U.S.
SECURITIES AND EXCHANGE COMMISSION


Washington,
D.C. 20549





FORM
10-Q





x QUARTERLY REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934





For
the quarterly period ended September 30,
2008





o TRANSITION REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934





For the
transition period from





Commission
File No. 000-52682





Yi
Xin International Copper, Inc.


(Name
of registrant in its charter)





Delaware
              26-1364740(State
      or other jurisdiction of
              (I.R.S.
      employerincorporation
      or formation)
              identification
      number)





No.
1 Guiba Road, Guixi District


Yingtan
City, Jiangxi Province


(Address
of principal executive offices)




Issuer’s telephone number:
              86
      701 333 8111







(Former
name, former address and former fiscal year, if changed since last
report)





Check
whether the issuer (1) filed all reports required to be filed by Section 13 or
15(d) of the Exchange Act during the preceding 12 months (or for such shorter
period that the issuer was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days. Yes x No  ̈




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
the definitions of “large accelerated filer,” “accelerated filer” and “smaller
reporting company” in Rule 12b-2 of the Exchange Act. (Check one):


Large
Accelerated filer   ̈   Accelerated
Filer   ̈  Non-Accelerated
Filer  x
Smaller Reporting Company   ̈





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


Yes  ̈ No x





State the
number of shares outstanding of each of the issuer's classes of common equity,
as of December 31, 2008: 20,500,000 shares of common
stock.










PART
I.  FINANCIAL INFORMATION





Item
1. Financial Statements.




Yi
Xin International Copper, Inc.










FINANCIAL
STATEMENTS





AT





September
30, 2008







Yi
Xin International Copper, Inc.





Consolidated
Balance Sheets





September 30, 2008
                                                    (Unaudited)
                                                  
                                                  
                                                  December 31, 2007
                                                    (Audited)ASSETSCurrent
      AssetsCash
      and Cash Equivalents
                                                  
                                                  $
                                                  2,794,526
                                                  
                                                  
                                                  $
                                                  789,429Accounts
      Receivable-Net
                                                  
                                                  
                                                  8,525,267
                                                  
                                                  
                                                  
                                                  6,805,279Accounts
      Receivable-Related Parties
                                                  
                                                  
                                                  1,409,095
                                                  
                                                  
                                                  
                                                  1,780,126Inventory
                                                  
                                                  
                                                  13,715,341
                                                  
                                                  
                                                  
                                                  4,386,064Prepayments
                                                  
                                                  
                                                  314,518
                                                  
                                                  
                                                  
                                                  692,246Subsidy
      Receivable
                                                  
                                                  
                                                  —
                                                  
                                                  
                                                  
                                                  842,291Other
      Receivables
                                                  
                                                  
                                                  1,021,434
                                                  
                                                  
                                                  
                                                  3,309,084Due
      from Related Parties
                                                  
                                                  
                                                  55,307
                                                  
                                                  
                                                  
                                                  723,643Total
      Current Assets
                                                  
                                                  
                                                  27,835,488
                                                  
                                                  
                                                  
                                                  19,328,162Property,
      Plant and Equipment – Net
                                                  
                                                  
                                                  838,070
                                                  
                                                  
                                                  
                                                  804,994Land
      Use Right – Net
                                                  
                                                  
                                                  1,817,625
                                                  
                                                  
                                                  
                                                  58,830Construction
      in Progress
                                                  
                                                  
                                                  659,666
                                                  
                                                  
                                                  
                                                  326,713Total
      Assets
                                                  
                                                  $
                                                  31,150,849
                                                  
                                                  
                                                  $
                                                  20,518,699LIABILITIES
      AND STOCKHOLDERS’ EQUITYCurrent
      LiabilitiesShort-term
      Loan
                                                  
                                                  $
                                                  4,418,327
                                                  
                                                  
                                                  $
                                                  2,734,444Accounts
      Payable
                                                  
                                                  
                                                  5,008
                                                  
                                                  
                                                  
                                                  5,059Accounts
      Payable-Related Parties
                                                  
                                                  
                                                  10,297,150
                                                  
                                                  
                                                  
                                                  9,682,812Note
      Payable-Related Parties
                                                  
                                                  
                                                  1,472,776
                                                  
                                                  
                                                  
                                                  —Advances
      from Customers
                                                  
                                                  
                                                  911,793
                                                  
                                                  
                                                  
                                                  566,749Other
      Payables
                                                  
                                                  
                                                  2,342,502
                                                  
                                                  
                                                  
                                                  682,044Tax
      Payable
                                                  
                                                  
                                                  676,049
                                                  
                                                  
                                                  
                                                  546,433Due
      to Related Parties
                                                  
                                                  
                                                  1,784,621
                                                  
                                                  
                                                  
                                                  6,201,734Accrued
      Expenses
                                                  
                                                  
                                                  696,723
                                                  
                                                  
                                                  
                                                  99,363Total
      Current Liabilities
                                                  
                                                  
                                                  22,604,949
                                                  
                                                  
                                                  
                                                  20,518,638Stockholders’
      EquityPreferred
      Stock (20,000,000 authorized, 0 issued and outstanding, $0.001 par
      value)
                                                  
                                                  
                                                  —
                                                  
                                                  
                                                  
                                                  —Common
      Stock (100,000,000 authorized, 21,500,000 issued, $0.001 par
      value)
                                                  
                                                  
                                                  21,500
                                                  
                                                  
                                                  
                                                  18,000Treasury
      stock, at cost (1,000,000 shares at $.0025 per share)
                                                  
                                                  
                                                  (2,500
                                                  )
                                                  
                                                  
                                                  —Additional
      Paid-In-Capital
                                                  
                                                  
                                                  5,637,550
                                                  
                                                  
                                                  
                                                  (17,565
                                                  )Retained
      Earnings (Accumulated Deficit)
                                                  
                                                  
                                                  2,383,662
                                                  
                                                  
                                                  
                                                  (374
                                                  )Accumulated
      Other Comprehensive Income
                                                  
                                                  
                                                  505,688
                                                  
                                                  
                                                  
                                                  —Total
      Stockholders’ Equity
                                                  
                                                  
                                                  8,545,900
                                                  
                                                  
                                                  
                                                  61Total
      Liabilities and Stockholders’ Equity
                                                  
                                                  $
                                                  31,150,849
                                                  
                                                  
                                                  $
                                                  20,518,699





“The accompanying
notes are an integral part of these financial statements”











Yi
Xin International Copper, Inc.





Consolidated
Statements of Operations and Comprehensive Income





For nine months ended
                          September 30, 2008
                          (Unaudited)
                        
                        
                        For nine months ended
                          September 30, 2007
                          (Pro Forma Unaudited)
                        
                        
                        For three months ended
                          September 30, 2008
                          (Unaudited)
                        
                        
                        For three months ended
                          September 30, 2007
                          (Pro Forma Unaudited)Sales
                        
                        $
                        100,868,908
                        
                        
                        $
                        98,036,528
                        
                        
                        $
                        28,979,401
                        
                        
                        $
                        22,684,475Cost
      of Sales
                        
                        
                        (98,835,174
                        )
                        
                        
                        (100,143,624
                        )
                        
                        
                        (28,962,529
                        )
                        
                        
                        (22,895,108
                        )Government
      Subsidies
                        
                        
                        1,849,646
                        
                        
                        
                        4,351,460
                        
                        
                        
                        588,300
                        
                        
                        
                        400,418Sales
      Tax and Surtax
                        
                        
                        —
                        
                        
                        
                        (195,240
                        )
                        
                        
                        —
                        
                        
                        
                        (37,198
                        )Gross
      Profit
                        
                        
                        3,883,380
                        
                        
                        
                        2,049,124
                        
                        
                        
                        605,172
                        
                        
                        
                        152,587Operating
      ExpensesSelling
      Expense
                        
                        
                        —
                        
                        
                        
                        29,875
                        
                        
                        
                        —
                        
                        
                        
                        5,321General
      and Administrative Expenses
                        
                        
                        1,189,602
                        
                        
                        
                        478,034
                        
                        
                        
                        628,337
                        
                        
                        
                        251,477Financial
      Expenses
                        
                        
                        179,623
                        
                        
                        
                        6,002
                        
                        
                        
                        60,674
                        
                        
                        
                        7,128Total
      Operating Expenses
                        
                        
                        1,369,225
                        
                        
                        
                        513,911
                        
                        
                        
                        689,011
                        
                        
                        
                        263,926Operating
      Income
                        
                        
                        2,514,155
                        
                        
                        
                        1,535,213
                        
                        
                        
                        (83,839
                        )
                        
                        
                        (111,339
                        )Non-operating
      income
                        
                        
                        1,435
                        
                        
                        
                        16,232
                        
                        
                        
                        1,432
                        
                        
                        
                        88Non-operating
      expenses
                        
                        
                        (6,540
                        )
                        
                        
                        (7,651
                        )
                        
                        
                        ( 5,879
                        )
                        
                        
                        (7,621
                        )Net
      Income (Loss) Before Provision for Income Taxes
                        
                        
                        2,509,050
                        
                        
                        
                        1,543,794
                        
                        
                        
                        (88,286
                        )
                        
                        
                        (118,872
                        )Provision
      for Income Taxes
                        
                        
                        (117,744
                        )
                        
                        
                        —
                        
                        
                        
                        85,856
                        
                        
                        
                        —Net
      Income (Loss)
                        
                        
                        2,391,306
                        
                        
                        
                        1,543,794
                        
                        
                        
                        (2,430
                        )
                        
                        
                        (118,872
                        )Other
      Comprehensive IncomeForeign
      Currency Translation
                        
                        
                        505,688
                        
                        
                        
                        211,349
                        
                        
                        
                        99,804
                        
                        
                        
                        89,644Comprehensive
      Income
                        
                        $
                        2,896,994
                        
                        
                        $
                        1,755,143
                        
                        
                        $
                        97,374
                        
                        
                        $
                        (29,228
                        )Net
      income per share:-
      Basic
                        
                        
                        0.13
                        
                        
                        
                        0.09
                        
                        
                        
                        0.00
                        
                        
                        
                        (0.01
                        )-
      Diluted
                        
                        
                        0.13
                        
                        
                        
                        0.09
                        
                        
                        
                        0.00
                        
                        
                        
                        (0.01
                        )Weighted
      average shares outstanding:-
      Basic
                        
                        
                        18,428,832
                        
                        
                        
                        18,000,000
                        
                        
                        
                        19,277,174
                        
                        
                        
                        18,000,000-
      Diluted
                        
                        
                        18,428,832
                        
                        
                        
                        18,000,000
                        
                        
                        
                        19,277,174
                        
                        
                        
                        18,000,000





“The accompanying
notes are an integral part of these financial statements”











Yi
Xin International Copper, Inc.





Consolidated
Statements of Cash Flows





For nine
                            months ended
                            September 30,
                            2008
                            (Unaudited)
                          
                          
                          For nine months
                            ended
                            September 30,
                            2007
                            (Pro Forma
                            Unaudited)Cash
      Flows from Operating ActivitiesNet
      Income (Loss)
                          
                          $
                          2,391,306
                          
                          
                          $
                          1,543,794Adjustments
      to Reconcile Net Income (Loss) to Net Cash Provided by
      Operations:Depreciation
      and Amortization Expenses
                          
                          
                          189,242
                          
                          
                          
                          132,145Cash
      Provided (Used) by Changes in Operating Assets and
    LiabilitiesAccounts
      Receivable
                          
                          
                          (1,161,581
                          )
                          
                          
                          (4,234,174
                          )Accounts
      Receivable-Related Parties
                          
                          
                          494,407
                          
                          
                          
                          (1,496,283
                          )Other
      Receivables
                          
                          
                          2,472,828
                          
                          
                          
                          (408,743
                          )Prepayments
                          
                          
                          419,253
                          
                          
                          
                          (450,725
                          )Inventory
                          
                          
                          (8,742,153
                          )
                          
                          
                          (5,407,162
                          )Subsidy
      Receivable
                          
                          
                          882,239
                          
                          
                          
                          —Accounts
      Payable
                          
                          
                          (429
                          )
                          
                          
                          72,045Accounts
      Payable -Related Parties
                          
                          
                          (129,522
                          )
                          
                          
                          6,010,888Note
      Payable
                          
                          
                          1,432,067
                          
                          
                          
                          —Advance
      from Customers
                          
                          
                          292,962
                          
                          
                          
                          1,930,565Tax
      Payable
                          
                          
                          82,224
                          
                          
                          
                          —Other
      Payables
                          
                          
                          1,563,366
                          
                          
                          
                          1,637,059Accrued
      Expenses
                          
                          
                          591,988
                          
                          
                          
                          —Net
      Cash Provided (Used) by Operating Activities
                          
                          
                          778,198
                          
                          
                          
                          (670,591
                          )Cash
      Flows from Investing ActivitiesCash
      Used for Construction in Progress
                          
                          
                          (251,589
                          )
                          
                          
                          (251,518
                          )Acquisition
      of Property, Plant and Equipment
                          
                          
                          (41,028
                          )
                          
                          
                          (1,492,077
                          )Acquisition
      of Land Use Right
                          
                          
                          (1,699,765
                          )
                          
                          
                          —Net
      Cash Provided by (Used in) Investing Activities
                          
                          
                          (1,992,382
                          )
                          
                          
                          (1,743,595
                          )Cash
      Flows from Financing ActivitiesBorrowing
      from (Repayment to) Directors or Managerial Personnel –
net
                          
                          
                          (3,976,304
                          )
                          
                          
                          (1,271,495
                          )Bank
      and other borrowings raised
                          
                          
                          4,296,201
                          
                          
                          
                          521,121Repayment
      of bank and other borrowings
                          
                          
                          (2,864,134
                          )
                          
                          
                          —Capital
      Contribution
                          
                          
                          5,648,844
                          
                          
                          
                          6,360,282Net
      Cash Flows from Financing Activities
                          
                          
                          3,104,607
                          
                          
                          
                          5,609,908Net
      Changes in Cash and Cash Equivalents
                          
                          
                          1,890,423
                          
                          
                          
                          3,195,722Effect
      on Change of Exchange Rate
                          
                          
                          114,673
                          
                          
                          
                          72,425Cash
      and Cash Equivalents - Beginning of Period
                          
                          
                          789,429
                          
                          
                          
                          130,148Cash
      and Cash Equivalents - End of Period
                          
                          $
                          2,794,526
                          
                          
                          $
                          3,398,295








Yi
Xin International Copper, Inc.





