (20) year
exclusive contract enables Da Chuan to utilize the network assets owned by Shi
Dai to provide internet related services.  Da Chuan will pay Shi Dai
ten percent (10%) of Da Chuan’s net revenue for maintenance and support of the
Shi Dai assets.





The
second primary contract is an exclusive twenty (20) year contract between Gao Da
and Da Chuan, whereby Da Chuan will manage all aspects of Gao Da’s assets and
business.  Da Chuan will obtain and service retail and wholesale
customers on behalf of Gao Da and will provide billing and collection services,
etc.  Da Chuan will use the various resources held by Gao Da to
deliver services to end customers.  Da Chuan will pay Gao Da one
percent (1%) of the net revenue generated from the use of Gao Da’ assets and
other resources.




4


The third
primary contract is between Gao Da and Long Teng for a term of two (2)
years.  This contract provides for Gao Da (effectively assigned to Da
Chuan by the second primary contract mentioned above) to obtain wholesale and
retail customers utilizing Long Teng’s license.  Gao Da will pay Long
Teng three percent of (3%) of the revenues derived from service contracts signed
by Long Teng with end customers served by Da Chuan on behalf of Gao
Da.  Gao Da agrees to provide Long Teng favorable pricing on data
transport services across the fiber network managed by Da Chuan on behalf of Shi
Dai, if requested.  Da Chuan and Shi Dai have tentatively agreed to
provide this access, prices to be determined when, and if,
requested.





In the
early growth years of the business, funs to build the business in China is
flowing from China Wi-Max to its wholly-owned subsidiaries and other entities,
in the form of loans or deposits, as necessary to meet the requirements of the
China Wi-Max business plan.  Currently, there are no legal impediments
that would hinder future repayment of these loans/deposits (investment other
than for registered capital will be in the form of a loan) to the parent
Company, China Wi-Max.  Additionally, there are no existing legal
impediments for the subsidiaries to pay dividends to the parent Company, China
Wi-Max, after the appropriate in-country (China) taxes are paid.  The
current business plan does not contemplate the need for any funds to be returned
from the subsidiary entities in China to China Wi-Max in the United States for
successful execution.




The
preceding description of the current corporate structure provides China Wi-Max
with the basis to operate a value-added telecommunications service business in
China through its wholly owned Chinese subsidiaries that meets legal and
regulatory requirements, while at the same time giving the corporate parent
significant direct and indirect control over operations.





Contracts,
Licenses and Agreements





The
Cooperation Agreement by and between Gao Da and Long Teng provides for both
parties to use each other’s existing fiber network and related infrastructures
and licenses to develop their services in Beijing.  The Cooperation
Agreement further enables Da Chuan (a subsidiary of China Wi-Max) to obtain new
customers on behalf of Gao Da and for collecting fees from and issuing invoices
to customers.  The Cooperation Agreement provides for Gao Da to pay on
a quarterly basis 3% of the revenue received from the services sold by Da Chuan
on behalf of Gao Da to Long Teng.





The
cooperation agreement between Da Chuan and Gao Da provides for Da Chuan to pay
Gao Da 1% of the net revenues collected by Da Chuan resulting from the use of
Gao Da’s assets.  The contract between Da Chuan and Shi Dai provides
for Da Chuan to pay Shi Dai 10% of the net revenues collected by Da Chuan for
customers using the network assets held by Shi Dai.





China
Wi-Max has access to three metropolitan area city 5.8GHz frequency licenses,
held by Gao Da, which were granted from the Ministry of Information Industry
(MII) offices of Beijing, Hangzhou and Shanghai. The coverage is the
administrative area of each city government.  The frequency range of
the licenses is from 5725MHz-5850MHz.





According
to the National Radio Stations Frequency Occupation Charging Standard the
license holder (Gao Da) must pay for spectrum use, as follows:





·
            For
      microwave station frequencies below 10GHz, the charge is 40 Yuan per
      station in operation, per MHz per year, for example, if the base station
      working frequency is 4MHzx40RMB/Year or 8MHzx40RMB/Year. In Beijing:
      x1(yr), Shanghai: x3(yr);
Hangzhou:x2(yr)





5


Three
license usage period:





Beijing:
January 1, 2009 Cease Dec. 31, 2010




Hangzhou:
November 1, 2009 Cease Oct. 30, 2010




Shanghai:
June 1, 2008 Cease May 31, 2011





National
radio frequency usage regulations:





During
the license-effective period, base stations set up and used in the network have
to be registered at local MII offices. One month before the expiration date of
each license, there is a requirement to apply for annual inspection and submit a
renewal fee for each station. It is not necessary to reapply for licenses and no
limitation exists on the number of base stations set up.





Da Chuan
may use Wi-Fi for internal distribution of broadband within
buildings.  Public Wi-Fi (Wi-Fi existing outside of a structure)
requires registration and associated fees; Wi-Fi existing within a structure is
exempted from said requirements.  As a result no Wi-Fi registration is
currently contemplated.





Service
Delivery





The
Company plans to build, own, and operate metropolitan area Internet Protocol
(IP)-based broadband networks using a combination of Company-owned optical fiber
and licensed Wi-Max (Worldwide Interoperability for Microwave Access) capable
wireless spectrum. These networks are designed to provide the reliability,
redundancy, scalability, and other features expected of a carrier class network.
The company has tested its network in Beijing and is ready to achieve full
operation by July .The Company intends to provide IP Transport, Internet Access,
and value added services (VAS) in China.  Furthermore, the Company plans to
position itself to bypass the local loop facilities and primary transit
facilities in and out of China, and connect enterprise customers directly to a
global communications network providing managed Virtual Private LAN Services
(VPLS) to U.S. companies.





The
Company has raised to-date approximately $4.2M.  The Company is seeking
initially $15M, in whole or in stages, to launch sales and marketing in Beijing
and begin development of three additional markets in Shanghai, Hangzhou, and
Tianjin.





The
Company anticipates acquiring strategically positioned local companies in target
markets to accelerate its business development in China.  In addition, the
Company will be actively seeking to provide, on an exclusive basis, a diverse
array of telecommunications services to dedicated customers situated in new
buildings thereby creating significantly enhanced revenue and profit
opportunities.





Target
Markets





China
Wi-Max’s initial ten target markets represent approximately eight percent of the
population of China.  The initial municipal market areas
are:





Current
Markets





Metropolitan Area
            
            Approximate Market
    PopulationBeijing –
      Network operating
            
            
            16,000,000Hangzhou –
      Company subsidiary owns fiber and access to wireless
    spectrum
            
            
            6,600,000Future
      Target MarketsShanghai
            
            
            17,100,000Chongqing
            
            
            12,000,000Shenzhen
            
            
            9,000,000Dalian
            
            
            5,800,000Qingdao
            
            
            7,000,000Guangzhou
            
            
            13,500,000Xi’an
            
            
            4,000,000Tianjin
            
            
            7,200,000Totals
            
            
            98,200,000





6




Competition





The
market for broadband services is highly competitive, and includes companies that
offer a variety of services using a number of distinctly different technological
platforms, such as cable networks, DSL, third-generation cellular, satellite,
wireless Internet service, and other emerging technologies. China Wi-Max’s
wholly owned Chinese subsidiaries compete with these companies on the basis of
the portability, ease of use, speed, and respective price of
services.





Many
telecom carriers are offering non-cable internet services. These companies, like
China Netcom (a telecom carrier), are dominant broadband service providers in
most of China Wi-Max’s target cities. In this sense, local telecom broadband
service providers represent China Wi-Max’s wholly owned Chinese subsidiaries
major competitors for its broadband services.





While
telecom carriers hold “last mile access,” like fixed phone lines to most urban
households, the Company believes that cable operators enjoy a greater
competitive advantage by owning last mile connections of a much larger
bandwidth. In urban areas targeted by China Wi-Max, a large number of households
have both fixed phone line and cable television access. Many of these homes
currently have phone line based internet access.  These cable
companies are somewhat handicapped in their offerings by the regulatory
differences of Ministry of Information Industry (MII), which regulates the
telecom industry and the State Administration of Radio, File and Television
(China) (“SARFT”), which regulates the radio and television broadcasting
industry.





Incumbent
Telephone Companies





The
Company’s wholly owned Chinese subsidiaries face competition from traditional
wireline operators in terms of price, performance, discounted rates for bundles
of services, breadth of service, reliability, network security, and ease of
access and use. In particular, these competitors include traditional wireline
companies like China Telecom, China Tietong and China Netcom.





Local
telecom carriers are actively marketing broadband services on national and
provincial, as well as local levels in China.  China Wi-Max believes
that its wholly owned Chinese subsidiaries could add Voice-over Internet
Protocol telephony service (known as “VOIP) to Broadband services it
offers.  While China Wi-Max’s wholly owned Chinese subsidiaries do not
currently have plans to provide VOIP service in the near future, the Company
anticipates that, should it ever wish to enter into this business, it would do
so with a strategic partner (and subsequent to People’s Republic of China,
hereinafter referred to as PRC, regulatory approval).





Cable
Modem and DSL Services





China
Wi-Max’s wholly-owned Chinese subsidiaries compete with companies that provide
Internet connectivity through cable modems or DSL. Principal competitors include
cable companies, such as China Cable Television Network and Shanghai Cable TV,
although the broadband competition from cable has not been nearly as robust as
from DSL.  There are many cable companies, but most have a relatively
small number of users.  Incumbent telephone companies, such as China
Telecom, China Tietong and China Netcom have been aggressively adding capacity
and upgrading the speed of their DSL networks. Both the cable and telephone
companies deploy their services over wired networks initially designed for voice
and one-way data transmission that have subsequently been upgraded to provide
for additional services.





Cellular
and PCS Services





Cellular
carriers are seeking to expand their capacity to provide data and voice services
in competition with the services provided by China Wi-Max’s wholly owned Chinese
subsidiaries. These providers have substantially broader geographic coverage
than China Wi-Max’s subsidiaries currently have (and expect to have in the
foreseeable future). If one or more of these providers can deploy technologies
that compete effectively with China Wi-Max’s subsidiaries’ services, the
mobility and coverage offered by these carriers will provide even greater
competition than is currently faced. The Chinese government has not yet set a
timetable for distribution of third generation (3G) cellular
licenses.  Today’s more advanced cellular technologies, such as 3G,
currently offer broadband service with data packet transfer speeds of up to
2,000,000 bits per second for fixed applications, and slower speeds for mobile
applications. It is difficult to determine when the Chinese government may
ultimately distribute 3G licenses, and therefore this is not expected to be a
major short term threat to the business.




7





Wireless Broadband Service
Providers





China
Wi-Max’s wholly owned Chinese subsidiaries also face competition from other
wireless broadband service providers that use licensed and unlicensed spectrum.
In addition to these commercial operators, many local governments, universities,
and other governmental or quasi-governmental entities are providing or
subsidizing “Wi-Fi” networks.  There are numerous small urban wireless
operations offering local services that could compete in some of the present or
planned geographic markets.





Satellite





Satellite
providers, such as China Telecom Distant Communication and China Satcom, offer
broadband data services that address a niche market, mainly less densely
populated areas that are unserved or underserved by competing service providers.
Although satellite offers service to a large geographic area, latency caused by
the time it takes for the signal to travel to and from the satellite may
challenge satellite providers’ ability to provide some services, such as VoIP
and online gaming, which reduces the size of the addressable
market.





Other





China
Wi-Max believes other emerging technologies may also seek to enter the broadband
services market. For example, China Wi-Max is aware that several power
generation and distribution companies are seeking to develop or have already
offered commercial broadband Internet services over existing electric power
lines.





Competitive Features of
China Wi-Max Plans





Despite
facing substantial existing and prospective competition, China Wi-Max believes
that its wholly owned Chinese subsidiaries will possess several competitive
advantages that will allow them to attract new customers and retain these
customers over time.  These advantages include:





Reliability





Compared to cellular, cable and DSL
networks that generally rely on an infrastructure originally designed for
non-broadband purposes, the optical fiber and wireless networks operated by
China Wi-Max’s subsidiaries are designed specifically to support broadband
services. When the networks are deployed, customers will connect through the
optical network, which will connect at carrier interconnection points along the
network, thereby eliminating single points of failure.  The network is
intended to deliver at least 99% reliability rates with true
redundancy.





Value





China Wi-Max, through its wholly owned
subsidiaries, owns its entire fiber optic network and has access to wireless
spectrum in each market.  This should result in a very price
competitive solution.  Utilizing the owned fiber rings should result
in lower or no local loop costs.




8


Economic
Model





After initially bringing the fiber
optic network into operation, a “Success Based Capital Approach” is to be used,
which will enable capital assets to be acquired and installed as customers are
added.  There is no need to pre-build an extensive network before
customers are added.  Utilizing the core fiber network and extending
it through use of wireless base stations should provide a cost advantage by
minimizing the number of interconnection points and providing for lower cost
high bandwidth interconnection contract costs.  This should result in
incremental savings in its build-out costs as the subscriber base
grows.





Principal Chinese Government
Regulations





China
Wi-Max’s operations in China will be carried out by wholly owned Chinese
subsidiary companies, formed or purchased by China Wi-Max, as
follows:




·
            Beijing
      Yuan Shan Da Chuan Business Development Ltd.,  (Da
      Chuan)


·
            Beijing
      Yuan Shan Shi Dai Technology CO, Ltd.  (Shi
  Dai)





Da Chuan
is a wholly owned foreign subsidiary and is governed by laws including the Law of the
People’s Republic of China on Foreign Capital Enterprisesand related
regulations.





Shi Dai
was acquired through share purchases, and will be governed by the Chinese
Administrative
Regulation on Foreign Investment in Telecommunication Enterprise, Regulations
for Merger with and Acquisition of Domestic Enterprises by Foreign
Investor, andLaw of the
People’s Republic of China on Chinese-foreign Equity Joint Ventures and
other related laws and regulations.





The
Regulations set forth the requirements for establishing wholly owned foreign
entities, acquiring Chinese companies, operating as a value-added
telecommunications enterprise and identify the limits of ownership, types of
asset that may be owned based on ownership interest, licensing requirements,
capital requirements, etc.  As an example, to provide regional
value-added telecommunications services, a company must have a minimum
registered capital of one million RMB.  China Wi-Max retained legal
council in China to assist with the development of its operating plan and
corporate structure.  China Wi-Max has been assured by legal council
that the current corporate structure, operating plan, and associated licensing
will enable China Wi-Max’s wholly owned Chinese subsidiary companies to deliver
value-added telecommunications services in China, and more specifically Beijing
(initially).





The
Company has complete control over its 100% owned subsidiaries, Da Chuan and Shi
Dai, in China.   Gao Da and Long Teng, which hold
telecommunications-related licenses under Chinese Law, are not able to be
“controlled” by the Company through equity. However, the contracts with Gao Da
and Long Teng are expected to be enforceable, and the Company believes, under
current Chinese law, have contracts legally provide for revenue sharing, license
access and enterprise management.





Intellectual Property and
Other Agreements





China
Wi-Max and its wholly owned Chinese subsidiaries are not a party to any royalty
agreements, labor contracts, or franchise agreements and, other than the
Company’s wholly owned Chinese subsidiaries right to own and operate networks to
provide value-added telecommunication services, the Company does not currently
own any trademarks. China Wi-Max intends to apply for trademarks for the regions
in which the Company operates, including, but not limited to, the business logo
and service description tagline.




9


Development
Activities





China
Wi-Max’s fixed assets and intangible assets (contractual license rights) totaled
approximately $820,000 and $895,000 as of December 31, 2009 and 2008,
respectively.  China Wi-Max does not foresee expending material sums
on research and development in the near future.





Industry Structure and
Government Regulation





There are
various barriers to entry into the cable or internet service provider business
in China, and to expansion of China Wi-Max’s value-added services provided by
its wholly owned Chinese subsidiaries.  These barriers stem from both
industry barriers and government regulation.  The rates charged and
services provided by China Wi-Max’s subsidiaries are subject to government
regulation and approval.








Lack of Economies of
Scale





Up until
2005, China had over 2,000 independent cable operators on different levels.
While SARFT pushed hard from the national level for consolidation of cable
networks into one singular national entity, current consolidation occurs mostly
on a provincial platform. Among the 30 provinces, consolidation practices remain
highly variable with respect to specific efforts and processes. China Wi-Max
believed most cable operators in China still lack the economies of scale to
systematically introduce value-added services that can significantly upgrade
average revenue per user (ARPU).





Other Barriers to
Entry





China
Wi-Max believes, through its wholly-owned Chinese subsidiaries, it is in a
favorable position to acquire the network assets it seeks at attractive prices.
This belief has been substantiated to an extent by successful purchases of
optical fiber and access to wireless licenses in Beijing and
Hangzhou.  China Wi-Max is confident of its advantage over some
competitors, having spent the past several years cultivating relationships
deemed to be essential to the Company’s business prospects in
China.  In China specifically, bureaucratic obstacles can represent
significant inhibitors to a fledging corporation. Other more generic concerns
include the acquisition of materials and the establishment of a technological
platform from which to operate. Generally, these opportunities and entities from
which to purchase installed fiber in China are limited.  Just as in
the United States, wire-line companies do not normally sell their fiber assets
to potential competitors, minimizing non-government purchasing
opportunities.  Alternatively, there exists clear opportunities to
build fiber networks, however, such an undertaking would require several years
of procuring approvals, rights of way, and construction, which would be
prohibitively expensive in metropolitan areas that are already densely
developed.  China Wi-Max’s careful cultivation of relationships within
China aids in effectively navigating these concerns. Finally, China Wi-Max,
through its wholly owned Chinese subsidiaries is acquiring access to
significantly broad blocks of spectrum.  China Wi-Max believes if its
wholly owned Chinese subsidiaries effectively implement and utilize this
spectrum, they will be able to retain access to a large block of bandwidth for a
significant period of time.




10


Material
Contracts





Service
agreements between:




1.
            Da
      Chuan and Shi Dai (Exhibit 10.6)


2.
            Da
      Chuan and Gao Da (Exhibit 10.7)


3.
            Gao
      Da and Long Teng (Exhibit 10.8)





On
December 17, 2008, China Wi-Max Communications, Inc. and Wang Zheng, the legal
representative of Gao Da, signed an Amended and Restated Declaration of
Trust.
 
 On
December 17, 2008 China Wi-Max Communications, Inc. also entered into a Security
and Pledge Agreement with Gao Da.




ITEM 1A.  RISK
FACTORS





Risk
Factors





GENERAL
BUSINESS RISK FACTORS





China Wi-Max is a
development stage company and unproven and therefore should be considered
speculative and highly risky to investors.





China
Wi-Max has only very recently embarked on the business plan described
herein.  Potential investors should be aware of the risk and
difficulties encountered by a new enterprise in the wired and wireless
communications business in China, especially in view of the intense competition
from existing businesses in the industry.





China Wi-Max has a lack of
revenue history and investors cannot view China Wi-Max’s past performance since
it is a start-up company.





China
Wi-Max Communications, Inc. was formed on July 5, 2006 for the purpose of
engaging in any lawful business and has adopted a plan to take advantage of the
expanding broadband communications needs in China through fiber optic and
wireless delivery.  There is no assurance that China Wi-Max’s intended
activities will be successful or result in significant revenue or profit to the
Company. China Wi-Max faces all risks that are associated with any new business,
such as under-capitalization, insufficient cash flow and personnel, financial
and resource limitations, as well as special risks associated with its proposed
operations. There is no assurance that it will be successful in implementing its
business plan described herein.





China Wi-Max has no
operating history and no revenue and minimal assets which may impair its ability
to raise capital, to sustain operations, which could cause failure of the
Company.





China
Wi-Max is considered a “start-up” operation, and as such, it has no operating
history, no revenue and no earnings from operations. China Wi-Max has minimal
assets and limited financial resources. China Wi-Max will continue to sustain
operating expenses without corresponding revenues, at least until it further
develops its operating subsidiaries in The Peoples Republic of China (“PRC”),
which is not expected to occur until it receives sufficient proceeds from
additional capital raising. China Wi-Max has incurred a net operating loss that
will continue until China Wi-Max has more fully implemented its business plan
and is producing sufficient revenues to break even. There can be no assurance
that China Wi-Max’s operations will become profitable in the near future, or at
all.




