<SEC-DOCUMENT>0001062993-13-003041.txt : 20131231
<SEC-HEADER>0001062993-13-003041.hdr.sgml : 20131231
<ACCEPTANCE-DATETIME>20130613145234
<PRIVATE-TO-PUBLIC>
ACCESSION NUMBER:		0001062993-13-003041
CONFORMED SUBMISSION TYPE:	CORRESP
PUBLIC DOCUMENT COUNT:		2
FILED AS OF DATE:		20130613

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			CHINA BAK BATTERY INC
		CENTRAL INDEX KEY:			0001117171
		STANDARD INDUSTRIAL CLASSIFICATION:	MISCELLANEOUS ELECTRICAL MACHINERY, EQUIPMENT & SUPPLIES [3690]
		IRS NUMBER:				880442833
		STATE OF INCORPORATION:			NV
		FISCAL YEAR END:			0930

	FILING VALUES:
		FORM TYPE:		CORRESP

	BUSINESS ADDRESS:	
		STREET 1:		BAK INDUSTRIAL PARK, NO. 1 BAK STREET
		STREET 2:		KUICHONG TOWN, LONGGANG DISTRICT
		CITY:			SHENZHEN PEOPLE
		STATE:			F4
		ZIP:			518119
		BUSINESS PHONE:		86-755-8977-0093

	MAIL ADDRESS:	
		STREET 1:		BAK INDUSTRIAL PARK, NO. 1 BAK STREET
		STREET 2:		KUICHONG TOWN, LONGGANG DISTRICT
		CITY:			SHENZHEN PEOPLE
		STATE:			F4
		ZIP:			518119

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	MEDINA COFFEE INC
		DATE OF NAME CHANGE:	20000626
</SEC-HEADER>
<DOCUMENT>
<TYPE>CORRESP
<SEQUENCE>1
<FILENAME>filename1.htm
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   <TITLE>China BAK Battery Inc.: Correspondence - Filed by newsfilecorp.com</TITLE>
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<P align=center><IMG src="correspx1x1.jpg" border=0 width="442" height="74"> </P>
<P align=right>June 13, 2013 </P>
<P align=justify>Jeanne Bennett<BR>Division of Corporation Finance <BR>U.S.
Securities and Exchange Commission <BR>100 F Street, NE <BR>Washington, DC 20549
</P>
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  <TR vAlign=top>
    <TD align=left width="5%"  >&nbsp;</TD>
    <TD align=left width="5%" ><B>Re:</B> </TD>
    <TD align=left width="90%"><B>China BAK Battery, Inc.</B> </TD></TR>
  <TR vAlign=bottom>
    <TD align=center width="5%"  >&nbsp;</TD>
    <TD align=center width="5%" >&nbsp;</TD>
    <TD align=left width="90%" ><STRONG>Form 10-K for Fiscal Year
      Ended September 30, 2012</STRONG> </TD></TR>
  <TR vAlign=top>
    <TD align=left width="5%"  >&nbsp;</TD>
    <TD align=left width="5%" >&nbsp; </TD>
    <TD align=left width="90%"><B>Filed December 31, 2012</B> </TD></TR>
  <TR vAlign=top>
    <TD align=left width="5%"  >&nbsp;</TD>
    <TD align=left width="5%" >&nbsp; </TD>
    <TD align=left width="90%"><B>Form 10-Q for Quarterly Period Ended
      December 31, 2012</B> </TD></TR>
  <TR vAlign=top>
    <TD align=left width="5%"  >&nbsp;</TD>
    <TD align=left width="5%" >&nbsp; </TD>
    <TD align=left width="90%"><B>Filed February 14, 2013</B> </TD></TR>
  <TR vAlign=top>
    <TD align=left width="5%"  >&nbsp;</TD>
    <TD align=left width="5%" >&nbsp; </TD>
    <TD align=left width="90%"><B>File No. 001-32898</B> </TD></TR></TABLE>
<P align=justify>Dear Ms. Bennett: </P>
<P align=justify style="text-indent: 5%">On behalf of China BAK Battery, Inc. (the &#147;<I>Company</I>&#148;), we
hereby submit the Company&#146;s responses to the comments of the staff (the
&#147;<I>Staff</I>&#148;) of the Securities and Exchange Commission (the
&#147;<I>Commission</I>&#148;), dated May 15, 2013, with respect to the above-referenced
Form 10-K for the fiscal year ended September 30, 2012 (the &#147;<I>10-K</I>&#148;) and
the Form 10-Q for the quarterly period ended December 31, 2012 (the
&#147;<I>10-Q</I>&#148;).</P>
<P align=justify style="text-indent: 5%">For the convenience of the Staff, a summary of the Staff&#146;s
comments is included and is followed by the corresponding response of the
Company. References in this letter to &#147;we,&#148; &#147;us&#148; and &#147;our&#148; refer to the Company,
and &#147;you&#148; and &#147;your&#148; refer to the Staff, unless the context indicates otherwise.
</P>
<P align=justify><B><U>Form 10-K for the Fiscal Year Ended September 30,
2012</U></B><B> </B></P>
<P align=justify><B><U>Item 7. Management&#146;s Discussion and Analysis of Financial
Condition and Results</U></B><B> </B><B><U>of Operations</U></B><B> </B></P>
<P align=justify><B><U>Liquidity and Capital Resources, page 40</U></B><B>
</B></P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0 BCLLIST>

  <TR>
    <TD vAlign=top width="5%"><B>1.</B> </TD>
    <TD>
      <P align=justify><B>Please expand your response to prior comment 1, and
      your revised disclosure in future filings, to clarify what you mean by
      having a &#147;good relationship&#148; with banks and how this &#147;good relationship&#148;
      will allow you to renew your short- term debt. Given the amount of your
      current liabilities relative to your existing sources of liquidity, it is
      unclear from your response how having only a &#147;good relationship&#148; will
      allow you to renew debt. Also, as a related matter, it appears your
      response only addresses your short-term debt. Please also expand to
      discuss your other short-term obligations, such as your accounts and bills
      payable and accrued expenses. In this regard, we note the table you
      provided in response to comment 1 lists anticipated cash outflows of $192
      million over the next 12 months, but your most recent Form 10-Q lists more
than $320 million of current liabilities.</B></P></TD></TR></TABLE><BR>
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  <TR vAlign=top>
    <TD align=left>Jeanne Bennett </TD></TR>
  <TR vAlign=top>
    <TD align=left>June 13, 2013 </TD></TR>
  <TR vAlign=top>
    <TD align=left>Page 2 </TD></TR></TABLE>
<P align=justify>COMPANY RESPONSE: In response to the Staff&#146;s comment, we
believe that due to our long history of business relationship with our banks,
which has historically allowed us to renew our loans on maturity, we should be
able to continue to do so. The following summarizes our history with our banks:-
</P>
<DIV>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
borderColor=#000000 cellSpacing=0 cellPadding=3 width="100%" border=1>

  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD align=left width="11%">&nbsp; </TD>
    <TD noWrap align=center width="11%">&nbsp; </TD>
    <TD noWrap align=center width="33%" colSpan=3><B>Last facility letter</B>
    </TD>
    <TD noWrap align=center width="33%" colSpan=3><B>Existing facility
      letter</B> </TD></TR>
  <TR vAlign=top>
    <TD align=left><BR><BR><B><U>Name of Bank</U></B> <BR><BR></TD>
    <TD align=left width="11%"><BR><BR><B><U>Name of Branch</U></B>
<BR><BR></TD>
    <TD noWrap align=center width="11%"><B><U>Loan facility
      </U></B><BR><B><U>since</U></B> <BR><B><U>(month/year) </U></B><BR><BR></TD>
    <TD noWrap align=center width="11%"><STRONG><U>Period start</U></STRONG>
      <BR><B><U>(date /</U></B> <BR><STRONG><U>month /year)</U></STRONG>
    <BR><BR></TD>
    <TD noWrap align=center width="11%"><B><U>Period end</U></B>
      <BR><B><U>(date / month</U></B> <BR><B><U>/year)</U></B> <BR><BR></TD>
    <TD noWrap align=center width="11%"><BR><BR><B><U>Amount</U></B>
    <BR><BR></TD>
    <TD noWrap align=center width="11%"><B><U>Period</U></B>
      <BR><B><U>start</U></B> <BR><B><U>(date /</U></B> <BR><B><U>month</U></B>
      <BR><B><U>/year)</U></B> </TD>
    <TD noWrap align=center width="11%"><B><U>Period</U></B>
      <BR><B><U>end(date /</U></B> <BR><B><U>month /year) </U></B><BR><BR></TD>
    <TD noWrap align=center width="11%"><BR><BR><STRONG><U>Amount</U></STRONG>
      <BR><BR></TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD align=left width="11%">&nbsp; </TD>
    <TD noWrap align=center width="11%">&nbsp; </TD>
    <TD noWrap align=center width="11%">&nbsp; </TD>
    <TD noWrap align=center width="11%">&nbsp; </TD>
    <TD noWrap align=center width="11%"><B>$'000</B> </TD>
    <TD noWrap align=center width="11%">&nbsp; </TD>
    <TD noWrap align=center width="11%">&nbsp; </TD>
    <TD noWrap align=center width="11%"><B>$'000</B> </TD></TR>
  <TR vAlign=top>
    <TD vAlign=bottom align=left>Agricultural Bank of China </TD>
    <TD vAlign=bottom align=left width="11%">Shenzhen Eastern Branch </TD>
    <TD vAlign=bottom align=center width="11%">06/2007 </TD>
    <TD vAlign=bottom align=center width="11%">30/11/2011 </TD>
    <TD vAlign=bottom align=center width="11%">24/11/2012 </TD>
    <TD vAlign=bottom align=right width="11%">72,492 </TD>
    <TD vAlign=bottom align=right width="11%">27/11/2012 </TD>
    <TD vAlign=bottom align=right width="11%">25/11/2013 </TD>
    <TD vAlign=bottom align=right width="11%">67,659 </TD></TR>
  <TR vAlign=top>
    <TD vAlign=bottom align=left>Bank of China </TD>
    <TD vAlign=bottom align=left width="11%">Longgang Branch </TD>
    <TD vAlign=bottom align=center width="11%">03/2010 </TD>
    <TD vAlign=bottom align=center width="11%">4/5/2011 </TD>
    <TD vAlign=bottom align=center width="11%">4/5/2012 </TD>
    <TD vAlign=bottom align=right width="11%">62,942 </TD>
    <TD vAlign=bottom align=right width="11%">3/7/2012 </TD>
    <TD vAlign=bottom align=right width="11%">3/7/2013 </TD>
    <TD vAlign=bottom align=right width="11%">64,437 </TD></TR>
  <TR vAlign=top>
    <TD vAlign=bottom align=left>Shenzhen Development Bank </TD>
    <TD vAlign=bottom align=left width="11%">Longgang Branch </TD>
    <TD vAlign=bottom align=center width="11%">06/2007 </TD>
    <TD vAlign=bottom align=center width="11%">26/1/2011 </TD>
    <TD vAlign=bottom align=center width="11%">18/1/2012 </TD>
    <TD vAlign=bottom align=right width="11%">31,718 </TD>
    <TD vAlign=bottom align=right width="11%">5/6/2012 </TD>
    <TD vAlign=bottom align=right width="11%">31/5/2013<SUP>3</SUP> </TD>
    <TD vAlign=bottom align=right width="11%">28,997 </TD></TR>
  <TR vAlign=top>
    <TD vAlign=bottom align=left>CITIC Bank </TD>
    <TD vAlign=bottom align=left width="11%">Shungan Branch </TD>
    <TD vAlign=bottom align=center width="11%">05/2010 </TD>
    <TD vAlign=bottom align=center width="11%">6/5/2011 </TD>
    <TD vAlign=bottom align=center width="11%">6/5/2012 </TD>
    <TD vAlign=bottom align=right width="11%">11,802 </TD>
    <TD vAlign=bottom align=right width="11%">13/6/2012 </TD>
    <TD vAlign=bottom align=right width="11%">13/6/2013<SUP>3</SUP> </TD>
    <TD vAlign=bottom align=right width="11%">12,082 </TD></TR>
  <TR vAlign=top>
    <TD vAlign=bottom align=left>China Everbright Bank </TD>
    <TD vAlign=bottom align=left width="11%">Shenzhen Branch </TD>
    <TD vAlign=bottom align=center width="11%">08/2009 </TD>
    <TD vAlign=bottom align=center width="11%">11/11/2011 </TD>
    <TD vAlign=bottom align=center width="11%">10/11/2012 </TD>
    <TD vAlign=bottom align=right width="11%">12,727<SUP>1</SUP> </TD>
    <TD vAlign=bottom align=right width="11%">- </TD>
    <TD vAlign=bottom align=right width="11%">- </TD>
    <TD vAlign=bottom align=right width="11%">- </TD></TR>
  <TR vAlign=top>
    <TD vAlign=bottom align=left>China Construction Bank </TD>
    <TD vAlign=bottom align=left width="11%">Tianjin Branch </TD>
    <TD vAlign=bottom align=center width="11%">01/2012 </TD>
    <TD vAlign=bottom align=center width="11%">16/1/2012 </TD>
    <TD vAlign=bottom align=center width="11%">15/1/2013 </TD>
    <TD vAlign=bottom align=right width="11%">8,128<SUP>2</SUP> </TD>
    <TD vAlign=bottom align=right width="11%">- </TD>
    <TD vAlign=bottom align=right width="11%">- </TD>
    <TD vAlign=bottom align=right width="11%">- </TD></TR>
  <TR vAlign=top>
    <TD vAlign=bottom align=left>Bank of Dalian </TD>
    <TD vAlign=bottom align=left width="11%">Tianjin Branch Office </TD>
    <TD vAlign=bottom align=center width="11%">11/2009 </TD>
    <TD vAlign=bottom align=center width="11%">22/11/2011 </TD>
    <TD vAlign=bottom align=center width="11%">21/11/2012 </TD>
    <TD vAlign=bottom align=right width="11%">12,887 </TD>
    <TD vAlign=bottom align=right width="11%">21/11/2012 </TD>
    <TD vAlign=bottom align=right width="11%">20/11/2013 </TD>
    <TD vAlign=bottom align=right width="11%">11,857 </TD></TR>
  <TR vAlign=top>
    <TD vAlign=bottom align=left>Bank of Dalian </TD>
    <TD vAlign=bottom align=left width="11%">Tianjin Branch Office </TD>
    <TD vAlign=bottom align=center width="11%">11/2009 </TD>
    <TD vAlign=bottom align=center width="11%">21/11/2012 </TD>
    <TD vAlign=bottom align=center width="11%">20/11/2013 </TD>
    <TD vAlign=bottom align=right width="11%">11,856 </TD>
    <TD vAlign=bottom align=right width="11%">28/1/2013 </TD>
    <TD vAlign=bottom align=right width="11%">27/1/2014 </TD>
    <TD vAlign=bottom align=right width="11%">19,331 </TD></TR>
  <TR vAlign=top>
    <TD vAlign=bottom align=left>Bohai Bank </TD>
    <TD vAlign=bottom align=left width="11%">Tianjin Branch </TD>
    <TD vAlign=bottom align=center width="11%">01/2010 </TD>
    <TD vAlign=bottom align=center width="11%">19/1/2010 </TD>
    <TD vAlign=bottom align=center width="11%">19/1/2011 </TD>
    <TD vAlign=bottom align=right width="11%">6,058 </TD>
    <TD vAlign=bottom align=right width="11%">29/5/2012 </TD>
    <TD vAlign=bottom align=right width="11%">28/5/2013<SUP>3</SUP> </TD>
    <TD vAlign=bottom align=right width="11%">12,887 </TD></TR>
  <TR vAlign=top>
    <TD vAlign=bottom align=left>China Development Bank </TD>
    <TD vAlign=bottom align=left width="11%">Shenzhen Branch </TD>
    <TD vAlign=bottom align=center width="11%">02/2010 </TD>
    <TD vAlign=bottom align=center width="11%">N/A </TD>
    <TD vAlign=bottom align=center width="11%">N/A </TD>
    <TD vAlign=bottom align=right width="11%">N/A </TD>
    <TD vAlign=bottom align=right width="11%">9/2/2010 </TD>
    <TD vAlign=bottom align=right width="11%">9/2/2016 </TD>
    <TD vAlign=bottom align=right width="11%">24,164
</TD></TR></TABLE></DIV>
<P align=justify>Note:</P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0 BCLLIST>