Consolidated
Statements of Cash Flows (Continued)





For nine
                          months ended
                          September 30,
                          2008
                          (Unaudited)
                        
                        
                        For nine months
                          ended
                          September 30,
                          2007
                          (Pro Forma
                          Unaudited)Supplementary
      Cash Flow Disclosures:Interest
      Paid
                        
                        $
                        172,425
                        
                        
                        $
                        7,930Income
      Taxes Paid
                        
                        $
                        —
                        
                        
                        $
                        —





NOTE
A – CHANGE OF CORPORATE STRUCTURE AND DESCRIPTION OF BUSINESS




Acquisition
of Jiangxi Guixi Yi Xin Copper Co., Ltd.




Yi Xin
International Copper, Inc.(Yi Xin International), which was formerly known as
AFH HOLDING I, INC(AFH), was incorporated in the State of Delaware on April 16,
2007.




AFH was
100% owned by AFH Holding and Advisory, LLC. On August 14, 2008 (the “Closing
Date”), AFH entered into a Share Exchange Agreement (the “Share Exchange
Agreement”) with LYH Acquisition Corporation (LYH) and Newry Invest & Trade,
Inc., a British Virgin Islands corporation (“Newry”).  Prior to the
Closing Date, Newry owned 100% of the issued and outstanding shares of common
stock of LYH;  LYH owned 100% of the issued and outstanding securities
of WWC; and WWC owned 100% of the issued and outstanding securities of Jiangxi
Guixi Yi Xin Copper Co., Ltd (Yi Xin Copper). Jing Yu, a Norwegian, owned 100%
of Newry.




The Share
Exchange Transaction was consummated on the Closing Date. AFH issued 18,000,000
shares of common stock, par value US $0.001 per share (“Common Stock”) to Newry
in exchange for all of the issued and outstanding LYH common
stock.  As a result, LYH became a direct wholly-owned subsidiary of
AFH, and WWC and Yi Xin Copper became indirect wholly-owned subsidiaries of AFH.
Shortly after the Share Exchange Transaction, AFH Holding changed its name to
“Yi Xin International Copper, Inc.”.




In this
report, “The Company” refers to Yi Xin International and its directly and
indirectly owned subsidiaries.




LYH was
incorporated in the British Virgin Islands on September 21, 2007.  The
sole purpose of the formation of LYH was to create a corporate entity outside of
the People’s Republic of China, or PRC, to create a Hong Kong Corporation for
the purpose of acquiring Yi Xin Copper.  LYH was initially owned by
one individual who was a United States citizen until he transferred his entire
interest in November 2007 to Newry, a company incorporated in the British Virgin
Islands on September 21, 2007.




WWC
Corporation LTD. (WWC) was incorporated in Hong Kong on October 22, 2007 as the
wholly owned subsidiary of LYH.




Jiangxi
Guixi Yi Xin Copper Co., Ltd was established in April 2006 in Guixi City of
Jiangxi Province of the Peoples Republic of China (“PRC”) and began operations
in December 2006.




On
November 18, 2007, WWC entered into an Equity Interest Acquisition Agreement
with the owners of Yi Xin Copper to acquire 100% of the equity interest of Yi
Xin Copper for cash consideration.  The transaction was approved by
the Jiangxi Provincial Government on November 29, 2007, and the acquisition was
completed on December 11, 2007, when the Certificate of Incorporation of Yi Xin
Copper as a Foreign Invested Enterprise (FIE) was issued by the Ying tan
Administration of Industry and Commerce (YIAIC).  Based on applicable
PRC regulations and pursuant to the Equity Interest Acquisition Agreement, WWC
shall pay the acquisition price of Yi Xin Copper within three (3)
months.









WWC has
paid RMB 40 million for Yi Xin Copper ((estimated at USD $5,468,889 as of
December 31, 2007, using an exchange rate of USD$1 equal to RMB7.31410) (the
“Purchase Price”)) by March 28, 2008.  The source of the cash used for
the acquisition was from shareholders’ capital contributions.




Securities
Purchase Agreement and Share Cancellation




Prior to
the Share Exchange Transaction, there were a total of 4,000,000 shares of common
stock issued and outstanding and held by AFH Holding and Advisory,
LLC.  In connection with the Share Exchange Transaction, AFH Holding
and Advisory agreed to cancel 2,000,000 shares of common stock held by it and
sold 870,000 shares of common stock to 41 accredited investors (“Investors”) in
exchange for $870,000 in cash consideration, resulting in a reduction of the
number of shares held by AFH Holding and Advisory to 1,130,000
shares.




In sum,
after giving effect to the Share Exchange Transaction and the above private
placement and share cancellation, of the 20,000,000 shares of common stock
outstanding, 870,000 shares were held by the Investors, 1,130,000 shares of
common stock were held by AFH Holding, and 18,000,000 shares were held by Newry.
Also, simultaneously with the closing of the Share Exchange Transaction and
pursuant to the terms of their employment agreements Linquan Hu, our CEO and
Vice Chairman, and Fucan Dong, our Chairman, were each
granted  250,000 restricted shares of our common stock, vesting in
three equal installments over three years.




Nature
of Operations




Yi Xin
Copper is principally engaged in the manufacture and distribution of brass and
copper products such as copper rods, wires and valves.  It distributes
products nationally in China.  Currently it has 223 employees, among
which 197 employees are disabled.  Yi Xin Copper is eligible for
special tax treatment due to hiring more than 50% of total employees who are
disabled.




Yi Xin
Copper purchases scrap coppers from suppliers in Tai Zhou city of Zhejiang
province who operate as factories instead of retailers.  About 99% of
the total scrap coppers purchased are from Guixi Fangyuan Recycling Company, a
related company.  As the major scrap copper supplier, Guixi Fang Yuan
Recycling Company sells the raw materials to Yi Xin Copper at the fair market
value.




It is
management’s opinion that all adjustments necessary for a fair statement of the
results for the interim periods have been made.  All adjustments are
of normal recurring nature.





NOTE
B - PRO FORMA CONSOLIDATED FINANCIALS




In the
body of the financial statements, we present the pro forma financial statement
for the nine months ended September 30, 2007 for comparison
purposes.




The
September 30, 2007 pro forma consolidated financial statements combine the
historical statements of operations and comprehensive income of Yi Xin
International, LYH, WWC, and Yi Xin Copper, for the nine-month ended September
30, 2007, and their respective statements of cash flows for the nine-month
period ended September 30, 2007, giving effect to the acquisition of Yi Xin
Copper as if the acquisition had taken place on January 1, 2007.




The
Company accounted for the acquisition using the purchase method of accounting.
The pro forma adjustments are based upon available information and assumptions
that the Company believes are reasonable.




We
provide the following information to aid you in your analysis of the financial
aspects of the acquisition of Yi Xin Copper.




The
fiscal year end of Yi Xin International, LYH, WWC, and Yi Xin Copper is December
31, respectively.









The pro
forma consolidation financial information is for illustrative purposes
only.  The companies may have performed differently had the
acquisition taken place other than on December 11, 2007, and had they always
been consolidated.  You should not rely on the pro forma consolidated
financial information as being indicative of the historical results that would
have been achieved had the acquisition taken place other than on December 11,
2007, and had the companies always been consolidated or the future results that
the companies will experience after the acquisition.





1.Pro Forma Consolidated
Statements of Operations and Comprehensive Income – For the Nine-Month Ended
September 30, 2007




(a)
Derived from the unaudited statement of operations and comprehensive income of
Yi Xin for the nine-month ended September 30, 2007





2. Pro Forma Consolidated
Statements of Cash Flows – For the Nine-Month Ended September 30,
2007




(a)
Derived from the unaudited statement of cash flows of Yi Xin for the nine-month
ended September 30, 2007




NOTE
C - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES




(a)
            Cash
      and Cash equivalents





The
Company considers cash and cash equivalents to include cash on hand and demand
deposits with banks with an original maturity of three months or
less.




(b)
            Account
      Receivable





Account
Receivables are recognized and carried at the original invoice amount less
allowance for any uncollectible amounts.  An estimate for doubtful
accounts is made when collection of the full amount is no longer
probable.  Bad Debts are written off as incurred.  The
Company monitors exposure to credit losses and maintains allowances for
anticipated losses considered necessary under the circumstances. .




(c)
            Inventory





Inventory
is valued at the lower of cost of market (using the weighted average method) or
net realizable value.  Cost includes all costs to acquire and other
costs incurred in bringing the inventories to their present location and
condition.  The Company evaluates the net realizable value of its
inventories on a regular basis and records a provision for loss to reduce the
computed weighted-average cost.  Net realizable value is the estimated
selling price in the ordinary course of business less the estimated costs of
completing, selling expenses and related taxes.




(d)
            Land
      Use Right





According
to the laws of China, the government owns all the land in
China.  Companies or individuals are authorized to possess and use the
land only through land use rights granted by the Chinese
government.  Land use rights are amortized using the straight-line
method over the lease term of 50 years.




(e)
            Property,
      Plant and Equipment




Fixed
assets are stated at cost.  The cost of repairs and maintenance is
expensed as incurred; major replacements and improvements are
capitalized.









When
assets are retired or otherwise disposed of, the costs and related accumulated
depreciation are removed from the accounts, and any resulting gain or loss is
recognized in income for the period of disposition.




Depreciation
is computed using the straight-line method over the estimated useful lives of
assets, net of the estimated residual values.  The useful lives for
property, plant and equipment are as follows:




Buildings
      and leasehold improvement
              20 yearsPlant
      and Machinery
              5-10 yearsOffice
      equipment and furnishing
              5 yearsMotor
      Vehicles
              10 years




(f)
            Construction
      in Progress




Construction
in Progress represents direct costs of construction or acquisition and design
fees incurred.  Capitalization of these costs ceases and the
construction in progress is transferred to plant and equipment assets when
substantially all the activities necessary to prepare the assets for their
intended use are completed.  No depreciation is provided until it is
completed and ready for intended use.




(g)
            Government
      Subsidies




The
Company is a welfare enterprise, it is entitled to the special tax
treatments.  Government subsidies refer to the tax refund by both the
central and the local Chinese government from the value-added taxes paid by the
Company for the employment of qualified welfare employees.  The
Company has to pay the value-add tax in accordance with the relevant Chinese tax
laws and regulations.




Prior to
July 2007, government subsidies consist of the government refunds of all of the
value-added tax payments paid by the Company.




Effective
in July 2007, because the Company is a welfare enterprise, it is entitled to
receive up to 35,000 Yuan in RMB per qualified handicapped employee per year
according to the central government policies.  In addition, due to the
incentive policies made by Guixi Local Finance Department to attract out of town
investments that is effective in July 2007 and expires on December 30, 2009, the
Company is entitled to receive from Guixi Local Finance Department 25% of net of
VAT tax paid minus up to 35,000 Yuan in RMB government subsidies per handicapped
employee per year.




Subsidies
are recognized at their fair values when received or there is reasonable
assurance that they will be received and all attached conditions are complied
with.  According to Chinese tax law, government subsidies for
qualified welfare employees up to 35,000 Yuan in RMB per handicapped employee
per year are not subject to income taxes.




(h)
            Income
      Taxes





LYH was
incorporated in the British Virgin Islands (BVI) on September 21,
2007.  As an offshore company, it is exempt from income taxes
according to the Article 242 of the BVI Business Companies Act 2004 (“Exemptions
from Tax”), which states that (a) a company b) all dividends, interest, rents,
royalties, compensations and other amounts paid by company, and (c) capital
gains realized with respect to any shares, debt obligations or other securities
of a company, are exempt from all provisions of the Income Tax
Ordinance.