11


China Wi-Max’s auditors have
issued a “going concern” emphasis paragraph to its opinion which indicates that
the Company does not have adequate cash resources or cash flow based on its
financial statements to insure its continuation in business.





China
Wi-Max’s independent registered public accounting firm’s report on the Company’s
financial statements as of December 31, 2009 and December 31, 2008, and for the
periods then ended, includes an explanatory paragraph expressing substantial
doubt about China Wi-Max’s ability to continue as a going concern.  As
a result of this going concern modification in the Company’s auditor’s report on
China Wi-Max’s financial statements, the Company may have a difficult time
obtaining significant additional financing.  If China Wi-Max is unable
to secure significant additional financing, the Company may be obligated to seek
protection under the bankruptcy laws and China Wi-Max shareholders may lose
their investment.





China Wi-Max may have a
shortage of working capital in the future which could jeopardize its ability to
carry out the business plan.





China
Wi-Max’s capital needs consist primarily of operating overhead for itself and
its Chinese subsidiaries and funds for the purchase of fiber and access to
spectrum in additional cities in China, herein identified, and could exceed
$9,000,000 in the next twelve months. Such funds are not currently committed,
and China Wi-Max has cash as of December 31, 2009 of approximately
$34,000.





China
Wi-Max and its Chinese subsidiaries have no operating history and no revenue and
it may be unlikely that China Wi-Max will raise the required additional working
capital from any source.





China Wi-Max may in the
future issue more shares which could cause a loss of control by the Company’s
present management and current stockholders.





China
Wi-Max may issue further shares as consideration for the cash or assets or
services out of its authorized but unissued common stock that would, upon
issuance, represent a majority of the voting power and equity of the
Company.  The result of such an issuance would be those new
stockholders and management would control the Company, and persons unknown could
replace China Wi-Max current management.  Such an occurrence would
result in a greatly reduced percentage of ownership of the Company by China
Wi-Max current shareholders, which could present significant risks to
investors.





China Wi-Max is not
diversified and it will be dependent on only one business which increases risks
of loss to investors.





Because
of the limited financial resources that the Company has, it is unlikely that
China Wi-Max will be able to diversify its operations beyond its intended and
current Chinese operations.  The Company’s probable inability to
diversify its activities into more than one area will subject the Company to
economic fluctuations within the telecommunications industry in China and
therefore increase the risks associated with its operations due to lack of
diversification.





China Wi-Max will depend
upon full and part-time management and minority shareholders will have no direct
participation in management and very limited ability to
influence.





As of
December 31, 2009, China Wi-Max has five individuals who are serving as its
officers, directors and managers.  Dr. Allan Rabinoff, Chairman,,
Steven T. Berman President, Chief Executive  Officer, and Frank
Ventura, Chief Financial Officer are working full-time for the Company while the
other officers, managers and consultants typically work 10 to 30 hours per week,
each on a part-time basis.  Two directors are also acting as Company
officers.  China Wi-Max will be heavily dependent upon their skills,
talents, and abilities, as well as several consultants to the Company, to
implement its business plan.  The inability of the officers, directors
and consultants to devote their full-time attention to the business may result
in slower progress implementing the Company’s business plan.  Once
China Wi-Max receives the proceeds from the offering, additional staff and other
consultants may be employed on a full or part-time basis as
required.  Investors will not be able to directly manage the Company’s
business. As such, they should critically assess all of the information
concerning the Company’s officers and directors.  A portion of China
Wi-Max’s officers and directors are not employed full-time by the Company, which
could be detrimental to the business.





Some
China Wi-Max directors and officers are, or may become in their individual
capacities, officers, directors, controlling shareholders and/or partners of
other entities engaged in a variety of businesses.  Thus, the
Company’s part-time officers and directors may have potential conflicts
including the amount of their time and effort provided to China Wi-Max due to
their time commitment to other business entities.  Some officers and
directors of the Company’s business are engaged in business activities outside
of the Company’s business and the amount of time they devote as officers and
directors to China Wi-Max business may be limited.




12





China
Wi-Max does not know of any reason other than outside business interests that
would prevent the current part-time officers and directors from devoting
full-time to the Company, when the business may demand such full-time
participation.





China Wi-Max officers and
directors may have conflicts of interests as to corporate opportunities which
the Company may not be able or allowed to participate in which is a risk to
investors because the officers and directors may not devote their exclusive
efforts to the Company.





Presently
there is no requirement contained in the Company’s Articles of Incorporation,
Bylaws, or minutes which requires officers and directors of the Company’s
business to disclose to the Company business opportunities which come to their
attention.  China Wi-Max officers and directors do, however, have a
fiduciary duty of loyalty to China Wi-Max to disclose to the Company any
business opportunities which come to their attention, in their capacity as an
officer and/or director or otherwise.  Excluded from this duty would
be opportunities which the person learns about through his involvement as an
officer and director of another company.  China Wi-Max has no
intention of merging with or acquiring business opportunities from any affiliate
or officer or director.  (See “Conflicts of Interest” at page
47).





China Wi-Max may, in the
future, issue debt having priority, which, if foreclosed, could cause loss of
some or all of the Company’s assets or business.





While
management has no immediate plans to issue any securities that would have a
higher priority in terms of repayment or be secured by Company assets than those
unsecured Convertible Notes previously sold or currently offered, these plans
may change in the future. In the event of a China Wi-Max default on its
obligations to repay all sums due pursuant to the existing Notes, investors
herein will have the same rights as any of the Company’s other unsecured
creditors and the assets of the Company at that time may be insufficient to
repay all of its creditors in full.





China Wi-Max’s proposed
operations are dependent upon implementation of its business plan in China, and
failure to successfully execute the plan could jeopardize investors in the
Company.





A
substantial portion of the future capital raising will be allocated for the
capital necessary to fund existing wholly owned subsidiaries in China and to
form additional partially or wholly owned foreign enterprises in China and on
proposed asset acquisitions and operating costs for these companies in The
Peoples Republic of China. The success of China Wi-Max’s proposed plan of
operation will depend, to a great extent, on China Wi-Max ability to acquire
interests in companies and assets in China and may entail unforeseen
circumstances that cannot be specifically cited as of the date of this
Registration Statement. Unless China Wi-Max successfully consummates offerings
of its common stock or other financings to successfully grow China Wi-Max
business operations described herein, investors may lose all or a substantial
portion of their investment herein.





China Wi-Max may not be able
to manage its growth effectively, which could adversely affect the Company’s
operations and financial performance.





The
ability to manage and operate the Company’s business as it executes its
development and growth strategy will require effective planning. Significant
rapid growth could strain China Wi-Max internal resources, and exacerbate other
problems that could adversely affect China Wi-Max financial performance. China
Wi-Max expects that its efforts to grow will place a significant strain on its
personnel, management systems, infrastructure and other resources in the
immediate future. The ability to manage future growth effectively will also
require the Company to successfully attract, train, motivate, retain, and manage
new employees, and continue to update and improve the Company’s operational,
financial, and management controls and procedures. If China Wi-Max does not
manage its growth effectively, its operations could be adversely affected,
resulting in slower growth and a failure to achieve or sustain
profitability.





China Wi-Max may depend upon
outside advisors, who may not be available on reasonable terms and as
needed.





To
supplement the business experience of its officers and directors, the Company
may be required to employ accountants, technical experts, appraisers, attorneys,
engineers, or other consultants or advisors.  Management, without any
input from stockholders, will make the selection of any such
advisors.  Furthermore, China Wi-Max anticipates that such persons
will be engaged on an “as needed” basis without a continuing fiduciary or other
obligation to the Company.  In the event China Wi-Max considers it
necessary to hire outside advisors, it may elect to hire persons who are
affiliates, if they are able to provide the required services.




13





China Wi-Max may not
voluntarily implement various corporate governance measures, in the absence of
which, stockholders may havereduced protections against
insider director transactions, conflicts of interest and other
matters.





At this
time, China Wi-Max is subject to any law, rule or regulation requiring that it
adopt any of the corporate governance measures that are required by the rules of
national securities exchanges or NASDAQ, such as independent directors and audit
committees. It is possible that, if the Company were to adopt some or all of the
corporate governance measures, stockholders would benefit from somewhat greater
assurances that internal corporate decisions were being made by disinterested
directors and that policies had been implemented to define responsible conduct.
Prospective investors should bear in mind China Wi-Max’s current lack of
corporate governance measures in formulating their investment
decisions.





The success of China
Wi-Max’s business is dependent on its ability to retain the Company’s existing
key employees and to add and retain senior officers to China Wi-Max’s
management.





China
Wi-Max depends on the services of its existing key employees. China Wi-Max’s
success will largely depend on its ability to retain these key employees and to
attract and retain qualified senior and mid-level managers to its management
team.China Wi-Max has recruited executives and management in China to assist in
its ability to manage the business and to recruit and oversee employees. While
China Wi-Max believes it offers compensation packages that are consistent with
market practice, China Wi-Max cannot be certain that it will be able to hire and
retain sufficient personnel to support its broadband business. The loss of any
of China Wi-Max’s key employees would significantly harm its business. China
Wi-Max does not maintain key person life insurance on any of its
employees.




14


RISK
FACTORS RELATED TO DOING BUSINESS IN CHINA





ChinaWi-Max will be materially
reliant on revenues from operations in thePeoplesRepublicofChina. There are significant
risks associated with doing business in the PRC that may cause an investor to
lose the entire
investment in the Company.





If China
Wi-Max is successful in implementing its business plan, of which there is no
assurance, the Company’s growth and success will be tied to operations of
operating subsidiaries acquired by the Company in the PRC. Therefore, a downturn
or stagnation in the economic environment of the PRC could have a materially
adverse effect on the Company’s financial condition that could result in a
significant loss of revenues and liquidity in future periods.





ChinaWi-Maxcannot assure that the
current Chinese policies of economic reform will continue, and due to this
uncertainty, there are significant economic risks associated with doing business
inChina.





Although
the majority of productive assets in China are owned by the Chinese government,
in the past several years the government has implemented economic reform
measures that emphasize decentralization and encourage private and foreign
business ownership and operation. In keeping with these economic reform
policies, the PRC has been openly promoting business development in order to
bring more foreign businesses into the PRC. Because these economic reform
measures may be inconsistent or ineffectual, there are no assurances
that:





·
            the
      Chinese government will continue its pursuit of economic reform
      policies;·
            the
      economic policies, even if pursued, will be successful;·
            economic
      policies will not be significantly altered from time to time;
  and·
            business
      operations in China will not become subject to the risk of
      nationalization.





Even if
the Chinese government continues its policies of economic reform, China Wi-Max
may be unable to take advantage of these opportunities in a fashion that will
provide financial benefit to the Company. China Wi-Max’s inability to sustain
its proposed operations in China could result in a significant reduction in the
Company’s future revenues that would result in escalating losses and liquidity
concerns.





China’s
economy has experienced significant growth in the past decade, but such growth
has been uneven across geographic and economic sectors and has shown recent
slowing.  There can be no assurance that relative growth rates will
not further decrease or that any economic slowdown will not have a negative
effect on the Company’s proposed business. The Chinese economy is also
experiencing deflation which may continue in the future. China Wi-Max cannot
assure that it will be able to capitalize on these economic reforms, assuming
the reforms continue. Given that China Wi-Max will be materially reliant on its
proposed operations in the PRC, any failure on the Company’s part to take
advantage of the growth in the Chinese economy will have a materially adverse
effect on the results of its operations and liquidity in future
periods.





China Wi-Max willbe subject to
risks associated with the conversion of Chinese Renminbi (RMB) into U.S.
dollars, over which it has no control, and any Chinese government artificial
control of the exchange rate may cause the Company losses of value when gauged
in U.S. dollars.





If China
Wi-Max is successful in implementing its business plan, of which there is no
assurance, it will generate revenues and incur expenses and liabilities in both
Chinese RMB and U.S. dollars. Since 1994, the official exchange rate for the
conversion of Chinese RMB to U.S. dollars has generally been stable and the
Chinese RMB has appreciated slightly against the U.S. dollar. China Wi-Max has
not entered into agreements or purchased instruments to hedge its exchange
rate risks, although it may do so in the future. China Wi-Max’s results of
operations and financial condition may be negatively affected by changes in the
value of Chinese RMB.





If shareholders sought to
sue China Wi-Max’s officers or directors, it may be difficult to obtain
jurisdiction over the parties and access to the assets located in the
PRC.





It may be
difficult, if not impossible, to acquire jurisdiction over officers and
directors residing outside of the United States in the event that a lawsuit is
initiated against such officers and directors by shareholders in the United
States. It also is unclear if extradition treaties now in effect between the
United States and the PRC would permit effective enforcement of criminal
penalties of the federal securities laws. Furthermore, because a substantial
amount of China Wi-Max’s assets are located in the PRC, it would be extremely
difficult to access those assets to satisfy an award entered against China
Wi-Max in a United States court. Moreover, China Wi-Max is not aware of any
treaties between the PRC and the United States providing for the reciprocal
recognition and enforcement of judgments of courts. As a result, it may not be
possible for investors in the U.S. to enforce their legal rights, to effect
service of process upon China Wi-Max’s directors or officers, or to enforce
judgments of U.S. courts predicated upon civil liabilities and criminal
penalties of its directors and officers under Federal securities
laws.




15





The Chinese government could
change its policies toward, or even nationalize, private enterprise, which could
reduce or eliminate the interests held in China Wi-Max.





Over the
past several years, the Chinese government has pursued economic reform policies,
including the encouragement of private economic activities and decentralization
of economic regulation. The Chinese government may not continue to pursue these
policies or may significantly alter them to China Wi-Max’s detriment from time
to time without notice. Changes in policies by the Chinese government that
result in a change of laws, regulations, their interpretation, or the imposition
of high levels of taxation, restrictions on currency conversion or imports, and
sources of supply could materially and adversely affect China Wi-Max’s business
and operating results. The nationalization or other expropriation of private
enterprises by the Chinese government could result in the total loss of China
Wi-Max’s investment in China.





The Chinese government may
nationalize certain businesses or otherwise alter its policy with respect to
foreign investment in China in a way that would prohibit or greatly hinder the
Company’s ability to do business in China.





While the
Chinese government currently advocates foreign investment into China,
socio-political changes, war or economic changes and shifts could result in a
change in China’s policy with respect to investment from non-Chinese businesses.
The government agencies, for example, could prohibit ownership of businesses by
foreigners or revoke licenses granted that China Wi-Max is dependant on, or
otherwise alter the Company’s revenue sharing model. While China Wi-Max does not
believe that the foregoing is likely in the near future, no assurance can be
made that such events, all of which would adversely affect the Company, will not
occur.





Since China Wi-Max’s assets
and operating subsidiaries are located in the PRC, any distribution of dividends
or proceeds from liquidation are subject to the approval of the relevant PRC
government agencies. China Wi-Max is not likely to declare dividends in the near
future.





Because
China Wi-Max’s assets are predominantly located inside the PRC, China Wi-Max
will be subject to the law of the PRC in determining dividends. Under the laws
governing foreign invested enterprises in the PRC, dividend distribution and
liquidation are allowed but subject to special procedures under the relevant
laws and rules.  Under current Chinese tax regulations, dividends paid
to China Wi-Max are subject to a 10 percent Chinese tax.  In the
future, tax authorities in China could amend or interpret the regulations in a
manner that would materially and adversely affect the ability of China Wi-Max’s
subsidiaries to pay dividends and other distributions to China
Wi-Max.  There is also the possibility that other regulatory
interpretations by the Chinese authorities could prohibit China Wi-Max from
recording revenues or consolidating its financial statements in order to comply
with SEC reporting obligations.





In
addition, Chinese legal restrictions permit payment of dividends only out of net
income as determined in accordance with Chinese accounting standards and
regulations. If China Wi-Max or its subsidiaries incur debt on its own behalf in
the future, the instruments governing the debt may restrict its ability to pay
dividends or make other distributions to China Wi-Max, which in turn would limit
China Wi-Max’s ability to pay dividends on its common stock.





The uncertain legal
environment in China could limit the legal protections available to China
Wi-Max.





The
Chinese legal system is a civil law system based on written statutes. Unlike
common law systems, it is a system in which decided legal cases have little
value as precedent. In the late 1970s, the Chinese government began to
promulgate a comprehensive system of laws and regulations governing economic
matters. The overall effect of legislation enacted over the past 20 years has
significantly enhanced the protections afforded to foreign invested enterprises
in China.  However, these laws, regulations, and legal requirements
are relatively recent and are evolving rapidly, and their interpretation and
enforcement involve uncertainties. These uncertainties could limit the legal
protections available to foreign investors such as China Wi-Max.




16





Fluctuation in Chinese RMB
exchange rates could adversely affect the value of China Wi-Max’s stock and any
cash dividend declared for holders of its common stock.





As China
Wi-Max’s operations are primarily in China, any significant revaluation of the
Chinese RMB may materially and adversely affect cash flows, revenues, and
financial condition.  For example, to the extent that China Wi-Max
needs to convert United States dollars into Chinese RMB for operations,
appreciation of this currency against the United States dollar could have a
materially adverse effect on China Wi-Max’s business, financial condition and
results of operations.  Conversely, if China Wi-Max decides to convert
Chinese RMB into United States dollars for other business purposes and the
United States dollar appreciates against this currency, the United States dollar
equivalent of the Chinese RMB that China Wi-Max converts would be
reduced.





China
Wi-Max’s ability to bid for and acquire businesses in new regions is dependent
on favorable exchange rates between the U.S. dollar and the Chinese Renminbi.
The value of the Renminbi may fluctuate according to a number of factors. Since
1994, the exchange rate for RMB against the United States dollars has remained
relatively stable, generally in the region of RMB 8.0 to US $1.00. However, in
2005, the Chinese government announced that would begin pegging the exchange
rate of the Chinese RMB against a number of currencies, rather than just the
U.S. dollar.  Currently, exchange rates are approximately RMB 6.8 to
US $1.00 resulting in an increased price for Chinese products to U.S purchasers.
On July 21, 2005, as a result of the Renminbi rates being tied to a basket of
currencies, the Renminbi was revalued and appreciated against the U.S. dollar.
Additionally, global events and expenditures that deflate the value of the U.S.
dollar will result in more expensive purchase prices of China based entities.
There can be no assurance that such exchange rate will continue to remain stable
in the future. China Wi-Max’s operating subsidiaries revenues will be primarily
denominated in Renminbi and any fluctuation in the exchange rate of Renminbi may
affect the value of, and dividends, if any, payable on, China Wi-Max’s shares in
foreign currency terms.





Restrictions on currency
exchange may limit China Wi-Max’s ability to receive and use its revenues
effectively.





Because
almost all of China Wi-Max’s operating subsidiaries future revenues may be in
the form of Renminbi, any future restrictions on currency exchanges may limit
its ability to use revenue generated in Renminbi to fund its business activities
outside China or to make dividend payments in U.S. dollars. Although the Chinese
government introduced regulations in 1996 to allow greater convertibility of the
Renminbi for current account transactions, significant restrictions still
remain. Current account transactions include payments of dividends and trade and
service-related foreign exchange transactions.





In
contrast, capital account transactions, which include foreign direct investment
and loans, must be approved by the State Administration for Foreign Exchange, or
SAFE. China Wi-Max cannot be certain that the Chinese regulatory authorities
will not impose more stringent restrictions on the convertibility of the
Renminbi, especially with respect to foreign exchange transactions.





RISKS
RELATED TO THE TELECOMMUNICATIONS AND INTERNET INDUSTRIES


IN THE PEOPLE’S REPUBLIC OF
CHINA





China Wi-Max does not
currently own any Chinese subsidiary with value added telecommunications or
wireless licenses and if they or their ultimate shareholders or control persons
violate China Wi-Max’s operating subsidiaries contractual arrangements with
them, the Company’s business could be disrupted, China Wi-Max’s reputation may
be harmed, and China Wi-Max will have only limited rights and ability to enforce
the Company’s rights against these parties.





