NOTES PAYABLE	9 Months Ended
Sep. 30, 2012
NOTES PAYABLE
NOTES PAYABLE	NOTE 7 – NOTES PAYABLE On October 26, 2011, the Company renewed a revolving line of credit with a bank in the amount of RMB25,000,000. The related note payable bore interest at an annual rate of 7.54% (based upon 115% of the PRC government’s short term rate of 6.56%). Advances on the line of credit were due one year from the date of the advance and were collateralized by certain land use rights and buildings. The outstanding balance due under the revolving line of credit was RMB25,000,000 (approximately $3.96 million) as of September 30, 2012. This amount had been classified as short-term notes payable in the accompanying condensed consolidated balance sheet as of September 30, 2012. As of September 30, 2012, the Company had no additional amounts available to it under the line of credit. On October 18, 2012, the Company fully paid the amount due under this line of credit and on October 26, 2012, it matured and was not renewed. On October 30, 2012, the Company entered into a revolving line of credit with another bank in the amount of RMB30,000,000. The related note payable bears interest at an annual rate of 6.90% (based upon 115% of the PRC government’s current short term rate of 6.00%). Advances on the line of credit are due one year from the date of the advance and are collateralized by certain land use rights and buildings. The outstanding balance due under the revolving line of credit was RMB30,000,000 (approximately $4.75 million) as of November 9, 2012. *Fair Value of* *Notes Payable* – Based on the borrowing rates currently available to the Company for bank loans with similar terms and maturities, the carrying amounts of notes payable outstanding as of September 30, 2012 and December 31, 2011 approximated their fair value because of either the immediate or short-term maturity of these financial instruments or because the underlying instruments bear interest rates that approximated current market rates.

NOTES PAYABLE

9 Months Ended

Sep. 30, 2012

NOTE 7 – NOTES PAYABLE

On October 26, 2011, the Company renewed a revolving line of credit with a bank in the amount of RMB25,000,000. The related note payable bore interest at an annual rate of 7.54% (based upon 115% of the PRC government’s short term rate of 6.56%). Advances on the line of credit were due one year from the date of the advance and were collateralized by certain land use rights and buildings. The outstanding balance due under the revolving line of credit was RMB25,000,000 (approximately $3.96 million) as of September 30, 2012. This amount had been classified as short-term notes payable in the accompanying condensed consolidated balance sheet as of September 30, 2012. As of September 30, 2012, the Company had no additional amounts available to it under the line of credit. On October 18, 2012, the Company fully paid the amount due under this line of credit and on October 26, 2012, it matured and was not renewed.

On October 30, 2012, the Company entered into a revolving line of credit with another bank in the amount of RMB30,000,000. The related note payable bears interest at an annual rate of 6.90% (based upon 115% of the PRC government’s current short term rate of 6.00%). Advances on the line of credit are due one year from the date of the advance and are collateralized by certain land use rights and buildings. The outstanding balance due under the revolving line of credit was RMB30,000,000 (approximately $4.75 million) as of November 9, 2012.

Fair Value of Notes Payable – Based on the borrowing rates currently available to the Company for bank loans with similar terms and maturities, the carrying amounts of notes payable outstanding as of September 30, 2012 and December 31, 2011 approximated their fair value because of either the immediate or short-term maturity of these financial instruments or because the underlying instruments bear interest rates that approximated current market rates.