WWC was
incorporated in Hong Kong on October 22, 2007. In accordance with the relevant
tax laws and regulations of Hong Kong, a company, irrespective of its
residential status, is subject to tax on all profits (excluding profits arising
from the sale of capital assets) arising in or derived from Hong Kong. No tax is
levied on profits arising abroad, even if they are remitted to Hong
Kong.  Therefore, WWC is exempt from Hong Kong income tax since all
the profits were derived from Yi Xin Copper in PRC. The income tax rate in Hong
Kong is 17.5%.




Yi Xin
Copper was established in April 2006 in Guixi City of Jiangxi Province of the
Peoples Republic of China (“PRC”) and began operations in December
2006.  In accordance with the relevant tax laws and regulations of
PRC, a company registered in the PRC is subject to state and local income taxes
within PRC at the applicable tax rate on the taxable income as reported in their
PRC statutory financial statements.  Under the Provisional Taxation
Regulation of the PRC, income tax is payable at a rate of 33% of their taxable
income for year 2007.  Effective January 1, 2008, all companies are
subject to uniform tax rate of 25%.  According to the PRC tax law,
government subsidies for qualified welfare employees up to 35,000 Yuan in RMB
per handicapped employee per year are not subjected to income
taxes.  In addition, the PRC tax law allows operating losses to be
carried forward for five years.  Due to the incentive policies made by
Guixi Local finance department to attract out of town investments, Yi Xin
Copper, who qualifies as out of town investor, is entitled to a two-year
exemption from income taxes followed by three years of a 50% tax reduction,
commencing from the first cumulative profit-making year net of losses carried
forward.  Yi Xin Copper is allowed to carry forward net-operating
losses for five years under the current PRC tax law.  Yi Xin Copper is
required to pay income taxes first at regular tax rate, prior to January 1,
2008, the government will make full refund of the taxes paid by Yi Xin Copper
for the first two years, then reduced to a refund of 50% of the taxes paid by Yi
Xin Copper for the following three years.  Effective on January 1,
2008, only the local government will make full refund of the taxes paid by Yi
Xin Copper that is allocable to the local government for the first two years,
then reduced to a refund of 50% of the taxes paid by Yi Xin Copper that is
allocable to the local government for the following three years.




The
Company accounts for income tax using an assets and liability approach and
allows for recognition of deferred tax benefits in future
years.  Under the assets and liability approach, deferred taxes are
provided for the net tax effects of temporary differences between the carrying
amounts of assets and liabilities for financial reporting purposes and the
amounts used for income tax purpose.  A valuation allowance is
provided for deferred tax assets if it is more likely than not these items will
either expire before the Company is able to realize their benefits, or that
future realization is uncertain.




The
Company has no temporary differences.  Therefore, no deferred tax
assets and liabilities have been recognized and no valuation allowance has been
established. The Company does have permanent differences, such as penalty,
government subsidies for qualified welfare employees, etc.




(i)
            Related
      Parties





Parties
are considered to be related if one party has the ability, directly or
indirectly, to control the other party or exercise significant influence over
the other party in making financial and operational
decisions.  Parties are also considered to be related if they are
subject to common control or common significant influence.  Related
parties may be individuals or corporate entities.




(j)
            Foreign
      Currency Translation





The
Company, LYH and WWC maintain their books and accounting records in U.S
dollars.  Yi Xin Copper maintains its books and accounting records in
Renminbi (“RMB”), the PRC’s currency, being the functional
currency.  Transactions denominated in foreign currencies are
translated into the reporting currency at the exchange rates prevailing on the
transaction dates.  Assets and liabilities denominated in foreign
currencies are translated into the reporting currency at the exchange rates
prevailing at the balance sheet date.  Income and expenditures are
translated at the average exchange rate of the year.










September 30, 2008Balance
      sheet
                                      
                                      RMB
                                      6.78990
                                      
                                      to
      US
                                      
                                      $
                                      1Operating
      statement
                                      
                                      RMB
                                      6.98291
                                      
                                      to
      US
                                      
                                      $
                                      1December 31, 2007Balance
      sheet
                                      
                                      RMB
                                      7.31410
                                      
                                      to
      US
                                      
                                      $
                                      1Operating
      statement
                                      
                                      RMB
                                      7.61720
                                      
                                      to
      US
                                      
                                      $
                                      1September 30, 2007Balance
      sheet
                                      
                                      RMB
                                      7.51760
                                      
                                      to
      US
                                      
                                      $
                                      1Operating
      statement
                                      
                                      RMB
                                      7.67576
                                      
                                      to
      US
                                      
                                      $
                                      1





In July
2005, the PRC began to value the RMB against a basket of currencies of its major
trading partners, including the U.S.  Since the adoption of this
flexible exchange rate policy, the RMB has been under pressure to appreciate
against the U.S. dollar.  This has affected the changes in the foreign
currency translation as reflected in the other comprehensive income of $505,688
and $211,349 (pro forma) for the nine months ended September 30, 2008 and 2007,
respectively.




(k)
            Use
      of Estimates





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 period.  On an on-going basis, the Company
evaluates its estimates, including, but not limited to, those related to
depreciation, bad debts, income taxes and contingencies.  The Company
bases its estimates on historical experience and on various other assumptions
that are believed to be reasonable under the circumstances, Actual results could
differ from those estimates.




(l)
            Economic
      and Political Risks




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




The
Company’s operations in the PRC are subject to special considerations and
significant risks not typically associated with companies in North America and
Western Europe.  These include risks associated with, among others,
the political, economic and legal environment and foreign currency
exchange.  The Company’s results may be adversely affected by changes
in governmental policies with respect to laws and regulations, anti-inflationary
measures, currency conversion, remittances abroad, and rates and methods of
taxation, among other things.




(m)
            Fair
      value of Financial Instruments





The
carrying value of financial instruments including cash, receivables, accounts
payable, accrued expenses and debt, approximates their fair value at September
30, 2008, and December 31, 2007 due to the relatively short-term nature of these
instruments.









(n)
            Revenue
      Recognition




The
Company recognizes revenue from product sales when goods are delivered, the
quantity and quality of the goods are confirmed and rewards and risk of
ownership and title pass to the customers.  Revenues consist of the
invoice value of the sale of goods and services net of value added tax, rebates
and discounts, certain sales incentives, trade promotion, and product
returns.  All of the Company’s products are shipped directly to the
manufacturer.  Revenue arrangement requires receipt of purchase orders
before product shipment and delivery.




(o)
            Employee’s
      Benefits





The
Company is required and made contributions to the Chinese Government’s health,
retirement benefit and unemployment plan at the statutory rates in force during
the period, based on gross salary payments.  The cost of these
payments is charged to the statement of income at the same period as the related
salary cost.




(p)
            Comprehensive
      Income (loss)





The
Company adopted Statement of Financial Accounting Standards No, 130, “Reporting
Comprehensive Income,” (SFAS No. 130).  SFAS No. 130 requires the
reporting of comprehensive income in addition to net income from
operations.




Comprehensive
income is a more inclusive financial reporting methodology that includes
disclosure of information that historically has not been recognized in the
calculation of net income.  The other comprehensive income (expense)
for the nine months ended September 30 2008 and 2007 were $505,688 and $211,349
(pro forma), respectively.




(q)
            Concentration
      of Credit Risk




Financial
instruments that potentially subject the Company to significant concentration of
credit risk consist primarily of trade account receivable.  The
Company performs ongoing credit evaluations with respect to the financial
condition of its creditors, but does not require collateral.




(r)
            Recent
      Accounting Pronouncements





In
September 2006, the FASB issued SFAS No.157, “Fair Value Measurements”, which
defines fair value, establishes a framework for measuring fair value in
generally accepted accounting principles (GAAP), and expands disclosures about
fair value measurements. On February 12, 2008, the FASB issued FASB Staff
Position (FSP) No.157-2, which deferred the effective date for certain portions
of SFAS No.157 related to nonrecurring measurements of non-financial assets and
liabilities. The provision of SFAS No.157 will be effective for the Company’s
fiscal year 2009.





In
December 2007, the FASB issued FASB 141(R), "Business Combinations" the
objective of which is to improve the relevance, representational faithfulness,
and comparability of the information that a reporting entity provides in its
financial reports about a business combination and its effects. The new standard
requires the acquiring entity in a business combination to recognize all (and
only) the assets acquired and liabilities assumed in the transaction;
establishes the acquisition-date fair value as the measurement objective for all
assets acquired and liabilities assumed; and requires the acquirer to disclose
to investors and other users all of the information they need to evaluate and
understand the nature and financial effect of the business
combination.










In
December 2007, the FASB issued FASB 160 "Noncontrolling Interests in
Consolidated Financial Statements - an amendment of ARB No.51" of which the
objective is to improve the relevance, comparability, and transparency of the
financial information that a reporting entity provides in its consolidated
financial statements by establishing accounting and reporting standards by
requiring all entities to report noncontrolling (minority) interests in
subsidiaries in the same way - as an entity in the consolidated financial
statements. Moreover, Statement 160 eliminates the diversity that currently
exists in accounting for transactions between an entity and noncontrolling
interests by requiring they be treated as equity transactions.





Both FASB
141(R) and FASB 160 are effective for fiscal years beginning after December 15,
2008. The Company does not believe that the adoption of these standards will
have any impact on its consolidated financial statements.





In
December 2007, the SEC issued Staff Accounting Bulletin No. 110 (“SAB 110”). SAB
110 permits companies to continue to use the simplified method, under certain
circumstances, in estimating the expected term of “plain vanilla” options beyond
December 31, 2007. SAB 110 updates guidance provided in SAB 107 that previously
stated that the Staff would not expect a company to use the simplified method
for share option grants after December 31, 2007. Adoption of SAB 110 is not
expected to have a material impact on the Company’s financial
statements.




In March
2008, the FASB issued SFAS No.161, Disclosures about Derivative Instruments and
Hedging Activities- an amendment of FASB statement No.133. SFAS No.161 requires
enhanced disclosures about an entity’s derivative and hedging activities and
thereby improves the transparency of financial reporting. SFAS No.161 is
effective for fiscal years, and interim periods within those fiscal years,
beginning after November 15, 2008, with early application encouraged. As such,
the Company is required to adopt these provisions at the beginning of the fiscal
year ending December 31, 2009. The Company is currently evaluating the impact of
SFAS No. 161 on its consolidated financial statements.





In May
2008, the FASB issued Statement of Financial Accounting Standard (“SFAS”) No.
162, "The Hierarchy of Generally Accepted Accounting
Principles”.  SFAS 162 identifies the sources of accounting principles
and the framework for selecting the principles used in the preparation of
financial statements of nongovernmental entities that are presented in
conformity with generally accepted accounting principles (GAAP) in the United
States.  SFAS 162 is effective 60 days following the SEC’s approval of
the Public Company Accounting Oversight Board amendments to AU Section 411, The
Meaning of Present Fairly in Conformity With Generally Accepted Accounting
Principles. The Company is currently evaluating the impact of SFAS 162 on its
consolidated financial statements but does not expect it to have a material
effect.





In May
2008, the FASB issued Statement of Financial Accounting Standard (“SFAS”) No.
163, "Accounting for Financial Guarantee Insurance Contracts—an interpretation
of FASB Statement No. 60" (“SFAS 163”).  SFAS 163 interprets Statement
60 and amends existing accounting pronouncements to clarify their application to
the financial guarantee insurance contracts included within the scope of that
Statement.  SFAS 163 is effective for financial statements issued for
fiscal years beginning after December 15, 2008, and all interim periods within
those fiscal years.  As such, the Company is required to adopt these
provisions at the beginning of the fiscal year ended December 31,
2009.  The Company is currently evaluating the impact of SFAS 163 on
its consolidated financial statements but does not expect it to have a material
effect.










NOTE
D - ACCOUNTS RECEIVABLE




The
Company’s accounts receivable from unrelated parties as of September 30, 2008
and December 31, 2007 are summarized as follows:




September 30,
                          2008
                        
                        
                        December 31,
                          2007Trade
      Receivables
                        
                        $
                        8,562,104
                        
                        
                        $
                        6,839,476Less:
      Allowance for doubtful accounts
                        
                        
                        36,837
                        
                        
                        
                        34,197Net
      accounts receivable
                        
                        $
                        8,525,267
                        
                        
                        $
                        6,805,279





NOTE
E - PROPERTY, PLANT AND EQUIPMENT





Property,
plant and equipment consisted of the following, as of September 30, 2008 and
December 31, 2007.