  <TR>
    <TD vAlign=top width="5%">1. </TD>
    <TD>
      <P align=justify>The Company repaid this loan in January and March
      2013.</P></TD></TR>
  <TR>
    <TD width="5%">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
  <TR>
    <TD vAlign=top width="5%">2. </TD>
    <TD>
      <P align=justify>The Company repaid this loan on January 15,
  2013.</P></TD></TR>
  <TR>
    <TD width="5%">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
  <TR>
    <TD vAlign=top width="5%">3. </TD>
    <TD>
      <P align=justify>The Company is negotiating with the banks to extend these
      facilities and expect that they should be renewed by the end of June,
      2013, amounts of which should be at least equal to the expired
      facilities.</P></TD></TR></TABLE>
<font SIZE="2">
<p align="justify">As a leading company in the new-energy industry in China, we
are supported by the Chinese government at both national and local levels. The
government encourages banks including most of the above mentioned to provide
preferential financial support to us. </p>
</font>
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<TABLE
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cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=top>
    <TD align=left>Jeanne Bennett </TD></TR>
  <TR vAlign=top>
    <TD align=left>June 13, 2013 </TD></TR>
  <TR vAlign=top>
    <TD align=left>Page 3 </TD></TR></TABLE>
<P align=justify>Also, we have long-term business relationship with our
suppliers and we have been paying them within 90-360 days from the respective
invoice dates. The following summarizes our history with our major suppliers:
</P>
<DIV>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
borderColor=#000000 cellSpacing=0 cellPadding=3 width="100%" border=1>

  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD align=left width="30%">&nbsp; </TD>
    <TD align=left width="16%">&nbsp; </TD>
    <TD align=center width="48%" colSpan=3><B>Amount of accounts payable
      at</B> </TD></TR>
  <TR vAlign=bottom>
    <TD align=center><BR><BR><BR></TD>
    <TD align=center width="30%"><BR><BR><BR><STRONG><U>Name of
      Supplier</U></STRONG> </TD>
    <TD align=center width="16%"><STRONG><U>Business</U></STRONG>
      <BR><B><U>relationship</U></B> <BR><B><U>since</U></B>
      <BR><B><U>(month/year)</U></B> </TD>
    <TD align=center width="16%"><BR><BR><BR><STRONG><U>9/30/2012</U></STRONG>
    </TD>
    <TD align=center
      width="16%"><BR><BR><BR><STRONG><U>12/31/2012</U></STRONG> </TD>
    <TD align=center width="16%"><BR><BR><BR><STRONG><U>3/31/2013</U></STRONG>
    </TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD align=left width="30%">&nbsp; </TD>
    <TD align=left width="16%">&nbsp; </TD>
    <TD align=center width="48%" colSpan=3><B>in thousands of US dollars</B>
    </TD></TR>
  <TR vAlign=top>
    <TD vAlign=bottom align=center>1 </TD>
    <TD vAlign=bottom align=left width="30%">Citic Guoan MGL Power Technolong
      Co.,Ltd </TD>
    <TD vAlign=bottom align=center width="16%">01/2004 </TD>
    <TD vAlign=bottom align=right width="16%">10,531 </TD>
    <TD vAlign=bottom align=right width="16%">2,534 </TD>
    <TD vAlign=bottom align=right width="16%">6,836 </TD></TR>
  <TR vAlign=top>
    <TD vAlign=bottom align=center>2 </TD>
    <TD vAlign=bottom align=left width="30%">Hunan Reshine New Material
      Co.,Ltd </TD>
    <TD vAlign=bottom align=center width="16%">09/2004 </TD>
    <TD vAlign=bottom align=right width="16%">4,125 </TD>
    <TD vAlign=bottom align=right width="16%">4,479 </TD>
    <TD vAlign=bottom align=right width="16%">4,401 </TD></TR>
  <TR vAlign=top>
    <TD vAlign=bottom align=center>3 </TD>
    <TD vAlign=bottom align=left width="30%">Shenzhen Tianjiao Technology
      Development Co.,Ltd </TD>
    <TD vAlign=bottom align=center width="16%">07/2005 </TD>
    <TD vAlign=bottom align=right width="16%">3,186 </TD>
    <TD vAlign=bottom align=right width="16%">3,236 </TD>
    <TD vAlign=bottom align=right width="16%">3,705 </TD></TR>
  <TR vAlign=top>
    <TD vAlign=bottom align=center>4 </TD>
    <TD vAlign=bottom align=left width="30%">Shenzhen Capchem Technology
      Co.,Ltd </TD>
    <TD vAlign=bottom align=center width="16%">08/2006 </TD>
    <TD vAlign=bottom align=right width="16%">2,994 </TD>
    <TD vAlign=bottom align=right width="16%">2,766 </TD>
    <TD vAlign=bottom align=right width="16%">1,923 </TD></TR>
  <TR vAlign=top>
    <TD vAlign=bottom align=center>5 </TD>
    <TD vAlign=bottom align=left width="30%">Qingdao Dahua Electronics
      Technology Co.,Ltd </TD>
    <TD vAlign=bottom align=center width="16%">11/2006 </TD>
    <TD vAlign=bottom align=right width="16%">2,647 </TD>
    <TD vAlign=bottom align=right width="16%">2,231 </TD>
    <TD vAlign=bottom align=right width="16%">1,682 </TD></TR>
  <TR vAlign=top>
    <TD vAlign=bottom align=center>6 </TD>
    <TD vAlign=bottom align=left width="30%">Beijing Easpring Material
      Technology Co.,Ltd </TD>
    <TD vAlign=bottom align=center width="16%">01/2004 </TD>
    <TD vAlign=bottom align=right width="16%">4,288 </TD>
    <TD vAlign=bottom align=right width="16%">1,886 </TD>
    <TD vAlign=bottom align=right width="16%">1,446 </TD></TR>
  <TR vAlign=top>
    <TD vAlign=bottom align=center>7 </TD>
    <TD vAlign=bottom align=left width="30%">Hunan Bangpu Recycle Technology
      Co.,Ltd </TD>
    <TD vAlign=bottom align=center width="16%">07/2011 </TD>
    <TD vAlign=bottom align=right width="16%">1,445 </TD>
    <TD vAlign=bottom align=right width="16%">481 </TD>
    <TD vAlign=bottom align=right width="16%">483 </TD></TR>
  <TR vAlign=top>
    <TD vAlign=bottom align=center>8 </TD>
    <TD vAlign=bottom align=left width="30%">Shenzhen BTR New Energy Material
      Co.,Ltd </TD>
    <TD vAlign=bottom align=center width="16%">01/2004 </TD>
    <TD vAlign=bottom align=right width="16%">2,215 </TD>
    <TD vAlign=bottom align=right width="16%">2,493 </TD>
    <TD vAlign=bottom align=right width="16%">2,753 </TD></TR>
  <TR vAlign=top>
    <TD vAlign=bottom align=center>9 </TD>
    <TD vAlign=bottom align=left width="30%">Shenzhen Topband Co.,Ltd </TD>
    <TD vAlign=bottom align=center width="16%">08/2008 </TD>
    <TD vAlign=bottom align=right width="16%">1,658 </TD>
    <TD vAlign=bottom align=right width="16%">1,559 </TD>
    <TD vAlign=bottom align=right width="16%">1,700 </TD></TR>
  <TR vAlign=top>
    <TD vAlign=bottom align=center>10 </TD>
    <TD vAlign=bottom align=left width="30%">Hubei Yanguang Technology Co.,Ltd
    </TD>
    <TD vAlign=bottom align=center width="16%">09/2010 </TD>
    <TD vAlign=bottom align=right width="16%">3,444 </TD>
    <TD vAlign=bottom align=right width="16%">51 </TD>
    <TD vAlign=bottom align=right width="16%">2,394 </TD></TR>
  <TR vAlign=top>
    <TD vAlign=bottom align=left>&nbsp; </TD>
    <TD vAlign=bottom align=left width="30%">Total of the above </TD>
    <TD vAlign=bottom align=left width="16%">&nbsp; </TD>
    <TD vAlign=bottom align=right width="16%">36,533 </TD>
    <TD vAlign=bottom align=right width="16%">&nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;21,716 </TD>
    <TD vAlign=bottom align=right width="16%">27,323 </TD></TR>
  <TR vAlign=top>
    <TD vAlign=bottom align=left>&nbsp; </TD>
    <TD vAlign=bottom align=left width="30%">Consolidated accounts payable </TD>
    <TD vAlign=bottom align=left width="16%">&nbsp; </TD>
    <TD vAlign=bottom align=right width="16%">143,745 </TD>
    <TD vAlign=bottom align=right width="16%">136,677 </TD>
    <TD vAlign=bottom align=right width="16%">136,488
</TD></TR></TABLE></DIV>
<P align=justify>The cash plan that we presented in our letter dated April 18,
2013 is for the period from April 1, 2013 to March 31, 2014. A reconciliation of
our anticipated cash outflows of $192,742 to our current liabilities as of March
31, 2013 is presented in the following table: </P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD noWrap align=center width="12%">(In thousands of U.S </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD noWrap align=center width="12%">dollars) </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Anticipated cash outflows as per cash plan
    </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>192,742 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>Add: Items excluded from anticipated cash outflows </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="12%">&nbsp; </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Bank borrowings repaid and renewed within
      one year </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"
    bgColor=#e6efff>137,815 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD></TR>
  <TR>
    <TD>&nbsp; </TD>
    <TD width="1%" >&nbsp;</TD>
    <TD width="12%">&nbsp; </TD>
    <TD width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Total current liabilities as of March 31,
      2013 per Form 10-Q </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="12%"
    bgColor=#e6efff>330,557 </TD>
    <TD align=left width="2%"
  bgColor=#e6efff>&nbsp;</TD></TR></TABLE>
<P align=justify>In accordance with the staff&#146;s request, we will add disclosures
to discuss our relationships with banks and to discuss our other short-term
obligations, such as accounts and bills payable and accrued expenses, as
follows:-x </P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<!--$$/page=--><A name=page_4></A><BR>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=top>
    <TD align=left>Jeanne Bennett </TD></TR>
  <TR vAlign=top>
    <TD align=left>June 13, 2013 </TD></TR>
  <TR vAlign=top>
    <TD align=left>Page 4 </TD></TR></TABLE>
<P align=justify><U>Form 10-K for the fiscal year ended September 30, 2012</U>
<BR><U>Item 7 Management&#146;s Discussion and Analysis of Financial Condition and
Results of</U> <U>Operation</U> </P>
<P align=justify>&#147;We have long-term business relationships with our banks and
over the term of these relationships we have been able to renew our loans upon
maturity and we expect that we should be able to continue to do so. As of
September 30, 2012, we still have unutilized lines of credit totaling
approximately $27.6 million extending to periods up to February 2016. We also
have established long-term relationships with our suppliers and we will be able
to pay them within 90-360 days from the respective invoice dates. We will
continue to implement our turnaround plans to improve our operations. We expect
that our sources of liquidity will be sufficient for the next 12 months.&#148; </P>
<P align=justify><B><U>Note 2. Summary of Significant Accounting Policies and
Practices (o) Government Grants, page F-18</U></B></P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0 BCLLIST>