The
Company’s operations are currently dependent upon the Company’s operating
subsidiaries contractual relationships with Gao Da and Long Teng.  The
terms of these agreements are often statements of general intent and do not
detail the rights and obligations of the parties. Some of these contracts
provide that the parties will enter into further agreements on the details of
the services to be provided. Others contain price and payment terms that are
subject to adjustment. These provisions may be subject to differing
interpretations, particularly on the details of the services to be provided and
on price and payment terms. It may be difficult for China Wi-Max’s operating
subsidiaries to obtain remedies or damages from these companies or their
ultimate shareholders for breaching these agreements. Because China Wi-Max’s
operating subsidiaries rely significantly on these companies for their business,
the realization of any of these risks may disrupt China Wi-Max’s operating
subsidiaries operations or cause degradation in the quality and service provided
by, or a temporary or permanent shutdown of, the Company.  China
Wi-Max’s operating subsidiaries initial Cooperation Agreement (term of 2 years)
that enables the Company to operate its value-added services, business, and the
Exclusive Service Agreement in which the parties will cooperate and provide each
other with technical services related to their businesses and access to use
wireless licenses, is for a term of 20 years.  If China Wi-Max’s
operating subsidiaries are unable to renew these agreements on favorable terms,
or to enter into similar agreements with other parties, their business may not
expand and China Wi-Max operating subsidiaries operating expenses may
increase.




17





Any
increase in government regulation of the telecommunications and Internet
industries in China may result in the Chinese government requiring China
Wi-Max’s operating subsidiariesto
obtain additional licenses or other governmental approvals to conduct the their
business which, if unattainable, may restrict China Wi-Max’s operating
subsidiariesoperations.





The
telecommunications industry, including Internet service providers (ISP), is
highly regulated by the Chinese government with the main relevant government
authority being the Ministry of Information Industry (MII). Prior to China’s
entry into the World Trade Organization (WTO), the Chinese government generally
prohibited foreign investors from operating, or taking equity ownership of,
telecommunications businesses. ISP services were—and still are—classified as
value-added telecommunications services and therefore fell within the scope of
this prohibition. This prohibition was partially lifted following China’s entry
into the WTO allowing foreign investors to now own up to 50% interests in
Chinese businesses that are licensed to provide value added telecommunications
services (a foreign company can only own 49% of a Chinese Company with a basic
telecommunications services license). In addition, enterprises that are more
than 50% foreign owned (and foreign invested) are currently not able to apply
for the required licenses for operating broadband services in
China.





China
Wi-Max’s operating subsidiaries cannot be certain that they will be granted any
of the appropriate licenses, permits, or clearance that may be needed in the
future. Moreover, China Wi-Max cannot be certain that any local or national ISP
or telecommunications license requirements will not conflict with one another or
that any given license will be deemed sufficient by the relevant governmental
authorities for the provision of the Company’s operating subsidiaries
services.





Until
such time as China Wi-Max acquires up to a 50% equity interest in a local
company that has value added telecommunications license(s), China Wi-Max’s
operating subsidiaries must rely exclusively on contractual arrangements with
their Chinese partners and their approvals to operate as value added
telecommunications (ISP) providers. China Wi-Max believes that its operating
subsidiaries present operations are structured to comply with Chinese law.
However, many Chinese regulations are subject to extensive interpretive powers
of governmental agencies and commissions. China Wi-Max cannot be certain that
the Chinese government will not take action to prohibit or restrict its
operating subsidiaries business activities. China Wi-Max cannot be certain as to
whether the Chinese government will reclassify China Wi-Max’s operating
subsidiaries business as a media or retail company due to its acceptance of fees
for  Internet access, Internet advertising, online games, and wireless
value-added and other services as sources of revenues, or as a result of its
current corporate structure. Such reclassification could subject China Wi-Max
operating subsidiaries to penalties or fines or place significant restrictions
on their business. Future changes in Chinese government policies affecting the
provision of information services, including the provision of online services,
Internet access, e-commerce services and online advertising, may impose
additional regulatory requirements on China Wi-Max or its service providing
subsidiaries  or otherwise harm its business.





China Wi-Max operating
subsidiaries may be unable to compete successfully against new entrants and
established industry competitors.





The
Chinese market for telecom access and services is intensely competitive and
rapidly changing. Barriers to entry are relatively minimal, and current and new
competitors can launch new websites at a relatively low cost. Many companies
offer competitive products or services including land line services, wireless
services, and cable/fiber optic companies. In addition, as a consequence of
China joining the World Trade Organization, the Chinese government has partially
lifted restrictions on foreign-invested enterprises so that foreign investors
may hold in the aggregate up to approximately 50% of the total equity ownership
in any value-added telecommunications services business in China.





Currently,
China Wi-Max’s operating subsidiaries competition comes from standard telephone
and cable providers. Any of China Wi-Max’s operating subsidiaries present or
future competitors may offer products and services that provide significant
performance, price, creativity, or other advantages over those offered by it
and, therefore, achieve greater market acceptance than those offered by China
Wi-Max’s operating subsidiaries.





Because
many of China Wi-Max’s operating subsidiaries existing and/or potential
competitors have longer operating histories in the Internet market, greater name
and brand recognition, better connections with the Chinese government, larger
customer bases and databases, and significantly greater financial, technical,
and marketing resources than China Wi-Max and its operating subsidiaries have,
they cannot ensure they will be able to compete successfully against their
current or future competitors. Any increased competition could make it difficult
for China Wi-Max’s operating subsidiaries to attract and retain users, reduce or
eliminate its market share, lower profit margins, and reduce
revenue.





18


Unexpected network
interruption caused by system failures may reduce user base and harm China
Wi-Max’s operating subsidiaries reputation.





Reliable
access and consistent speeds while connecting to Internet services and the
performance and reliability of China Wi-Max’s operating subsidiaries technical
infrastructure are critical to their reputation and ability to attract and
retain users of their Internet services. Any system failure or performance
inadequacy that causes interruptions or delays in the availability of China
Wi-Max’s operating subsidiaries services or increases the response time of their
services could reduce user satisfaction and traffic, which would reduce the
Internet service appeal to users of “high speed” Internet access. As the number
of users and traffic increase, China Wi-Max operating subsidiaries cannot ensure
that they will be able to scale their systems proportionately. In addition, any
system failures and electrical outages could materially and adversely impact the
business.





If China
Wi-Max’soperating
subsidiariessuppliers of bandwidth and collocation services for switches, routers, and
servers fail to provide these services, their business could be materially
curtailed.





China
Wi-Max’s operating subsidiaries rely on partners to provide them with bandwidth
and collocation services for switches, routers, and servers for Internet users.
If partners fail to provide such services or raise prices for services, China
Wi-Max’s operating subsidiaries may not be able to find a reliable and
cost-effective substitute provider on a timely basis, if at all. If this
happens, their business could be materially curtailed.





RISK
FACTORS RELATED TO CHINA WI-MAX STOCK





China
Wi-Max was listed on the OTC Bulletin Board on September 4, 2009. China Wi-Max
cannot predict the extent to which a trading market will develop or how liquid
that market might become. Accordingly, holders of China Wi-Max’s common stock
may be required to retain their shares for an indefinite period of
time.





The OTCBB
is an inter-dealer, over-the-counter market that provides significantly less
liquidity than stock exchanges. Quotes for stocks included on the OTCBB are not
listed in the financial sections of newspapers, as are those for the exchanges.
Therefore, prices for securities traded solely on the OTCBB may be difficult to
obtain and holders of common stock may be unable to resell their securities at
or near their original acquisition price or at any price. Market prices for
China Wi-Max’s common stock will be influenced by a number of factors,
including:





·
            the
      issuance of new equity securities pursuant to future
    offering;





·
            changes
      in interest rates;





·
            new
      services or significant contracts and
  acquisitions;





·
            variations
      in quarterly operating results;





·
            change
      in financial estimates by securities
analysts;





·
            the
      depth and liquidity of the market for the Company’s common
      stock;





·
            investor
      perceptions of us and of China-based investments and companies generally;
      and





·
            general
      economic and other national and international
  conditions.





The regulation of penny
stocks by the SEC and FINRA may discourage the tradability and liquidity which
will impair investors’ ability to sell China Wi-Max’s
securities.





China
Wi-Max is a “penny stock” company.  None of its securities currently
trade in any market and, if ever available for trading, will be subject to a
Securities and Exchange Commission rule that imposes special sales practice
requirements upon broker-dealers who sell such securities to persons other than
established customers or accredited investors.  For purposes of the
rule, the phrase “accredited investors” means, in general terms, institutions
with assets in excess of $5,000,000, or individuals having a net worth in excess
of $1,000,000 or having an annual income that exceeds $200,000 (or that, when
combined with a spouse’s income, exceeds $300,000).  For transactions
covered by the rule, the broker-dealer must make a special suitability
determination of the purchaser and receive the purchaser’s written agreement to
the transaction prior to the sale.  Effectively, this discourages
broker-dealers from executing trades in penny stocks.  Consequently,
the rule will affect the ability of purchasers in this offering to sell their
securities in any market that might develop, because it imposes additional
regulatory burdens on penny stock transactions.




19





In
addition, the Securities and Exchange Commission has adopted a number of rules
to regulate “penny stocks”.  Such rules include Rules 3a51-1, 15g-1,
15g-2, 15g-3, 15g-4, 15g-5, 15g-6, 15g-7, and 15g-9 under the Securities and
Exchange Act of 1934, as amended.  Because China Wi-Max’s securities
constitute “penny stocks” within the meaning of the rules, the rules would apply
to us and to China Wi-Max’s securities.  The rules will further affect
the ability of owners of shares to sell their securities in any market that
might develop for them because it imposes additional regulatory burdens on penny
stock transactions.





Shareholders
should be aware that, according to Securities and Exchange Commission, the
market for penny stocks has suffered in recent years from patterns of fraud and
abuse.  Such patterns include (i) control of the market for the
security by one or a few broker-dealers that are often related to the promoter
or issuer; (ii) manipulation of prices through prearranged matching of purchases
and sales and false and misleading press releases; (iii) “boiler room” practices
involving high-pressure sales tactics and unrealistic price projections by
inexperienced sales persons; (iv) excessive and undisclosed bid-ask
differentials and markups by selling broker-dealers; and (v) the wholesale
dumping of the same securities by promoters and broker-dealers after prices have
been manipulated to a desired level, leaving investors with
losses.  China Wi-Max management is aware of the abuses that have
occurred historically in the penny stock market.  Although China
Wi-Max does not expect to be in a position to dictate the behavior of the market
or of broker-dealers who participate in the market, management will strive
within the confines of practical limitations to prevent the described patterns
from being established with respect to the its securities.





China Wi-Max has no plan to
pay dividends in the foreseeable future and investors may not expect a dividend
as a return of or on any investment in the Company.





China
Wi-Max has not paid dividends on its common stock and does not anticipate paying
such dividends in the foreseeable future.




20


Many of China Wi-Max’s
shares of common stock will be available for resale in the
future.  Rule 144 sales in the future may have a depressive effect on
China Wi-Max’s stock price which may cause investors losses.





All of
the outstanding shares of common stock held by the present officers, directors,
and affiliate stockholders are “restricted securities” within the meaning of
Rule 144 under the Securities Act of 1933, as amended.  As restricted
shares, these shares may be resold only pursuant to an effective registration
statement or under the requirements of Rule 144 or other applicable exemptions
from registration under the Act and as required under applicable state
securities laws.  We have filed a Form 10-12g registering shares held
by officers, directors and affiliates and such individuals are now able to sell
their shares after meeting the holding period requirements of Rule
144.  Rule 144 provides in essence that a person who is an affiliate
or officer or director who has held restricted securities for six months may,
under certain conditions, sell every three months, in brokerage transactions, a
number of shares that does not exceed the greater of 1.0% of a company’s
outstanding common stock or the average weekly trading volume during the four
calendar weeks prior to the sale.  There is no limit on the amount of
restricted securities that may be sold by a nonaffiliate after the owner has
held the restricted securities for a period of six months if the company is a
current, reporting company under the ‘34 Act.  A sale under Rule 144
or under any other exemption from the Act, if available, or pursuant to
subsequent registration of shares of common stock of present stockholders, may
have a depressive effect upon the price of the common stock in any market that
may develop.





China Wi-Max’s investors may
suffer future dilution due to issuances of shares for various considerations in
the future.





There may
be substantial dilution to China Wi-Max’s shareholders purchasing in future
offerings or issuances for other purposes as a result of future decisions of the
Board to issue shares without shareholder approval for cash, services, or
acquisitions.





The
shares of China Wi-Max’s common stock, quoted on the OTCBB, is thinly-traded on
the OTC Bulletin Board, meaning that the number of persons interested in
purchasing China Wi-Max’s common shares at or near ask prices at any given time
is relatively small or non-existent.  This situation is attributable
to a number of factors, including the fact that it is a small company which is
relatively unknown to stock analysts, stock brokers, institutional investors,
and others in the investment community that generate or influence sales volume,
and that even if China Wi-Max came to the attention of such persons, they tend
to be risk-averse and would be reluctant to follow an unproven, early stage
company such as China Wi-Max or purchase or recommend the purchase of any of
China Wi-Max Securities until such time as it became more seasoned and
viable.  As a consequence, there are periods of several days or more
when trading activity in China Wi-Max’s Securities is minimal or non-existent,
as compared to a seasoned issuer which has a large and steady volume of trading
activity that will generally support continuous sales without an adverse effect
on the Securities price.  China Wi-Max cannot give investors any
assurance that a broader or more active public trading market for its common
securities will develop or be sustained, or that any trading levels will be
sustained.  Due to these conditions, China Wi-Max can give investors
no assurance that they will be able to sell their shares at or near ask prices
or at all if they need money or otherwise desire to liquidate their securities
of China Wi-Max.




21


China
Wi-Max’s common stock is volatile, which substantially increases the risk that
the investor may not be able to sell securities at or above the price that the
investor may pay for the security.





Because
of the limited trading market for China Wi-Max’s common stock and because of the
possible price volatility, the investor may not be able to sell their shares of
common stock when the investor desires to do so.  The inability to
sell securities in a rapidly declining market may substantially increase the
risk of loss because of such illiquidity and because the price for China Wi-Max
Securities may suffer greater declines because of China Wi-Max price
volatility.





Certain
factors, some of which are beyond China Wi-Max’s control, that may cause China
Wi-Max’s share price to fluctuate significantly include, but are not limited to
the following:





·
            Variations
      in China Wi-Max quarterly operating
results;


·
            Loss
      of a key relationship or failure to complete significant
      transactions;


·
            Additions
      or departures of key personnel; and


·
            Fluctuations
      in stock market price and volume.





Additionally,
in recent years the stock market in general, and the over-the-counter markets in
particular, have experienced extreme price and volume
fluctuations.  In some cases, these fluctuations are unrelated or
disproportionate to the operating performance of the underlying
company.  These market and industry factors may materially and
adversely affect China Wi-Max stock price, regardless of China Wi-Max operating
performance.  In the past, class action litigation often has been
brought against companies following periods of volatility in the market price of
those companies common stock.  If it becomes involved in this type of
litigation in the future, it could result in substantial costs and diversion of
management attention and resources, which could have a further negative effect
on the investment in China Wi-Max’s stock.





ITEM 1B. UNRESOLVED STAFF
COMMENTS





Not
Applicable.





ITEM
2.  PROPERTIES




China
Wi-Max’s operations are principally located at 1905 Sherman Street, Suite 335,
Denver, Colorado 80203.   As of December 31, 2009, the
Company’s lease for the use of the offices at 1905 Sherman Street is month to
month.  The monthly rental approximates $1,100.





Da Chuan
leases office space in Beijing, China on a month-to-month basis for
approximately $5,400 per month.





ITEM 3.  LEGAL
PROCEEDINGS





China
Wi-Max anticipates that it (including any subsidiaries) will from time to time
become subject to claims and legal proceedings arising in the ordinary course of
business.  It is not feasible to predict the outcome of any such
proceedings and China Wi-Max cannot assure that their ultimate disposition will
not have a materially adverse effect on China Wi-Max business, financial
condition, cash flows or results of operations.  There are no such
claims or legal proceedings as of December 31, 2009.





ITEM
4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY
HOLDERS





No
matters were submitted during the period covered by this report to a vote of
security holders of the Company, through the solicitation of proxies or
otherwise.




22


PART
II




ITEM 5. MARKET FOR
REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF
EQUITY SECURITIES





Market
Information





China
Wi-Max is listed on the over-the-counter bulletin board trading facility
(“OTCBB”) China Wi-Max began trading on September 4, 2009. The Company cannot
assure that its shares will trade at or above the Company’s net asset
value.





Holders





There are
approximately 90 holders of record of China Wi-Max common stock as of December
31, 2009.





Dividend
Policy





Holders
of China Wi-Max common stock are entitled to receive such dividends as may be
declared by China Wi-Max’s Board of Directors.  China Wi-Max has not
declared or paid any dividends on China Wi-Max common shares and does not plan
on declaring any dividends in the near future.  China Wi-Max currently
intends to use all available funds to finance the operation and expansion of its
business.





Shares
Eligible for Future Sale





As of
December 31, 2009, China Wi-Max currently has 14,654,004 shares of common stock
outstanding.  A current shareholder who is an “affiliate” of China
Wi-Max, defined in Rule 144 as a person who directly, or indirectly through one
or more intermediaries, controls, or is controlled by, or is under common
control with China Wi-Max will be required to comply with the resale limitations
of Rule 144.  Of these shares a total of 10,535,002 shares have been
held for six months or more and are eligible for resale under Rule 144 assuming
the Company has been a reporting company for 90 days.  Sales by
affiliates will be subject to the volume and other limitations of Rule 144,
including certain restrictions regarding the manner of sale, notice
requirements, and the availability of current public information about China
Wi-Max.  The volume limitations generally permit an affiliate to sell,
within any three month period, a number of shares that does not exceed the
greater of one percent of the outstanding shares of common stock or the average
weekly trading volume during the four calendar weeks preceding his
sale.  A person who ceases to be an affiliate at least three months
before the sale of restricted securities beneficially owned for at least two
years may sell the restricted securities under Rule 144 without regard to any of
the Rule 144 limitations.





Recent
Sales of Unregistered Securities





Sales of Unregistered
Securities




During
2009 several persons who had purchased our Convertible Notes in prior years
exercised their right to convert $1,596,624 due under the notes into 3,193,248
shares of Common Stock.





During
the year 2009 we issued 1,900,000 shares of our Common Stock and granted options
to purchase up to 4,075,000 shares of Common Stock to seven bona fide employees
or consultants to the Company for services in transactions exempt from
registration under Section 4(2) of the Securities Act of 1933 and comparable
provisions of State securities laws. A total of 975,000 options were immediately
exercisable and the balance are exercisable over three years, or upon the
achievement of performance milestones. The exercise price is $0.25 per
share.





During
2009 we sold Convertible Notes due December 31, 2009 to accredited investors
pursuant to transactions exempt from registration under Section 4(2) of the
Securities Act of 1933 and comparable provisions of State securities laws. A
total of $433,111 of the Notes are convertible into 1,732,444 shares of Common
Stock at $0.25 per share and a total of $118,279 of the Notes are convertible
into 236,559 shares of Common Stock at $0.50 per share.




23





These
transactions are summarized in the following table.





Date
      of Transaction
            
            Title
      of Securities
            
            Number
      of Shares
            
            
            Consideration
            
            Class
      of PurchaserVarious
      in 2009
            
            Conversion
      of Notes1
            
            
            3,193,248
            
            
            $
            1,596,624
            
            Existing
      Note holdersVarious
      in 2009
            
            Common
      Stock
            
            
            1,900,000
            
            
            Services
            
            Employees
      and ConsultantsVarious
      in 2009
            
            Options2
            
            
            4,075,000
            
            
            Services
            
            Employees
      and ConsultantsVarious
      in 2009
            
            Convertible
      Notes3
            
            
            
            
            
            $
            433,111
            
            Accredited
      InvestorsVarious
      in 2009
            
            Convertible
      Notes4
            
            
            
            
            
            $
            118,279
            
            Accredited
      Investors







1 Holders
of Convertible Notes converted their Notes into Common Stock at $0.25 per
share.





2 Options
are immediately exercisable to purchase up to 875,000 shares of Common Stock at
$0.25 per share.


3
Convertible Notes are exercisable at $0.25 per share.


4
Convertible Notes are exercisable at $0.50 per share.




Exemption From Registration
Claimed




All of
the sales by us of our unregistered securities were made in reliance upon
Section 4(2) of the Securities Act of 1933, as amended (the “1933
Act”).  The persons or entities listed above that purchased
unregistered securities were existing shareholders or other persons, known to us
and our management, through pre-existing business relationships, as a long
standing business associate.  Each was provided access to all material
information, which he or it requested, and all information necessary to verify
such information and was afforded access to our management in connection with
the purchases.  The purchaser of the unregistered securities acquired
such securities for investment and not with a view toward distribution,
acknowledging such intent to us. All certificates or agreements representing
such securities that were issued contained restrictive legends, prohibiting
further transfer of the certificates or agreements representing such securities,
without such securities either being first registered or otherwise exempt from
registration in any further resale or disposition.




