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Line of credit
 9 Months Ended
Sep. 30, 2012
Line of credit [Abstract]  
Line of credit
  15. Line of credit

 

The Company entered into some credit contracts revolving line of credit, which were used by short-term loans and bank acceptance bills. The following tables summarize the unused lines of credit as of September 30, 2012 and December 31, 2011:

 

    September 30, 2012 (Unaudited)
Lender   Starting date   Maturity date   Line of credit     Unused line of credit  
            $     $  
Bank of China   1/13/ 2012   1/12/2013     7,954,437       241,815  
Wing Lung Bank Ltd.   3/29/2012   3/28/2013     2,600,000       -  
Wing Lung Bank Ltd.   4/20/2012   4/19/2013     2,708,244       -  
The Shanghai Commercial & Saving bank   8/8/2012   6/7/2013     4,000,000       -  
Industrial and Commercial Bank of China   7/26/2012   7/25/2013     6,363,550       2,395,876  
Shenzhen Development Bank Co., Ltd   12/12/2011   11/27/2012     15,908,874       4,672,436  
China Everbright Bank   8/1/2012   7/31/2013     7,954,437       6,999,905  
China Resources Bank Of Zhuhai   4/28/2012   4/28/2013     6,363,550       5,568,106  
                         
Total             53,853,092       19,878,138  

 

    December 31, 2011
Lender   Starting date   Maturity date   Line of credit     Unused line of credit  
            $     $  
Industrial and Commercial Bank of China   11/29/2011   8/31/2013     6,343,568       4,898,820  
Shenzhen Development Bank Co., Ltd   12/12/2011   11/27/2012     15,858,919       10,768,206  
Standard Chartered (China) Co., Ltd.   1/21/2011   3/30/2012     2,000,000       2,000,000  
China Everbright Bank   6/9/2011   6/9/2012     7,929,460       3,103,590  
Standard Chartered (Hong Kong) Co., Ltd.   1/21/2011   1/21/2012     13,000,000       10,120,000  
Citibank (Hong Kong) Co., Ltd.   1/31/2011   1/31/2012     3,000,000       3,000,000  
Industrial and Commercial Bank of China   11/29/2011   9/8/2012     3,171,784       -  
Wing Lung Bank Ltd.   8/29/2011   3/20/2012     2,600,000       -  
Wing Lung Bank Ltd.   8/29/2011   3/20/2012     2,574,665       -  
Total             56,478,396       33,890,616  

 

The line of credits from Bank of China and Industrial and Commercial Bank of China are guaranteed by SZ Springpower, HK Highpower and the Company's Chief Executive Officer, Mr. Dang Yu Pan.

 

The line of credits from Shenzhen Development Bank Co., Ltd, China Resources Bank of Zhuhai and Standard Chartered (China) Co., Ltd are jointly guaranteed by SZ Springpower and the Company's Chief Executive Officer, Mr. Dang Yu Pan.

 

The line of credit from China Everbright Bank is guaranteed by the Company's Chief Executive Officer, Mr. Dang Yu Pan.

 

Certain of the agreements governing the Company's loans include standard affirmative and negative covenants, including restrictions on granting additional pledges on the Company's property and incurring additional debt and obligations to provide advance notice of major corporate actions, and other covenants including: the borrower may not serve as a guarantor for more than double its net assets; the borrower is restricted in certain circumstances from using the loans in connection with related party transactions or other transactions with affiliates; the borrower must provide monthly reports to certain lenders describing the actual use of loans; the borrower may need to obtain approval to engage in major corporate transactions; and the borrower may need to obtain approval to increase overseas investments, guarantee additional debt or incur additional debt by an amount which exceeds 20% of its total net assets should the lender determine that such action will have a material impact on the ability of the borrower to repay the loan. The covenants in these loan agreements could prohibit the Company from incurring any additional debt without consent from its lenders. The Company believes it would be able to obtain consents from the lenders in the event it needed to do so. The agreements governing the Company's loans may also include covenants that, in certain circumstances, may require the Company's PRC operating subsidiaries to give notice to, or obtain consent from, certain of their lenders prior to making a distribution of net profit, as well as covenants restricting the ability of the Company's PRC operating subsidiaries from extending loans. As of September 30, 2012 and December 31, 2011, the Company was in compliance with all material covenants in its loan agreements.