  <TR>
    <TD vAlign=top width="5%"><B>2.</B> </TD>
    <TD>
      <P align=justify><B>We note your response to prior comment 3. Irrespective
      of whether the company presents the amount in a separate line item, we
      continue to note that the nature of the grants is related to your
      operations and that since you present a caption entitled &#147;operating loss&#148;
      that amount should reflect all transactions relating to your operations.
      Refer to Rule 5-03 of Regulation S-X. Also, see our views outlined in SAB
      Topic 5.P.3., indicating that the proper classification of an item depends
      on the nature of the charge and the assets and operations to which it
      relates. Please revise future filings to present government grants as part
      of your operating loss.</B></P></TD></TR></TABLE>
<P align=justify>COMPANY RESPONSE: We will revise our future filings to present
government grants as part of our operating loss as follows:- </P>
<P align=justify><U>Form 10-K for the fiscal year ended September 30, 2012</U>
<BR><U>Consolidated statements of operations and comprehensive loss</U> </P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=center width="10%"><I><U>Note</U></I> </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="10%"><I>2011</I> </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="10%"><I>2012</I> </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR>
    <TD>&nbsp; </TD>
    <TD width="1%" >&nbsp;</TD>
    <TD align=center width="10%">&nbsp; </TD>
    <TD width="2%" >&nbsp;</TD>
    <TD width="1%" >&nbsp;</TD>
    <TD width="10%">&nbsp; </TD>
    <TD width="2%" >&nbsp;</TD>
    <TD width="1%" >&nbsp;</TD>
    <TD width="10%">&nbsp; </TD>
    <TD width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Net revenues </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=center width="10%" bgColor=#e6efff>25 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"  bgColor=#e6efff>$</TD>
    <TD vAlign=bottom align=right width="10%"
      bgColor=#e6efff>&nbsp;218,952,724 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"  bgColor=#e6efff>$</TD>
    <TD vAlign=bottom align=right width="10%"
      bgColor=#e6efff>&nbsp;205,670,946 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>Cost of revenues </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=center width="10%">8, 20 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="10%">(192,648,690</TD>
    <TD vAlign=bottom align=left width="2%" ><U><FONT
      color=#e6efff>)</FONT></U> </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="10%">(204,197,751</TD>
    <TD vAlign=bottom align=left width="2%" ><U><FONT
      color=#e6efff>)</FONT></U> </TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Gross profit </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=center width="10%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="10%" bgColor=#e6efff>26,304,034 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="10%" bgColor=#e6efff>1,473,195 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>Operating expenses: </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=center width="10%">&nbsp; </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="10%">&nbsp; </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="10%">&nbsp; </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp;Research and development
      expenses </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=center width="10%" bgColor=#e6efff>8, 20 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>(6,513,814</TD>
    <TD vAlign=bottom align=left width="2%"  bgColor=#e6efff>)
</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>(1,843,451</TD>
    <TD vAlign=bottom align=left width="2%"  bgColor=#e6efff>)
  </TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp;Sales and marketing expenses </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=center width="10%">8, 20 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">(8,541,782</TD>
    <TD vAlign=bottom align=left width="2%" >) </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">(8,488,889</TD>
    <TD vAlign=bottom align=left width="2%" >) </TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp;General and administrative
      expenses </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=center width="10%" bgColor=#e6efff>8, 20 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>(17,955,625</TD>
    <TD vAlign=bottom align=left width="2%"  bgColor=#e6efff>)
</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>(39,761,019</TD>
    <TD vAlign=bottom align=left width="2%"  bgColor=#e6efff>)
  </TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp;Impairment charge </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=center width="10%">8 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="10%">(6,517,344</TD>
    <TD vAlign=bottom align=left width="2%" ><U><FONT
      color=#e6efff>)</FONT></U> </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="10%">(3,918,959</TD>
    <TD vAlign=bottom align=left width="2%" ><U><FONT
      color=#e6efff>)</FONT></U> </TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp;Total operating expenses </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=center width="10%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="10%" bgColor=#e6efff>(39,528,565</TD>
    <TD vAlign=bottom align=left width="2%"  bgColor=#e6efff>)
</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="10%" bgColor=#e6efff>(54,012,318</TD>
    <TD vAlign=bottom align=left width="2%"  bgColor=#e6efff>)
  </TD></TR>
  <TR vAlign=top>
    <TD align=left>Operating loss </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=center width="10%">&nbsp; </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">(13,224,531</TD>
    <TD vAlign=bottom align=left width="2%" >) </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">(52,539,123</TD>
    <TD vAlign=bottom align=left width="2%" >) </TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Finance costs, net </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=center width="10%" bgColor=#e6efff>19 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>(10,828,983</TD>
    <TD vAlign=bottom align=left width="2%"  bgColor=#e6efff>)
</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>(11,265,990</TD>
    <TD vAlign=bottom align=left width="2%"  bgColor=#e6efff>)
  </TD></TR>
  <TR vAlign=top>
    <TD align=left>Government grant income </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=left width="10%">&nbsp; </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="10%">505,769 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="10%">1,190,012 </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Other income / (expense) </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="10%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="10%"
    bgColor=#e6efff>312,501 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="10%"
    bgColor=#e6efff>(798,528</TD>
    <TD align=left width="2%" bgColor=#e6efff>) </TD></TR>
  <TR vAlign=top>
    <TD align=left>Loss before income taxes </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=left width="10%">&nbsp; </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="10%">(23,235,244</TD>
    <TD align=left width="2%">) </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="10%">(63,413,629</TD>
    <TD align=left width="2%">) </TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Income taxes expense </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=center width="10%" bgColor=#e6efff>7(a) </TD>
    <TD align=left width="2%" bgColor=#e6efff></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="10%"
    bgColor=#e6efff>(1,302,120</TD>
    <TD align=left width="2%" bgColor=#e6efff>) </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="10%"
    bgColor=#e6efff>(2,393,766</TD>
    <TD align=left width="2%" bgColor=#e6efff>) </TD></TR>
  <TR vAlign=top>
    <TD align=left>Net loss </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=center
      width="10%">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%">$</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right
      width="10%">&nbsp;(24,537,364</TD>
    <TD align=left width="2%">) </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%">$</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right
      width="10%">&nbsp;(65,807,395</TD>
    <TD align=left width="2%">) </TD></TR></TABLE>
<BR>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<!--$$/page=--><A name=page_5></A><BR>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=top>
    <TD align=left>Jeanne Bennett </TD></TR>
  <TR vAlign=top>
    <TD align=left>June 13, 2013 </TD></TR>
  <TR vAlign=top>
    <TD align=left>Page 5 </TD></TR></TABLE>
<P align=justify>Below is reconciliation between the original Form 10-K and our
proposed future filings:- </P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD noWrap align=center width="10%">&nbsp; </TD>
    <TD noWrap align=center width="2%" >&nbsp;</TD>
    <TD noWrap align=center width="1%" >&nbsp;</TD>
    <TD noWrap align=center width="10%"><B>Amortization</B> </TD>
    <TD noWrap align=center width="2%" >&nbsp;</TD>
    <TD noWrap align=center width="1%" >&nbsp;</TD>
    <TD noWrap align=center width="10%"><B>Subsidies for</B> </TD>
    <TD noWrap align=center width="2%" >&nbsp;</TD>
    <TD noWrap align=center width="1%" >&nbsp;</TD>
    <TD noWrap align=center width="10%">&nbsp; </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD noWrap align=center width="10%">&nbsp; </TD>
    <TD noWrap align=center width="2%" >&nbsp;</TD>
    <TD noWrap align=center width="1%" >&nbsp;</TD>
    <TD noWrap align=center width="10%"><B>on subsidies for</B> </TD>
    <TD noWrap align=center width="2%" >&nbsp;</TD>
    <TD noWrap align=center width="1%" >&nbsp;</TD>
    <TD noWrap align=center width="10%"><B>research and</B> </TD>
    <TD noWrap align=center width="2%" >&nbsp;</TD>
    <TD noWrap align=center width="1%" >&nbsp;</TD>
    <TD noWrap align=center width="10%"><B>Revised</B> </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD noWrap align=center width="10%"><B>Per original</B> </TD>
    <TD noWrap align=center width="2%" >&nbsp;</TD>
    <TD noWrap align=center width="1%" >&nbsp;</TD>
    <TD noWrap align=center width="10%"><B>lease</B> </TD>
    <TD noWrap align=center width="2%" >&nbsp;</TD>
    <TD noWrap align=center width="1%" >&nbsp;</TD>
    <TD noWrap align=center width="10%"><B>development</B> </TD>
    <TD noWrap align=center width="2%" >&nbsp;</TD>
    <TD noWrap align=center width="1%" >&nbsp;</TD>
    <TD noWrap align=center width="10%"><B>September 30,</B> </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left><B>For the year ended September 30, 2011</B> </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD noWrap align=center width="10%"><B>2012 Form 10-K</B> </TD>
    <TD noWrap align=center width="2%" >&nbsp;</TD>
    <TD noWrap align=center width="1%" >&nbsp;</TD>
    <TD noWrap align=center width="10%"><B>prepayments</B> </TD>
    <TD noWrap align=center width="2%" >&nbsp;</TD>
    <TD noWrap align=center width="1%" >&nbsp;</TD>
    <TD noWrap align=center width="10%"><B>projects</B> </TD>
    <TD noWrap align=center width="2%" >&nbsp;</TD>
    <TD noWrap align=center width="1%" >&nbsp;</TD>
    <TD noWrap align=center width="10%"><STRONG>2011 (note)</STRONG> </TD>
    <TD align=left width="2%" ></TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD align=left width="1%" ></TD>
    <TD noWrap align=center width="10%"><STRONG>$</STRONG></TD>
    <TD noWrap align=center width="2%" >&nbsp;</TD>
    <TD noWrap align=center width="1%" ></TD>
    <TD noWrap align=center width="10%"><STRONG>$</STRONG></TD>
    <TD noWrap align=center width="2%" >&nbsp;</TD>
    <TD noWrap align=center width="1%" ></TD>
    <TD noWrap align=center width="10%">$</TD>
    <TD noWrap align=center width="2%" >&nbsp;</TD>
    <TD noWrap align=center width="1%" ></TD>
    <TD noWrap align=center width="10%"><STRONG>$</STRONG></TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Government grant income </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>1,453,727 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>(177,761</TD>
    <TD vAlign=bottom align=left width="2%"  bgColor=#e6efff>)
</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>(770,197</TD>
    <TD vAlign=bottom align=left width="2%"  bgColor=#e6efff>)
</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>505,769 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>Research and development expenses </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">(7,287,214</TD>
    <TD vAlign=bottom align=left width="2%" >) </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">3,203 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">770,197 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">(6,513,814</TD>
    <TD vAlign=bottom align=left width="2%" >) </TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>General and administrative expenses </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>(18,130,183</TD>
    <TD vAlign=bottom align=left width="2%"  bgColor=#e6efff>)
</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>174,558 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>- </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>(17,955,625</TD>
    <TD vAlign=bottom align=left width="2%"  bgColor=#e6efff>)
  </TD></TR></TABLE><BR>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD noWrap align=center width="10%">&nbsp; </TD>
    <TD noWrap align=center width="2%" >&nbsp;</TD>
    <TD noWrap align=center width="1%" >&nbsp;</TD>
    <TD noWrap align=center width="10%"><B>Amortization</B> </TD>
    <TD noWrap align=center width="2%" >&nbsp;</TD>
    <TD noWrap align=center width="1%" >&nbsp;</TD>
    <TD noWrap align=center width="10%"><B>Subsidies for</B> </TD>
    <TD noWrap align=center width="2%" >&nbsp;</TD>
    <TD noWrap align=center width="1%" >&nbsp;</TD>
    <TD noWrap align=center width="10%">&nbsp; </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD noWrap align=center width="10%">&nbsp; </TD>
    <TD noWrap align=center width="2%" >&nbsp;</TD>
    <TD noWrap align=center width="1%" >&nbsp;</TD>
    <TD noWrap align=center width="10%"><B>on subsidies for</B> </TD>
    <TD noWrap align=center width="2%" >&nbsp;</TD>
    <TD noWrap align=center width="1%" >&nbsp;</TD>
    <TD noWrap align=center width="10%"><B>research and</B> </TD>
    <TD noWrap align=center width="2%" >&nbsp;</TD>
    <TD noWrap align=center width="1%" >&nbsp;</TD>
    <TD noWrap align=center width="10%"><B>Revised</B> </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD noWrap align=center width="10%"><B>Per original</B> </TD>
    <TD noWrap align=center width="2%" >&nbsp;</TD>
    <TD noWrap align=center width="1%" >&nbsp;</TD>
    <TD noWrap align=center width="10%"><B>lease</B> </TD>
    <TD noWrap align=center width="2%" >&nbsp;</TD>
    <TD noWrap align=center width="1%" >&nbsp;</TD>
    <TD noWrap align=center width="10%"><B>development</B> </TD>
    <TD noWrap align=center width="2%" >&nbsp;</TD>
    <TD noWrap align=center width="1%" >&nbsp;</TD>
    <TD noWrap align=center width="10%"><B>September 30,</B> </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left><B>For the year ended September 30, 2012</B> </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD noWrap align=center width="10%"><B>2012 Form 10-K</B> </TD>
    <TD noWrap align=center width="2%" >&nbsp;</TD>
    <TD noWrap align=center width="1%" >&nbsp;</TD>
    <TD noWrap align=center width="10%"><B>prepayments</B> </TD>
    <TD noWrap align=center width="2%" >&nbsp;</TD>
    <TD noWrap align=center width="1%" >&nbsp;</TD>
    <TD noWrap align=center width="10%"><B>projects</B> </TD>
    <TD noWrap align=center width="2%" >&nbsp;</TD>
    <TD noWrap align=center width="1%" >&nbsp;</TD>
    <TD noWrap align=center width="10%"><STRONG>2012 (note)</STRONG> </TD>
    <TD align=left width="2%" ></TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD align=left width="1%" ></TD>
    <TD noWrap align=center width="10%"><STRONG>$</STRONG></TD>
    <TD noWrap align=center width="2%" >&nbsp;</TD>
    <TD noWrap align=center width="1%" ></TD>
    <TD noWrap align=center width="10%"><STRONG>$</STRONG></TD>
    <TD noWrap align=center width="2%" >&nbsp;</TD>
    <TD noWrap align=center width="1%" ></TD>
    <TD noWrap align=center width="10%">$</TD>
    <TD noWrap align=center width="2%" >&nbsp;</TD>
    <TD noWrap align=center width="1%" ></TD>
    <TD noWrap align=center width="10%"><STRONG>$</STRONG></TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Government grant income </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="10%" bgColor=#e6efff>5,353,554 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="10%" bgColor=#e6efff>(252,470</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="10%" bgColor=#e6efff>(3,911,072</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="10%" bgColor=#e6efff>1,190,012 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>Research and development expenses </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="10%">(5,759,072</TD>
    <TD align=left width="2%" >) </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="10%">4,549 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="10%">3,911,072 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="10%">(1,843,451</TD>
    <TD align=left width="2%" >) </TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>General and administrative expenses </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="10%" bgColor=#e6efff>(40,008,940</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="10%" bgColor=#e6efff>247,921 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="10%" bgColor=#e6efff>- </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="10%" bgColor=#e6efff>(39,761,019</TD>
    <TD align=left width="2%"  bgColor=#e6efff>)
</TD></TR></TABLE><BR>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=top>
    <TD align=left >
      <P align=justify>Note: </P></TD>
    <TD align=left width="90%">
      <P align=justify>These represented government subsidies received by us
      with non-operating nature and with no further conditions to be met. The
      amounts are recorded as a non- operating income when received.
  </P></TD></TR></TABLE><BR>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<!--$$/page=--><A name=page_6></A><BR>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=top>
    <TD align=left>Jeanne Bennett </TD></TR>
  <TR vAlign=top>
    <TD align=left>June 13, 2013 </TD></TR>
  <TR vAlign=top>
    <TD align=left>Page 6 </TD></TR></TABLE>
<P align=justify><B><U>Note 4. Trade Accounts Receivable, net, page
F-21</U></B></P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0 BCLLIST>