ITEM 6.  SELECTED
FINANCIAL DATA





Not
applicable.








ITEM
7.  MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS





The
following discussion is intended to provide an analysis of China Wi-Max’s
financial condition and should be read in conjunction with China Wi-Max’s
financial statements and the notes thereto set forth herein.  The
matters discussed in these sections that are not historical or current facts
deal with potential future circumstances and developments.  China
Wi-Max actual results could differ materially from the results discussed in the
forward-looking statements.  Factors that could cause or contribute to
such differences include those discussed below.





Plan
of Operations





China
Wi-Max plans to be a telecommunications broadband provider focused on providing
commercial customers with high bandwidth connections through first and second
tier markets in China through subsidiary companies.  Through these
wholly and partially owned subsidiaries, China Wi-Max intends to build, own, and
operate metropolitan area Internet Protocol (IP) based broadband networks, using
both owned optical fiber and licensed Wi-Max capable wireless
spectrum.





China
Wi-Max operating subsidiaries networks are designed to provide the reliability,
redundancy, scalability, and other features expected of a carrier class
network.  China Wi-Max believes its operating subsidiaries can bypass
the local loop facilities of the local exchange carrier to connect enterprise
customers directly to the global communications network.  At this
time, China Wi-Max has six full-time employees in the United States, augmented
by a number of personnel in operating subsidiaries, contract personnel and
professional services organizations.




24





Service
to customers is provided through direct connections to the optical fiber or
transmissions over licensed radio spectrum provided through China Wi-Max’s
Chinese operating subsidiaries.  Currently, the Company’s operating
subsidiaries are offering customers high speed broadband Internet access in a
pilot program.   Services contemplated to be offered in the
future include Voice-over Internet Protocol, or VoIP, bandwidth on demand,
bandwidth redundancy, virtual private networks, or VPNs, disaster recovery,
bundled data, and video services.





During
2009, the Company continued to put in place the structure and resources
necessary to provide the services contemplated in its business
plan.  The Company put into place the corporate structure of
subsidiaries, licenses and contract relationships necessary to provide services
in China.  Audit work and filings with the United States Securities
and Exchange Commission were successfully completed to position the Company to
become a trading company on the Over The Counter Bulletin Board
exchange.  Initial office space  and personnel resources
were obtained in China.





The
addition of customers will require additional capital to acquire access to new
buildings, purchase and install equipment, etc.  The Company is also
pursuing opportunities to utilize its wireless assets to provide last mile
bridging services for potential customers.  The Company also plans to
initialize its network assets in Hangzhou. This project timing will be dependant
our ability to raise sufficient capital to proceed.  We are optimistic
about the opportunity in China, but recognize how difficult it is to raise
capital necessary to carry out the Company's plans.





25




In the
continuance of our business operations, we do not intend to purchase or sell any
significant assets and we do not expect a significant change in the number of
employees, until additional capital is raised.
 
 RESULTS
OF OPERATIONS
 
 For
The Year Ended December 31, 2009 Compared to the Year Ended December 31,
2008
 
 During
the year ended December 31, 2009, China Wi-Max incurred general and
administrative expenses of $2,805,474 compared to $1,520,271 for the year ended
December 31, 2008. The $1,285,203 increase was primarily the result of an
increase in the Company’s operational activities compared to the prior period.
During the year ended December 31, 2009, the Company increased use of outside
consultants, as it continued implementation of its business plan. The period
over period increase was primarily a result of the staff increases, with an
increase of $405,000 in salary and wages, increased consulting and professional
fees of $552,000, expenses for operations in China increased of $207,000 and
increased travel expense of $63,000. During the year ended December 31, 2009,
China Wi-Max incurred $475,000 in expenses related to common stock and expense
of $336,361 in options issued as payment for services totaling $811,361 compared
to $324,275 for the year ended December 31, 2008.
 
 During
the year ended December 31, 2009, China Wi-Max recognized a net loss of
$3,108,512 compared to a net loss of $1,716,195 during the year ended December
31, 2008. The $1,392,317 increase in net losses was primarily the result of the
$1,285,203 increase in general and administrative expenses, discussed above
combined with the $107,114 increase in interest expense as a result of the
issuance of convertible promissory notes discussed below.
 
 China
Wi-Max’s basic loss per share was $0.24 during the year ended December 31, 2009
versus a net loss per share of $0.17 during the year ended December 31,
2008.
 
 Liquidity
and Capital Resources For the Year Ended December 31, 2009 and the Year Ended
December 31, 2008
 
 Cash flow
from operations has not historically been sufficient to sustain China Wi-Max’s
operations without additional sources of capital. At December 31, 2009, the
Company had total current assets of $86,909, consisting of cash of $34,524 and
prepaid expenses of $52,385. At December 31, 2009, the Company had total current
liabilities of $4,251,590. Total current liabilities consist of accounts payable
of $357,577, accrued interest of $425,189 and current convertible notes payable
of $3,468,824. At December 31, 2009, the Company had a working capital deficit
of $4,164,680.
 
 During
the year ended December 31, 2009, China Wi-Max used $1,698,944 in its operating
activities. The net loss of $3,108,512 was adjusted for $475,000 of services
paid for by the issuance of common stock, $73,491 of accrued interest converted
to stock, $336,361 in non-cash option expenses, depreciation of $27,448 and
$20,378 in amortization. During the year ended December 31, 2009, there was a
$28,544 increase in prepaid expenses, a $38,139 decrease in other assets, a
$237,747 increase in accounts payable and a $229,548 increase in accrued
interest.
 
 During
the year ended December 31, 2008, China Wi-Max used $1,172,914 in its operating
activities. The net loss of $1,716,195 was adjusted for $221,000 of services
paid for by the issuance of common stock, $13,753 of accrued interest converted
to stock, $103,275 in non-cash option expenses, depreciation of $6,323 and
$3,162 in amortization of debt issuance costs. During the year ended December
31, 2008, there was a $15,822 increase in prepaid expenses, a $32,329 increase
in accounts payable and a $179,261 increase in accrued interest.


26





During
the year
ended  December  31,  2009,  China  Wi-Max
used  $9,850 in its investing  activities,  Most
was for purchases of network equipment.





During
the year
ended  December  31,  2008,  China  Wi-Max
used  $384,008 in its investing  activities,  of
which $205,133 was for purchases of optical fiber and $178,875  was
used  primarily  for deposits for
the  acquisition  of  long-lived
assets,  which relate to the  acquisition  of
business and wireless  licenses in Beijing, Hangzhou and Shanghai,
China.





During
the year ended December 31, 2009,  China Wi-Max
received  $1,596,624 from
its  financing  activities.  During year
ended  December 31, 2008,  China Wi-Max received $1,522,410
from its financing activities. During the first quarter of 2010, the Company
raised an additional $211,500 in exchange for 10% convertible
notes.





In June
2007, the Board of Directors authorized the sale of up to $1 million of
unsecured convertible promissory notes. Principal and interest are convertible
at any time into shares of China Wi-Max’s common stock at $0.25 per share, at
the option of the note holders. As of January 2008, the Company oversubscribed
the offering and issued $1,004,300 of notes payable, which mature on December
31, 2008, bear interest at 12% per annum, and are unsecured. During the year
ended December 31, 2008, China Wi-Max issued an additional $1,429,800 in
unsecured convertible promissory notes, which mature on December 31, 2009,
bearing interest at 10% per annum, and are unsecured. Principal and interest are
convertible at any time into shares of China Wi-Max’s common stock at $0.50 per
share, at the option of the promissory note holders. China Wi-Max has not paid
nor is any principal or interest due on these notes. As of December 31, 2009,
there is $3,468,824 in outstanding convertible notes payable and accrued
interest of $425,189.
 
 During
the year ended December 31, 2009, China Wi-Max issued 1,900,000 shares of its
common stock to individuals as employment signing bonuses and payments for
services performed for China Wi-Max, valued at $475,000. In addition, China
Wi-Max issued 1,732,447 shares for the conversion of $367,900 in principal and
$65,212 in interest of the notes issued in 2007, convertible at $.25 per share.
China Wi-Max also issued 236,532 shares for the conversion of $110,000 in
principal and $8,266 in interest of the notes issued in 2008, convertible at
$.50 per share.
 
 During
the year ended December 31, 2008, China Wi-Max issued 884,000 shares of its
common stock to individuals as employment signing bonuses and payments for
services performed for China Wi-Max, valued at $221,000. In addition, China
Wi-Max issued 391,002 shares for the conversion of $84,000 in principal and
$13,753 in interest of the notes issued in 2007, convertible at $.25 per
share.




Going
Concern




The
independent registered public accounting firm’s report on the Company’s
consolidated financial statements as of December 31, 2009 and 2008, includes a
“going concern” explanatory paragraph that describes substantial doubt about the
Company’s ability to continue as a going concern.




27


Critical
Accounting Policies





China
Wi-Max has identified the policies below as critical to China Wi-Max business
operations and the understanding of China Wi-Max results from
operations.  The impact and any associated risks related to these
policies on the Company’s business operations is discussed throughout
Management’s Discussion and Analysis of Financial Conditions and Results of
Operations where such policies affect China Wi-Max reported and expected
financial results.  For a detailed discussion on the application of
these and other accounting policies, see Note 2 in the Notes to the Consolidated
Financial Statements.  Note that China Wi-Max’s preparation of this
document requires China Wi-Max to make estimates and assumptions that affect the
reported amounts of assets and liabilities, disclosure of contingent assets and
liabilities at the date of China Wi-Max financial statements, and the reported
amounts of expenses during the reporting periods.  There can be no
assurance that actual results will not differ from those estimates.




Revenue
Recognition




China
Wi-Max follows very specific and detailed guidelines in measuring revenue;
however, certain judgments may affect the application of China Wi-Max revenue
policy.  Revenue results are difficult to predict, and any shortfall
in revenue or delay in recognizing revenue could cause China Wi-Max operating
results to vary significantly from quarter to quarter and could result in future
operating losses.




The
Company recognizes revenue pursuant to Securities and Exchange Commission, Staff
Accounting Bulletin (“SAB”) No. 101, Revenue Recognition in Financial
Statements, as amended by SAB No. 104 Revenue
Recognition.  Consistent with the requirements of these SABs, revenue
is recognized only when:  a) persuasive evidence of arrangement
exists, b) delivery has occurred, c) the seller’s price to the buyer
is fixed, and d) collection is reasonably assured.





Stock-based
Compensation




The
Company accounts for stock-based compensation through recognition of the cost of
employee services received in exchange for an award of equity instruments in the
financial statements and is measured based on the grant date fair value of the
award that is ultimately expected to vest during the period. The stock
compensation expense is recognized over the period during which an employee is
required to provide service in exchange for the award (the requisite service
period, which in the Company’s case is the same as the vesting
period).




Transactions
in which the Company issues stock-based compensation for goods or services
received from non-employees are accounted for based on the fair value of the
consideration received or the fair value of the equity instruments issued,
whichever is the more reliably measurable. The Company often utilizes pricing
models in determining the fair values of options and warrants issued as
stock-based compensations to non-employees. These pricing models utilize the
market price of the Company’s common stock and the exercise price of the option
or warrant, as well as time value and volatility factors underlying the
positions.




Long-Lived
Assets





Property
and equipment, which consists of fiber optic cable and network support
equipment, are stated at cost, less accumulated
depreciation.  Depreciation is calculated using the straight-line
method over the estimated useful lives ranging from five to twenty five
years.  Depreciation is commenced when the assets are placed in
service.  The economic lives are estimated at the time
assets  are  placed  in  service  and  are  based  on  industry  experience  and
anticipated technological or other changes.  If technological changes
were to occur more rapidly than anticipated or in a different form than
anticipated, the useful lives assigned to these assets may need to be shortened,
resulting in the recognition of increased depreciation expense in future
periods. The Company’s intangible asset, contractual license rights, represents
the Company rights to certain frequency licenses held by Gao Da. The Company
amortizes this intangible asset over the twenty-year term of the
agreement.  The Company evaluates this intangible asset for impairment
annually,  and between  annual  evaluations if
events or changes
in  circumstances  indicate  that
the  carrying  amount of the asset may not be
fully  recoverable.  In cases where required, an impairment
provision is recognized in an amount by which the carrying value exceeds the
estimated fair value of the asset.




28





Recoverability
of the contractual license rights is dependent upon the recoverability of the
underlying licenses of Gao Da. The underlying value of the frequency licenses
held by Gao Da is dependent on numerous factors, including successful deployment
of networks and connectivity, and/or radio links. The Company considers the
underlying licenses to have an indefinite useful life under the provisions of
Accounting Standards Codification (“ASC”) Topic 350. These licenses are
typically renewed if the licensee files a renewal application prior to license
expiration wherein the licensee demonstrates its engagement in supplying
services or related activities to satisfy the appropriate criteria for renewal.
If at any time the Company determines that these criteria will most likely not
be met or if there is a change in management’s future business plans or
disposition of one or more licenses underlying the contractual license rights,
the Company will first test the contractual license rights for impairment and
then the Company will modify the life of the contractual license rights and
begin amortizing the cost over the remaining underlying license period. The
Company also tests its long-lived assets for impairment if there are any legal,
regulatory, contractual, competitive, and economic or other factors that are
determined to limit the useful lives of the respective
assets.




In
assessing the recoverability of long-lived assets, the Company must make
assumptions regarding estimated future cash flows and other factors to determine
the fair value of the respective assets.  Long-lived assets are
evaluated for impairment whenever events or changes in circumstances indicate
that the carrying value may not be recoverable. An impairment loss is recognized
whenever (i) the estimated undiscounted future cash flows expected to result
from the use of the asset plus net proceeds  expected
from  disposition of the asset, if any, are less than
the  carrying  value of the  asset and (ii) the
fair  value of the asset is less than its
carrying  value.  When an impairment loss is identified, the
carrying value of the asset is reduced to its fair value.





Recently
Issued and Adopted Accounting Pronouncements





In
June 2009, the Financial Accounting Standards Board (“FASB”) approved the
FASB Accounting Standards Codification (“the Codification”) as the single source
of authoritative nongovernmental Generally Accepted Accounted Principles (GAAP).
All existing accounting standard documents, such as FASB, American Institute of
Certified Public Accountants, Emerging Issues Task Force and other related
literature, excluding guidance from the Securities and Exchange Commission
(“SEC”), have been superseded by the Codification. All other non-grandfathered,
non-SEC accounting literature not included in the Codification has become
non-authoritative. The Codification did not change GAAP, but instead introduced
a new structure that combines all authoritative standards into a comprehensive,
topically organized online database. The Codification became effective for the
Company in  September,, 2009, and
impacts the Company’s financial statements, as all references to authoritative
accounting literature is now referenced in accordance with the
Codification.





On
January 1, 2009, the Company adopted new accounting guidance related to the
accounting for business combinations and related disclosures.  This
new guidance addresses the recognition and accounting for identifiable assets
acquired, liabilities assumed, and non-controlling interests in business
combinations.  The guidance also establishes expanded disclosure
requirements for business combinations.  The Company will apply this
new guidance to future business combinations, if any.





On
January 1, 2009, the Company also adopted new accounting guidance related to the
accounting for non-controlling (minority) interests in consolidated financial
statements.  This guidance establishes accounting and reporting
standards for the non-controlling interest in a subsidiary and for the
deconsolidation of a subsidiary, and requires that non-controlling interests in
subsidiaries be reported in the equity section of the controlling company’s
balance sheet.  It also changes the manner in which the net income of
the subsidiary is reported and disclosed in the controlling company’s income
statement.  Because the Company’s subsidiaries are wholly-owned, there
are no non-controlling interests, and as a result, the adoption of this guidance
had no impact on the Company’s consolidated financial statements.





In May
2009, the FASB established general standards for accounting and disclosure of
events that occur after the balance sheet date but before the financial
statements are issued or are available to be issued. The pronouncement required
the disclosure of the date through which an entity has evaluated subsequent
events and the basis for that date, whether that date represents the date the
financial statements were issued or were available to be issued. In February
2010, the FASB amended this standard whereby SEC filers, like the Company, are
required by GAAP to evaluate subsequent events through the date its financial
statements are issued, but are no longer required to disclose in the financial
statements that the Company has done so or disclose the date through which
subsequent events have been evaluated.




29





In June
2009, the FASB issued FASB ASC 810-10-65 (Prior authoritative
literature:  SFAS No. 167,  Amendments to FASB Interpretation
No. 46(R)) which amends the consolidation guidance applicable to a
variable interest entity (“VIE”). This standard also amends the guidance
governing the determination of whether an enterprise is the primary beneficiary
of a VIE, and is therefore required to consolidate an entity, by requiring a
qualitative analysis rather than a quantitative analysis. Previously, the
standard required reconsideration of whether an enterprise was the primary
beneficiary of a VIE only when specific events had occurred. This standard is
effective for fiscal years beginning after November 15, 2009, and for
interim periods within those fiscal years. Early adoption is
prohibited.  The Company is  evaluating the impact, if any,
that this new guidance  may have on its consolidated financial
statements.





In August
2009, the FASB provided clarification when measuring liabilities at fair value
of a circumstance in which a quoted price in an active market for an identical
liability is not available. A reporting entity is required to measure fair value
using one or more of the following methods: 1) a valuation technique that
uses a) the quoted price of the identical liability when traded as an asset
or b) quoted prices for similar liabilities (or similar liabilities when
traded as assets) and/or 2) a valuation technique that is consistent with
the preexisting fair value guidance. It also clarifies that when estimating the
fair value of a liability, a reporting entity is not required to adjust to
include inputs relating to the existence of transfer restrictions on that
liability. The adoption of this guidance did not have a material impact on the
Company’s consolidated financial statements.





In
October 2009, the FASB issued an update to existing guidance on accounting for
arrangements with multiple deliverables. This update will allow companies to
allocate consideration received for qualified separate deliverables using
estimated selling price for both delivered and undelivered items when
vendor-specific objective evidence or third-party evidence is unavailable.
Additional disclosures discussing the nature of multiple element arrangements,
the types of deliverables under the arrangements, the general timing of their
delivery, and significant factors and estimates used to determine estimated
selling prices will be required. This guidance is effective prospectively for
interim and annual periods ending after June 15, 2010. The Company is
currently evaluating the impact this guidance may have, if any, on its
consolidated financial statement, but does not anticipate that this updated
guidance will have a material impact.





ITEM 7A. QUANTITATIVE AND
QUALITATIVE DISCLOSURES ABOUT MARKET RISK





China
Wi-Max’s operations do not employ financial instruments or derivatives which are
market sensitive.  Short term funds are held in non-interest bearing
accounts and funds held for longer periods are placed in interest bearing
accounts.  Large amounts of funds, if available, will be distributed
among multiple financial institutions to reduce risk of
loss.   Our cash holdings do not generate interest
income.





China
Wi-Max incurs expenses and liabilities in both Chinese Renminbi (RMB) and U.S.
dollars. Since 1994, the official exchange rate for the conversion of Chinese
RMB to U.S. dollars has generally been stable and the Chinese RMB has
appreciated slightly against the U.S. dollar. In the past year, the RMB has
appreciated quite rapidly against the dollar.  China Wi-Max has not
entered into agreements or purchased instruments to hedge its exchange rate
risks, although it may do so in the future. China Wi-Max’s results of operations
and financial condition may be negatively affected by changes in the value of
Chinese RMB.





