Note 6 - Short Term Loans and Long Term Loans

9 Months Ended

Jun. 30, 2015

Note 6 - Short Term Loans and Long Term Loans

Note 6 – Short Term Loans and Long Term Loans

The short term loans as of June 30, 2015 and September 30, 2014 consisted of the following:

		June 30, 2015		September 30, 2014
a) Loan payable to Nanchong City Bureau of Finance due on demand, fixed interest rate of 0.465% per month	$	-	$	650,047

b) Loan payable to Nanchong Commercial Bank, due on March 7, 2015, at a fixed interest rate of 6.9% per annum, guaranteed by a third party		-		812,559

c) Loan payable to Nanchong Commercial Bank, due on July 23, 2015, at a fixed interest rate of 6.9% per annum, guaranteed by a third party		816,000		812,559

d) Loan payable to Nanchong Commercial Bank, due on March 23, 2016, at a fixed interest rate of 6.1525% per annum, guaranteed by a third party		816,000		-

e) Loan payable to Bank of Communications due on July 27, 2015, at an interest rate of 7.8% per annum and guaranteed by a third party and Mr. Pu, Chairman and CEO of the Company		816,000		812,559

f) Individual loans from unrelated parties, which are due on demand and bearing a weighted average interest rate of 2.68% per month		9,206,503		7,008,727

Total Short Term Loans	$	11,654,503	$	10,096,451

a) Individual loans from unrelated parties bearing a weighted average interest rate of 2.73% per month		1,270,310*		1,462,094

b) Individual loans from various investors, bearing interest of 12% per annum and due on July 1, 2015, as extended		100,000	100,000

c) Loan payable to Jialing Rural Credit Cooperative Union due on December 19, 2015 at an interest rate of 10.764% per annum, secured by Chunfei Chemical’s real property and Chunfei Real Estate’s real property		4,732,800		4,712,842

Less: current portion of long term loans		(6,103,110)		(1,508,465)

Total Long Term Loans	$	-	$	4,766,471

* Loan in the amount of $19,382 was due on August 12, 2015 and is currently in default. Loans in the amount of $1,250,928 are in default.

The Company recorded interest expense of $922,003 and $2,841,316 for the three and nine months ended June 30, 2015, respectively. The Company recorded interest expense of $805,999 and $1,991,213 for the three and nine months ended June 30, 2014, respectively.