  <TR>
    <TD vAlign=top width="5%"><B>3.</B> </TD>
    <TD colSpan=2>
      <P align=justify><B>We note from your response to prior comment 6 that the
      company provided favorable payment terms to customers, including a
      relatively loose credit policy that was implemented prior to
    2012.</B></P></TD></TR>
  <TR>
    <TD width="5%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
  <TR>
    <TD width="5%"></TD>
    <TD vAlign=top width="5%"><li>&nbsp;</li></TD>
    <TD>
      <P align=justify><B>Explain to us how the company&#146;s standard payment terms
      for receivables differed from the terms offered under the loose credit
      policy.</B></P></TD></TR>
  <TR>
    <TD width="5%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
  <TR>
    <TD width="5%"></TD>
    <TD vAlign=top width="5%"><li>&nbsp;</li></TD>
    <TD>
      <P align=justify><B>Tell us how the change in the company&#146;s credit policy
      impacted the consideration of your revenue recognition policy, including
      your determination of collectability.</B></P></TD></TR>
  <TR>
    <TD width="5%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
  <TR>
    <TD width="5%"></TD>
    <TD vAlign=top width="5%"><li>&nbsp;</li></TD>
    <TD>
      <P align=justify><B>Describe to us how the change in credit policy
      impacted your analysis of your allowance for doubtful
  accounts.</B></P></TD></TR></TABLE>
<P align=justify>COMPANY RESPONSE: The Company did not change its payment terms.
However, given the severe market competition, overall unfavorable credit status
in China and challenging macroeconomic environment, the Company did not strictly
enforce the payment terms with respect to some of its major customers and did
not follow up with them regarding outstanding payments regularly, hoping that
the customers might be able to solve their own short-term working capital
problems and would eventually pay off our invoices. As a result, the payments of
these customers were delayed and some of them failed to solve their working
capital shortage problems and eventually went bankrupt. </P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<!--$$/page=--><A name=page_7></A><BR>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=top>
    <TD align=left>Jeanne Bennett </TD></TR>
  <TR vAlign=top>
    <TD align=left>June 13, 2013 </TD></TR>
  <TR vAlign=top>
    <TD align=left>Page 7 </TD></TR></TABLE><BR>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0 BCLLIST>

  <TR>
    <TD vAlign=top width="5%"><B>4.</B> </TD>
    <TD>
      <P align=justify><B>We note from your response that your loss rates for
      each aging range were (i) 15% for the accounts from 7 to 9 months past
      due, (ii) 50% for accounts from 10 to 12 months past due and (iii) 100%
      for your accounts over one year past due. Please explain how you developed
      your loss rates. For example, discuss why the loss rates for accounts past
      due from 7 to 9 months and from 10 to 12 months are not
  higher.</B></P></TD></TR></TABLE>
<P align=justify>COMPANY RESPONSE: The allowance for doubtful accounts is
determined based on our best estimate of the amount of probable credit losses in
our existing trade accounts receivable. We determine the allowance based on
historical write-off experience, customer specific facts and economic
conditions. Our loss rate on doubtful accounts is analyzed as follows: </P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD noWrap align=center width="10%">&nbsp; </TD>
    <TD noWrap align=center width="2%" >&nbsp;</TD>
    <TD noWrap align=center width="1%" >&nbsp;</TD>
    <TD noWrap align=center width="10%"><B><I>Over 9 months but</I></B> </TD>
    <TD noWrap align=center width="2%" >&nbsp;</TD>
    <TD noWrap align=center width="1%" >&nbsp;</TD>
    <TD noWrap align=center width="10%">&nbsp; </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD noWrap align=center width="10%"><B><I>7 to 9 months</I></B> </TD>
    <TD noWrap align=center width="2%" >&nbsp;</TD>
    <TD noWrap align=center width="1%" >&nbsp;</TD>
    <TD noWrap align=center width="10%"><B><I>within 12 months</I></B> </TD>
    <TD noWrap align=center width="2%" >&nbsp;</TD>
    <TD noWrap align=center width="1%" >&nbsp;</TD>
    <TD noWrap align=center width="10%"><B><I>Over 1 year</I></B> </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD align=left width="1%" ></TD>
    <TD noWrap align=center width="10%"><STRONG>$</STRONG></TD>
    <TD noWrap align=center width="2%" >&nbsp;</TD>
    <TD noWrap align=center width="1%" ></TD>
    <TD noWrap align=center width="10%"><STRONG>$</STRONG></TD>
    <TD noWrap align=center width="2%" >&nbsp;</TD>
    <TD noWrap align=center width="1%" ></TD>
    <TD noWrap align=center width="10%"><STRONG>$</STRONG></TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Accounts receivable as of September 30,
      2011 </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>6,861,298 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>1,834,256 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>24,548,227 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>Settlement up to September 30, 2012 </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">5,996,094 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">939,255 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">- </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>September 30, 2011 accounts receivable
      remained unsettled as of September 30, 2012 </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>865,204 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>895,001 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>24,548,227 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left><B>Loss rate</B> </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">13% </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">49% </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">100% </TD>
    <TD vAlign=bottom align=left width="2%"
>&nbsp;</TD></TR></TABLE>
<P align=justify>As of September 30, 2012, we compared the recoverability of
accounts receivable of the prior year. Historical loss rate of aged accounts
from 7 to 9 months, over 9 months but within 12 months and over one year were
13%, 49% and 100%, respectively. Based on the historical loss experience, we
estimated our loss rates for accounts receivable as of September 30, 2012 for
each aging range were (i) 15% for the accounts from 7 to 9 months past due, (ii)
50% for accounts over 9 months but within 12 months past due and (iii) 100% for
our accounts over one year past due.</P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0 BCLLIST>