ITEM 8.  FINANCIAL
STATEMENTS AND SUPPLEMENTARY DATA





The
audited financial statements of China Wi-Max Communications, Inc. for the years
ended December 31, 2009, and 2008, and for the period from July 5, 2006 through
December 31, 2009, appear as pages 32 through 42.




30





REPORT OF
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM





Board of
Directors


China
Wi-Max Communications, Inc.





We have
audited the accompanying consolidated balance sheets of China Wi-Max
Communications, Inc. and subsidiaries (a Development Stage Enterprise) (the
“Company”) as of December 31, 2009 and 2008, and the related consolidated
statements of operations, shareholders’ deficit, and cash flows for the years
ended December 31, 2009 and 2008, and the period from July 5, 2006 (inception)
through December 31, 2009. These consolidated financial statements are the
responsibility of the Company’s management. Our responsibility is to express an
opinion on these consolidated financial statements based on our
audits.
 
 We
conducted our audits in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the
consolidated financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the consolidated financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by the
management, as well as evaluating the overall consolidated financial statement
presentation. We believe that our audits provide a reasonable basis for our
opinion.
 
 In our
opinion, the consolidated financial statements referred to above present fairly,
in all material respects, the financial position of China Wi-Max Communications,
Inc. and subsidiaries as of December 31, 2009 and 2008, and the results of their
operations and their cash flows for the years ended December 31, 2009 and 2008,
and the period from July 5, 2006 (inception) through December 31, 2009, in
conformity with accounting principles generally accepted in the United States of
America.
 
 The
accompanying consolidated financial statements have been prepared assuming that
the Company will continue as a going concern. As discussed in Note 1 to the
consolidated financial statements, the Company reported a net loss of
approximately $3.1million during the year ended December 31, 2009, and has a
working capital deficiency and a shareholders’ deficit of approximately
$4.1million and $3.3million respectively, at December 31, 2009. In addition, the
Company has a limited operating history and no revenue producing operations.
These conditions raise substantial doubt about the Company’s ability to continue
as a going concern. Management’s plans with regard to these matters are also
described in Note 1. The consolidated financial statements do not include any
adjustments that might result from the outcome of this
uncertainty.




/s/ GHP
Horwath, P.C.


Denver,
Colorado








31




CHINA WI-MAX COMMUNICATIONS,
INC.


(A Development Stage
Enterprise)
  CONSOLIDATED BALANCE
SHEETS


ASSETSDecember
31,
              
              
              December
31,2009
              
              
              2008Current
    assets:Cash
              
              $
              34,524
              
              
              $
              147,889Prepaid
      expenses
              
              
              52,385
              
              
              
              23,841Total current
      assets
              
              
              86,909
              
              
              
              171,730Property and equipment,
      net
              
              
              514,731
              
              
              
              531,009Intangible assets and other,
      net
              
              
              305,678
              
              
              
              364,195820,409
              
              
              
              895,204$
              907,318
              
              
              $
              1,066,934LIABILITIES AND SHAREHOLDERS'
      DEFICITCurrent
      liabilities:Accounts
      payable
              
              $
              357,577
              
              
              $
              119,830Accrued
      interest
              
              
              425,189
              
              
              
              195,641Convertible notes
      payable
              
              
              3,468,824
              
              
              
              2,350,100Total liabilities (all
      current)
              
              
              4,251,590
              
              
              
              2,665,571Shareholders'
      deficit:Common stock; $.001 par value;
      100,000,000 shares authorized;14,654,004 and 10,785,002 shares
      issued and outstanding as ofDecember 31, 2009 and December 31,
      2008, respectively
              
              
              14,654
              
              
              
              10,785Additional paid-in
      capital
              
              
              1,892,931
              
              
              
              534,048Accumulated other comprehensive
      income
              
              
              25,978
              
              
              
              25,853Deficit accumulated during the
      development stage
              
              
              (5,277,835
              )
              
              
              (2,169,323
              )Total shareholders'
      deficit
              
              
              (3,344,272
              )
              
              
              (1,598,637
              )$
              907,318
              
              
              $
              1,066,934




See
notes to consolidated financial statements.






32


CHINA WI-MAX COMMUNICATIONS,
INC.
 (A Development Stage
Enterprise)
  CONSOLIDATED STATEMENTS OF OPERATIONS
AND COMPREHENSIVE LOSS


Period fromJuly 5,
2006(inception)throughYear Ended December
      31
              
              
              December
31,2009
              
              
              2008
              
              
              2009Operating
      expenses:General
      and administrative expense
              
              $
              (2,805,474
              )
              
              $
              (1,520,271
              )
              
              $
              (4,760,385
              )Operating
    loss
              
              
              (2,805,474
              )
              
              
              (1,520,271
              )
              
              
              (4,760,385
              )Other
    expense:Interest
      expense
              
              
              (303,038
              )
              
              
              (195,924
              )
              
              
              (517,450
              )Net loss
              
              
              (3,108,512
              )
              
              
              (1,716,195
              )
              
              
              (5,277,835
              )Foreign currency translation
      gain
              
              
              125
              
              
              
              25,853
              
              
              
              25,978Comprehensive
      loss
              
              $
              (3,108,387
              )
              
              $
              (1,690,342
              )
              
              $
              (5,251,857
              )Basic and diluted net loss per
      share
              
              $
              (0.24
              )
              
              $
              (0.17
              )Weighted average number of
      commonshares
      outstanding
              
              
              13,109,534
              
              
              
              10,087,814


See notes
to consolidated financial statements.






33


CHINA WI-MAX COMMUNICATIONS,
INC.
 (A Development Stage
Enterprise)
  CONSOLIDATED STATEMENTS OF SHAREHOLDERS'
DEFICIT
  PERIODS FROM JULY 5, 2006 (INCEPTION)
THROUGH DECEMBER 31, 2009


Accumulated
              
              
              DeficitAdditional
              
              
              other
              
              
              accumulated
              
              
              TotalCommon
stock
              
              
              paid-in
              
              
              comprehensive
              
              
              during the
              
              
              shareholders'Shares
              
              
              Amount
              
              
              capital
              
              
              income
              
              
              development
      stage
              
              
              deficitCommon
      stock issued for cash between July 5, 2006 (inceptionand
      December 31, 2006 at par value ($0.001 per share)
              
              
              3,825,000
              
              
              $
              3,825
              
              
              $
              -
              
              
              $
              -
              
              
              $
              -
              
              
              $
              3,825Net loss
              
              
              
              
              
              
              
              
              
              
              -
              
              
              
              -
              
              
              
              (8,538
              )
              
              
              (8,538
              )Balances, December 31,
      2006
              
              
              3,825,000
              
              
              
              3,825
              
              
              
              -
              
              
              
              -
              
              
              
              (8,538
              )
              
              
              (4,713
              )Common
      stock issued for cash between January andJune 2007 at par
      value ($0.001 per share)
              
              
              5,230,000
              
              
              
              5,230
              
              
              
              -
              
              
              
              -
              
              
              
              -
              
              
              
              5,230Common
      stock issued for cash between June andDecember 2007 at par
      value ($0.001 per share)
              
              
              260,000
              
              
              
              260
              
              
              
              -
              
              
              
              -
              
              
              
              -
              
              
              
              260Common stock issued for services,
      valued at $0.25 per share
              
              
              455,000
              
              
              
              455
              
              
              
              113,295
              
              
              
              -
              
              
              
              -
              
              
              
              113,750Net loss
              
              
              -
              
              
              
              -
              
              
              
              -
              
              
              
              -
              
              
              
              (444,590
              )
              
              
              (444,590
              )Balances, December 31,
      2007
              
              
              9,770,000
              
              
              
              9,770
              
              
              
              113,295
              
              
              
              -
              
              
              
              (453,128
              )
              
              
              (330,063
              )Shares of common stock cancelled
      at par value
              
              
              (260,000
              )
              
              
              (260
              )
              
              
              -
              
              
              
              -
              
              
              
              -
              
              
              
              (260
              )Common stock issued for services,
      valued at $0.25 per share
              
              
              884,000
              
              
              
              884
              
              
              
              220,116
              
              
              
              -
              
              
              
              -
              
              
              
              221,000Common stock issued upon
      conversion of notes and accrued interest in December 2008, valued at $0.25
      per share
              
              
              391,002
              
              
              
              391
              
              
              
              97,362
              
              
              
              -
              
              
              
              -
              
              
              
              97,753Fair value of options vested
      during the year
              
              
              -
              
              
              
              -
              
              
              
              103,275
              
              
              
              -
              
              
              
              -
              
              
              
              103,275Net loss
              
              
              -
              
              
              
              -
              
              
              
              -
              
              
              
              -
              
              
              
              (1,716,195
              )
              
              
              (1,716,195
              )Other comprehensive income
      adjustments, gain on foreign currency translation
              
              
              -
              
              
              
              -
              
              
              
              -
              
              
              
              25,853
              
              
              
              -
              
              
              
              25,853Balances, December 31,
      2008
              
              
              10,785,002
              
              
              
              10,785
              
              
              
              534,048
              
              
              
              25,853
              
              
              
              (2,169,323
              )
              
              
              (1,598,637
              )Common stock issued for
      services
              
              
              1,900,000
              
              
              
              1,900
              
              
              
              473,100
              
              
              
              -
              
              
              
              -
              
              
              
              475,000Common stock issued upon
      conversion of notes and accrued interest
              
              
              1,969,002
              
              
              
              1,969
              
              
              
              549,422
              
              
              
              -
              
              
              
              -
              
              
              
              551,391Fair value of options vested
      during the year
              
              
              -
              
              
              
              -
              
              
              
              336,361
              
              
              
              -
              
              
              
              -
              
              
              
              336,361Net loss
              
              
              -
              
              
              
              -
              
              
              
              -
              
              
              
              -
              
              
              
              (3,108,512
              )
              
              
              (3,108,512
              )Other comprehensive income
      adjustments, gain on foreign currency translation
              
              
              -
              
              
              
              -
              
              
              
              -
              
              
              
              125
              
              
              
              -
              
              
              
              125Balances, December 31,
      2009
              
              
              14,654,004
              
              
              $
              14,654
              
              
              $
              1,892,931
              
              
              $
              25,978
              
              
              $
              (5,277,835
              )
              
              $
              (3,344,272
              )




See notes
to consolidated financial statements.




34




CHINA WI-MAX
COMMUNICATIONS,INC.


(A Development Stage
Enterprise)




CONSOLIDATED STATEMENTS OF CASH
FLOWS


Period fromJuly 5,
2006(Inception)Year Ended December
      31
              
              
              through2009
              
              
              2008
              
              
              December 31,
      2009Cash flows from operating
      activities:Net loss
              
              $
              (3,108,512
              )
              
              $
              (1,716,195
              )
              
              $
              (5,277,835
              )Adjustments to reconcile net loss
      to net cashused in operating
      activities:Common stock issued for
      services
              
              
              475,000
              
              
              
              221,000
              
              
              
              809,750Accrued interest converted to
      common stock
              
              
              73,491
              
              
              
              13,753
              
              
              
              87,244Non-cash stock option
      expense
              
              
              336,361
              
              
              
              103,275
              
              
              
              439,636Depreciation
              
              
              27,448
              
              
              
              6,323
              
              
              
              33,770Amortization
              
              
              20,378
              
              
              
              3,162
              
              
              
              25,649Changes in assets and
      liabilities:Increase in prepaid
      expenses
              
              
              (28,544
              )
              
              
              (15,822
              )
              
              
              (52,385
              )Decrease in other
      assets
              
              
              38,139
              
              
              
              -
              
              
              
              38,139Increase in accounts
      payable
              
              
              237,747
              
              
              
              32,329
              
              
              
              357,577Increase in accrued
      interest
              
              
              229,548
              
              
              
              179,261
              
              
              
              425,189Net cash used in operating
      activities
              
              
              (1,698,944
              )
              
              
              (1,172,914
              )
              
              
              (3,113,266
              )Cash flows from investing
      activities:Purchase of property and
      equipment
              
              
              (9,850
              )
              
              
              (205,133
              )
              
              
              (521,329
              )Purchase of intangible
      assets
              
              
              -
              
              
              
              (178,875
              )
              
              
              (364,195
              )Net cash used in investing
      activities
              
              
              (9,850
              )
              
              
              (384,008
              )
              
              
              (885,524
              )Cash flows from financing
      activities:Proceeds from issuance of
      convertible notes payable
              
              
              1,596,624
              
              
              
              1,520,100
              
              
              
              4,030,724Proceeds from
      issuance  of common stock
              
              
              -
              
              
              
              2,310
              
              
              
              9,055Debt issue
      costs
              
              
              -
              
              
              
              -
              
              
              
              (5,270
              )Net cash provided by financing
      activities
              
              
              1,596,624
              
              
              
              1,522,410
              
              
              
              4,034,509Effect of exchange rate changes on
      cash
              
              
              (1,195
              )
              
              
              -
              
              
              
              (1,195
              )Net (decrease) increase in
      cash
              
              
              (113,365
              )
              
              
              (34,512
              )
              
              
              34,524Cash, beginning of
      period
              
              
              147,889
              
              
              
              182,401
              
              
              
              -Cash, end of
      period
              
              $
              34,524
              
              
              $
              147,889
              
              
              $
              34,524Supplemental disclosure of
      non-cash investing and financing
      activities:Convertible notes and accrued
      interest converted to common stock
              
              $
              551,391
              
              
              $
              97,753
              
              
              $
              649,144






See notes
to consolidated financial statements.




35






CHINA
WI-MAX COMMUNICATIONS, INC.


(A
Development Stage Enterprise)


NOTES TO
CONSOLIDATED FINANCIAL STATEMENTS


PERIODS
ENDED DECEMBER 31, 2009 AND 2008





1.   Organization,
basis of presentation, going concern and management’s plans:





Organization
and basis of presentation:





China
Wi-Max Communications, Inc. (the “Company”) is a development stage
telecommunications broadband provider. The Company is a Nevada corporation
formed in July 2006, and is focused on providing commercial customers with high
bandwidth connections throughout first and second tier markets in China. For
accounting purposes, the Company is classified as a development stage
enterprise.
 
 The
Company plans to build, own, and operate metropolitan area Internet Protocol
(IP)-based broadband networks using a combination of Company-owned optical fiber
and licensed Wi-Max (Worldwide Interoperability for Microwave Access) capable
wireless spectrum. These networks are designed to provide the reliability,
redundancy, scalability, and other features expected of a carrier class network.
The Company intends to provide value-added services such as IP transport,
Internet Service Provider (ISP) services, and broadband internet access. The
Company plans to position itself to bypass the local loop facilities of the
current local exchange carriers to connect enterprise customers directly to a
global communications network.
 
 In
September 2008, the Company effectuated the formation and control of two
wholly-owned subsidiaries in China: Beijing Yuan Shan Da Chuan Business
Development Ltd. (“Da Chuan”) and Beijing Yuan Shan Shi Dai Technology Ltd.
(“Shi Dai”). Da Chuan has contractual agreements with two local Chinese
companies to use licenses to deliver “Value Added Telecommunications Services”
(Note 4). Shi Dai owns optical fiber assets located in Beijing and Hangzhou; Shi
Dai’s purchases of optical fiber assets were made at the direction of and with
funding from China Wi-Max prior to consolidation. The Company began initial
operation of its network in Beijing in 2008, but has not generated any revenue
to date.
 
 The
Company’s financial statements as of December 31, 2009 and 2008, and for the
year ended December 31, 2009, and the periods from September 24, 2008 (the date
at which the Company gained 100% ownership of Da Chuan and Shi Dai) through
December 31, 2008 and 2009, include the accounts of Da Chuan and Shi Dai.
Intercompany balances and transactions have been eliminated in
consolidation.
 
 The
Company’s foreign subsidiaries (Da Chuan and Shi Dai) are located in China, and
foreign transactions are conducted in currencies other than the U.S. dollar,
primarily the Chinese Renmimbi (RMB). Da Chuan and Shi Dai financial statements
are maintained in the functional currency. For financial reporting purposes, the
financial statements of the subsidiaries have been translated into United States
(U.S.) dollars. Assets and liabilities are translated into U.S. dollars at
year-end exchange rates. Income and expense items are translated at
weighted-average rates of exchange prevailing during the year. Any resulting
translation adjustments are charged or credited
to other comprehensive income in shareholders’ deficit. Gains and losses on
foreign currency transactions are included in other income and
expense.
 
 The
Company is exposed to movements in foreign currency exchange rates. In addition,
the Company is subject to risks including adverse developments in the foreign
political and economic environment, trade barriers, managing foreign operations
and potentially adverse tax consequences. There can be no assurance that any of
these factors will not have a material negative impact on the Company’s
financial condition or results of operations in the future.
 
 Going
concern and management’s plans:
 
 The
accompanying financial statements have been prepared on a going concern basis,
which contemplates the realization of assets and the settlement of liabilities
and commitments in the normal course of business. The Company reported a net
loss of approximately $3,109,000 for the year ended December 31, 2009, and a
working capital deficiency and shareholders’ deficit of approximately $4,165,000
and $3,344,000, respectively, at December 31, 2009. The Company has a limited
operating history and no current revenue producing operations. In addition, the
Company does not have a revolving loan agreement with any financial institution,
nor can the Company provide any assurance it will be able to enter into any such
agreement in the future, or be able to raise funds through a future issuance of
debt or equity. These factors raise substantial doubt about the Company’s
ability to continue as a going concern. The financial statements do not include
any adjustments relating to the recoverability and classification of assets or
the amounts and classification of liabilities that might be necessary should the
Company be unable to continue as a going concern.


36





The
Company’s continuance as a going concern is dependent on its future
profitability and on the on-going support of its shareholders and creditors. In
order to mitigate the going concern issues, the Company is continuing its
efforts to raise capital. The Company raised approximately $211,500 during the
first quarter of 2010 in exchange for 10% convertible notes (Note 5). The
Company is planning a $1million to $5 million private placement of stock in mid
2010. However, additional financing may not be available in amounts or on terms
acceptable to the Company or at all. As a consequence, if the Company is unable
to obtain any additional financing in the near term, the Company will be
required to delay its business plan implementation, and/or the Company may be
required to cease operations in order to offset the lack of available funding,
which would have a material adverse impact on the Company.
 
 2.
Summary of significant accounting policies:
 
 Use of
estimates in the preparation of financial statements:
 
 The
preparation of financial statements in conformity with accounting principles
generally accepted in the United States of America requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of revenues and expenses
during the reporting periods. Actual results could differ from those estimates.
  Property
and equipment:





Property
and equipment are stated at cost, and  depreciation is provided by use
of the  straight-line  method over
the  estimated  useful  lives of the related
assets. Major improvements are capitalized,  while expenditures for
repairs and maintenance are expensed when incurred.  Estimated useful
lives of property and equipment are as follows:





Fiber optic cable
            25
      yearsNetwork
      support equipment
            5
      years





Impairment
of long-lived assets:




Management
assesses the carrying values of long-lived assets for impairment when
circumstances indicate that such amounts may not be recoverable from future
operations. Generally, assets to be held and used are considered impaired if the
sum of expected undiscounted future cash flows is less than the carrying amount
of the asset. Management does not believe any impairment has occurred as of
December 31, 2009. The accounting estimates for the Company’s long-lived assets
require management to make significant assumptions about fair value.
Management’s assumptions regarding fair value require significant judgments
about economic factors, industry factors and technology considerations, as well
as about the Company’s business prospects. Changes in these judgments may have a
significant effect on the estimated fair values of the Company’s long-lived
assets and could result in an impairment charge that could have a material
adverse effect on the Company’s statements of position and results of
operations.




Debt
issue costs:





Debt
issue costs of  approximately  $5,000 were fully amortized
to interest expense on a straight-line  basis over the term of the
related debt,  which matured in December 2008 (Note 5).




Fair
value of financial instruments:





The fair
value of the  Company’s  cash,  accounts payable
and convertible  notes approximate  their carrying amounts
due to the short maturities of these instruments.