September 30,
                              2008
                            
                            
                            December 31,
                              2007Buildings
      and Leasehold
                            
                            $
                            609,550
                            
                            
                            $
                            565,864Machinery
                            
                            
                            2,138,579
                            
                            
                            
                            1,967,344Office
      Equipments
                            
                            
                            40,008
                            
                            
                            
                            15,935Motor
      Vehicles
                            
                            
                            25,364
                            
                            
                            
                            23,5452,813,501
                            
                            
                            
                            2,572,688Accumulated
      Depreciation
                            
                            
                            (411,958
                            )
                            
                            
                            (204,221
                            )Acquisition
      Adjustment
                            
                            
                            (1,563,473
                            )
                            
                            
                            (1,563,473
                            )Property,
      Plant and Equipment, net
                            
                            $
                            838,070
                            
                            
                            $
                            804,994





The
Company recorded depreciation expense of $ 186,664 and $129,178 (pro forma) for
the nine months ended September 30, 2008 and 2007, respectively.




NOTE
F - LAND USE RIGHTS




September 30,
                        2008
                      
                      
                      December 31,
                        2007Land
      Use Right
                      
                      $
                      1,938,955
                      
                      
                      $
                      177,192Accumulated
      Amortization
                      
                      
                      (7,070
                      )
                      
                      
                      (4,102
                      )Acquisition
      Adjustment
                      
                      
                      (114,260
                      )
                      
                      
                      (114,260
                      )Land
      Use Right, net
                      
                      $
                      1,817,625
                      
                      
                      $
                      58,830




In order
to enlarge production scale, the Company paid RMB11,869,312 (approximately $1.70
million), as the unit price is RMB168 per square meter, for the second Land Use
Right at the third quarter of 2008. The Company recorded amortization expense of
$2,578 and $2,088 (pro forma) for the nine months ended September 30, 2008 and
2007, respectively.










NOTE
G - INVENTORY




On
September 30, 2008 and December 31, 2007, inventories consisted of the
following:




September 30,
                        2008
                      
                      
                      December 31,
                        2007Raw
      materials
                      
                      $
                      10,467,947
                      
                      
                      $
                      1,002,546Finished
      goods
                      
                      
                      3,247,394
                      
                      
                      
                      3,383,518Total
      Inventories
                      
                      $
                      13,715,341
                      
                      
                      $
                      4,386,064




Since the
Company does not recognize sales until customers confirmed the quantity and
quality of the goods, some finished goods, although delivered and stored at
customer’s site, still belong to the Company and are included in the inventory
of the Company until customers accept the goods and revenues recognized by the
Company.





NOTE
H - RELATED PARTY TRANSACTIONS




These
following entities are considered related parties to the Company and the related
parties act only as the Company’s suppliers, retailers, or directors or
managerial personnel. And there are no other relationships wherein the Company
has the ability to exercise significant influence over the operating and
financial policies of these parties.  The Company is not obligated to
provide any type of financial support to these related parties.  The
economic substance of each entity is summarized as follows:





Related Party
            
            Economic SubstanceTaizhou
      Wuhe Copper Company
            
            Distributes
      copper products in ChinaTaizhou
      Guangda Packaging Company
            
            Engaged
      in buying and selling packaging materialsZhengzhou
      Xiandai Chemical Company
            
            Engaged
      in Chemical products manufacturing and distributingYuhuan
      Ruixing Copper Company
            
            Manufactures
      and distributes copper products in ChinaGuixi
      Fangyuan Recycling Company
            
            Engage
      in recycling of waste materials in
China




The
Company continued to purchase and sell copper products between related parties
which include Taizhou Wuhe Copper Company and Guixi Fangyuan Recycling
Company.  The following related party transactions occurred for the
nine months ended September 30, 2008 and 2007.







Nine-Month
                                  Ended September
                                  30, 2008
                                  (Unaudited)
                                
                                
                                Nine-Month
                                  Ended
                                  September 30,
                                  2007
                                  (Pro Forma
                                  Unaudited)Purchases
      from Related PartiesGuixi
      Fangyuan Recycling Company
                                
                                $
                                106,626,831
                                
                                
                                $
                                104,308,832$
                                106,626,831
                                
                                
                                $
                                104,308,832Sales
      to Related PartiesTaizhou
      Wuhe Copper Company
                                
                                $
                                8,209,468
                                
                                
                                $
                                4,000,516$
                                8,209,468
                                
                                
                                $
                                4,000,516





NOTE
I - SHORT-TERM BANK LOAN




To
finance the operation of the business, during the quarter ended June 30, 2007,
the Company’s subsidiary, Yi Xin Copper, obtained a short-term loan of
RMB4,000,000 (approximately $0.53 million) from local Construction Bank of
China, with interest bearing at 6.475% per annum.  The loan was paid
in full by December 31, 2007.




On
December 3, 2007, Yi Xin Copper obtained the second short-term loan of
RMB20,000,000 (approximately $2.73 million) from local Bank of Pu Fa, Nanchang
branch with interest bearing at 7.128% per annum.  The loan is
guaranteed by an unrelated company. The loan was paid in full by May 26,
2008.




On June
27, 2008, Yi Xin Copper entered into a Short Term Loan Contract with Industrial
Bank Co., Ltd., Nanchang Branch, under which Yixin borrowed a loan of
RMB15,000,000 (approximately $2.18 million) for a term of eleven
months.  The loan is secured by certain improvements to real property
of Yixin and a Guarantee Agreement by and between Guixi Fangyuan Waste Recycling
Co. Ltd, Hu Linquan, Dong Fucan and Industrial Bank Co., Ltd. The loan is due on
May 27, 2009 and renewable after that. The interest rate is calculated quarterly
according to the actual fluctuation of PRC State Benchmark Interest
Rate.




On
September 27, 2008, Yi Xin Copper entered into a Short Term Loan Contract with
Industrial Bank Co., Ltd., Nanchang Branch, under which Yixin borrowed a loan of
RMB15,000,000 (approximately $2.15 million) for a term of eleven
months.  The loan is secured by certain improvements to real property
of Yi Xin Copper. The loan is due on September 27, 2009 and renewable after
that. The interest rate is calculated quarterly according to the actual
fluctuation of PRC State Benchmark Interest Rate.




The
Company recorded $172,425 and $7,930 (pro forma) interest expenses for the nine
months ended September 30, 2008 and 2007, respectively.










NOTE
J - NOTE PAYABLE




On July
3, 2008, Yi Xin Copper issued a bank acceptance note with the amount of
RMB10,000,000 (approximately $1,47 million) to purchase raw materials from Guixi
Fangyuan Recycling Company, a related party. This note is accepted by Industrial
Bank Co., Ltd., Nanchang Branch and guaranteed by the Company’s chairman, Mr.
Dong, Fucan’s personal assets . The note is due on January 3, 2009.




NOTE
K – INCOME TAXES




As an
offshore company, LYH, a BVI corporation, is exempt from income taxes according
to the Article 242 of the BVI Business Companies Act 2004 (“Exemptions from
Tax”).




Accordance
with the relevant tax laws and regulations of Hong Kong, WWC, a Hong Kong
company, is exempt from Hong Kong income tax since all the profits were derived
from Yi Xin Copper in PRC.




Yi Xin
Copper, a PRC company, is subject to state and local income taxes within PRC at
the applicable tax rate on the taxable income net of operating losses carried
forward as reported in its PRC statutory financial statements in accordance with
the relevant tax laws and regulations of PRC.  Under the Provisional
Taxation Regulation of the PRC, income tax is payable at a rate of 33% of their
taxable income for year 2007.  Effective January 1, 2008, all
companies are subject to uniform tax rate of 25%.  According to the
PRC tax law, government subsidies for qualified welfare employees up to 35,000
Yuan in RMB per handicapped employee per year are not subjected to income
taxes.  In addition, the PRC tax law allows operating losses to be
carried forward for five years.  Finally, due to the incentive
policies made by Guixi Local finance department to attract out of town
investments, Yi Xin Copper, who qualifies as out of town investor, is entitled
to a two-year exemption from income taxes followed by three years of a 50% tax
reduction, commencing from the first cumulative profit-making year net of losses
carried forward.  Yi Xin Copper is required to pay income taxes first
at regular tax rate, then the government will make full refund of the taxes paid
by Yi Xin Copper for the first two years, then reduced to a refund of 50% of the
taxes paid by Yi Xin Copper for the following three years.  Effective
on January 1, 2008, only the local government will make full refund of the taxes
paid by Yi Xin Copper that is allocable to the local government for the first
two years, then reduced to a refund of 50% of the taxes paid by Yi Xin Copper
that is allocable to the local government for the following three
years.




Government
subsidies for qualified welfare employees and revenues generated from selling of
products manufactured from industrial wastes are exempt from income
taxes.  This results in permanent difference between net income for
financial statement reporting and net income for income tax
reporting.




Yi Xin
Copper had net income before income tax provision $2,509,051 and a taxable
income of $758,364 for the nine months ended September 30,
2008.  Therefore, the Company estimated $117,744 income tax expense
net of income tax rebate for the nine months ended September 30,
2008.




The
reconciliation of the effective income tax rate of the Company to the statutory
income tax rate in the PRC for the fiscal years ended December 31, 2007 and 2008
is as following:




2008
                  
                  
                  2007Statutory
      tax rate
                  
                  
                  25
                  %
                  
                  
                  33
                  %Tax
      holidays and concessions
                  
                  
                  (10
                  )%
                  
                  
                  xEffective
      tax rate
                  
                  
                  13
                  %
                  
                  
                  x




No
provision for deferred tax assets and liabilities have been recognized and no
valuation allowance has been established since the Company has no temporary
differences between the tax bases of assets and liabilities and their carrying
amounts.










NOTE
L - SEGMENT REPORTING




The
Company operates in a single reportable business segment which comprises the
manufacture and sale of brass, copper and related products.




The
following table summarizes the Company’s revenues generated from each
product:




Nine-Month Ended September
                            30, 2008
                            (Unaudited)
                          
                          
                          Nine-Month Ended September
                            30, 2007
                            (Pro Forma Unaudited)Sales Amounts
                          
                          
                          % of
                            Total Sales
                          
                          
                          Sales Amounts
                          
                          
                          % of
                            Total SalesBrass
                          
                          
                          60,443,697
                          
                          
                          
                          60
                          %
                          
                          
                          36,057,830
                          
                          
                          
                          37
                          %Anode
      Copper & Copper Round Rod
                          
                          
                          39,270,376
                          
                          
                          
                          39
                          %
                          
                          
                          60,318,766
                          
                          
                          
                          62
                          %Copper
      Left Over
                          
                          
                          1,154,835
                          
                          
                          
                          1
                          %
                          
                          
                          1,659,932
                          
                          
                          
                          1
                          %$
                          100,868,908
                          
                          
                          
                          100
                          %
                          
                          $
                          98,036,528
                          
                          
                          
                          100
                          %




Substantially
all of the Company’s long-lived assets are located in Mainland
China.







Major
customers




Details
of the top 5 customers were as follows:




Nine-Month Ended September
                    30, 2008
                    (Unaudited)
                  
                  
                  Nine-Month Ended September
                    30, 2007
                    (Pro Forma Unaudited)Sales Amounts
                  
                  
                  % of
                    Total Sales
                  
                  
                  Sales Amounts
                  
                  
                  % of
                    Total SalesHuangshi
      Jingu Copper Company Ltd(UnrelatedParty)
                  
                  
                  23,152,231
                  
                  
                  
                  23
                  %
                  
                  
                  13,724,778
                  
                  
                  
                  14
                  %Da
      Yie You Se Jin Shu Company(Unrelated Party)
                  
                  
                  21,214,985
                  
                  
                  
                  21
                  %
                  
                  
                  9,693,322
                  
                  
                  
                  10
                  %Taizhou
      Wuhe Copper Company(Related Party)
                  
                  
                  8,209,468
                  
                  
                  
                  8
                  %
                  
                  
                  4,680,603
                  
                  
                  
                  5
                  %Tai
      Zhou Ao Si Ke Valves LTD(Unrelated Party)
                  
                  
                  6,424,863
                  
                  
                  
                  6
                  %
                  
                  
                  —
                  
                  
                  
                  0
                  %Yu
      Huan San Li Valves LTD(Unrelated Party)
                  
                  
                  4,064,872
                  
                  
                  
                  4
                  %
                  
                  
                  —
                  
                  
                  
                  0
                  %Ning
      Bo Jia Ming Metal LTD(Unrelated Party)
                  
                  
                  —
                  
                  
                  
                  0
                  %
                  
                  
                  7,660,849
                  
                  
                  
                  8
                  %Zhe
      Jiang Wan Sheng Machinery LTD(Unrelated Party)
                  
                  
                  —
                  
                  
                  
                  0
                  %
                  
                  
                  4,622,584
                  
                  
                  
                  5
                  %




NOTE
M - COMMITMENTS AND CONTINGENCIES




(a)
            CAPITAL
      COMMITMENTS




As of
September 30, 2008, the Company had no significant capital commitments required
for disclosure.




(b)
            LEASE
      COMMITMENTS




As of
September 30, 2008, the Company had no lease commitments required for
disclosure.




(c)
            LEGAL
      PROCEEDINGS





As of
September 30, 2008, the Company had no legal proceedings required for
disclosure.