  <TR>
    <TD vAlign=top width="5%"><B>5.</B> </TD>
    <TD>
      <P align=justify><B>With respect to the aging of your accounts receivable
      provided in the exhibit of your response, we note that the aging in the
      271 &#150; 360 day category was $26.2 million as of September 30, 2012. It
      appears that the receivables are still outstanding and are included in the
      361 &#150; 720 day category in the December 31, 2012 aging which shows a $28.4
      million receivable. Please tell us the nature of the significant
      receivables included in the $26.2 million as of September 30, 2012 and
      your analysis in determining that the allowance should only be 50% of that
      balance.</B></P></TD></TR></TABLE><BR>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
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<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=top>
    <TD align=left>Jeanne Bennett </TD></TR>
  <TR vAlign=top>
    <TD align=left>June 13, 2013 </TD></TR>
  <TR vAlign=top>
    <TD align=left>Page 8 </TD></TR></TABLE>
<P align=justify>COMPANY RESPONSE: Included in the $26.2 million were
receivables from customers, most of which are still making regular payments to
us. Based on our historical loss experience (see our responses to Comment #4
above), we estimated our loss rate for accounts receivable as of September 30,
2012 was 50% for accounts over 9 months but within 12 months past due. </P>
<P align=justify>The following tables provide an analysis of the September 30,
2012 accounts receivable which remained outstanding as of December 31, 2012 and
March 31, 2013.</P>
<P align=justify><B>Table 1: Accounts receivable aged over 270 days as of
9/30/2012 and 12/31/2012</B></P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD noWrap align=center width="10%"><B>Over 9 months but</B> </TD>
    <TD noWrap align=center width="2%" >&nbsp;</TD>
    <TD noWrap align=center width="1%" >&nbsp;</TD>
    <TD noWrap align=center width="10%"><B>Over 1 year but</B> </TD>
    <TD noWrap align=center width="2%" >&nbsp;</TD>
    <TD noWrap align=center width="1%" >&nbsp;</TD>
    <TD noWrap align=center width="10%">&nbsp; </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left><B>Account receivable</B> </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD noWrap align=center width="10%"><B>within 12 months</B> </TD>
    <TD noWrap align=center width="2%" >&nbsp;</TD>
    <TD noWrap align=center width="1%" >&nbsp;</TD>
    <TD noWrap align=center width="10%"><B>within 3 years</B> </TD>
    <TD noWrap align=center width="2%" >&nbsp;</TD>
    <TD noWrap align=center width="1%" >&nbsp;</TD>
    <TD noWrap align=center width="10%"><B>Over 3 years</B> </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD align=left width="1%" ></TD>
    <TD noWrap align=center width="10%">$</TD>
    <TD noWrap align=center width="2%" >&nbsp;</TD>
    <TD noWrap align=center width="1%" ></TD>
    <TD noWrap align=center width="10%">$</TD>
    <TD noWrap align=center width="2%" >&nbsp;</TD>
    <TD noWrap align=center width="1%" ></TD>
    <TD noWrap align=center width="10%">$</TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR>
    <TD>&nbsp; </TD>
    <TD width="1%" >&nbsp;</TD>
    <TD width="10%">&nbsp; </TD>
    <TD width="2%" >&nbsp;</TD>
    <TD width="1%" >&nbsp;</TD>
    <TD width="10%">&nbsp; </TD>
    <TD width="2%" >&nbsp;</TD>
    <TD width="1%" >&nbsp;</TD>
    <TD width="10%">&nbsp; </TD>
    <TD width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>September 30, 2012 </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>26,167,044 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>12,290,133 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>7,405,633 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>December 31, 2012 </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">904,563 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">28,402,698 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">7,480,992 </TD>
    <TD vAlign=bottom align=left width="2%"
>&nbsp;</TD></TR></TABLE>
<P align=justify><B>Table 2: Subsequent status of 9/30/2012 accounts receivable
aged over 270 days </B></P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD noWrap align=center width="10%"><B>Over 9 months but</B> </TD>
    <TD noWrap align=center width="2%" >&nbsp;</TD>
    <TD noWrap align=center width="1%" >&nbsp;</TD>
    <TD noWrap align=center width="10%"><B>Over 1 year but</B> </TD>
    <TD noWrap align=center width="2%" >&nbsp;</TD>
    <TD noWrap align=center width="1%" >&nbsp;</TD>
    <TD noWrap align=center width="10%">&nbsp; </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left><B>Account receivable</B> </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD noWrap align=center width="10%"><B>within 12 months</B> </TD>
    <TD noWrap align=center width="2%" >&nbsp;</TD>
    <TD noWrap align=center width="1%" >&nbsp;</TD>
    <TD noWrap align=center width="10%"><B>within 3 years</B> </TD>
    <TD noWrap align=center width="2%" >&nbsp;</TD>
    <TD noWrap align=center width="1%" >&nbsp;</TD>
    <TD noWrap align=center width="10%"><B>Over 3 years</B> </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD align=left width="1%" ></TD>
    <TD noWrap align=center width="10%">$</TD>
    <TD noWrap align=center width="2%" >&nbsp;</TD>
    <TD noWrap align=center width="1%" ></TD>
    <TD noWrap align=center width="10%">$</TD>
    <TD noWrap align=center width="2%" >&nbsp;</TD>
    <TD noWrap align=center width="1%" ></TD>
    <TD noWrap align=center width="10%">$</TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>September 30, 2012 </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>26,167,044 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>12,290,133 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>7,405,633 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>9/30/2012 accounts receivable remained outstanding as of
      12/31/2012 </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">16,112,565 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">12,290,133 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">7,405,633 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>9/30/2012 accounts receivable remained
      outstanding as of 3/31/2013 </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>9,672,346 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>12,290,133 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>7,405,633 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>Actual loss rate up to 3/31/2013 </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">37% </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">100% </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">100% </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Estimated loss rate </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>50% </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>100% </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>100% </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD></TR></TABLE>
<P align=justify>We received subsequent settlement for those accounts over 270
days. As of March 31, 2013, we have received $16.5 million for those accounts
over 270 days and $9.7 million was outstanding. The actual loss rate as of March
31, 2013 for accounts over 270 days was 37%. Therefore, we determined that an
allowance of 50% of accounts receivable aged over 9 months but within one year
is adequate. </P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
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<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=top>
    <TD align=left>Jeanne Bennett </TD></TR>
  <TR vAlign=top>
    <TD align=left>June 13, 2013 </TD></TR>
  <TR vAlign=top>
    <TD align=left>Page 9 </TD></TR></TABLE>
<P align=justify><B><U>Note 5. Inventories, page F-22</U></B></P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0 BCLLIST>

  <TR>
    <TD vAlign=top width="5%"><B>6.</B> </TD>
    <TD>
      <P align=justify><B>While we note your response to comment 7, your
      response did not address how you plan to revise your disclosures in future
      filings to comply with U.S. GAAP. We continue to note that you are
      reporting recoveries of obsolete inventories and reversals of provisions.
      Please confirm that your accounting and disclosure in future filings
      complies with SAB Topic 5.BB, wherein a write-down of inventory to the
      lower of cost or market at the close of a fiscal period creates a new cost
      basis that subsequently cannot be marked up based on changes in underlying
      facts and circumstances. Please also see FASB ASC 330-10-35-1 and
      35-14.</B></P></TD></TR></TABLE>
<P align=justify>COMPANY RESPONSE: We confirm that our current accounting of
inventories complies with SAB Topic 5.BB and FASB ASC 330-10-35-1 and 35-14,
wherein a write-down of inventory to the lower of cost or market at the close of
a fiscal period creates a new cost basis that we do not mark up based on
subsequent changes in underlying facts and circumstances.<B> </B>We will amend
our future filings to present the impairment of inventories as a write down of
each of the inventory components as follows:- </P>
<P align=justify><U>Form 10-K for the fiscal year ended September 30, 2012</U>
<BR><U>Consolidated financial statements</U> <BR><U>Note 5. Inventories, page
F-22</U> </P>
<P align=justify>Inventories as of September 30, 2012 and 2011 consisted of the
following: </P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="12%"><I>2011</I> </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="12%"><I>2012</I> </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Raw materials </TD>
    <TD vAlign=bottom align=left width="1%"  bgColor=#e6efff>$</TD>
    <TD vAlign=bottom align=right width="12%" bgColor=#e6efff>&nbsp;18,522,969
    </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"  bgColor=#e6efff>$</TD>
    <TD vAlign=bottom align=right width="12%" bgColor=#e6efff>&nbsp;19,999,192
    </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>Work-in-progress </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%">9,366,491 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%">13,912,685 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Finished goods </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="12%" bgColor=#e6efff>39,251,508 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="12%" bgColor=#e6efff>31,471,952 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%" >$</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=right
    width="12%">&nbsp;67,140,968 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%" >$</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=right
    width="12%">&nbsp;65,383,829 </TD>
    <TD vAlign=bottom align=left width="2%"
>&nbsp;</TD></TR></TABLE>
<P align=justify>During the years ended September 30, 2012 and 2011, write-down
of obsolete inventories to lower of cost or market was $9,702,373 and $4,517,357
was charged to cost of revenues, respectively. </P>
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noShade SIZE=5>
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<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=top>
    <TD align=left>Jeanne Bennett </TD></TR>
  <TR vAlign=top>
    <TD align=left>June 13, 2013 </TD></TR>
  <TR vAlign=top>
    <TD align=left>Page 10 </TD></TR></TABLE>
<P align=justify><U>Consolidated statements of cash flows</U> </P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="12%"><I>2011</I> </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="12%"><I>2012</I> </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff><B>Cash flow from operating activities</B>
    </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="12%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="12%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>Net loss </TD>
    <TD vAlign=bottom align=left width="1%" >$</TD>
    <TD vAlign=bottom align=right width="12%">&nbsp;(24,537,364 </TD>
    <TD vAlign=bottom align=left width="2%" >) </TD>
    <TD vAlign=bottom align=left width="1%" >$</TD>
    <TD vAlign=bottom align=right width="12%"
    >&nbsp;(65,807,395</TD>
    <TD vAlign=bottom align=left width="2%" >) </TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Adjustments to reconcile net loss to net
      cash provided by operating activities: </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="12%" bgColor=#e6efff></TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="12%" bgColor=#e6efff></TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>Depreciation and amortization </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%">18,628,181 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%">18,519,317 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Provision for doubtful debts </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%" bgColor=#e6efff>1,910,521 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%" bgColor=#e6efff>22,505,322 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>Provision for obsolete inventories </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%">4,517,357 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%">9,702,373 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Share-based compensation </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%" bgColor=#e6efff>1,584,154 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%" bgColor=#e6efff>804,085 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>Impairment charge </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%">6,517,344 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%">3,918,959 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Gain on disposal of property, plant and
      equipment </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%" bgColor=#e6efff>(471,444</TD>
    <TD vAlign=bottom align=left width="2%"  bgColor=#e6efff>)
</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%" bgColor=#e6efff>(16,106</TD>
    <TD vAlign=bottom align=left width="2%"  bgColor=#e6efff>)
  </TD></TR>
  <TR vAlign=top>
    <TD align=left>Deferred income taxes </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%">1,302,120 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%">2,116,630 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Deferred revenue </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%" bgColor=#e6efff>(244,181</TD>
    <TD vAlign=bottom align=left width="2%"  bgColor=#e6efff>)
</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%" bgColor=#e6efff>(252,469</TD>
    <TD vAlign=bottom align=left width="2%"  bgColor=#e6efff>)
  </TD></TR>
  <TR vAlign=top>
    <TD align=left>Exchange loss </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%">1,353,907 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%">3,206,705 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD></TR>
  <TR>
    <TD bgColor=#e6efff>&nbsp; </TD>
    <TD vAlign=bottom width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom width="12%" bgColor=#e6efff>&nbsp; </TD>
    <TD vAlign=bottom width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom width="12%" bgColor=#e6efff>&nbsp; </TD>
    <TD vAlign=bottom width="2%"  bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>Changes in operating assets and liabilities: </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="12%">&nbsp; </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="12%">&nbsp; </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Trade accounts receivable </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%" bgColor=#e6efff>(157,072</TD>
    <TD vAlign=bottom align=left width="2%"  bgColor=#e6efff>)
</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%" bgColor=#e6efff>(9,816,650</TD>
    <TD vAlign=bottom align=left width="2%"  bgColor=#e6efff>)
  </TD></TR>
  <TR vAlign=top>
    <TD align=left>Inventories </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%">(4,235,943 </TD>
    <TD vAlign=bottom align=left width="2%" >) </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%">(6,953,601</TD>
    <TD vAlign=bottom align=left width="2%" >) </TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Prepayments and other receivables </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%" bgColor=#e6efff>472,866 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%" bgColor=#e6efff>(2,962,638</TD>
    <TD vAlign=bottom align=left width="2%"  bgColor=#e6efff>)
  </TD></TR>
  <TR vAlign=top>
    <TD align=left>Accounts and bills payable </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%">20,032,670 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%">22,048,375 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Accrued expenses and other payables </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="12%" bgColor=#e6efff>8,645,183 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="12%" bgColor=#e6efff>8,155,480 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD></TR>
  <TR>
    <TD>&nbsp; </TD>
    <TD vAlign=bottom width="1%" >&nbsp;</TD>
    <TD vAlign=bottom width="12%">&nbsp; </TD>
    <TD vAlign=bottom width="2%" >&nbsp;</TD>
    <TD vAlign=bottom width="1%" >&nbsp;</TD>
    <TD vAlign=bottom width="12%">&nbsp; </TD>
    <TD vAlign=bottom width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Net cash provided by operating activities
    </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="12%" bgColor=#e6efff>35,318,299 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="12%" bgColor=#e6efff>5,168,387 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD></TR></TABLE>
<P align=justify><B><U>Note 8. Property, Plant and Equipment, page
F-27</U></B><B> </B></P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0 BCLLIST>