Revenue
recognition:





As of
December 31, 2009, the Company has no revenue-producing operations. When revenue
generating operations begin, the Company will recognize revenue pursuant to
Securities and Exchange Commission, Staff Accounting Bulletin (“SAB”) No. 101,
Revenue Recognition in Financial Statements, as amended by SAB No. 104, Revenue
Recognition. Consistent with the requirements of these SABs, revenue will be
recognized only when: a) persuasive evidence of arrangement exists, b) delivery
has occurred, c) the seller’s price to the buyer is fixed, and d) collectability
is reasonably assured.
  37
 
 Loss per
share:
 
 Basic
loss per share of common stock is computed based on the weighted average number
of common shares outstanding during the year. Stock options and common shares
issuable upon the conversion of debt securities (11,542,292 at December 31, 2009
and 7,178,300 at December 31, 2008) are not considered in the calculation, as
the effect would be antidilutive. Therefore, diluted loss per share is
equivalent to basic loss per share.
  Recently
issued and adopted accounting pronouncements:





In
June 2009, the Financial Accounting Standards Board (“FASB”) approved the
FASB Accounting Standards Codification (“the Codification”) as the single source
of authoritative nongovernmental Generally Accepted Accounting Principles
(GAAP). All existing accounting standard documents, such as FASB, American
Institute of Certified Public Accountants, Emerging Issues Task Force and other
related literature, excluding guidance from the Securities and Exchange
Commission (“SEC”), have been superseded by the Codification. All other
non-grandfathered, non-SEC accounting literature not included in the
Codification has become non-authoritative. The Codification did not change GAAP,
but instead introduced a new structure that combines all authoritative standards
into a comprehensive, topically organized online database. The Codification
became effective for the Company in  September , 2009, and impacts the
Company’s financial statements, as all references to authoritative accounting
literature is now referenced in accordance with the Codification.





On
January 1, 2009, the Company adopted new accounting guidance related to the
accounting for business combinations and related disclosures.  This
new guidance addresses the recognition and accounting for identifiable assets
acquired, liabilities assumed, and non-controlling interests in business
combinations.  The guidance also establishes expanded disclosure
requirements for business combinations.  The Company will apply this
new guidance to future business combinations, if any.





On
January 1, 2009, the Company also adopted new accounting guidance related to the
accounting for non-controlling (minority) interests in consolidated financial
statements.  This guidance establishes accounting and reporting
standards for the non-controlling interest in a subsidiary and for the
deconsolidation of a subsidiary, and requires that non-controlling interests in
subsidiaries be reported in the equity section of the controlling company’s
balance sheet.  It also changes the manner in which the net income of
the subsidiary is reported and disclosed in the controlling company’s income
statement.  Because the Company’s subsidiaries
are  wholly-owned, there are no non-controlling interests, and as a
result, the adoption of this guidance had no impact on the Company’s
consolidated financial statements.





In May
2009, the FASB established general standards for accounting and disclosure of
events that occur after the balance sheet date but before the financial
statements are issued or are available to be issued. The pronouncement required
the disclosure of the date through which an entity has evaluated subsequent
events and the basis for that date, whether that date represents the date the
financial statements were issued or were available to be issued. In February
2010, the FASB amended this standard whereby SEC filers, like the Company, are
required by GAAP to evaluate subsequent events through the date its financial
statements are issued, but are no longer required to disclose in the financial
statements that the Company has done so or disclose the date through which
subsequent events have been evaluated.





In June
2009, the FASB issued FASB ASC 810-10-65 (Prior authoritative
literature:  SFAS No. 167,  Amendments to FASB Interpretation
No. 46(R)) which amends the consolidation guidance applicable to a
variable interest entity (“VIE”). This standard also amends the guidance
governing the determination of whether an enterprise is the primary beneficiary
of a VIE, and is therefore required to consolidate an entity, by requiring a
qualitative analysis rather than a quantitative analysis. Previously, the
standard required reconsideration of whether an enterprise was the primary
beneficiary of a VIE only when specific events had occurred. This standard is
effective for fiscal years beginning after November 15, 2009, and for
interim periods within those fiscal years. Early adoption is
prohibited.  The Company is evaluating the impact, if any, that this
new guidance  may have on its consolidated financial
statements.





In August
2009, the FASB provided clarification when measuring liabilities at fair value
of a circumstance in which a quoted price in an active market for an identical
liability is not available. A reporting entity is required to measure fair value
using one or more of the following methods: 1) a valuation technique that
uses a) the quoted price of the identical liability when traded as an asset
or b) quoted prices for similar liabilities (or similar liabilities when
traded as assets) and/or 2) a valuation technique that is consistent with
the preexisting fair value guidance. It also clarifies that when estimating the
fair value of a liability, a reporting entity is not required to adjust to
include inputs relating to the existence of transfer restrictions on that
liability. The adoption of this guidance did not have a material impact on the
Company’s consolidated financial statements.




38





In
October 2009, the FASB issued an update to existing guidance on accounting for
arrangements with multiple deliverables. This update will allow companies to
allocate consideration received for qualified separate deliverables using
estimated selling price for both delivered and undelivered items when
vendor-specific objective evidence or third-party evidence is unavailable.
Additional disclosures discussing the nature of multiple element arrangements,
the types of deliverables under the arrangements, the general timing of their
delivery, and significant factors and estimates used to determine estimated
selling prices will be required. This guidance is effective prospectively for
interim and annual periods ending after June 15, 2010. The Company is
currently evaluating the impact this guidance may have, if any, on its
consolidated financial statements, but does not anticipate that this updated
guidance will have a material impact.





3.    Property
and equipment:





As of
December 31, 2009 and December 31, 2008, property and equipment consists of the
following:




2009
              
              
              2008Fiber
      optic cable
              
              $
              507,875
              
              
              $
              506,616Network
      support equipment
              
              
              40,643
              
              
              
              30,716548,518
              
              
              
              537,332Less
      accumulated depreciation
              
              
              (33,787
              )
              
              
              (6,323
              )$
              514,731
              
              
              $
              531,009


4.   Intangible
and other assets:





As of
December 31, 2009 and 2008, intangible and other assets consist of the
following:




2009
              
              
              2008Contractual
      license rights
              
              $
              326,056
              
              
              $
              326,056Less
      accumulated amortization
              
              
              (20,378
              )
              
              
              -305,678
              
              
              
              326,056Deposits
              
              
              -
              
              
              
              38,139$
              305,678
              
              
              $
              364,195


The
Company’s intangible asset, contractual license rights, represents the Company’s
rights to certain frequency licenses held by Gao Da. The Company entered into
this contract with Gao Da in September 2008. Previous to the contract date, the
Company had recorded deposits, which represented cash paid to Gao Da for the
purpose of acquiring frequency licenses.
 
 The
contractual license rights represent the right to revenue generated from
customers who contract to utilize frequency licenses held by Gao Da (Note 8).
The Company amortizes this intangible asset over the twenty-year term of the
agreement (amortization was not considered material in 2008). The Company
evaluates this intangible asset for impairment annually, and between annual
evaluations if events or changes in circumstances indicate that the carrying
amount of the asset may not be fully recoverable. In cases where required, an
impairment provision is recognized in an amount by which the carrying value
exceeds the estimated fair value of the asset.
 
 Recoverability
of the contractual license rights is dependent upon the recoverability of the
underlying licenses of Gao Da. The underlying value of the frequency licenses
held by Gao Da is dependent on numerous factors, including successful deployment
of networks and connectivity, and/or radio links. The Company considers the
underlying licenses to have an indefinite useful life under the provisions of
ASC Topic 350, Goodwill and
Other Intangible Assets. These licenses are typically renewed if the
licensee files a renewal application prior to license expiration wherein the
licensee demonstrates its engagement in supplying services or related activities
to satisfy the appropriate criteria for renewal. If at any time the Company
determines that these criteria will most likely not be met, or if there is a
change in management’s future business plans or disposition of one or more
licenses underlying the contractual license rights, the Company will first test
the contractual license rights for impairment, and then the Company will modify
the life of the contractual license rights and begin amortizing the cost over
the remaining underlying license period. The Company also tests its contractual
license rights for impairment if there are any legal, regulatory, contractual,
competitive, and economic or other factors that are determined to limit the
useful lives of the licenses.




39





The
expected  amortization for the next five years is approximately
$16,000 per year, and approximately $226,000 in aggregate for the years
thereafter.





5.   Convertible
notes payable:





In 2007,
the Company issued $914,000 of 12% convertible notes payable; an additional
$90,300 of 12% convertible notes were issued in January 2008.  These
notes are unsecured, and their maturity date was originally December 31,
2008.  Principal and interest are convertible at any time into shares
of the Company’s common stock at $0.25 per share at the option of the note
holders.  During 2008, notes for $84,000 and related accrued interest
of $13,753 were converted into 391,002 shares of common stock.  During
the 2009,  notes for
$367,900  and  related  accrued  interest  of
$65,211  were  converted  into
1,732,443  shares of common stock.  As of December 31, 2009,
the holders of notes totaling $368,500 agreed to extend the maturity date to
June 30, 2010, and holders of notes totaling $28,900 have requested conversion
to common stock. Notes totaling $155,000 are due on demand as of December 31,
2009.





In 2009
and 2008, the Company issued $1,596,624 and $1,429,800, respectively, of 10%
convertible notes payable. These notes bear interest at 10% per annum and are
unsecured. Principal and interest are convertible at any time into shares of the
Company’s common stock at $0.50 per share at the option of the note holders. In
2008, notes for $110,000 and related accrued interest of $8,279 were converted
into 236,559 shares of common stock.  As of December 31, 2009, notes
totaling $1,754,940 are due between March and June 30, 2010, and notes totaling
$1,046,479 are due on December 31, 2010. At December 31, 2009, holders of notes
totaling $10,000 have requested conversion to common stock, and other note
holders with notes totaling $105,000 have demanded payment as of December 31,
2009. During the first quarter of 2010, the Company issued additional 10% notes,
due December 31, 2010, in exchange for cash of $211,500.





6.   Income
taxes:





Based on
the U.S. statutory income tax rates, the
Company’s  expected  income tax benefit was approximately
$1,057,000 and $584,000 for the years ended  December 31, 2009
and 2008,  respectively.  The expected income tax benefit
differs from the actual benefit of $0 each period, due primarily to the
valuation allowance.





Deferred
tax assets  consisted  of the  following at
December 31, 2009 and 2008:




2009
              
              
              2008Deferred
      non-current tax assets:Net
      operating loss carryforwards
              
              $
              1,662,000
              
              
              $
              683,000Stock-based
      compensation
              
              
              170,000
              
              
              
              56,000Valuation
      allowance
              
              
              (1,832,000
              )
              
              
              (739,000
              )Net
      non-current deferred tax assets
              
              $
              -
              
              
              $
              -





The
Company’s subsidiaries operate in the Peoples  Republic  of
China (PRC) and are therefore subject to the PRC tax laws
and  regulations. The PRC
federal  statutory  income tax rate is 25% and the local
income tax rate is 3%.  At December 31,
2009,  the  Company  has U.S.  net
operating  loss
carryforwards   of   approximately $4,521,000
which expire through 2029 and PRC net operating loss carryforwards of
approximately $257,000 which expire 2014.  As the Company is unable to
determine  that it is more likely than not that future
taxable  income of the Company will
be  sufficient  to utilize the net
operating  loss  carryforwards,  a  valuation  allowance  has
been established against this asset.




40





7.   Shareholders
deficit:





Stock
option plan:


In 2009,
the Company recorded total stock-based compensation of $336,361 for options that
vested during the year, which is included in general and administrative expense.
As of December 31, 2009, the fair value of 300,000 unvested stock options was
$27,414 which is expected to be recognized over a weighted average period of
approximately three years.
 
 The
Company uses the Black-Scholes option pricing model to determine the weighted
average fair value of options. The weighted average fair value of options
granted during 2009 was $0.38 per share. The assumptions utilized to determine
the fair value of options granted in 2009 and 2008 are provided in the following
table:


2009
              
              2008Risk
      free interest rates
              
              1.34%
      - 2.75%
              
              1.61%
      - 2.89%Expected
      volatility
              
              135%
      - 191%
              
              80%
      - 89%Expected
      term in years
              
              3 -
      5
              
              2 -
      3Expected
      dividend yield
              
              -
              
              -


The
following table sets forth stock option activity since  January
1, 2009 :





Number
      of Options
              
              
              Weighted
      Average Exercise Price
              
              
              Exercisable
              
              
              Average
      Fair ValueOutstanding,
      January 1, 2009
              
              
              2,200,000
              
              
              $
              0.25
              
              
              
              637,500
              
              
              $
              0.13Granted/vested
      during period
              
              
              4,075,000
              
              
              $
              0.38
              
              
              
              1,412,500
              
              
              $
              0.20Forfeited
              
              
              (925,000
              )
              
              $
              0.25
              
              
              
              -
              
              
              $
              0.14Outstanding,
      December 31, 2009
              
              
              5,350,000
              
              
              $
              0.35
              
              
              
              2,050,000
              
              
              $
              0.18





41




Nonvested
      Shares
                      
                      Number
      of
                      
                      
                      WeightedShares
                      
                      
                      Average
      FairNonvested
      Shares at January 1, 2009
                      
                      
                      1,562,500
                      
                      
                      $
                      0.13Granted
                      
                      
                      4,075,000
                      
                      
                      $
                      0.20Vested
                      
                      
                      (1,412,500
                      )
                      
                      $
                      0.20Forfeited
                      
                      
                      ( 925,000
                      )
                      
                      $
                      0.14Nonvested at
      December 31, 2009
                      
                      
                      3,300,000
                      
                      
                      $
                      0.18


As of
December 31, 2009, the Company has 3,300,000 unvested stock options of which
3,000,000 vesting is contingent on future events.
 Options
granted to date have been granted outside of the plan and have terms that do not
exceed five years. There were 2,050,000 vested options as of December 31, 2009.
There was $288,750 intrinsic value attributable to options outstanding at the
period ended December 31, 2009. There was $255,000 intrinsic value attributable
to options vested at the period ended December 31, 2009.
 Subsequent
to December 31, 2009 , the Company granted an additional 4,700,000 options of
stock as payments for services and employee compensation.
  Effective
January 1, 2008, the Company established a Stock Option Award and Compensation
Plan (the “Plan”) covering up to 4,000,000 shares of the Company’s common stock.
As part of the shareholders’ approval of the Plan, the Plan was renamed the 2009
Stock Award and Compensation Plan (the “2009 Plan”). Any employee, consultant or
Director of the Company, any parent or any subsidiary is eligible to
participate. On May 15, 2009, the Board of Directors increased the number of
authorized shares to 5,000,000. The exercise prices of the options granted are
determined by the Plan committee, whose members are appointed by the Board of
Directors, and the exercise prices are generally to be established at the
estimated fair value of the Company’s common stock at the date of grant. 
The compensation committee may award incentive stock options and nonqualified
stock options under the 2009 Plan. Only employees may receive incentive stock
options. The compensation committee also determines the exercise price of each
option. However, the exercise price of an incentive stock option may not be less
than 100% of the fair market value of the underlying shares on the date of
grant. The exercise price of any option may not be less than the par value of
the underlying share(s). In October 2009, the Company filed an Information
Statement on Schedule 14C, which included a proposal for the approval of the
2009 Plan by a majority of the Company’s shareholders (approved by a majority of
the Company’s shareholders on October 28, 2009). The 2009 Plan became effective
on November 23, 2009.
  The
compensation committee determines the term of each option, but no term may
exceed 10 years from the date of grant. The compensation committee also
determines at what time or times each option may be exercised and any conditions
that must be met before an option may be exercised. Options may be made
exercisable in installments, and the exercisability of options may be
accelerated by the compensation committee. As of December 31, 2009, the
Company’s Board of Directors was serving as the compensation
committee.


Common
stock issued for services:





During
the year ended  December 31, 2009, the Company issued 1,900,000 shares
of common stock to various parties as employment bonuses and payments for
services performed for the Company, valued at $475,000 ($0.25 per share).
During the year ended December 31, 2008, the Company issued 884,000 shares of
common stock to various third parties who performed services for the Company.
These shares were valued at $221,000 ($0.25 per share).





Subsequent
to December 31, 2009 and through April 12, 2010, the Company issued an
additional 1,540,000 common shares of stock as signing bonuses and payments for
services performed for the Company, valued at approximately $323,400 ($.21 per
share).





8.   Commitments:





Contract
with Gao Da





In
September  2008, the Company,  through Da
Chuan,  entered into a 20-year contract  with Gao Da, in
which the Company is entitled to utilize Gao Da’s licenses and contracts that
relate to the Company’s deployment of fiber and wireless assets for the
Company’s benefit, as defined. As consideration for the
service  agreement,  the Company is to pay or
reimburse  Gao Da for any licensing  fees for
base  stations  or
license  renewal  expenses,  and the
Company  is to pay a  quarterly  fee to Gao Da
equal to one  percent of net
revenue  generated  from the use of Gao
Da’s  contracts and licenses in the
Company’s  business  operations,  as  defined.  No
fees were  payable as of December 31, 2009 or 2008 under the
contract.





Leases:





The
Company leases  office space in Denver,  Colorado on a
month-to-month basis. forapproximately $1,100 per month. Da Chuan leases office
space in Beijing, China on a month-to-month basis for approximately $5,400 per
month  Total lease expense for 2009 and 2008 was approximately $16,000
and $11,000, respectively.





42


ITEM 9.  CHANGES
IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL
DISCLOSURE





Not
applicable.





ITEM 9A. CONTROLS AND
PROCEDURES





Disclosure Controls and
Procedures




The
Company, under the supervision and with the participation of the Company’s
management, including the Company’s Chief Executive Officer and Chief Financial
Officer, performed an evaluation of the effectiveness of the design and
operation of the Company’s disclosure controls and procedures (as defined in
Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934), as of
December 31, 2009. Based on that evaluation, the Chief Executive Officer
and Chief Financial Officer concluded that, because of the material weakness in
internal control over financial reporting described below, the Company’s
disclosure controls and procedures were not effective as of December 31,
2009.





ITEM 9A(T). CONTROLS AND
PROCEDURES





Management’s Report on
Internal Control over Financial Reporting




Management
is responsible for establishing and maintaining adequate internal control over
financial reporting, as such term is defined in the Securities Exchange Act of
1934 Rule 13a-15(f). The Company’s internal control over financial
reporting is a process designed to provide reasonable assurance regarding the
reliability of financial reporting and the preparation of financial statements
for external purposes in accordance with U.S. generally accepted accounting
principles.  The Company’s internal control over financial reporting
includes those policies and procedures that (i) pertain to the maintenance of
records that, in reasonable detail, accurately and fairly reflect the
transactions and dispositions of assets; (ii) provide reasonable assurance that
transactions are recorded as necessary to permit the preparation of financial
statements in accordance with U.S. generally accepted accounting principles, and
that the Company’s receipts and expenditure are being made only in accordance
with authorizations of the Company’s management and directors; and (iii) provide
reasonable assurance regarding the prevention or timely detection of
unauthorized acquisitions, use, or disposition of the Company’s assets that
could have material effect on the Company’s consolidated financial
statements.





Because
of its inherent limitations, internal control over financial reporting may not
prevent or detect misstatements.  Also, projections of any evaluation
of effectiveness to future periods is subject to the risk that controls may
become inadequate because of changes in conditions, or that the degree of
compliance with the policies or procedures may deteriorate.




A
material weakness is a control deficiency, or combination of control
deficiencies, that results in more that a remote likelihood that a material
misstatement of the annual or interim financial statements will not be prevented
or detected.  The Company’s Chief Executive Officer and Chief
Financial Officer conducted an evaluation of the effectiveness of the Company’s
internal control over financial reporting as of December 31, 2009, based on the
framework in Internal Control
- Integrated Framework, issued by the Committee of Sponsoring
Organizations of the Treadway Commission (the “COSO Framework”). As a result of
this assessment, management concluded that the Company’s internal control over
financial reporting was not effective as of December 31, 2009. Management
identified the following material weaknesses in the Company’s internal control
over financial reporting:





·
            While
      there were internal controls and procedures in place that relate to
      financial reporting and the prevention of material misstatements, these
      controls did not meet the required documentation and effectiveness
      requirements under the Sarbanes-Oxley Act and therefore, management could
      not certify that these controls were properly implemented.  As a
      result, it was management’s opinion that the lack of documentation
      warranted a material weakness in the financial reporting
      process.





