Short-term Bank Loans

3 Months Ended

Dec. 31, 2011

Short-term Bank Loans [Text Block]

7.      Short-term Bank Loans

The Company obtained several short-term loan facilities from financial institutions in the PRC. These facilities were secured by the Company’s assets with the following carrying values:

		September 30,		December 31,
		2011		2011
Inventories (Note 4)	$	23,495,137	$	23,788,379
Machinery and equipment, net (Note 6)		25,333,574		25,949,874
	$	48,828,711	$	49,738,253

As of September 30, 2011 and December 31, 2011, the Company had several short-term bank loans with aggregate outstanding balances of US$139,706,153 and US$130,889,802, respectively. The loans were primarily obtained for general working capital, carried interest rates ranging from 5.10% to 7.21% per annum, and had maturity dates ranging from 3 to 12 months. Each loan is guaranteed by Mr. Xiangqian Li, who did not receive any compensation for acting as guarantor.

As of December 31, 2011, the Company had pledged the land use rights certificate in relation to the land on which Shenzhen BAK’s corporate campus had been constructed for short-term bank loans amounting to US$61,056,838 borrowed from Shenzhen Eastern Branch, Agricultural Bank of China. As of December 31, 2011, the aggregate net book value of the buildings and land use rights in relation to the land use rights certificate was US$127,119,640.