  <TR>
    <TD vAlign=top width="5%"><B>7.</B> </TD>
    <TD>
      <P align=justify><B>Your response to prior comment 10 did not explain why
      you disclosed additional pledged assets as of September 30, 2012 in your
      December 31, 2012 Form 10-Q. That is, you have not addressed whether your
      disclosure in the 10- K is complete and accurate. Therefore, we reissue
      the comment.</B></P></TD></TR></TABLE>
<P align=justify>COMPANY RESPONSE: In accordance with the Staff&#146;s request, we
provide the following reconciliation of pledged assets:- </P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<!--$$/page=--><A name=page_11></A><BR>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=top>
    <TD align=left>Jeanne Bennett </TD></TR>
  <TR vAlign=top>
    <TD align=left>June 13, 2013 </TD></TR>
  <TR vAlign=top>
    <TD align=left>Page 11 </TD></TR></TABLE><BR>
<DIV>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD noWrap align=center width="13%">&nbsp; </TD>
    <TD noWrap align=center width="13%"><I>Note disclosure on</I> </TD>
    <TD noWrap align=center width="13%"><I>Balance of</I> </TD>
    <TD noWrap align=center width="13%"><I>Balance of</I> </TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD noWrap align=center width="13%">N<I>ote disclosure on</I> </TD>
    <TD noWrap align=center width="13%"><I>December 31, 2012</I> </TD>
    <TD noWrap align=center width="13%"><I>pledged assets as</I> </TD>
    <TD noWrap align=center width="13%"><I>pledged assets</I> </TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD noWrap align=center width="13%"><I>September 30, 2012</I> </TD>
    <TD noWrap align=center width="13%"><I>Form 10-Q</I> </TD>
    <TD noWrap align=center width="13%"><I>of September 30,</I> </TD>
    <TD noWrap align=center width="13%"><I>as of December</I> </TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD noWrap align=center width="13%"><I>Form 10-K</I> </TD>
    <TD noWrap align=center width="13%">&nbsp; </TD>
    <TD noWrap align=center width="13%"><I>2012</I> </TD>
    <TD noWrap align=center width="13%"><I>31, 2012</I> </TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD noWrap align=center width="13%">&nbsp; </TD>
    <TD noWrap align=center width="13%">&nbsp; </TD>
    <TD noWrap align=center width="13%">$ </TD>
    <TD noWrap align=center width="13%"><I>$</I> </TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>For short-term bank loans </TD>
    <TD align=left width="13%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="13%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="13%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="13%" bgColor=#e6efff>&nbsp; </TD></TR>
  <TR vAlign=top>
    <TD align=left>Inventories </TD>
    <TD align=left width="13%">Notes 5, 11 </TD>
    <TD align=left width="13%">Notes 4 and 7 </TD>
    <TD align=right width="13%">23,863,691 </TD>
    <TD align=right width="13%">24,072,024 </TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Machinery and equipment </TD>
    <TD align=left width="13%" bgColor=#e6efff>Notes 8(iii), 11 </TD>
    <TD align=left width="13%" bgColor=#e6efff>Notes 6 (iii) and 7 </TD>
    <TD align=right width="13%" bgColor=#e6efff>47,255,604 </TD>
    <TD align=right width="13%" bgColor=#e6efff>45,722,332 </TD></TR>
  <TR vAlign=top>
    <TD align=left>Land use rights, buildings and construction in progress of
      Shenzhen BAK Industrial Park </TD>
    <TD align=left width="13%">Note 11 </TD>
    <TD align=left width="13%">Note 6 (iii) </TD>
    <TD align=right width="13%">107,140,980* </TD>
    <TD align=right width="13%">107,340,987<SUP>@</SUP> </TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>For long-term bank loans </TD>
    <TD align=left width="13%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="13%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=right width="13%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=right width="13%" bgColor=#e6efff>&nbsp; </TD></TR>
  <TR vAlign=top>
    <TD align=left>Land use rights, and construction in progress of Research
      and Development Test Centre </TD>
    <TD align=left width="13%">Notes 9 and 12 (The land use right stated in
      Note 9 should be $1,283,424, instead of $4,919,301*. Also, the Company
      disclosed the fact that the property ownership on this land is pledged,
      and did not disclose the amount of the property being pledged
      (construction in progress of $33.5 million). We will ensure proper and
      adequate of disclosures in future filings) </TD>
    <TD align=left width="13%">Notes 6 (iii) and 8 (The Company erroneously
      disclosed the net book value of Shenzhen BAK Industrial Park of $16.4
      million in note 8 and included an amount of $4.9 million<SUP>@ </SUP>Note
      6 (iii), instead of the correct net book value of this site of $1.2
      million) under this note. Also, the Company disclosed the fact that the
      property ownership on this land is pledged, and did not disclose the
      amount of the property being pledged (CIP of $38.1 million). We will
      ensure proper and adequate disclosures in future filings) </TD>
    <TD align=right width="13%">34,796,887 </TD>
    <TD align=right width="13%">39,369,580 </TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>For other long-term loans </TD>
    <TD align=left width="13%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="13%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=right width="13%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=right width="13%" bgColor=#e6efff>&nbsp; </TD></TR>
  <TR vAlign=top>
    <TD align=left>Land use rights #2 (&#147;LUR #2&#148;) of Tianjin Industrial Park
      Zone </TD>
    <TD align=left width="13%">Notes 9, 11 and 14 (LUR #2 of Tianjin Industrial Park Zone should be $9,566,555 instead of
      $4,793,816 (as disclosed in Note 9). We will ensure accuracy of
      disclosures in future filing) </TD>
    <TD align=left width="13%">Note 9 (LUR #2 of Tianjin Industrial Park Zone should be $9,595,552,
      instead of $5,087,131 (as disclosed in Note 9). We will ensure accuracy of
      disclosures in future filing) </TD>
    <TD align=right width="13%">9,566,555 </TD>
    <TD align=right width="13%">9,595,552 </TD></TR></TABLE></DIV>
<P align=justify>Summation of * = $112,060,281 per the Staff&#146;s prior comment #
10<BR>Summation of <SUP>@</SUP> = $112,217,714 per the original disclosure on
Form 10-Q Note 6 (iii) <BR>
</P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<!--$$/page=--><A name=page_12></A><BR>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=top>
    <TD align=left>Jeanne Bennett </TD></TR>
  <TR vAlign=top>
    <TD align=left>June 13, 2013 </TD></TR>
  <TR vAlign=top>
    <TD align=left>Page 12 </TD></TR></TABLE>
<P align=justify><B><U>Note 9. Lease Prepayments, page F-28</U></B></P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0 BCLLIST>

  <TR>
    <TD vAlign=top width="5%"><B>8.</B> </TD>
    <TD>
      <P align=justify><B>Further to your response to prior comment 13, and as
      previously requested, please reconcile your response to your disclosure in
      the two paragraphs following the table. We note that the response shows
      total lease prepayments for Shenzhen BAK industrial park, Shenzhen
      R&amp;D, and Tianjin of $18.7 million, $1.4 million, and $16.9 million,
      respectively. We also note that your disclosure shows total lease
      prepayments for Shenzhen BAK industrial park, Shenzhen R&amp;D, and
      Tianjin of $3.9 million, $0.7 million, and $14.1 million, respectively.
      Please explain the reasons for the
differences.</B></P></TD></TR></TABLE>
<P align=justify>COMPANY RESPONSE: The differences were mainly related to
payments in other years and foreign exchange adjustments. We refer to the
Staff&#146;s request and reconcile the land use rights as follows:- </P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD noWrap align=center width="12%"><I>Lease prepayment as of</I> </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD noWrap align=center width="12%"><I>September 30, 2012</I> </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD align=left width="1%" ></TD>
    <TD noWrap align=center width="12%">$</TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Shenzhen BAK Industrial Park </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="12%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>First payment in 2003 (as disclosed in note 9 on the 2012
      Form 10-K) </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">3,246,791 </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Second payment in 2007 </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>7,889,991 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>Final payment in 2008 (as disclosed in note 9 on the 2012
      Form 10-K) </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">3,929,850 </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Foreign exchange adjustment </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"
    bgColor=#e6efff>3,650,018 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right
      width="12%">18,716,650 </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR>
    <TD bgColor=#e6efff>&nbsp; </TD>
    <TD width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD width="12%" bgColor=#e6efff>&nbsp; </TD>
    <TD width="2%"  bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>Shenzhen Research and Development Test Centre </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="12%">&nbsp; </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>First payment on June 26, 2007 (as
      disclosed in note 9 on the 2012 Form 10-K) </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>717,344 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>Final payment in December 2008 </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">466,724 </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Foreign exchange adjustment </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"
    bgColor=#e6efff>204,762 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right
      width="12%">1,388,830 </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR></TABLE><BR>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<!--$$/page=--><A name=page_13></A><BR>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=top>
    <TD align=left>Jeanne Bennett </TD></TR>
  <TR vAlign=top>
    <TD align=left>June 13, 2013 </TD></TR>
  <TR vAlign=top>
    <TD align=left>Page 13 </TD></TR></TABLE><BR>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Tianjin BAK Industrial Park </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="12%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>Purchase cost in September 2007(as disclosed in note 9 on
      the 2012 Form 10-K) </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%">14,119,888 </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Foreign exchange adjustment </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"
    bgColor=#e6efff>2,752,004 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right
      width="12%">16,871,892 </TD>
    <TD align=left width="2%">&nbsp;</TD></TR></TABLE>
<P align=justify><B><U>Note 11. Short-term Bank Loans, page F-29</U></B><B>
</B></P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0 BCLLIST>

  <TR>
    <TD vAlign=top width="5%"><B>9.</B> </TD>
    <TD>
      <P align=justify><B>Your response to prior comment 14 did not explain why
      you disclosed additional assets securing loans as of September 30, 2012 in
      your December 31, 2012 Form 10-Q. That is, you have not addressed whether
      your disclosure in the 10-K is complete and accurate. We continue to note
      that the total amount of assets securing loans as of September 30, 2012 as
      reflected in Note 11 is only $71.1 million, whereas the similar table as
      of that date on page F-16 of your December 31, 2012 Form 10-Q totals
      $166.9 million. Further, we note that the paragraph following the table
      refers to additional assets securing loans. Please show us the total
      amount of assets securing short-term bank loans as of September 30, 2012
      and December 31, 2012.</B></P></TD></TR></TABLE>
<P align=justify>COMPANY RESPONSE: Please refer to our responses to comment #7
above. </P>
<P align=justify><B><U>Note 23. Commitments and Contingencies, page
F-43</U></B><B> </B></P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0 BCLLIST>