·
            The
      Company’s disclosure controls and procedures were not effective to ensure
      that information required to be disclosed by the Company in the reports
      that the Company files or submits under the Exchange Act is recorded,
      processed, summarized and reported within the time periods specified in
      the Commission’s rules and forms, and to ensure that information required
      to be disclosed by the Company in the reports that the Company files or
      submits under the Exchange Act is accumulated and communicated to our
      management, including our Chief Financial Officer, as appropriate, to
      allow for timely decisions.  Inadequate controls include the
      lack of procedures used for identifying, determining, and calculating
      required disclosures and other supplementary information
      requirements.




43




·
            Due
      to the nature and size of the Company’s current operations, there is lack
      of segregations of duties in financial reporting.  This material
      weakness is primarily due to the Company’s lack of working capital to hire
      additional staff.





This
annual report does not include an attestation report of the Company’s registered
public accounting firm regarding internal control over financial reporting.
Management’s report was not subject to attestation by the Company’s registered
public accounting firm pursuant to temporary rules of the Securities and
Exchange Commission that permit the Company to provide only management’s report
in this annual report.





There was
no change in our internal control over financial reporting that occurred during
the fiscal quarter ended December 31, 2009, that has materially affected, or is
reasonably likely to materially affect, our internal control over financial
reporting.





ITEM 9B.  OTHER
INFORMATION





Not
applicable.





44


PART
III





ITEM
10.  DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE
GOVERNANCE





The
following table sets forth information as to persons who currently serve as
China Wi-Max directors, executives or officers, including their ages as of
December 31, 2009.





Name
            
            Age
            
            Position
      with CHWM
            
            Served
      as a Director SinceDr.
      Allan Rabinoff
            
            65
            
            Chairman
      and Executive Director - China Business Development
            
            2006Steven
      T. Berman (1)
            
            47
            
            President
      and Director
            
            2009Frank
      R. Ventura
            
            70
            
            Chief
      Financial Officer
            
            2009Sharon
      Xiong
            
            46
            
            Director
            
            2009Buck
      Krieger
            
            68
            
            Director
            
            2006





Name
            
            Age
            
            Position
      with CHWM
            
            Served
      as a Director SinceDr.
      Allan Rabinoff
            
            65
            
            Chairman
      and Executive Director - China Business Development
            
            2006Steven
      T. Berman (1)
            
            47
            
            President
      and Director
            
            2009Frank
      R. Ventura
            
            70
            
            Chief
      Financial Officer
            
            2009Buck
      Krieger
            
            68
            
            Director
            
            2006Sharon
      Xiong
            
            
            
            Director
            
            2009


(1)
Effective March 5, 2009, Mr. Berman was appointed President and Director of
China Wi-Max Communications, Inc.





China
Wi-Max’s officers are elected by the board of directors at the first meeting
after each annual meeting of China Wi-Max’s shareholders and hold office until
their successors are duly elected and qualified under China Wi-Max’s bylaws, or
as defined by the terms of employment agreements.





The
directors named above will serve until the next annual meeting of China Wi-Max’s
stockholders. Thereafter, directors will be elected for one-, two-, or
three-year terms at the annual stockholders’ meeting. Officers will hold their
positions at the pleasure of the board of directors absent any employment
agreement. There is no arrangement or understanding between the directors and
officers of China Wi-Max’s and any other person pursuant to which any director
or officer was or is to be selected as a director or officer.





Dr. Allan
Rabinoff , Steven T. Berman, and Frank R. Ventura devote substantially all their
time to the affairs of China Wi-Max.  The other Board members or
officers of China Wi-Max will devote part-time to its affairs until such time as
they may be required to devote full time.





China
Wi-Max is building a team of experienced business and telecommunications experts
who understand the combined fiber/wireless broadband delivery model and also
have business knowledge within China.




45





Chairman and Founder: Dr. Allan Rabinoffhas over
twenty-five years of business experience in China and the Far East, including
developing international companies and teams.  Dr. Rabinoff has been
involved as a Board and Senior Executive Team member of several Chinese
ventures.  Additionally, he served as the Chief Operations Officer of
In Touch Communications Inc. in Beijing from November 2004 to May
2005.  Dr. Rabinoff has accumulated a vast array of contacts in
business and government over the last twenty-five years in Asia and has a firm
grasp on the requirements necessary to successfully operate in
China.  In 1975, Dr. Rabinoff earned a PhD from the University of
Maryland. He also holds a Master’s and Bachelor of Science degree from the
University of Wisconsin.





President and
Director:  Mr. Steven T. Berman was appointed as President and
Director on March 5, 2009.  Mr. Berman has a B.A. from the University
of Wisconsin (1984) and a J.D. from the University of Wisconsin
(1987).  He served as Assistant General Counsel from 1989-1994 for the
National Rural Utilities Cooperative Finance Corp. He became Senior VP, General
Counsel,   and   Secretary/Treasurer of National
Rural
Telecommunications   Cooperative   from   1994-2004.   In   2005-2006,
he was President/CEO of First Capital Surety & Trust
Company.   He founded EBC Enterprises, LLC in 2004 as a
consulting company.





Director: Mr. Buck Krieger was
appointed to the Company’s Board at its inception in July 2006. In August of
2004 he was the President of StarTelecom, Inc., a telecommunications consulting
firm, until July 2006. Mr. Krieger has an extensive financial background which
began at Clayton Brokerage Company, which became the largest brokerage house in
the country dedicated to commodities.  During his tenure at Clayton
Brokerage he was an Executive V.P. and National Sales Manager for ten years. Mr.
Krieger retired from Clayton after twenty-five years. He intends to focus his
business time primarily on China Wi-Max.





Director: Ms. Sharon Xiong was
appointed to the Company’s Board on March 9, 2009. Ms. Xiong received her
education in Computer Science from the University of Colorado, Denver and holds
an EMBA from the University of Colorado, Denver, a Ph.D. from the Medical school
at the University of South Dakota, and an M.S and B.S. from Peking University,
China. Sharon Xiong currently leads and manages system verification of High
DensitySIP Trunk Gateway at Avaya Communication Inc. Prior to working for Avaya,
Sharon worked at Lucent Technologies on 10G optical router (Bandwidth Manager)
development and Rhythm Netconnections, Inc., for DSL management software
development. Sharon is the president of XBC Consulting firm which offers
business consulting services to people who intend to expand their business in
China’s emerging market. She understands Chinese culture, has a broad Chinese
network, many years hands-on experience in US corporate business operation, and
corporate management skills.





Annual
Meeting





The
annual meeting will be held at China Wi-Max’s principal office or at such other
place as permitted by the laws of the State of Nevada and on such date as may be
fixed from time to time by resolution of China Wi-Max Board of
Directors.





Committees
of the Board of Directors





China
Wi-Max is managed by its officers under the oversight of its Board of
Directors.  China Wi-Max’s Board of Directors plans to establish an
Audit Committee as soon as practicable.  China Wi-Max is currently
attempting to recruit one or more independent directors to serve on the Board of
Directors and the audit committee, at least one of whom will qualify as an
“Audit Committee Financial Expert” as defined in SEC
regulations.  China Wi-Max is also establishing a Compensation
Committee.  There are currently no other committees under
consideration.





Executive
Committee





China
Wi-Max currently does not have an Executive Committee.





Audit
Committee





China
Wi-Max currently does not have an Audit Committee.  When formed, the
Audit Committee will be comprised solely of directors who are independent and
financially competent, as required by the Securities Exchange Act of 1934,
which, as amended, China Wi-Max refers to as the Securities Exchange
Act.  At least one member of the committee will have accounting or
related financial management expertise.




46





Previous
“Blank Check” or “Shell” Company Involvement





Management
of the Company has not been involved in prior private “blank-check” or “shell”
companies.





Compliance
with Section 16(A) of the Exchange Act





Section
16(a) of the Securities Exchange Act of 1934 (the “Exchange Act”) requires that
the Company’s officers and directors, and persons who own more than ten percent
of a registered class of the Company’s equity securities, file reports of
ownership and changes in ownership with the Securities and Exchange Commission.
Officers, directors and greater than ten percent stockholders are required by
regulation to furnish to the Company copies of all Section 16(s) forms they
file.





The
following persons failed to file forms on a timely basis during the past two
fiscal years as required under Section 16(a) as follows:





None.





Conflicts
of Interest - Directors





The
directors of China Wi-Max, who are not employed full-time, may not devote more
than a portion of their time to the affairs of the Company. There may be
occasions when the time requirements of China Wi-Max’s business conflict with
the demands of their other business and investment
activities.  Experienced directors of public companies, particularly
those doing business in China, are difficult to engage due to
expertise/experience issues and liability, and may not be readily available to
be engaged, leaving the Company lacking in experienced directors.





Conflicts
of Interest - Other





Certain
officers and directors of China Wi-Max may be directors and/or principal
shareholders of other companies and, therefore, could face conflicts of interest
with respect to potential acquisitions. Additionally, officers and directors of
the Company may in the future participate in business ventures which could be
deemed to compete directly with the Company. Additional conflicts of interest
and non-arms length transactions may also arise in the future in the event the
Company’s officers or directors are involved in the management of any firm with
which the Company transacts business.    At the date of this
Annual Report on Form 10-K, there are no current conflicts of interests
involving any of our directors or executive officers as to any known business
conflicts of our business.  No member of management is currently an
officer/director or affiliate with any other public or private company that is
currently, or is planning to be in a competitive business.





47


ITEM
11.  EXECUTIVE COMPENSATION




Securities
Authorized For Issuance Under Equity Compensation Plans
  The
following table sets forth the compensation paid to officers and board members
during the fiscal years ended December 31, 2009, 2008 and 2007. The table sets
forth this information for China Wi-Max, including salary, bonus, and certain
other compensation to the Board members and named executive officers for the
past three fiscal years and includes all Board Members and Officers as of
December 31, 2009.
  SUMMARY
EXECUTIVES COMPENSATION TABLE
  Name
      and Principal Position
                    
                    Fiscal
                      Year
                    
                    Salary
                    
                    
                    Bonus
                    
                    
                    Stock
      Awards
                    
                    
                    Option
      Awards
                    
                    
                    All
      Other Compensation
                    
                    
                    TotalDr.
      Allan Rabinoff, Chairman and Executive Director
                    
                    2009
                    
                    $
                    120,000
                    
                    
                    $
                    —
                    
                    
                    $
                    —
                    
                    
                    $
                    —
                    
                    
                    $
                    30,000
                    
                    
                    $
                    150,0002008
                    
                    $
                    100,000
                    
                    
                    $
                    —
                    
                    
                    $
                    —
                    
                    
                    $
                    —
                    
                    
                    $
                    20,000
                    
                    
                    $
                    120,0002007
                    
                    $
                    —
                    
                    
                    $
                    —
                    
                    
                    $
                    20,000
                    
                    
                    $
                    —
                    
                    
                    $
                    42,000
                    
                    
                    $
                    62,000Steven
      T. Berman,President
      and Director (1)
                    
                    2009
                    
                    $
                    60,000
                    
                    
                    $
                    —
                    
                    
                    $
                    187,500
                    
                    
                    $
                    37,800
                    
                    
                    $
                    —
                    
                    
                    $
                    285,3002008
                    
                    $
                    —
                    
                    
                    $
                    —
                    
                    
                    $
                    —
                    
                    
                    $
                    —
                    
                    
                    $
                    —
                    
                    
                    $
                    —2007
                    
                    $
                    —
                    
                    
                    $
                    —
                    
                    
                    $
                    —
                    
                    
                    $
                    —
                    
                    
                    $
                    —
                    
                    
                    $
                    —Frank
      Ventura, CFO
                    
                    2009
                    
                    $
                    42,000
                    
                    
                    $
                    —
                    
                    
                    $
                    —
                    
                    
                    $
                    9,550
                    
                    
                    $
                    —
                    
                    
                    $
                    51,5502008
                    
                    $
                    —
                    
                    
                    $
                    —
                    
                    
                    $
                    —
                    
                    
                    $
                    —
                    
                    
                    $
                    —
                    
                    
                    $
                    —2007
                    
                    $
                    —
                    
                    
                    $
                    —
                    
                    
                    $
                    —
                    
                    
                    $
                    —
                    
                    
                    $
                    —
                    
                    
                    $
                    —George
      Harris, Former CFO and Director
                    
                    2009
                    
                    $
                    112,500
                    
                    
                    $
                    —
                    
                    
                    $
                    112,500
                    
                    
                    $
                    —
                    
                    
                    $
                    —
                    
                    
                    $
                    225,0002008
                    
                    $
                    105,000
                    
                    
                    $
                    —
                    
                    
                    $
                    50,000
                    
                    
                    $
                    39,900
                    
                    
                    $
                    —
                    
                    
                    $
                    194,9002007
                    
                    $
                    —
                    
                    
                    $
                    —
                    
                    
                    $
                    —
                    
                    
                    $
                    —
                    
                    
                    $
                    —
                    
                    
                    $
                    —
  
 (1)
                During
      the year ended December 31, 2009, Steven Berman received 750,000 shares of
      common stock, valued at $187,500 as a signing bonus in connection with the
      employment agreement he executed at that time and 800,000 options with an
      exercise price of $0.25, valued at $37,800.  In Steven Berman’s
      employment agreement, it is confirmed that his monthly salary will
      increase to $15,000 as of March, 1st,
      2010.




48




OPTION/SAR
GRANTS IN THE LAST FISCAL YEAR





China
Wi-Max adopted an incentive stock option plan pursuant to which the Board of
Directors may grant options to key employees, consultants, and others to
purchase up to 5,000,000 shares of the Company’s common stock. The shareholders
approved the plan at the Annual Meeting in 2009.





The
plan will provide for the grant of incentive stock options with an exercise
price of not less than the fair market value on the date of the grant as
determined by the Board of Directors and will expire no later than the fifth
anniversary of the date of grant.  As of December 31, 2009, the Company has
not issued any options under the plan.During the year ended December 31, 2008
and 2009, options exercisable for 2,200,000 and 4,075,000 shares were granted
outside the incentive stock option plan discussed above.





The
options have a term of five years and an exercise price of $0.25 per
share.  The options all have vesting rates.  At December 31,
2009, 2,050,000 shares have vested in full, respectively.  Before any
employee options may be delivered or exercised, the shareholders must ratify the
Plan.





Employment
Agreements and Termination of Employment and Change-In-Control
Arrangements





On March
1, 2008, China Wi-Max entered into an employment agreement with Dr. Allan
Rabinoff to serve as the Executive Director - China Business
Development.  Dr. Rabinoff’s employment agreement has a term of three
years and provides for Dr. Rabinoff to receive a base salary of $10,000 per
month.  The employment agreement provides that the base salary upon
the earlier occurrence of the closing of financing of at least $4 million or
December 31, 2008, the base salary will increase to $15,000 per
month.  Vesting is accelerated in connection with a change in control
or termination.





On March
1, 2008, Dr. Rabinoff was issued an option exercisable for 600,000 shares in
connection with his employment agreement.  The option has an exercise price
of $0.25 per share and a term of five years.  The option vests at a rate of
75,000 shares with the completion of acquisitions of both the fiber assets and
spectrum license in each of the remaining 8 targeted cities of the business
plan.  Vesting is accelerated in connection with a change in control or
termination of the employment agreement.




On March
5, 2009 China Wi-Max entered into a three year employment agreement with Mr.
Berman to serve as President and Director providing for normal executive
participation in the employee benefit plans, expense reimbursements and paid
vacations. The Agreement contains normal duties, responsibilities, termination,
non-competition, and compensation clauses. The base salary is established at
$10,000 per month, beginning June 1, 2009.





The
Agreement also provides a signing bonus of 250,000 shares and options vesting
over three years for 100,000 shares per year at $.25.




49


In
connection with the employment agreements, generally, the Company terminates the
employment agreement at any time with cause.  The employee has the
right to terminate the employment agreement at any time with good
reason.  In the event, the Company terminates an employment agreement
for cause or the employee terminates his or her employee agreement with good
reason, all of such employee’s rights to compensation would cease upon the date
of such termination.  If we terminate an employment agreement without
cause, then such employee terminates his employment agreement for cause, or in
the event of a change in control, we are required to pay to such employee all
compensation and other benefits that would have accrued and/or been payable to
that employee during the full term of the employment agreement.





A change
of control is considered to have occurred when, as a result of any type of
corporate reorganization, execution of proxies, voting trusts or similar
arrangements, a person or group of persons (other than incumbent officers,
directors and our principal stockholders) acquires sufficient control to elect
more than a majority of our board of directors, acquires 50% or more of our
voting shares, or we adopt a plan of dissolution of liquidation.  The
employment agreement also include a non-compete and nondisclosure provisions in
which each employee agrees not to compete with or disclose confidential
information regarding us and our business during the term of the employment
agreement and for a period of one year thereafter.





Compensation
Committee Interlocks and Insider Participation





Through
December 31, 2009, the China Wi-Max Board of Directors in its entirety acted as
the Compensation Committee for China Wi-Max.  Dr. Rabinoff is the
Chairman of the Company.  As of February 26, 2008, a Compensation
Committee was established.





Stock
Option Award and Compensation Plan





China
Wi-Max adopted an incentive stock option plan pursuant to which the Board of
Directors may grant options to key employees, consultants, and others to
purchase up to 5,000,000 shares of the Company’s common stock. The shareholders
approved the plan at the Annual Meeting in 2009.





The
plan will provide for the grant of incentive stock options with an exercise
price of not less than the fair market value on the date of the grant as
determined by the Board of Directors and will expire no later than the fifth
anniversary of the date of grant.  As of December 31, 2009, the Company has
not issued any options under the plan.





Director
Compensation





The
Company does not pay any Directors fees for meeting attendance.  An
Audit Committee has yet to be established therefore no compensation has been
paid for this function.





Director
            
            Director
      Fees Earned or Paid in Cash
            
            
            Stock
      Awards
            
            
            Option
      Awards
            
            
            All
      Other Compensation
            
            TotalBuck
      Krieger, Director
            
            $
            -
            
            
            $
            -
            
            
            $
            -
            
            
            $
            24,000
            
            $
            24,000Sharon
      Xiong, Director
            
            $
            -
            
            
            $
            12,500
            
            
            $
            -
            
            
            $
            -
            
            $
            12,500




Limitation
on Liability and Indemnification





China
Wi-Max is a Nevada corporation. Nevada Revised Statutes (NRS) provide that a
Nevada corporation’s Articles of Incorporation may contain a provision
eliminating or limiting the personal liability of a director to the corporation
or its shareholders for monetary damages for breach of fiduciary duty as a
director, except that any such provision may not eliminate or limit the
liability of a director (i) for any breach of the director’s duty of loyalty to
the corporation or its shareholders, (ii) acts or omissions not in good faith or
which involve intentional misconduct or a knowing violation of law, (iii) acts
specified in the NRS (concerning unlawful distributions), or (iv) any
transaction from which a director directly or indirectly derived an improper
personal benefit.  China Wi-Max articles of incorporation contain a
provision eliminating the personal liability of directors to China Wi-Max or
China Wi-Max shareholders for monetary damages to the fullest extent provided by
the NRS.




50


The NRS
provides that a Nevada corporation must indemnify a person who was wholly
successful, on the merits or otherwise, in defense of any threatened, pending,
or completed action, suit, or proceeding, whether civil, criminal,
administrative, or investigative and whether formal or informal (a
“Proceeding”), in which he or she was a party because the person is or was a
director, against reasonable expenses incurred by him or her in connection with
the Proceeding, unless such indemnity is limited by the corporation’s articles
of incorporation.  China Wi-Max articles of incorporation do not
contain any such limitation.