NOTE
N – SUBSEQUENT EVENT




As a
related party company, Guixi Fangyuan Recycling Company (Fangyuan) is the source
of 100% of the Company's copper scrap supply according to the local government's
request. In order to regulate and reduce the related-party transactions, the
Company decided to acquire 100% of the equity interest of Fangyuan at the fourth
quarter of 2008 based on Attorney's opinion.





ITEM
2.  MANAGEMENT'S DISCUSSION AND ANALYSIS.





FORWARD-LOOKING
STATEMENTS




This
Quarterly Report on Form 10-Q contains statements that constitute “forward
looking statements” within the meaning of Section 21E of the Securities Exchange
Act of 1934, as amended, and Section 27A of the Securities Act of 1933, as
amended. The words “may,” “will,” “expect,” “anticipate,” “continue,”
“estimate,” “project,” “intend,” and similar expressions are intended to
identify forward-looking statements. These statements appear in a number of
places in this document and include statements regarding the intent, belief or
expectation of the Company, its directors or its officers with respect to
events, conditions, and financial trends that may affect the Company’s future
plans of operations, business strategy, operating results, and financial
position. Persons reviewing this Quarterly Report on Form 10-Q are cautioned
that any forward-looking statements are not guarantees of future performance and
are subject to risks and uncertainties and that actual results may differ
materially from those included within the forward-looking statements as a result
of various factors. More information on these risks and uncertainties, many of
which are beyond the Company’s control, is set forth under “Risk Factors,” in
the Company’s Form 8-K filed on August 14, 2008.




While
these forward-looking statements, and any assumptions upon which they are based,
are made in good faith and reflect the Company’s current judgment regarding the
direction of its business, actual results will almost always vary, sometimes
materially, from any estimates, predictions, projections, assumptions or other
future performance suggested herein. The Company undertakes no responsibility or
obligation to update publicly these forward-looking statements, but may do so in
the future in written or oral statements. Investors should take note of any
future statements made by or on behalf the Company.




The
following discussion should be read in conjunction with our unaudited
consolidated financial statements and the related notes that appear in Part I,
Item 1, “Financial Statements,” of this Quarterly Report. Our unaudited
consolidated financial statements are stated in United States Dollars and are
prepared in accordance with United States Generally Accepted Accounting
Principles. The following discussion and analysis covers the Company’s unaudited
consolidated results of operation of our active business for the nine-month
periods ended September 30, 2008 and 2007.





USE
OF DEFINED TERMS




As used
in this current report and unless otherwise indicated or the context requires
otherwise, the terms the “Company,” “we,” “us,” and “our” refer to one or more
of the following: AFH Holding I, Inc. (“AFH Holding”), a Delaware corporation
that changed its name to “Yi Xin International Copper, Inc.” (“Yi Xin Holding”),
after giving effect to the acquisition of LYH Acquisition Corporation, a British
Virgin Islands corporation (“LYH”), as described in this current report; LYH, a
wholly-owned subsidiary of Yi Xin Holding; WWC Corporation Ltd., a Hong Kong
corporation and a wholly-owned subsidiary of LYH (“WWC”); and Jiangxi Guixi Yi
Xin Copper Co., Ltd., a Chinese Foreign Invested Enterprise and a wholly-owned
subsidiary of WWC (“Yi Xin Copper”). References to “China” and “PRC” are
references to the People’s Republic of China.  References to “RMB” are
to Renminbi, the legal currency of China and references to “$” are to the legal
currency of the United States.









OUR COMPANY HISTORY AND
RECENT DEVELOPMENTS




AFH
Holding was incorporated in the State of Delaware on April 16, 2007 as a blank
check company whose intended purpose was to merge with an unidentified private
company or companies.




Newry
Invest & Trade, Inc. (“Newry”) was incorporated in the British Virgin
Islands on October 1, 2007. Jing Yu, a Norwegian citizen who is the cousin of
Linquan Hu, our Vice Chairman and Chief Executive Officer, initially was the
sole shareholder of Newry, until she transferred 98% of her interest to Messrs.
Hu and Dong in January 2008. Messrs. Hu and Dong transferred their collective
98% interest in Newry back to Ms. Yu in April 2008, but have entered into an
agreement with Newry pursuant to which they are entitled to receive 49% of
Newry’s holdings of our Common Stock if the Company achieves a 25% annual growth
rate for each of the twelve month periods ending June 30, 2009 and June 30,
2010.




LYH was
incorporated in the British Virgin Islands on September 21, 2007. The sole
purpose of the formation of LYH was to create a corporate entity outside of the
People’s Republic of China, or PRC, to create a Hong Kong Corporation for the
purpose of acquiring Yi Xin Copper. LYH was initially owned by one individual
who was a United States citizen until he transferred his entire interest to
Newry in November 2007.




WWC was
incorporated in Hong Kong on October 22, 2007 as the wholly-owned subsidiary of
LYH.




Yi Xin
Copper was incorporated as a Chinese limited liability company on April 30,
2006, and began operations in December 2006.




On
November 18, 2007, WWC entered into an agreement with Yi Xin Copper's owners to
acquire 100% of Yi Xin Copper for cash. The acquisition received provincial
government approval on November 29, 2007. On December 11, 2007 Yi Xin Copper was
reincorporated as a Chinese Foreign Invested Enterprise and WWC’s acquisition of
Yi Xin Copper from its previous owners was completed as of December 11, 2007,
upon the issuance of a registration certificate by the Foreign Exchange
Management of Yingtan Branch of State Administration of Foreign Exchange titled
Registration Form of Inward Remittance by Share Transfer and Outward Remittance
by Foreign Capital When Chinese Stock Ownership Purchased by Foreign
Company.




In the
Share Exchange Transaction consummated on August 14, 2008, AFH Holding issued
18,000,000 shares of its Common Stock to LYH’s sole owner, Newry, in exchange
for all of the issued and outstanding shares of LYH. As a result, LYH became a
direct wholly-owned subsidiary of AFH Holding, and WWC and Yi Xin Copper became
indirect wholly-owned subsidiaries of AFH Holding. Shortly after the Share
Exchange Transaction, AFH Holding changed its name to “Yi Xin International
Copper, Inc.” As a result of acquiring the operating business of Yi Xin Copper
in the Share Exchange Transaction, we ceased to be a shell company.





OVERVIEW
OF OUR BUSINESS




We
produce copper-based products from copper scrap. We smelt copper scrap material
to produce varying levels of refined, usable materials specified to the needs of
manufacturers. We purchase all of our copper scrap from Guixi Fangyuan Recycling
Company (“Fangyuan”).  We reprocess copper scrap into three main
products - brass, copper round rod and anode copper. Fangyuan is owned by the
wife of Fucan Dong, our Chairman and one of our directors, and  by
Rixu Huang, the husband of Liling Chen, who was one of the owners of Yi Xin
Copper prior to its being acquired by WWC in December, 2007.




Our
subsidiary, Yi Xin Copper, was formed in April 2006, and has been operating in
Yingtan City, Jiangxi Province, China since December 2006. Since that time Yi
Xin Copper’s annual sales have grown to more than US $149 million and we have
achieved profitability. In 2007, we had comprehensive income of US $3.06 million
from the sale of anode copper, brass and copper round rods. We have over 300
customers in several industries including automobile and motorcycle
manufacturers; electronics companies, cable companies, and producers of brass
valves, which are used in plumbing and oil and gas production, among other uses.
All of our customers are located in the PRC.









FINANCIAL AND BUSINESS
HIGHLIGHTS




The
following are some financial highlights for the third quarter of
2008:




Sales
Revenue: Our sales revenue for the third quarter of 2008 were $28.98 million, an
increase of 28% from $22.68 million in the third quarter of 2007, and a decrease
of 36% from $45.51 million in the second quarter of 2008.




Gross
Margin: Third quarter 2008 gross margin was 2% compared to 4.5% in the second
quarter of 2008.




Net
Income: We earned net income of $0 million for the third quarter of 2008
compared to $1.7 million in the second quarter of 2008.




Basic and
diluted earnings per share: Basic and diluted earnings per share for the third
quarter of 2008 were $0.00 and $0.00, respectively, compared to $0.09 and
$0.09(pro forma) in the second quarter of 2008.





Three-month ended
                  9/30/2007
                  (Pro Forma
                  Unaudited)
                
                
                Three-month ended
                  6/30/2008
                  (Unaudited)
                
                
                Three-month ended
                  9/30/2008
                  (Unaudited)Sales
                
                $
                22,684,475
                
                
                $
                45,511,076
                
                
                $
                28,979,401Cost
      of Sales
                
                
                (22,895,108
                )
                
                
                (44,269,808
                )
                
                
                (28,962,529
                )Government
      Subsidies
                
                
                400,418
                
                
                
                775,378
                
                
                
                588,300Sales
      Tax and Surtax
                
                
                (37,198
                )
                
                
                49,660
                
                
                
                —Gross
      Profit
                
                
                152,587
                
                
                
                2,066,306
                
                
                
                605,172Operating
      ExpensesSelling
      Expense
                
                
                5,321
                
                
                
                —
                
                
                
                —General
      and Administrative Expenses
                
                
                251,477
                
                
                
                150,262
                
                
                
                628,337Financial
      Expenses
                
                
                7,128
                
                
                
                60,916
                
                
                
                60,674Total
      Operating Expenses
                
                
                263,926
                
                
                
                211,178
                
                
                
                689,011Operating
      Income(Loss)
                
                
                (111,339
                )
                
                
                1,855,128
                
                
                
                (83,839
                )Non-operating
      income
                
                
                88
                
                
                
                3
                
                
                
                1,432Non-operating
      expenses
                
                
                (7,621
                )
                
                
                (661
                )
                
                
                (5,879
                )Net
      Income (Loss) Before Provision for Income Taxes
                
                
                (118,872
                )
                
                
                1,854,470
                
                
                
                (88,286
                )Provision
      for Income Taxes
                
                
                —
                
                
                
                (165,048
                )
                
                
                85,856Net
      Income (Loss)
                
                
                (118,872
                )
                
                
                1,689,422
                
                
                
                (2,430
                )Other
      Comprehensive IncomeForeign
      Currency Translation
                
                
                89,644
                
                
                
                246,331
                
                
                
                99,804Comprehensive
      Income
                
                $
                (29,228
                )
                
                $
                1,935,753
                
                
                $
                97,374Weighted
      Average Number Of Shares (Basic And Diluted, pro forma)
                
                
                18,000,000
                
                
                
                18,000,000
                
                
                
                19,277,174Earnings
      Per Common Share (Basic And Diluted)
                
                
                (0.01
                )
                
                
                0.09
                
                
                
                0.00




Results
of operations for the Third Quarter of 2008




Sales
Revenue




Our sales
revenue for the third quarter of 2008 were $28.98 million, an increase of 28%
from $22.68 million in the third quarter of 2007, and a decrease of 36% from
$45.51 million in the second quarter of 2008. The decrease in third quarter
revenues was primarily a result of declined selling prices of the brass and
related products.







Government
Subsidies




Government
Subsidies, which refer to the tax refund by both the central and the local
Chinese government from the value-add taxes paid by the Company for the
employment of qualified welfare employees, was $0.59 million in the third
quarter of 2008, a decrease of $0.19 million or 24% compared to $0.78 million in
the second quarter of 2008. The decrease in third quarter government subsidies
was primarily a result of a corresponding decline in sales revenue. And an
increase of $0.18 million or 45% compared to $0.40 million in the third quarter
of 2007




Gross
Profit




Gross
profit for the third quarter of 2008 was $0.6 million, a 297% increase
year-over-year. The gross margin for the third quarter 2008 was only 2% compared
to 4.5% in the second quarter of 2008. The decrease in gross margin was
primarily a result of a corresponding decline in sales revenue while the fixed
costs remain the same with the previous quarter.




Operating
Loss




Operating
loss for the third quarter of 2008 was $0.08 million, an decrease of 25%
year-over-year; and compared to operating profit $1.86 million in the second
quarter of 2008, a decrease of $1.94 million or approximately 104%. Total
operating expenses in the third quarter of 2008 increased to $0.69 million from
$0.2 million in the second quarter of 2008. The increase in operating expenses
was primarily attributable to a increase in agency service expenditure relating
to shares exchange.




Income
taxes




We
incurred income taxes of -$0.08 million for the third quarter of 2008, a
decrease of $0.25 million or 147% compared to $0.17 million in the second
quarter of 2008, primarily because the earnings of the third quarter of 2008
were negative, and we paid null to income taxes in the third quarter of
2007.




Net
Income




We earned
net income of $0 million for the third quarter of 2008 compared to $1.7 million
in the second quarter of 2008, and we got net loss -$0.12 million in the third
quarter of 2007.




