Short-term Bank Loans

3 Months Ended

Dec. 31, 2015

11.

Short-term Bank Loans

As of September 30 and December 31, 2015, the Company had short term bank borrowings of $12,585,740 and $12,316,787, respectively.

Under the banking facilities granted by Bank of Dandong on June 22, 2015 (Note 1), the Company borrowed a loan of $7,697,992 (RMB50 million) from Bank of Dandong for a period from June 25, 2015 to June 22, 2016, bearing fixed interest at 7.84% per annum. On August 18, 2015, the Company borrowed another loan of $4,618,795 (RMB30 million) with a fixed interest rate at 7.84% per annum for the period from August 18, 2015 to June 10, 2016.

The banking facilities were guaranteed by Mr. Xiangqian Li, the Company’s CEO and his wife, Ms. Xiaoqiu Yu, and Shenzhen BAK, a former subsidiary of the Company. The facilities were also secured by the Company’s assets with the following carrying amount:

		September 30,		December 31,
		2015		2015
Pledged deposits (note 2)	$	1,519,601	$	2,084,333
Prepaid land use rights (note 9)		8,631,995		8,404,286
Buildings		13,120,083		12,700,715
Machinery and equipment		3,831,790		3,641,932
Construction in progress		6,228,371		6,095,293
	$	33,331,840	$	32,926,559

As of December 31, 2015, the Company had unutilized committed banking facilities of $0.8 million.

During the three months ended December 31, 2014 and 2015, interest of $97,261 and $248,092, respectively, was incurred on the Company's bank borrowings.