The NRS
provides that a Nevada corporation may indemnify a person made a party to a
Proceeding because the person is or was a director against any obligation
incurred with respect to a Proceeding to pay a judgment, settlement, penalty,
fine (including an excise tax assessed with respect to an employee benefit plan)
or reasonable expenses incurred in the Proceeding if the person conducted
himself or herself in good faith and the person reasonably believed, in the case
of conduct in an official capacity with the corporation, that the person’s
conduct was in the corporation’s best interests and, in all other cases, his or
her conduct was at least not opposed to the corporation’s best interests and,
with respect to any criminal proceedings, the person had no reasonable cause to
believe that his or her conduct was unlawful.  The Company’s articles
of incorporation and bylaws allow for such indemnification.  A
corporation may not indemnify a director in connection with any Proceeding by or
in the right of the corporation in which the director was adjudged liable to the
corporation or, in connection with any other Proceeding charging that the
director derived an improper personal benefit, whether or not involving actions
in an official capacity, in which Proceeding the director was judged liable on
the basis that he or she derived an improper personal benefit.  Any
indemnification permitted in connection with a Proceeding by or in the right of
the corporation is limited to reasonable expenses incurred in connection with
such Proceeding.




Under the
NRS, unless otherwise provided in the articles of incorporation, a Nevada
corporation may indemnify an officer, employee, fiduciary, or agent of the
corporation to the same extent as a director and may indemnify such a person who
is not a director to a greater extent, if not inconsistent with public policy
and if provided for by its bylaws, general or specific action of its Board of
Directors or shareholders, or contract.  China Wi-Max articles of
incorporation provide for indemnification of directors, officers, employees,
fiduciaries and agents of China Wi-Max to the full extent permitted by Nevada
law.




China
Wi-Max articles of incorporation also provide that China Wi-Max may purchase and
maintain insurance on behalf of any person who is or was a director or officer
of China Wi-Max or who is or was serving at the request of China Wi-Max as a
director, officer or agent of another enterprise against any liability asserted
against him or her and incurred by him or her in any such capacity or arising
out of his or her status as such, whether or not China Wi-Max would have the
power to indemnify him or her against such liability.




EQUITY
COMPENSATION PLAN INFORMATION





China
Wi-Max adopted an incentive stock option plan pursuant to which the Board of
Directors may grant options to key employees, consultants, and others to
purchase up to 5,000,000 shares of the Company’s common stock. The shareholders
approved the plan at the Annual Meeting in 2009.





The
plan will provide for the grant of incentive stock options with an exercise
price of not less than the fair market value on the date of the grant as
determined by the Board of Directors and will expire no later than the fifth
anniversary of the date of grant.  As of December 31, 2009, the Company has
not issued any options under the plan.





51


Securities
Authorized For Issuance Under Equity Compensation Plans


The
following table provides information as of December 31, 2009 regarding the
equity compensation plan (including individual compensation arrangements) under
which shares of China Wi-Max’s common stock are authorized for
issuance.  No class of our securities other than our common stock or
options to purchase our common stock is authorized for issuance under any of our
equity compensation plans.
  Plan
      Category
              
              Number
      of securities
                to
      be issued upon
                exercise
      of
                outstanding
      options,
                warrants
      and rights
                (a)
              
              
              Weighted-average
                exercise
      price of
                outstanding
      options,
                warrants
      and rights
                (b)
              
              
              Number
      of securities
                remaining
      available
                for
      future issuance
                under
      equity
                compensation
      plans
                (excluding
      securities
                reflected
      in column (a)
                (c)Equity
      compensation plans approved by security holders
              
              
              0
              
              
              
              —
              
              
              
              0Equity
      compensation plans not approved by security holders
              
              
              1,450,000
              
              
              $
              0.25
              
              
              
              —Total
              
              
              1,450,000
              
              
              $
              0.25


ITEM 12. SECURITY OWNERSHIP
OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER
MATTERS.





The
following table sets forth information with respect to the beneficial ownership
of China Wi-Max outstanding common stock by:




·
            each
      person who is known by China Wi-Max to be the beneficial owner of five
      percent (5%) or more of China Wi-Max common
  stock;




·
            China
      Wi-Max’s President, its other executive officers, and each director as
      identified in the “Management — Executive Compensation” section;
      and




·
            all
      of the Company’s directors and executive officers as a
    group.




Beneficial
ownership is determined in accordance with the rules of the Securities and
Exchange Commission and generally includes voting or investment power with
respect to securities.  Shares of common stock and options, warrants
and convertible securities that are currently exercisable or convertible within
sixty days of the date of this document into shares of China Wi-Max common stock
are deemed to be outstanding and to be beneficially owned by the person holding
the options, warrants, or convertible securities for the purpose of computing
the percentage ownership of the person, but are not treated as outstanding for
the purpose of computing the percentage ownership of any other
person.




52


The
information below is based on the number of shares of China Wi-Max common stock
that China Wi-Max believes was beneficially owned by each person or entity as of
December 31, 2009.  The total shares outstanding as of December 31,
2009 was 14,654,004.





Title
      of Class
            
            Name
      and Address of Beneficial Owner
            
            Amount
      and Nature of Beneficial Owner
            
            
            Percent
      of Class
            
            
            Percent
      of Class After Conversion of Notes (1)Common
      shares
            
            Dr.
      Allan Rabinoff, Chairman of the Board and Executive Officer
              11649
      Port Washington Rd.
              Ste.
      #224
              Mequon,
      WI 53092
            
            
            2,825,000
            
            
            
            26.2
            %
            
            
            16.3
            %Common
      shares
            
            Steven
      T. Berman, President and Director
              11649
      Port Washington Rd.
              Ste.
      #224
              Mequon,
      WI 53092
            
            
            0
            (2)
            
            
            0
            %(2)
            
            
            0
            %(2)Common
      shares
            
            George
      E. Harris,  Chief Financial Officer and Director; Former
      President
              11649
      Port Washington Rd.
              Ste.
      #224
              Mequon,
      WI 53092
            
            
            470,000
            
            
            
            4.3
            %
            
            
            2.7
            %Common
      shares
            
            Frank
      Jia
              7-3-7#,
      No 102, Youyi Road, Haidian District
              Beijing,
      China 100085
            
            
            1,000,000
            
            
            
            9.3
            %
            
            
            5.8
            %Common
      shares
            
            Chris
      Watson
              P.O.
      Box 398, 228 E. Union St.
              Pacific,
      MO 63068
            
            
            600,000
            
            
            
            5.6
            %
            
            
            3.5
            %Common
      shares
            
            Buck
      Krieger, Director
              12
      Shari Dr.
              St.
      Louis, MO 63122
            
            
            1,800,000
            
            
            
            16.7
            %
            
            
            10.4
            %Common
      shares
            
            Jenny
      Wang, Former Chief Administrative Officer and Director
              11649
      Port Washington Rd. Ste. #224
              Mequon,
      WI 53092
            
            
            1,050,000
            
            
            
            9.7
            %
            
            
            6.1
            %Common
      shares
            
            Henry
      Zaks
              11649
      Port Washington Rd.
              Ste.
      #224
              Mequon,
      WI 53092
            
            
            900,000
            
            
            
            8.3
            %
            
            
            5.2
            %Common
      shares
            
            Daniel
      Najor, Director (3)
              1625
      Highland Dr.
              Solana
      Beach, California
              92075-2124
            
            
            357,500
            
            
            
            3.3
            %
            
            
            2.0
            %Common
      shares
            
            All
      Directors and Executive Officers as a Group (7 persons)
            
            
            6,522,500
            
            
            
            60.4
            %
            
            
            37.6
            %Common
      shares
            
            Wang,
      Sharon & Qi
              8552
      S Miller Ct, Littleton, Co 80127
            
            
            20,000
            
            
            
            0.2
            %
            
            
            0.1
            %







(1)
            Assumes
      the sale of the maximum number of Notes offered and conversion of all
      Notes into shares of common stock at $.25 and $.50 per share, which could
      be 6,540,800 shares. There are no assurances that all the Notes offered
      will be sold, as investors may not purchase the notes, or that if sold,
      all of the Notes will be converted. To the extent that less than all the
      Notes are converted, management’s percentage of ownership in the Company
      will increase proportionately.


(2)
            Mr.
      Berman was appointed as President and Director March 5,
      2009.  As of December 31, 2008 he was not a beneficial owner of
      China Wi-Max Communications, Inc.


(3)
            Ms.
      Xiong was appointed a Director March 9,
2009.


(4)
            Mr.
      Najor resigned as a Director effective March 1,
  2009.




Rule
13d-3 under the Securities Exchange Act of 1934 governs the determination of
beneficial ownership of securities.  That rule provides that a
beneficial owner of a security includes any person who directly or indirectly
has or shares voting power and/or investment power with respect to such
security.  Rule 13d-3 also provides that a beneficial owner of a
security includes any person who has the right to acquire beneficial ownership
of such security within sixty days, including through the exercise of any
option, warrant or conversion of a security.  Any securities not
outstanding which are subject to such options, warrants, or conversion
privileges are deemed to be outstanding for the purpose of computing the
percentage of outstanding securities of the class owned by such
person.  Those securities are not deemed to be outstanding for the
purpose of computing the percentage of the class owned by any other
person.  Included in this table are only those derivative securities
with exercise prices that China Wi-Max believes have a reasonable likelihood of
being “in the money” within the next sixty days.


ITEM 13. CERTAIN
RELATIONSHIPS AND RELATED TRANSACTIONS





On
January 1, 2008, China Wi-Max entered into an employment agreement with Mr.
George Harris to serve as the President and Chief Financial Officer of China
Wi-Max.  Mr. Harris’s employment agreement has a term of three years
and provides for Mr. Harris to receive a base salary of $10,000 per
month.  The employment agreement does provide for the possibility of
$5,000 per month being deferred, as necessary, and that the deferred salary may
be converted into common stock at a rate of $0.25 per share.  In
addition, upon the earlier occurrence of the closing of a financing of at least
$4 million or December 31, 2008, the base salary will increase to $15,000 per
month.  In addition, Mr. Harris’s employment agreement received a
signing bonus of 200,000 shares of China Wi-Max’s common stock.





On March
1, 2008, China Wi-Max entered into an employment agreement with Dr. Allan
Rabinoff to serve as the Executive Director of Chinese Business
Development.  Dr. Rabinoff’s employment agreement has a term of three
years and provides for Dr. Rabinoff to receive a base salary of $10,000 per
month.  The employment agreement provides that upon the earlier
occurrence of the closing of a financing of at least $4 million or December 31,
2008, the base salary will increase to $15,000 per month.





On
January 1, 2008, Mr. Harris was issued an option to purchase up to 500,000
shares under the Corporation Stock Option Plan in connection with his employment
agreement.  The option has an exercise price of $0.25 per share and a
term of five years.  The option vests at a rate of 200,000 on the
grant date, 100,000 on each anniversary of the effective date of the employment
agreement.  Vesting is accelerated in connection with a change in
control or termination of the employment agreement.





In
December 2007, Mr. Harris purchased a $5,000 Convertible Promissory Note, as
part of the Convertible Note Offering.  The note was due December 31,
2008, and is convertible into shares of common stock at $0.25 per
share.





On March
1, 2008, Dr. Rabinoff was issued an option to purchase up to 600,000 shares
under the Corporation Stock Option Plan in connection with his employment
agreement.  The option has an exercise price of $0.25 per share and a
term of five years.  The option vests at a rate of 75,000 shares with
the completion of acquisitions of both the fiber assets and spectrum license in
each of the remaining 8 targeted cities of the business plan.




53





On March
1, 2008, Mr. Daniel Najor, a former Director of China Wi-Max, was issued an
option to purchase up to 450,000 shares under the Corporation Stock Option
Plan.  The option has an exercise price of $0.25 per share and a term
of 5 years.  The option vests at a rate of 18,750 shares per
month.  Mr. Najor received the option as payment for his
services.





On March
5, 2009 China Wi-Max entered into a three-year employment agreement with Mr.
Berman to serve as President and Director providing for normal executive
participation in the employee benefit plans, expense reimbursements and paid
vacations. The Agreement contains normal duties, responsibilities, termination,
non-competition, and compensation clauses. The base salary is established at
$10,000 per month. The Agreement also provides a signing bonus of 250,000 shares
and options vesting over three years to purchse 100,000 shares per year at $.25
per share.





During
the years ended December 31, 2009, 2008 and 2007, the following officers and
directors of China Wi-Max received shares of common stock in the following
amounts for the reasons as stated below.





Name
            
            Number
      of Shares
            
            
            Value
      of Stock
            
            Reason
      for IssuanceYear
      Ended December 31, 2007Jenny
      Wang, Director
            
            
            200,000
            
            
            $
            200
            
            ServicesDr.
      Allan Rabinoff, Director
            
            
            750,000
            
            
            $
            750
            
            ServicesBuck
      Krieger, Director
            
            
            500,000
            
            
            $
            500
            
            ServicesJenny
      Wang
            
            
            100,000
            
            
            $
            100
            
            ServicesBuck
      Krieger, Director
            
            
            500,000
            
            
            $
            500
            
            ServicesDr.
      Allan Rabinoff, Director
            
            
            500,000
            
            
            $
            500
            
            ServicesDr.
      Allan Rabinoff
            
            
            75,000
            
            
            $
            18,750
            
            ServicesJenny
      Wang
            
            
            50,000
            
            
            $
            12,500
            
            ServicesYear
      Ended December 31, 2008George
      Harris, President, Chief Financial Officer and Director
            
            
            200,000
            
            
            $
            50,000
            
            Signing
      Bonus with Employment AgreementDaniel
      Najor, Former Director
            
            
            50,000
            
            
            $
            12,500
            
            Services


Year
      Ended December 31, 2009Steve
      T. Berman, President, Director
            
            
            750,000
            
            
            $
            187,500
            
            Signing
      Bonus with Employment Agreement and ServicesGeorge
      Harris, Former President, Chief Financial Officer and
    Director
            
            
            450,000
            
            
            $
            112,500
            
            ServicesSharon
      Xiong, Director
            
            
            50,000
            
            
            $
            12,500
            
            Services




54




ITEM 14. PRINCIPAL
ACCOUNTANT FEES AND SERVICES





GENERAL.
GHP Horwath, P.C. (“GHP”) is the Company’s independent registered public
accounting firm. The
following table represents aggregate fees billed, or expected to be
billed to the Company for the years ended December 31, 2009 and December
31, 2008 by GHP Horwath, P.C.





Year
      Ended December 31,2009
            
            
            2008Audit
      Fees
            
            $
            56,000
            
            
            $
            70,800-
            
            
            
            -Audit-related
      Fees
            
            
            -
            
            
            
            -Tax
      Fees
            
            
            6,000
            
            
            
            -All
      Other Fees
            
            
            -
            
            
            
            -Total
      Fees
            
            $
            62,000
            
            
            $
            70,800




All audit
work was performed by the auditors’ full time employees.





55


PART
IV





ITEM
15.  EXHIBITS, FINANCIAL STATEMENT SCHEDULES





The
following is a complete list of exhibits filed as part of this Form 10K. Exhibit
number corresponds to the numbers in the Exhibit table of Item 601 of Regulation
S-K.





(a)
            Audited
      financial statements for December 31, 2009(b)
            Exhibit No.
            
            Description3.1
            
            Articles
      of Incorporation of China Wi-Max Communications, Inc. – 7/5/06
      (2)3.2
            
            Certificate
      of Amendment – 9/1/06
              (Stock
      amount changed to 50,000,000 @ $.001) (2)3.3
            
            Bylaws
      of China Wi-Max Communications, Inc. (1)10.1
            
            Shares
      Transfer Agreement between Zhouwei and China Wi-Max Communications, Inc.
      (2)10.2
            
            Employment
      Agreement – George E. Harris (2)10.3
            
            Employment
      Agreement – Allan Rabinoff (2)10.4
            
            2008
      China Wi-Max Communications, Inc.  Stock Option Award and
      Compensation Plan (2)10.5
            
            Cooperation
      Agreement – English Translation and Chinese (2)10.6
            
            Services
      Agreement between Beijing Yuan Shan Shi Dai Technology Development Ltd.
      and Beijing Yuan Shan Da Chuan Business Development Ltd. – ENGLISH
      (3)10.7
            
            Services
      Agreement between Beijing Gao Da Yang Guang Technology Ltd. and Beijing
      Yuan Shan Da Chuan Business Development Ltd. – ENGLISH
  (3)10.8
            
            Cooperation
      Agreement Long Teng Jia Xun – ENGLISH (3)10.9
            
            Business
      License of Beijing Yuan Shan Da Chuan Business Development Ltd. – CHINESE
      and ENGLISH (3)10.10
            
            Business
      License of Beijing Shan Shi Dai Technology Development Ltd. – CHINESE and
      ENGLISH (3)10.11
            
            Declaration
      of Trust – CHINESE and ENGLISH (4)10.12
            
            Amended
      and Restated Declaration of Trust (5)10.13
            
            Security
      and Pledge Agreement (5)10.14
            
            Employment Agreement–Steven
      T. Berman21
            
            List
      of Subsidiaries31.1
            
            Certification
      of Principal Executive Officer pursuant to Section 302 of the
      Sarbanes-Oxley Act31.2
            
            Certification
      of Chief Financial Officer pursuant to Section 302 of the
      Sarbanes-Oxley Act32.1
            
            Certification
      of Principal Executive Officer pursuant to Section 906 of the
      Sarbanes-Oxley Act32.2
            
            Certification
      of Chief Financial Officer pursuant to Section 906 of the
      Sarbanes-Oxley Act99.1
            
            Appendix
      A – Diagram99.2
            
            Appendix
      B – Network Overview99.3
            
            English
      Translation of Business License of Gao Da Yang Guang Communication
      Technology Ltd. (2)99.4
            
            English
      Translation of Business License of Yuan Shan Shi Dai Technology
      Development, Ltd. (2)99.5
            
            Frequency
      License Explanation Letter (2)




(1)
Incorporated by reference from the exhibits included in the Company’s Form 10
filed with the Securities and Exchange Commission (www.sec.gov), dated June 4,
2008. A copy can be provided by mail, free of charge, by sending a written
request to China Wi-Max, Inc., 1905 Sherman Street, Suite 335, Denver, Colorado
80203.
 
 (2)
Incorporated by reference from the exhibits included in the Company’s Form 10/A
filed with the Securities and Exchange Commission (www.sec.gov), dated September
25, 2008. A copy can be provided by mail, free of charge, by sending a written
request to China Wi-Max, Inc., 1905 Sherman Street, Suite 335, Denver, Colorado
80203.
 
 (3)
Incorporated by reference from the exhibits included in the Company’s Form 10/A
filed with the Securities and Exchange Commission (www.sec.gov), dated November
5, 2008. A copy can be provided by mail, free of charge, by sending a written
request to China Wi-Max, Inc., 1905 Sherman Street, Suite 335, Denver, Colorado
80203.
 
 (4)
Incorporated by reference from the exhibits included in the Company’s Form 10/A
filed with the Securities and Exchange Commission (www.sec.gov), dated November
18, 2008. A copy can be provided by mail, free of charge, by sending a written
request to China Wi-Max, Inc., 1905 Sherman Street, Suite 335, Denver, Colorado
80203.
 
 (5)
Incorporated by reference from the exhibits included in the Company’s Form 8K
filed with the Securities and Exchange Commission (www.sec.gov), dated December
19, 2008. A copy can be provided by mail, free of charge, by sending a written
request to China Wi-Max, Inc., 1905 Sherman Street, Suite 335, Denver, Colorado
80203.




56


SIGNATURES





Pursuant
to the requirements of Section 13 or 15(d) of the Securities Exchange Act of
1934, the registrant has duly caused this report to be signed on its behalf by
the undersigned, thereunto duly authorized.








China
      Wi-Max Communications, Inc.Dated:
      April 15, 2010By:
            /s/
      Steven T. BermanSteven
      T. Berman
              President
      and DirectorDated:
      April 15, 2010By:
            /s/
      Frank R, VenturaFrank
      R, Ventura
              Chief
      Financial Officer




Pursuant
to the requirements of the Securities Exchange Act of 1934, this report has been
signed below by the following persons on behalf of the registrant and in the
capacities and on the dates indicated.





Dated:
      April 15, 2010
            /s/
      Steven T. BermanSteven
      T. Berman, President and DirectorDated:
      April 15, 2010
            /s/
      Frank R, VenturaFrank
      R, Ventura, Chief Financial Officer and Director/s/
      Dr. Allan RabinoffDr.
      Allan Rabinoff, Chairman and
              Executive
      Director – China Business Development/s/
      Buck KriegerBuck
      Krieger, Director/s/
      Sharon XiongSharon
      Xiong, Dirctor





57