Foreign Currency Translation
Gains




We had a
foreign currency translation gain of $0.10 million for the third quarter of 2008
compared to $0.25 million currency translation gain in second quarter of 2008.
On July 21, 2005, and increase $0.01 million compared to foreign currency gain
for the third quarter of 2007. China reformed its foreign currency exchange
policy, revalued the Renminbi by 2.1 percent and allowed Renminbi to appreciate
as much as 0.3 percent per day against the U.S. dollar.  As a result,
we used different exchange rates in translating Renminbi into U.S. dollar in our
financial statements for the three-month period ended September 30, 2008, the
exchange rates of RMB6.789900: US$1 and RMB6.98291: US$1 were used in
calculating the total assets/liabilities and statement of income, while for the
three-month period ended September 30, 2007, the exchange rates of RMB7.51760:
US$1 and RMB7.67576: US$1 were used.









Results
of operations for the nine-month period September 30, 2008 compared to the
nine-month period September 30, 2007.





For Nine-month
                  period September
                  30,2008
                  (Unaudited)
                
                
                For Nine-month
                  period September 30,
                  2007
                  (Pro Forma
                  Unaudited)
                
                
                $ Change
                
                
                % ChangeSales
                
                $
                100,868,908
                
                
                $
                98,036,528
                
                
                $
                2,832,380
                
                
                
                3
                %Cost
      of Sales
                
                
                (98,835,174
                )
                
                
                ( 100,143,624
                )
                
                
                1,308,450
                
                
                
                -1
                %Government
      Subsidies
                
                
                1,849,646
                
                
                
                4,351,460
                
                
                
                (2,501,814
                )
                
                
                -57
                %Sales
      Tax and Surtax
                
                
                —
                
                
                
                (195,240
                )
                
                
                195,240
                
                
                
                -100
                %Gross
      Profit
                
                
                3,883,380
                
                
                
                2,049,124
                
                
                
                1,834,256
                
                
                
                90
                %Operating
      ExpensesSelling
      Expense
                
                
                —
                
                
                
                29,875
                
                
                
                (29,875
                )
                
                
                -100
                %General
      and Administrative Expenses
                
                
                1,189,602
                
                
                
                478,034
                
                
                
                711,568
                
                
                
                149
                %Financial
      Expenses
                
                
                179,623
                
                
                
                6,002
                
                
                
                173,621
                
                
                
                2893
                %Total
      Operating Expenses
                
                
                1,369,225
                
                
                
                513,911
                
                
                
                855,314
                
                
                
                166
                %Operating
      Income
                
                
                2,514,155
                
                
                
                1,535,213
                
                
                
                978,942
                
                
                
                64
                %Non-operating
      income
                
                
                1,435
                
                
                
                16,232
                
                
                
                (14,797
                )
                
                
                -91
                %Non-operating
      expenses
                
                
                (6,540
                )
                
                
                (7,651
                )
                
                
                1,111
                
                
                
                -15
                %Net
      Income (Loss) Before Provision for Income Taxes
                
                
                2,509,050
                
                
                
                1,543,794
                
                
                
                965,256
                
                
                
                63
                %Provision
      for Income Taxes
                
                
                (117,744
                )
                
                
                —
                
                
                
                (117,744
                )
                
                
                100
                %Net
      Income (Loss)
                
                
                2,391,306
                
                
                
                1,543,794
                
                
                
                847,512
                
                
                
                55
                %Other
      Comprehensive IncomeForeign
      Currency Translation
                
                
                505,688
                
                
                
                211,349
                
                
                
                294,339
                
                
                
                139
                %Comprehensive
      Income
                
                $
                2,896,994
                
                
                $
                1,755,143
                
                
                $
                1,141,851
                
                
                
                65
                %Weighted
      Average Number Of Shares (Basic And Diluted, pro forma)
                
                
                18,428,832
                
                
                
                18,000,000
                
                
                
                428,832
                
                
                
                2
                %Earnings
      Per Common Share (Basic And Diluted, pro forma)
                
                
                0.13
                
                
                
                0.09
                
                
                
                0.04
                
                
                
                51
                %




Sales
Revenue




Our sales
revenue for the nine-month period ended September 30, 2008 were $100.87 million,
an increase of $2.8 million or 3%  compared to $98.04 million for the
nine-month period ended September 30, 2007.. The increase was primarily
attributable to the devaluation of US Dollar. In fact, the sales revenue for the
nine-month period ended September 30, 2008 were RMB704 million, a decrease of
RMB48 million or 6% year-over-year. The decrease was primarily a result of
declined selling prices of the brass and related products.




Government
Subsidies




Government
Subsidies, which refer to the tax refund by both the central and the local
Chinese government from the value-add taxes paid by the Company for the
employment of qualified welfare employees, was $1.85 million for the nine-month
period ended September 30, 2008, a decrease of $2.5 million or 57% compared to
$4.35 million year-over-year. The decrease was primarily a result of the change
of government subsidies policy. Effective July 1, 2007, the Chinese government
cancelled this exemption for all companies and enacted a new law known as the
Notice Concerning Preferential Tax Policies on Incentives for Employing the
Disabled.  Under the new law, we receive a tax refund from the
value-added tax of RMB 35,000 (US $5,012) per year for each qualified
handicapped employee.  In addition, due to incentive policies
established by Guixi Local Finance Department to attract out of town investments
effective from July 2007 and expiring on December 30, 2009, the Company is
entitled to receive from Guixi Local Finance Department 25% of the net of VAT
tax paid minus up to 35,000 yuan in RMB (US $5,012) per year for each
handicapped employee.  Subsidies are recognized at their fair values
when received or there is reasonable assurance that they will be received and
all attached conditions are complied with.  According to Chinese tax
law, government subsidies for qualified welfare employees up to 35,000 yuan in
RMB (US $5,012) per handicapped employee per year are not subject to income
taxes.









Gross
Profit




Gross
profit for the nine-month period ended September 30, 2008 was $388 million, a
90% increase year-over-year. The increase was primarily attributable to the
decrease of the cost of sales in 2008.




Operating
income




Operating
income for the nine-month period ended September 30, 2008 was $2.51 million, an
increase of $0.98 million or 64% year-over-year;. Total operating expenses for
the nine-month period ended September 30, 2008 increased to $1.37 million from
$0.51 million year-over-year. The increase in operating expenses was primarily
attributable to a increase in agency service expenditure relating to shares
exchange.




Income
taxes




We
incurred income taxes of $0.12 million for the nine-month period ended September
30, 2008 compared to $0 million for the nine-month period ended September 30,
2007




Net
Income




We earned
net income of $2.39 million for the nine-month period ended September 30, 2008
compared to $1.54 million for the nine-month period ended September 30,
2007.




Foreign Currency Translation
Gains




We had a
foreign currency translation gain of $0.51 million for the nine-month period
ended September 30, 2008 compared to $0.21 million currency translation gain for
the nine-month period ended September 30, 2007. On July 21, 2005, China reformed
its foreign currency exchange policy, revalued the Renminbi by 2.1 percent and
allowed Renminbi to appreciate as much as 0.3 percent per day against the U.S.
dollar.  As a result, we used different exchange rates in translating
Renminbi into U.S. dollar in our financial statements for the three-month period
ended September 30, 2008, the exchange rates of RMB6.789900: US$1 and
RMB6.98291: US$1 were used in calculating the total assets/liabilities and
statement of income, while for the three-month period ended September 30, 2007,
the exchange rates of RMB7.51760: US$1 and RMB7.67576: US$1 were
used.




FOREIGN
EXCHANGE RISK





While our
reporting currency is the U.S. Dollar, all of our consolidated revenues and
consolidated costs and expenses are denominated in Renminbi.  All of
our assets are denominated in RMB except for cash which is in RMB and Hong Kong
Dollar.  As a result, we are exposed to foreign exchange risk as our
revenues and results of operations may be affected by fluctuations in the
exchange rate between U.S. Dollars and RMB.  If the RMB depreciates
against the U.S. Dollar, the value of our RMB revenues, earnings and assets as
expressed in our U.S. Dollar financial statements will decline.  We
have not entered into any hedging transactions in an effort to reduce our
exposure to foreign exchange risk.




COPPER
PRICE RISK




The
selling price of our products is closely connected with market prices of copper.
Declines in the market prices of copper could adversely affect our earnings and
cash flows. Such declines could also cause significant volatility in our
financial performance and adversely affect the trading prices of our debt and
equity securities.









Liquidity
and Capital Resources




We
believe that we have adequate capital to operate our business at its current
levels and with a moderate growth rate.  However, in order to
implement our plans to accelerate the growth of our business more quickly, we
intend to commence an offering of up to $5 million of equity securities at a
pre-transaction valuation of $60 million to accredited investors in a private
placement sometime in the very near future.  If we are able to
complete such a transaction, we expect to allocate the majority of the funds
raised to acquire scrap copper for the existing brass and anode
copper.




ITEM
3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK




The
Company does not have any long-term commitments to purchase production raw
materials or sell products that would present significant risks due to price
fluctuations. Although we buy our copper scrap from one supplier, we are not
obligated to use only that supplier.  Copper scrap is available to us
from multiple domestic sources and, as a result, we believe the risk of supply
interruptions due to such things as strikes at the source of supply or to
logistics systems are limited.




Risks due
to fluctuation in interest rates are not material to the Company because of
minimal exposure to floating rate debt. The Company has no balance in temporary
investments.




ITEM
4. CONTROLS AND PROCEDURES





We
maintain disclosure controls and procedures that are designed to ensure that
information required to be disclosed in our reports filed under the Securities
Exchange Act of 1934, as amended, is recorded, processed, summarized and
reported within the time periods specified in the SEC's rules and forms, and
that such information is accumulated and communicated to our management,
including our president (also our principal executive officer) and our chief
financial officer (also our principal financial and accounting officer) to allow
for timely decisions regarding required disclosure.




On August
14, 2008, AFH entered into a Share Exchange Agreement with LYH and
Newry.  Prior to the Closing Date, Newry owned 100% of the issued and
outstanding shares of common stock of LYH;  LYH owned 100% of the
issued and outstanding securities of WWC; and WWC owned 100% of the issued and
outstanding securities of Jiangxi Guixi Yi Xin Copper Co., Ltd (Yi Xin Copper).
Jing Yu, a Norwegian, owned 100% of Newry.




The Share
Exchange Transaction was consummated on the August 14, 2008. AFH issued
18,000,000 shares of Common Stock to Newry in exchange for all of the issued and
outstanding LYH common stock.  As a result, LYH became a direct
wholly-owned subsidiary of AFH, and WWC and Yi Xin Copper became indirect
wholly-owned subsidiaries of AFH. Shortly after the Share Exchange Transaction,
AFH Holding changed its name to “Yi Xin International Copper, Inc.”As a result
of the transaction, a change in control occurred.




Therefore,
we have only recently become subject to the laws related to reporting companies,
including the Sarbanes-Oxley Act of 2002, as amended. Our management is
currently carrying out an evaluation, under the supervision and with the
participation of our president (also our principal executive officer) and chief
financial officer (also our principal financial and accounting officer), of the
effectiveness of the design and operation of our disclosure controls and
procedures, in order to conclude if our disclosure controls and procedures are
effective.




PART
II - OTHER INFORMATION





ITEM
1.  LEGAL PROCEEDINGS.





None.





ITEM
I1 RISK FACTORS
 
 Risks
related to operating a business in the PRC
  Changes
in China’s political or economic situation could harm us and our operational
results.




We are
subject to the general risks of operating a business in the PRC. These include
risks associated with the political and economic environment, foreign currency
exchange, and the legal system in the PRC. The economy of the PRC differs
significantly from the economies of the western industrialized nations in such
respects as structure, level of development, growth rate, capital reinvestment,
resource allocation, self-sufficiency, rate of inflation and balance of payments
position, among others. As a result of these differences, we may not develop in
the same way or at the same rate as might be expected if the Chinese economy
were similar to those of western industrialized countries.




The PRC
government encourages substantial private economic activities, but this has only
been the case since the early 1990’s. It is possible that the Chinese government
may abandon its reforms all together and return to a more nationalized economy.
Because many reforms are unprecedented or experimental, they are expected to be
refined and adjusted. Negative impact upon economic reform policies or
nationalization could result in a total investment loss in our common stock.
Other political, economic and social factors, such as political changes, changes
in the rates of economic growth, unemployment or inflation, or in the
disparities in per capita wealth between regions within China, could lead to
further readjustment of the reform measures. This refining and readjustment
process may negatively affect our operations.  This could damage our
profitability. Some of the things that could have this effect are:




• level
of government involvement in the economy;





• control
of foreign exchange;





• methods
of allocating resources;





• balance
of payments position;





•
international trade restrictions; or





•
international conflict.




A
downturn in the Chinese economy could negatively affect our revenue and impair
our growth.




The
Chinese economy has experienced significant growth in the past several years,
but such growth has been uneven among various sectors of the economy and
geographic regions. The Chinese economy may not continue to grow at its current
pace, or may begin to decline. Actions by the PRC government to control
inflation, for example, have restrained economic expansion in the recent past
across several industrial sectors. Similar and continued actions by the PRC
government in the future could have a significant adverse effect on the domestic
economic condition in the PRC.