  <TR>
    <TD vAlign=top width="5%"><B>10.</B> </TD>
    <TD>
      <P align=justify><B>In your response to prior comment 15, you note that of
      the five listed suppliers in Note 23, four of them are former raw material
      suppliers so they are not also listed on page 8 where you disclose your
      major suppliers. We similarly note that these four suppliers were not
      listed in the similar disclosure on page 9 of your Fiscal 2011 Form 10-K.
      Please tell us the nature of your relationship with these suppliers,
      including a discussion of any related party relationships. Tell us what
      products or services these companies supplied and the dates upon which the
      supplier relationships started and terminated.</B></P></TD></TR></TABLE>
<P align=justify>COMPANY RESPONSE: The four suppliers were not listed in the key
suppliers of Item 1 of Form 10-K because they were not the top suppliers of the
key raw material of suppliers in fiscal 2011 or 2012. In response to the Staff&#146;s
comment, we advise that none of these four suppliers is a related party of the
Company and the Company&#146;s relationship with the four suppliers is as follows:
</P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<!--$$/page=--><A name=page_14></A><BR>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=top>
    <TD align=left>Jeanne Bennett </TD></TR>
  <TR vAlign=top>
    <TD align=left>June 13, 2013 </TD></TR>
  <TR vAlign=top>
    <TD align=left>Page 14 </TD></TR></TABLE><BR>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD noWrap align=center width="10%">Products/services </TD>
    <TD noWrap align=center width="2%">&nbsp;</TD>
    <TD noWrap align=center width="1%">&nbsp;</TD>
    <TD noWrap align=center width="10%">Commencement </TD>
    <TD noWrap align=center width="2%">&nbsp;</TD>
    <TD noWrap align=center width="1%">&nbsp;</TD>
    <TD noWrap align=center width="10%">End date of </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>Guarantee for (all non- </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD noWrap align=center width="10%">that these parties </TD>
    <TD noWrap align=center width="2%">&nbsp;</TD>
    <TD noWrap align=center width="1%">&nbsp;</TD>
    <TD noWrap align=center width="10%">date of supplier </TD>
    <TD noWrap align=center width="2%">&nbsp;</TD>
    <TD noWrap align=center width="1%">&nbsp;</TD>
    <TD noWrap align=center width="10%">supplier </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>related parties)
    </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" noWrap align=center
      width="10%">supplied </TD>
    <TD noWrap align=center width="2%">&nbsp;</TD>
    <TD noWrap align=center width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" noWrap align=center
      width="10%">relationship </TD>
    <TD noWrap align=center width="2%">&nbsp;</TD>
    <TD noWrap align=center width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" noWrap align=center
      width="10%">relationship </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR>
    <TD>&nbsp; </TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="10%">&nbsp; </TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="10%">&nbsp; </TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="10%">&nbsp; </TD>
    <TD width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Shenzhen Tongli Hi-tech Co. Ltd. </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="10%" bgColor=#e6efff>Battery case </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="10%" bgColor=#e6efff>01/2004 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="10%" bgColor=#e6efff>Not applicable </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>Tianjin Huaxiahongyuan Ltd. </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=left width="10%">Chemical raw materials such as lithium cobalt
      oxides </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="10%">03/2012 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="10%">05/2012 </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Shenzhen Yasu Technology Co. Ltd. </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="10%" bgColor=#e6efff>Chemical raw materials such as
      lithium cobalt oxides </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="10%" bgColor=#e6efff>08/2009 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="10%" bgColor=#e6efff>03/2010 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>Shenzhen Langjin Technology Development Co. Ltd. </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=left width="10%">Chemical raw materials such as battery
      separator paper </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="10%">06/2011 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="10%">09/2011 </TD>
    <TD align=left width="2%">&nbsp;</TD></TR></TABLE><BR>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0 BCLLIST>

  <TR>
    <TD vAlign=top width="5%"><B>11.</B> </TD>
    <TD>
      <P align=justify><B>Further, with respect to each of your guarantees,
      please tell us the term of the guarantee as of September 30, 2012 and
      December 31, 2012, including the dates of any renewals. Also tell us in
      more detail how the guarantee arose, including an explanation of why the
      company agreed to provide guarantees ranging from $1.6 million to $9.5
      million for suppliers if the supply relationship was only temporary. Also
      discuss why you continued to provide these guarantees given the
      termination of the supplier relationship.</B></P></TD></TR></TABLE>
<P align=justify>COMPANY RESPONSE: In response to the Staff&#146;s comment, we
explain the terms and reasons for providing these guarantees as follows: </P>
<DIV>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD noWrap align=center width="8%">&nbsp; </TD>
    <TD noWrap align=center width="2%">&nbsp;</TD>
    <TD noWrap align=center width="1%">&nbsp;</TD>
    <TD noWrap align=center width="8%">&nbsp; </TD>
    <TD noWrap align=center width="2%">&nbsp;</TD>
    <TD noWrap align=center width="1%">&nbsp;</TD>
    <TD noWrap align=center width="8%">&nbsp; </TD>
    <TD noWrap align=center width="2%">&nbsp;</TD>
    <TD noWrap align=center width="1%">&nbsp;</TD>
    <TD noWrap align=center width="8%">&nbsp; </TD>
    <TD noWrap align=center width="2%">&nbsp;</TD>
    <TD noWrap align=center width="1%">&nbsp;</TD>
    <TD noWrap align=center width="8%">Why continued to </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD noWrap align=center width="8%">&nbsp; </TD>
    <TD noWrap align=center width="2%">&nbsp;</TD>
    <TD noWrap align=center width="1%">&nbsp;</TD>
    <TD noWrap align=center width="8%">&nbsp; </TD>
    <TD noWrap align=center width="2%">&nbsp;</TD>
    <TD noWrap align=center width="1%">&nbsp;</TD>
    <TD noWrap align=center width="8%">&nbsp; </TD>
    <TD noWrap align=center width="2%">&nbsp;</TD>
    <TD noWrap align=center width="1%">&nbsp;</TD>
    <TD noWrap align=center width="8%">&nbsp; </TD>
    <TD noWrap align=center width="2%">&nbsp;</TD>
    <TD noWrap align=center width="1%">&nbsp;</TD>
    <TD noWrap align=center width="8%">provide </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>Guarantee </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD noWrap align=center width="8%">&nbsp; </TD>
    <TD noWrap align=center width="2%">&nbsp;</TD>
    <TD noWrap align=center width="1%">&nbsp;</TD>
    <TD noWrap align=center width="8%">&nbsp; </TD>
    <TD noWrap align=center width="2%">&nbsp;</TD>
    <TD noWrap align=center width="1%">&nbsp;</TD>
    <TD noWrap align=center width="8%">&nbsp; </TD>
    <TD noWrap align=center width="2%">&nbsp;</TD>
    <TD noWrap align=center width="1%">&nbsp;</TD>
    <TD noWrap align=center width="8%">&nbsp; </TD>
    <TD noWrap align=center width="2%">&nbsp;</TD>
    <TD noWrap align=center width="1%">&nbsp;</TD>
    <TD noWrap align=center width="8%">guarantees given </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>for (all non- </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD noWrap align=center width="8%">&nbsp; </TD>
    <TD noWrap align=center width="2%">&nbsp;</TD>
    <TD noWrap align=center width="1%">&nbsp;</TD>
    <TD noWrap align=center width="8%">&nbsp; </TD>
    <TD noWrap align=center width="2%">&nbsp;</TD>
    <TD noWrap align=center width="1%">&nbsp;</TD>
    <TD noWrap align=center width="8%">&nbsp; </TD>
    <TD noWrap align=center width="2%">&nbsp;</TD>
    <TD noWrap align=center width="1%">&nbsp;</TD>
    <TD noWrap align=center width="8%">&nbsp; </TD>
    <TD noWrap align=center width="2%">&nbsp;</TD>
    <TD noWrap align=center width="1%">&nbsp;</TD>
    <TD noWrap align=center width="8%">the termination of </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>related </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD noWrap align=center width="19%" colSpan=4>Max. amount of </TD>
    <TD noWrap align=center width="2%">&nbsp;</TD>
    <TD noWrap align=center width="1%">&nbsp;</TD>
    <TD noWrap align=center width="8%">Guarantee </TD>
    <TD noWrap align=center width="2%">&nbsp;</TD>
    <TD noWrap align=center width="1%">&nbsp;</TD>
    <TD noWrap align=center width="8%">Why provided </TD>
    <TD noWrap align=center width="2%">&nbsp;</TD>
    <TD noWrap align=center width="1%">&nbsp;</TD>
    <TD noWrap align=center width="8%">supplier </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>parties) </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" noWrap align=center width="19%"
    colSpan=4>guarantees ($&#146;000) </TD>
    <TD noWrap align=center width="2%"></TD>
    <TD noWrap align=center width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" noWrap align=center
      width="8%">period </TD>
    <TD noWrap align=center width="2%">&nbsp;</TD>
    <TD noWrap align=center width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" noWrap align=center
      width="8%">guarantees </TD>
    <TD noWrap align=center width="2%">&nbsp;</TD>
    <TD noWrap align=center width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" noWrap align=center
      width="8%">relationship </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="8%">9/30/2012 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="8%">12/31/2012 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=left width="8%">&nbsp; </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=left width="8%">&nbsp; </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=left width="8%">&nbsp; </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Shenzhen Tongli Hi- tech Co. Ltd. </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="8%" bgColor=#e6efff>2,386 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="8%" bgColor=#e6efff>2,407 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="8%" bgColor=#e6efff>3/27/2012&#150; 3/31/2013 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="8%" bgColor=#e6efff>We would like to insure a
      continued supply of products. </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="8%" bgColor=#e6efff>We ceased to provide guarantee
      upon expiration on March 31, 2013. </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>Tianjin Huaxiahongy yuan Ltd. </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="8%">2,386 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="8%">2,407 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="8%">4/25/2012&#150; 4/25/2015 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=left width="8%">We are trying to expand our supplier base to insure a continued supply of
      products. </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=left width="8%">We are trying to expand our supplier base to insure a continued supply of
      products. </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgcolor="#E6EFFF">Shenzhen Yasu Technology Co. Ltd. </TD>
    <TD align=left width="1%" bgcolor="#E6EFFF" >&nbsp;</TD>
    <TD align=right width="8%" bgcolor="#E6EFFF">9,545 </TD>
    <TD align=left width="2%" bgcolor="#E6EFFF" >&nbsp;</TD>
    <TD align=left width="1%" bgcolor="#E6EFFF" >&nbsp;</TD>
    <TD align=right width="8%" bgcolor="#E6EFFF">10,752 </TD>
    <TD align=left width="2%" bgcolor="#E6EFFF" >&nbsp;</TD>
    <TD align=left width="1%" bgcolor="#E6EFFF" >&nbsp;</TD>
    <TD align=left width="8%" bgcolor="#E6EFFF">5/25/2012&#150; 6/24/2015 </TD>
    <TD align=left width="2%" bgcolor="#E6EFFF" >&nbsp;</TD>
    <TD align=left width="1%" bgcolor="#E6EFFF" >&nbsp;</TD>
    <TD align=left width="8%" bgcolor="#E6EFFF">We are trying to expand our supplier base to
      insure a continued supply of products. </TD>
    <TD align=left width="2%" bgcolor="#E6EFFF" >&nbsp;</TD>
    <TD align=left width="1%" bgcolor="#E6EFFF" >&nbsp;</TD>
    <TD align=left width="8%" bgcolor="#E6EFFF">We are trying to expand our supplier base to
      insure a continued supply of products. </TD>
    <TD align=left width="2%" bgcolor="#E6EFFF" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>Shenzhen Langjin Technology Development Co. Ltd. </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="8%">9,545 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="8%">9,629 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="8%">8/15/2011&#150; 8/14/2014 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="8%">We were trying to expand our supplier base to
      insure a continued supply of products. </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="8%">We intend to terminate the guarantee upon
      expiration in August 2014 </TD>
    <TD align=left width="2%"
>&nbsp;</TD></TR></TABLE><BR>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<!--$$/page=--><A name=page_15></A><BR>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=top>
    <TD align=left>Jeanne Bennett </TD></TR>
  <TR vAlign=top>
    <TD align=left>June 13, 2013 </TD></TR>
  <TR vAlign=top>
    <TD align=left>Page 15 </TD></TR></TABLE><BR>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0 BCLLIST>

  <TR>
    <TD vAlign=top width="5%"><B>12.</B> </TD>
    <TD>
      <P align=justify><B>In response to prior comment 16 you told us that the
      company is entitled to be indemnified fully or partially for any losses,
      damages or expenses in connection with the guarantees. Please explain the
      extent to which you may or have sought this indemnification with respect
      to your guarantee for Shenzhen Langjin Technology Co.,
  LTD.</B></P></TD></TR></TABLE>
<P align=justify>COMPANY RESPONSE: In accordance with the Staff&#146;s request, we
advise our indemnification with respect to the guarantee for Shenzhen Liangjin
Technology Co., Ltd. as follows:- </P>
<P align=justify>On January 5, 2013, the Company received a notice that Shenzhen
Langjin Technology Development Co. Ltd. (&#147;Shenzhen Langjin&#148;) had defaulted on
the loan guaranteed by China BAK and two other companies and demanded immediate
payment of the full guaranteed amount of RMB60 million ($9,665,571) from the
Company and two other co-guarantors. As the two other co-guarantors had the
ability to only pay RMB14 million ($2,255,300), the Company was demanded to pay
the remaining balance. As of March 31, 2013, the Company has paid China
Agricultural Bank an amount of RMB46 million (approximately $7.4 million) and
received an amount of RMB9 million (approximately $1.5 million) that it claimed
back from Shenzhen Lanjin. On April 28, 2013, the Company received a further
indemnification amount of RMB19 million (approximately $3.1 million). We expect
to receive the remaining indemnification within 3 months. </P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<!--$$/page=--><A name=page_16></A><BR>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=top>
    <TD align=left>Jeanne Bennett </TD></TR>
  <TR vAlign=top>
    <TD align=left>June 13, 2013 </TD></TR>
  <TR vAlign=top>
    <TD align=left>Page 16 </TD></TR></TABLE>
<P align=justify><B><U>Form 10-Q for the Quarterly Period Ended September 30,
2012 </U></B></P>
<P align=justify><B><U>Item 1. Financial Statements </U></B></P>
<P align=justify><B><U>Note 16. Commitments and Contingencies, page
F-24</U></B></P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0 BCLLIST>