A
slowdown or other adverse developments in the PRC economy could materially and
adversely affect our customers and the demand for our products. All of our
operations are conducted in the PRC and all of our revenues are generated from
sales to businesses operating in the PRC. We have only recently begun doing
business and have not yet experienced a contraction in the economy. As a result,
we do not know how well our business would perform in a slowdown in the Chinese
economy. A slowdown in overall economic growth, an economic downturn or
recession or other adverse economic developments in the PRC may materially
reduce the demand for our products and materially and adversely affect our
business and revenues.




Future
inflation in China may inhibit our ability to conduct business in
China.




In recent
years, the Chinese economy has experienced periods of rapid expansion and high
rates of inflation. During the past ten years, the rate of inflation in China
has been as high as 20.7% and as low as 2.2%. These factors have led to the
adoption by the Chinese government, from time to time, of various corrective
measures designed to restrict the availability of credit or regulate growth and
contain inflation. High inflation may in the future cause the Chinese government
to impose controls on credit and/or prices, or to take other action, which could
inhibit economic activity in China, which could harm the market for our products
and adversely effect our operations and business.







Our
financial results are dependent on the value and convertibility of the Chinese
Renminbi.




Any
devaluation of China's currency, the Renminbi, versus the US dollar may
adversely affect our financial performance and asset values when measured in
terms of the US dollar. Such devaluation could have a material adverse affect on
our earnings expressed in US dollars. We do not currently hedge our foreign
exchange exposure. The PRC government imposes controls on the convertibility of
Renminbi into foreign currencies and, in certain cases, the remittance of
currency out of the PRC. We receive substantially all of our revenues in
Renminbi, which is currently not a freely convertible currency. Shortages in the
availability of foreign currency may restrict our ability to remit sufficient
foreign currency to pay dividends, or otherwise satisfy foreign currency
denominated obligations. Under existing PRC foreign exchange regulations,
payments of current account items, including profit distributions and interest
payments, can be made in foreign currencies without prior approval from the PRC
State Administration of Foreign Exchange, or SAFE, by complying with certain
procedural requirements. However, approval from appropriate governmental
authorities is required where Renminbi is to be converted into foreign currency
and remitted out of PRC to pay capital expenses such as the repayment of bank
loans denominated in foreign currencies.




The PRC
government may also at its discretion restrict access in the future to foreign
currencies for current account transactions. If the foreign exchange control
system prevents us from obtaining sufficient foreign currency to satisfy our
currency demands, we may not be able to pay certain expenses as they come
due.




Chinese
laws are constantly changing, and their application and enforcement can be
unpredictable.




There are
substantial uncertainties regarding the interpretation and application of PRC
laws and regulations, including but not limited to the laws and regulations
governing or effecting our business, and the enforcement and performance of the
contractual arrangement with our suppliers and customers, and the enforcement
and performance of our arrangements with customers in the event of the
imposition of statutory liens, bankruptcy, or criminal proceedings. These laws
and regulations are relatively new and may be subject to future changes, and
their official interpretation and enforcement may involve substantial
uncertainty.




The
effectiveness of newly enacted laws, regulations or amendments may be delayed,
resulting in detrimental reliance by foreign investors. New laws and regulations
that affect existing and proposed future businesses may also be applied
retroactively. In addition, the PRC authorities retain broad discretion in
dealing with violations of laws and regulations, including levying fines,
revoking business licenses and requiring actions necessary for compliance. We
cannot predict what effect the interpretation of existing or new PRC laws or
regulations may have on its businesses.




For
example, China’s new Enterprise Income Tax Law, promulgated by the National
People’s Congress on March 16, 2007, and became effective on January 1, 2008,
represents a radical departure from the prior tax system. The prior system
provided for one set of rules applying to Foreign Investment Enterprises
(broadly, Chinese companies with 25 percent or higher foreign participation) and
a different set of rules applying to ordinary, “domestic” Chinese companies. The
split system had the effect of favoring the import of capital into China by
giving privileged tax treatment to the foreign owned enterprises.  As
a result of these changes, we have lost certain tax benefits to which we were
previously entitled.




The
Company competes with PRC state owned enterprises, Chinese-foreign joint
ventures, and Chinese private reprocessors.




Many
Chinese copper companies are better capitalized, more experienced, and have
deeper ties within the Chinese marketplace.   We are a newly
formed company.  We may be unsuccessful in our attempts to compete,
which would have a material adverse impact on our business and financial
condition. Not only are there numerous competitors in the PRC, but there may be
competitive threats from foreign companies. With the PRC’s entry into the World
Trade Organization and the PRC’s agreements to lift many of the barriers to
foreign competition, we anticipate that the environment in our markets will
become increasingly competitive.







The
copper industry in China is dominated by five large companies, all of which have
integrated operations (i.e. mining, smelting, and
refining) and four additional companies that are engaged in smelting. These
competitors include: Jiangxi Copper Group, Yantai Penghui Copper, Anhui Tongdu
Copper (Tongling Nonferrous), Daye Nonferrous, Jinchuan Group, Yunnan Copper,
Chifeng Jinjian Copper, Zhongtiaoshan Nonferrous and Baiyin Nonferrous. All of
these companies are better capitalized, more experienced, and have more
established relationships in the Chinese marketplace.




We
did not obtain SAFE government approval of our acquisition of Yi
Xin.  If it is determined that we should have obtained such approval,
we could be subject to sanctions.




On
October 31, 2005 and May 31, 2007, China’s State Administration of Foreign
Exchange (“SAFE”) issued an official notice separately known as “Circular 75”
and “Circular 106,” which requires the owners of Chinese companies to obtain
SAFE’s approval before establishing any offshore holding company structure in
so-called “round-trip” investment transactions for foreign financing as well as
subsequent acquisition matters in China.  On August 8, 2006, six PRC
regulatory agencies, namely, Ministry of Commerce, State-owned Assets
Supervision and Administration Commission, State Taxation Bureau, State
Administration for Industry and Commerce, China Securities Regulatory Commission
and SAFE jointly adopted the Provisions on Acquisition of Domestic Enterprises
by Foreign Investors (“New M&A Regulation”), which became effective on
September 8, 2006.  The New M&A Regulation imposes approval
requirements from the Ministry of Commerce for “round-trip” investment
transactions, including acquisitions in which equity was used as
consideration.  We did not file the SAFE’s registration, in connection
with the acquisition of Jiangxi Copper by WWC, based on the determination that
WWC is not a “special purpose company” as defined in Circular 75 and 106, and
that the acquisition of Jiangxi Copper by WWC was not a “round-trip” investment
transaction.  Because of uncertainty over how the SAFE Circulars will
be interpreted and implemented, and how or whether SAFE will apply it to us, we
cannot predict how it will affect our business operations or future
strategies.  We may need to make the SAFE registration when any
domestic PRC resident becomes a shareholder of the company in the
future.  A failure by our future domestic PRC resident shareholder to
comply with the SAFE Circulars, if SAFE requires it, could subject these
domestic PRC residents to fines or legal sanctions, restrict our overseas or
cross-border investment activities, limit our subsidiaries’ ability to make
distributions or pay dividends or affect our ownership structure, which could
adversely affect our business and prospects.





We may
need to file the SAFE government registration whenever any Chinese resident
becomes the shareholder of the company in the future





It
will be difficult for any shareholder of our company to commence a legal action
against our executives.  Enforcing judgments won against them or the
Company will be difficult.




Most of
our officers and directors reside outside of the United States. As a result, it
will be difficult, if not impossible, to acquire jurisdiction over those persons
in a lawsuit against any of them, including with respect to matters arising
under U.S. federal securities laws or applicable state securities
laws.  Because the majority of our assets are located in the PRC it
would also be extremely difficult to access those assets to satisfy an award
entered against us in United States court. Moreover, we have been advised that
the PRC does not have treaties with the United States providing for the
reciprocal recognition and enforcement of judgments of courts.




We
may have difficulty establishing adequate management, legal and financial
controls in the PRC.




The PRC
historically has been deficient in western-style management and financial
reporting concepts and practices, as well as in modern banking, computer and
other control systems. We may have difficulty in hiring and retaining a
sufficient number of qualified employees to work in the PRC. As a result of
these factors, we may experience difficulty in establishing management, legal
and financial controls, collecting financial data and preparing financial
statements, books of account and corporate records and instituting business
practices that meet western standards.  If we are not able to maintain
adequate controls our financial statements may not properly represent our
financial condition, results of operation or cash flows.  Weakness in
our controls could also delay disclosure of information to the public which is
material to an investment decision with respect to our stock.







Risks
Related to our Business and Our Industry




Declines
in the market prices of copper could adversely affect our earnings and cash
flows. Such declines could also cause significant volatility in our financial
performance and adversely affect the trading prices of our debt and equity
securities.




Future
growth in demand for copper may result in copper shortages and increased prices.
The world market price of copper has fluctuated historically and is affected by
numerous factors beyond our control.  We may not be able to offset any
future increase in the price of copper by increasing our prices and our margins
would be reduced .  If we cannot obtain an adequate supply of copper
or other needed raw materials, it would have a material adverse effect on our
consolidated financial condition, results of operations and cash
flows.




Additional
increases in the cost of copper could reduce the demand for copper-based
products by making alternatives more cost attractive.  The higher the
price of copper, the greater the possibility that substitutes will be used or
developed for many current uses of copper, resulting in a probable significant
decline in the demand for and price of copper products, and our business would
likely be materially adversely affected.




We
may not be able to secure financing needed for existing and future operating
needs on acceptable terms, or on any terms at all.




From time
to time, we may seek additional financing to provide the capital required to
maintain or expand our production facilities, to purchase copper scrap, and/or
to provide working capital for our business. Currently, in order to complete our
planned expansions and entry into the enameled copper wire and copper valve
markets, we need to obtain additional financing. If such financing is not
available on acceptable terms, or at all, we may not be able to implement or
existing plans. Moreover, unanticipated capital needs may arise in the future.
We cannot predict with certainty the timing or amount of any such capital
requirements. If such financing is not available on satisfactory terms, we may
be unable to maintain or expand our business or to develop new business at the
rate desired, and our operating results may suffer.  If we are able to
incur debt, we may be subject to certain restrictions imposed by the terms of
the debt, and the repayment of such debt may limit our cash flow and our ability
to grow.  If we elect to issue additional securities as a way of
raising capital, it would have a dilutive effect on the then current holders of
our equity.




Competitive
pressures from existing and new companies could have a material adverse effect
on our financial condition and results of operations.




We
compete in a global market with regard to the sale of processed scrap.
Competition for sales of processed scrap is based primarily on the price,
quantity and quality of the scrap metals, as well as the level of service
provided in terms of consistency of quality, reliability and timing of
delivery.  To the extent that one or more of our competitors becomes
more successful with respect to any key factor, our ability to attract and
retain consumers could be materially and adversely affected.




We
rely on one supplier, Fangyuan, for 100% of our copper scrap
supply.




One
supplier, Fangyuan, is the source of 100% of our copper scrap supply. Fangyuan
may not continue its exclusive relationship with us in the future, and even if
it does continue to be our exclusive supplier it may not be able to obtain a
sufficient source of copper scrap at favorable prices, or in the quantity we
require.  If Fangyuan severs its relationship with us, or becomes
unable to provide us with a sufficient supply of copper scrap on favorable
terms, we may have to rely on other purchasers who would likely charge
significantly higher margins than Fangyuan, which currently charges us only for
its price of scrap metal and its costs.  Moreover, we may not be able
to find other suppliers who are willing to provide us with copper scrap on
acceptable terms and in the quantities we require.  Any of these
occurrences would have a material adverse effect on our business and
operations.







If
we cannot obtain an adequate source of supply of copper scrap, we would be
unable to reprocess metals in desired volumes and our results of operations and
financial condition would be materially and adversely affected.




We depend
on scrap for our operations, and through Fangyuan, our scrap inventory is
acquired from numerous sources.  These suppliers generally are not
bound by long-term contracts and have no obligation to sell scrap metals to
Fangyuan. In periods of low industry prices, suppliers may elect to hold scrap
in inventory in the hope of receiving higher prices at a later
time.  In addition, a slowdown in industrial production in the U.S. or
in China could reduce the rate at which companies replace older equipment
containing copper, which is then turned into scrap, thereby making scrap scarcer
and more expensive. If an adequate supply of scrap metal is not available to us,
or is not available to us at favorable prices, we would be unable to reprocess
metals in desired volumes and our results of operations and financial condition
would be materially and adversely affected.




Our
primary supplier Fangyuan currently only supplies us with scrap purchased from
Chinese dealers.  In the future, Fangyuan may import scrap directly
from abroad.  Fangyuan currently does not charge us any profit margin,
but only charges us for its cost of purchasing scrap and its
expenses.  If Fangyuan loses its import license, we would have to
purchase imported scrap from other suppliers, who would likely charge us a
significant margin, and our business would likely be materially adversely
affected.




We
anticipate in July, 2008 we will apply for a Consignee’s and Consignor’s
Declaration Registration Certificate of Imported and Exported Goods Issued by
Customs of the PRC.  If we fail to qualify for this license, we will
not be permitted to directly import scrap and realize the potential benefits of
the lower raw material costs, which in turn would negatively affect our
profits.




The
cyclicality of our industry could negatively affect our sales volume and
revenues.




The
operating results of the scrap metals reprocessing industry in general, and our
operations specifically, are highly cyclical in nature.  They tend to
reflect and be amplified by general economic conditions, both in the PRC and
internationally.  Historically, in periods of recession or periods of
slowing economic growth, the operating results of scrap metals reprocessing
companies have been materially and adversely affected.  For example,
during recessions or periods of slowing economic growth, the automobile and the
construction industries typically experience major cutbacks in production,
resulting in decreased demand for copper.  This leads to significant
fluctuations in demand and pricing for our products.  Economic
downturns in the PRC and international economy would likely materially and
adversely affect our results of operations and financial
condition.  Our ability to withstand significant economic downturns in
the future will depend in part on our levels of debt and equity capital,
operating flexibility and access to liquidity.





We
may not be able to effectively control and manage our growth.




If our
business and markets grow and develop, it will be necessary for us to finance
and manage expansion in an orderly fashion.  In addition, we may face
challenges in managing expanding product offerings and in integrating acquired
businesses with our own.  Such eventualities will increase demands on
our existing management, workforce and facilities.  Failure to satisfy
such increased demands could disrupt or otherwise adversely affect our
operations and cause production backlogs, longer product development time frames
and administrative inefficiencies.




Six
customers comprise 40% of our sales.




Our six
largest customers comprised 40% of our sales in 2007.  If we lost one
or more of those customers, or if one or more of those customers significantly
reduced the volume that they purchases from us, and we could not find
replacement customers or increase our sales to other existing customers, our
revenues would be negatively impacted. In addition, those customers have very
similar businesses, and external factors that would lead one of them to
significantly reduce its purchases of our products would likely have a
significant impact on the others as well, this in turn would magnify the adverse
effect on our revenues.







Risks
Related to Our Management:




Our
ability to operate our company effectively could be impaired if we lose key
personnel




We depend
on the services of key executives, including Linquan Hu, our  Vice Chairman
and Chief Executive Officer, and Fucan Dong, our Chairman, as well as certain
other personnel focused on the operation of our production
facilities.  Additionally, the number of persons skilled in the
development and operation of copper scrap reprocessing facilities is limited and
significant competition exists for these individuals.  We may not be
able to employ key personnel or to attract and retain qualified personnel in the
future.  We do not maintain “key person” life insurance to cover our
executive officers.  Due to the relatively small size of our company,
our failure to retain or attract key personnel may delay or otherwise adversely
affect the operation and development of our projects and the management of our
company, which would have a material adverse effect on our
business.




We
may not be able to attract and retain the additional personnel we will need to
develop any of our projects




We are a
medium-sized company with a limited operating history and relatively few
employees. The development of any of our proposed projects will place
substantial demands on us.  We will be required to recruit additional
personnel and to train, motivate and manage these new employees.  We
may not be successful in attracting and retaining such personnel.




Our
senior management team has no experience in running a public company and will
need to procure assistance from professional advisers and third parties at
additional expense.




Our
management team and current key employees have not been engaged in similar
capacities with other public reporting companies and are not familiar with the
multitude of filings, regulations and requirements applicable to a public
company.  We will require the assistance of outside counsel and
accountants and possibly other third party advisers.  We may not be
able to find qualified, experienced people to perform these
tasks.  Even if successful, the fees and expense for these
professional advisers and third parties will be an additional administrative
cost that our competitors may not be required to incur.  In addition,
if the advice given or work performed by these outside advisers proves to be
inadequate or incorrect, the Company and its management will nonetheless bear
the brunt of the costs and penalties assessed, with limited avenues of redress
against the outside advisers.




Risks
Related to our Stock:




We
do not intend to pay any dividends on our Common Stock in the foreseeable
future.




We
currently intend to retain all future earnings, if any, to finance our current
and proposed business activities and do not anticipate paying any cash dividends
on our Common Stock in the foreseeable future. We may also incur indebtedness in
the future that may prohibit or effectively restrict the payment of cash
dividends on our Common Stock.




There
currently is no trading market for our Common Stock




Prior to
the closing of the Share Exchange Transaction, we were a shell company with only
one stockholder and there was no trading market for our shares of Common
Stock.  As a result of the Share Exchange Transaction, we are no
longer a shell company but still have only two stockholders.  All of
our currently outstanding shares of Common Stock are “restricted securities”,
and therefore there is still no trading market for our Common
Stock.  We are currently not listed on any exchange, nor are we quoted
on the Over the Counter Bulletin Board in the United States. A trading market
for our Common Stock may never develop.  Even if it does, trading of
our Common Stock may never attain significant levels of volume and
liquidity.  In such event, investors could find it difficult to sell
their shares of Common Stock due to the thin trading volume.







Certain
stockholders can exert control over the Company and may have interests that
conflict with those of other stockholders.




Jing Yu,
the cousin of Linquan Hu our Vice Chairman and Chief Executive Officer,
currently owns 100% of Newry, which owns 87.80% of our Common
Stock.  Although our officers and directors currently do not own any
of our Common Stock, Linquan Hu and Fucan Dong, our Chairman, have entered into
an agreement pursuant to which they would be entitled to receive 49% of Newry’s
holdings of our Common Stock if the Company achieves a  25% annual
growth rate for each of the twelve month periods ending June 30, 2009 and June
30, 2010.  If they achieve these targets and acquire the stock, they
will then beneficially own an aggregate of approximately 44% of our outstanding
shares of Common Stock. Consequently, Jing Yu and/or our management may exert a
significant degree of influence over our management and affairs and over matters
requiring stockholder approval, including the election of directors and approval
of significant corporate transactions.  In addition, this
concentration of ownership may delay or prevent a change of control of us and
might affect the market price of our Common Stock, even when a change of control
may be in the best interest of our stockholders as a
whole.  Furthermore, the interests of this concentration of ownership
may not always coincide with our interests or the interests of other
stockholders, and accordingly, they could cause us to enter into transactions or
agreements that we would not otherwise consider.




It
may be difficult for another company to acquire us, and this could depress our
stock price.




In
addition to the large percentage of our voting securities held by our officers,
directors and 5% and greater stockholders, provisions contained in our
certificate of incorporation, bylaws and Delaware law could make it difficult
for a third party to acquire us, even if doing so would be beneficial to our
stockholders. Our certificate of incorporation and bylaws may discourage, delay
or prevent a merger or acquisition that a stockholder may consider favorable by
authorizing the issuance of “blank check” preferred stock. In addition,
provisions of the Delaware General Corporation Law also restrict some business
combinations with interested stockholders. These provisions are intended to
encourage potential acquirers to negotiate with us and allow the board of
directors the opportunity to consider alternative proposals in the interest of
maximizing stockholder value. However, these provisions may also discourage
acquisition proposals or delay or prevent a change in control, which could harm
our stock price.




Our
investors may lose their entire investment in our securities.




An
investment in our securities is highly speculative and may result in the loss of
the entire investment.  Only potential investors who are experienced
investors in high risk investments and who can afford to lose their entire
investment should consider an investment in our securities.




Securities
analysts may not cover our Common Stock and this may have a negative impact on
our Common Stock's market price.




The
trading market for our Common Stock is likely to be significantly influenced by
the research and reports that securities analysts publish about us or our
business.  We do not have any control over these
analysts.  There is no guarantee that securities analysts will cover
our Common Stock.  If securities analysts do not cover our Common
Stock, the lack of research coverage would be likely to significantly reduce the
trading volume and investor interest in our Common Stock, and would be likely to
adversely affect our Common Stock's market price, if any trading market
exists.  If we are covered by securities analysts, and our stock is
downgraded, our stock price would likely decline.  If one or more of
these analysts ceases to cover us or fails to publish reports on us on a regular
basis, we could lose visibility in the financial markets, which could cause our
stock price or trading volume to decline.









We
may seek to raise additional funds, finance acquisitions or develop strategic
relationships by issuing capital stock.





We expect
to finance our operations, acquisitions and develop strategic relationships, at
least in part, by issuing equity or convertible debt securities, which could
significantly reduce the percentage ownership of our existing
stockholders.  Specifically, we intend to commence an
offering of up to $5 million of equity securities at a pre-transaction valuation
of $60 million to accredited investors in a private placement sometime in the
very near future.  Additional offerings of equity securities may be
made in the future.  Furthermore, any newly issued securities could
have rights, preferences and privileges senior to those of our existing
securities.  Moreover, any issuances by us of equity securities may be
at or below the prevailing market price of our Common Stock and in any event may
have a dilutive impact on stockholders' ownership interests, which could cause
the market price of our Common Stock to decline.




In
addition, our Board of Directors has approved our borrowing of $250,000 to cover
certain expenses relating to the Share Exchange Transaction and our contemplated
financing.  The form of the loan is anticipated to be convertible
notes with attached warrants, but the exact terms and conditions of any
transaction will have to be negotiated with the lender or lenders.




We may
also raise additional funds through the incurrence of debt, and the holders of
any debt we may issue would have rights superior to stockholders' rights in the
event we are not successful and are forced to seek the protection of the
bankruptcy laws.




The
price of our Common Stock may vary for reasons unrelated to our performance and
future prospects.




The
market price of our Common Stock could fluctuate substantially due to a variety
of factors including market perception of our ability to achieve our planned
growth, quarterly operating results of companies viewed as comparable to us,
trading volume in our Common Stock, changes in general conditions in the
economy, perceptions of the future of the copper and copper products markets in
the PRC and elsewhere, and broader developments in the financial
markets.




In
addition, the stock market is subject to extreme price and volume
fluctuations.  This volatility has had a significant effect on the
market price of securities issued by many companies for reasons unrelated to
their operating performance and could have the same effect on our Common
Stock.




Because
our Common Stock may be deemed a “penny stock,” investors may find it more
difficult to sell their shares.




Our
Common Stock may be subject to the “penny stock” rules adopted under Section
15(g) of the Securities Exchange Act of 1934.  The penny stock rules
apply to companies whose Common Stock trades at less than US $5.00 per share or
that have tangible net worth of less than US $5.0 million (US $2.0 million if
the company has been operating for three or more years) and are not quoted on
Nasdaq or on an exchange.  These rules require, among other things,
that brokers who trade a penny stock to persons other than “established
customers” complete certain documentation, make suitability inquiries of
investors and provide investors with certain information concerning trading in
the security, including a risk disclosure document and quote information under
certain circumstances.  Many brokers have decided not to trade penny
stocks because of the requirements of the penny stock rules and, as a result,
the number of broker-dealers willing to act as market makers in such securities
is limited.  Remaining subject to the penny stock rules for any
significant period could have an adverse effect on the market, if any, for our
securities.  If our securities are subject to the penny stock rules,
investors will find it more difficult to dispose of our securities.




Item
2. Unregistered Sales of Equity Securities and Use of Proceeds.





See our
current report filed on Form 8-K on August 14, 2008.





Item
3. Defaults Upon Senior Securities.





None.










Item
4. Submission of Matters to a Vote of Security Holders.





AFH
Holding and Advisory, LLC, at the time our sole shareholder, approved by written
consent the execution and delivery of the Share Exchange Agreement and the
consummation of the transactions contemplated thereby, including the election of
Linquan Hu, Fucan Dong and Ken Barun to our board of directors.




Item
5.  Other Information.




On
September 27, 2008, Yi Xin Copper entered into a Short Term Loan Contract with
Industrial Bank Co., Ltd., Nanchang Branch, under which Yixin borrowed
RMB15,000,000 (approximately $2.15 million) for a term of eleven
months.  The loan is secured by certain improvements to real property
of Yi Xin Copper. The loan is due on September 27, 2009 and renewable after
that. The interest rate is calculated quarterly according to the actual
fluctuation of PRC State Benchmark Interest Rate.





Item
6.





Exhibits.





10.1
            
            Industrial
      Bank’s Short-term Loan Contract Serial No. 2008000610.2
            
            Contract
      of Mortgage of maximum amount Serial No. 2008000810.3
            
            Contact
      of Mortgage of maximum amount Serial No. 2008000931.1
            
            Certification
      of Principal Executive Officer pursuant to Section 302 of Sarbanes-Oxley
      Act of 2002*31.2
            
            Certification
      of Principal Financial and Accounting Officer pursuant to Section 302 of
      Sarbanes-Oxley Act of 2002*32.1
            
            Certification
      pursuant to Section 906 of Sarbanes Oxley Act of
  2002*








SIGNATURES





In
accordance with the requirements of the Exchange Act, the registrant caused this
report to be signed on its behalf by the undersigned, there unto duly
authorized.





Yi
      Xin International Copper, Inc.(Registrant)Date:
      January 7, 2009
            By:
            /s/ Linquan HuLinquan
      Hu, CEO








Yi
      Xin International Copper, Inc.(Registrant)Date:
      January 7, 2009
            By:
            /s/ James QiJames
      Qi, CFO