  <TR>
    <TD vAlign=top width="5%"><B>13.</B> </TD>
    <TD>
      <P align=justify><B>Further to your responses to prior comments 16 and 18,
      please describe to us the analysis you performed as of September 30, 2012
      for your guarantees in determining that the company was not required to
      recognize a contingent liability under FASB ASC Section 450-20-25. Please
      be sufficiently detailed and explain the factors that caused your
      assessment to change between September 30, 2012 and December 31, 2012.
      Discuss the procedures the company used as of September 30, 2012 and
      December 31, 2012 to assess the payment/performance risk of the guarantee.
      Discuss how you considered the disclosure requirements of FASB ASC
      450-20-50-3 through 50-4.</B></P></TD></TR></TABLE>
<P align=justify>COMPANY RESPONSE: In accordance with FASB ASC Section
450-20-25, we have considered whether an estimated loss from a loss contingency
shall be accrued in relation to our guarantees by a charge to income if both of
the following conditions are met: </P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0 BCLLIST>

  <TR>
    <TD vAlign=top width="5%">a. </TD>
    <TD>
      <P align=justify>Information available before the financial statements are
      issued or are available to be issued indicates that it is probable that an
      asset had been impaired or a liability had been incurred at the date of
      the financial statements.</P></TD></TR>
  <TR>
    <TD width="5%">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
  <TR>
    <TD vAlign=top width="5%">b. </TD>
    <TD>
      <P align=justify>The amount of loss can be reasonably
  estimated.</P></TD></TR></TABLE>
<P align=justify>We have also considered whether a liability should be recorded
based on the fair value of the guarantee under FASB ASC 460-10-30. </P>
<P align=justify>We were not aware of any indication of default on any of the
loans that we guaranteed through December 31, 2012, the date on which the
Company issued the financial statements for the fiscal year ended September 30,
2012. As a result, the condition in paragraph 450-20-25-2(a) was not satisfied
because information available to us up to the date of issuance of the financial
statements for the year ended September 30, 2012 did not indicate any known or
possible default and thus prior to the occurrence of any known default there was
no liability incurred.</P>
<P align=justify>In accordance with paragraph 450-20-50-3, no disclosure was
required in the financial statements for the year ended September 30, 2012 as
there seemed to be a remote possibility that a loss from loan guarantees had
incurred when we issued such financial statements on December 31, 2012.
Therefore, we consider there is no liability under FASB ASC 460-10-30. </P>
<P align=justify>The loan granted by Agricultural bank of China to Shenzhen
Lanjin was due for repayment for various periods from November 2012 to February
2013. Up to December 31, 2012 (the date when the Company filed its annual report
on Form 10-K for fiscal 2012), we were aware that Shenzhen Lanjin was
negotiating with the Agricultural Bank of China for the extension of these
loans. On January 5, 2013, we were informed by the Agricultural Bank of China
about Shenzhen Lanjin&#146;s default on the loan guaranteed by us and two other
co-guarantors. As such, the condition in paragraph 450-20-25-2(a) was met as
information available to us before we issued the financial statements for the
quarter ended December 31, 2012 indicates that it was probable that a liability
had been incurred at the date of the financial statements. An accrual of losses
had been made on the financial statements as of December 31, 2012 as the losses
were reasonably estimable and relate to the current accounting period.</P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<!--$$/page=--><A name=page_17></A><BR>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=top>
    <TD align=left>Jeanne Bennett </TD></TR>
  <TR vAlign=top>
    <TD align=left>June 13, 2013 </TD></TR>
  <TR vAlign=top>
    <TD align=left>Page 17 </TD></TR></TABLE>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0 BCLLIST>

  <TR>
    <TD vAlign=top width="5%">&nbsp;</TD>
    <TD>
      &nbsp;</TD></TR>

  <TR>
    <TD vAlign=top width="5%"><B>14.</B> </TD>
    <TD>
      <P align=justify><B>Please tell us why the amount of loss recognized
      ($7,360,706) is less than the total amount of the guarantee as of December
      31, 2012 ($9,628,809).</B></P></TD></TR></TABLE>
<P align=justify>COMPANY RESPONSE: In accordance with the Staff&#146;s request, we
would like to advise that the loans of Shenzhen Langjin were co-guaranteed by
the Company and two other co-guarantors. As the two other co-guarantors had the
ability to pay RMB14 million ($2,246,722, using exchange rate at December 31,
2012) only, the Company was demanded to pay the remaining balance of RMB46
million ($7,382,087, using exchange rate at December 31, 2012). As such, the
Company recorded a loss of $7,360,706 (using period average exchange rate) for
the three month period ended December 31, 2012. </P>
<P align=justify><B><U>Item 2. Management&#146;s Discussion and Analysis of Financial
Condition and Results</U></B><B> </B><B><U>of Operations, page 2</U></B></P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0 BCLLIST>

  <TR>
    <TD vAlign=top width="5%"><B>15.</B> </TD>
    <TD>
      <P align=justify><B>We note your reference to FASB ASC 330-10-35-7 in your
      response to prior comment 19. Please tell us in more detail how the
      company applied FASB ASC 330-10-35-1 to 35-12. Show us the significant
      components of the gross loss in the last four quarters. Relate your
      response regarding your inventory accounting to your disclosure on page 6
      that the company&#146;s significant change from gross profit to gross loss
      included the impact of the sale of low priced and obsolete products with
      negative gross margins as a result of severe market
  competition.</B></P></TD></TR></TABLE><BR>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<!--$$/page=--><A name=page_18></A><BR>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=top>
    <TD align=left>Jeanne Bennett </TD></TR>
  <TR vAlign=top>
    <TD align=left>June 13, 2013 </TD></TR>
  <TR vAlign=top>
    <TD align=left>Page 18 </TD></TR></TABLE>
<P align=justify>COMPANY RESPONSE: In accordance with the Staff&#146;s request, we
advise that the gross loss was mainly from sale of our aluminum-case cell and
lithium polymer cell products. There were about 600 and 350 items of
aluminum-case cell and lithium polymer cell products, respectively, sold at a
loss in each of the last four quarters. We listed below five of these low priced
and obsolete products with negative gross margins in the last four quarters:-
</P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD noWrap align=center width="10%">Quarter </TD>
    <TD noWrap align=center width="2%" >&nbsp;</TD>
    <TD noWrap align=center width="1%" >&nbsp;</TD>
    <TD noWrap align=center width="10%">Quarter </TD>
    <TD noWrap align=center width="2%" >&nbsp;</TD>
    <TD noWrap align=center width="1%" >&nbsp;</TD>
    <TD noWrap align=center width="10%">Quarter </TD>
    <TD noWrap align=center width="2%" >&nbsp;</TD>
    <TD noWrap align=center width="1%" >&nbsp;</TD>
    <TD noWrap align=center width="10%">Quarter </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD noWrap align=center width="10%">ended </TD>
    <TD noWrap align=center width="2%" >&nbsp;</TD>
    <TD noWrap align=center width="1%" >&nbsp;</TD>
    <TD noWrap align=center width="10%">ended </TD>
    <TD noWrap align=center width="2%" >&nbsp;</TD>
    <TD noWrap align=center width="1%" >&nbsp;</TD>
    <TD noWrap align=center width="10%">ended </TD>
    <TD noWrap align=center width="2%" >&nbsp;</TD>
    <TD noWrap align=center width="1%" >&nbsp;</TD>
    <TD noWrap align=center width="10%">ended </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD noWrap align=center width="10%">3/31/2012 </TD>
    <TD noWrap align=center width="2%" >&nbsp;</TD>
    <TD noWrap align=center width="1%" >&nbsp;</TD>
    <TD noWrap align=center width="10%">6/30/2012 </TD>
    <TD noWrap align=center width="2%" >&nbsp;</TD>
    <TD noWrap align=center width="1%" >&nbsp;</TD>
    <TD noWrap align=center width="10%">9/30/2012 </TD>
    <TD noWrap align=center width="2%" >&nbsp;</TD>
    <TD noWrap align=center width="1%" >&nbsp;</TD>
    <TD noWrap align=center width="10%">12/31/2012 </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD noWrap align=center width="10%">RMB </TD>
    <TD noWrap align=center width="2%" >&nbsp;</TD>
    <TD noWrap align=center width="1%" >&nbsp;</TD>
    <TD noWrap align=center width="10%">RMB </TD>
    <TD noWrap align=center width="2%" >&nbsp;</TD>
    <TD noWrap align=center width="1%" >&nbsp;</TD>
    <TD noWrap align=center width="10%">RMB </TD>
    <TD noWrap align=center width="2%" >&nbsp;</TD>
    <TD noWrap align=center width="1%" >&nbsp;</TD>
    <TD noWrap align=center width="10%">RMB </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>1. Lithium polymer cells &#150; 18650C4 </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="10%" bgColor=#e6efff></TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="10%" bgColor=#e6efff></TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="10%" bgColor=#e6efff></TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="10%" bgColor=#e6efff></TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>Unit selling price </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">9.03 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">8.72 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">8.23 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">7.91 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Unit cost </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>10.53 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>8.99 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>8.69 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>8.12 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>Gross loss &#150; per unit </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">(1.50</TD>
    <TD vAlign=bottom align=left width="2%" >) </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">(0.27</TD>
    <TD vAlign=bottom align=left width="2%" >) </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">(0.46</TD>
    <TD vAlign=bottom align=left width="2%" >) </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">(0.21</TD>
    <TD vAlign=bottom align=left width="2%" >) </TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Gross loss &#150; total </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>(5,920,279</TD>
    <TD vAlign=bottom align=left width="2%"  bgColor=#e6efff>)
</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>(1,270,323</TD>
    <TD vAlign=bottom align=left width="2%"  bgColor=#e6efff>)
</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>(1,276,256</TD>
    <TD vAlign=bottom align=left width="2%"  bgColor=#e6efff>)
</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>(500,973</TD>
    <TD vAlign=bottom align=left width="2%"  bgColor=#e6efff>)
  </TD></TR>
  <TR vAlign=top>
    <TD align=left>- Including write- down of inventories to realizable value
      (charged to cost of sales for the quarter) </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">559,239 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">1,230,723 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">1,055,482 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">590,877 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Gross loss % </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>(16.6%</TD>
    <TD vAlign=bottom align=left width="2%"  bgColor=#e6efff>)
</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>(3.1%</TD>
    <TD vAlign=bottom align=left width="2%"  bgColor=#e6efff>)
</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>(5.6%</TD>
    <TD vAlign=bottom align=left width="2%"  bgColor=#e6efff>)
</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>(2.7%</TD>
    <TD vAlign=bottom align=left width="2%"  bgColor=#e6efff>)
  </TD></TR>
  <TR>
    <TD>&nbsp; </TD>
    <TD width="1%" >&nbsp;</TD>
    <TD vAlign=bottom width="10%">&nbsp; </TD>
    <TD vAlign=bottom width="2%" >&nbsp;</TD>
    <TD vAlign=bottom width="1%" >&nbsp;</TD>
    <TD vAlign=bottom width="10%">&nbsp; </TD>
    <TD vAlign=bottom width="2%" >&nbsp;</TD>
    <TD vAlign=bottom width="1%" >&nbsp;</TD>
    <TD vAlign=bottom width="10%">&nbsp; </TD>
    <TD vAlign=bottom width="2%" >&nbsp;</TD>
    <TD vAlign=bottom width="1%" >&nbsp;</TD>
    <TD vAlign=bottom width="10%">&nbsp; </TD>
    <TD vAlign=bottom width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Inventory value at quarter end </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>57,893,290 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>14,759,223 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>12,802,070 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>1,505,046 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD></TR>
  <TR>
    <TD>&nbsp; </TD>
    <TD width="1%" >&nbsp;</TD>
    <TD vAlign=bottom width="10%">&nbsp; </TD>
    <TD vAlign=bottom width="2%" >&nbsp;</TD>
    <TD vAlign=bottom width="1%" >&nbsp;</TD>
    <TD vAlign=bottom width="10%">&nbsp; </TD>
    <TD vAlign=bottom width="2%" >&nbsp;</TD>
    <TD vAlign=bottom width="1%" >&nbsp;</TD>
    <TD vAlign=bottom width="10%">&nbsp; </TD>
    <TD vAlign=bottom width="2%" >&nbsp;</TD>
    <TD vAlign=bottom width="1%" >&nbsp;</TD>
    <TD vAlign=bottom width="10%">&nbsp; </TD>
    <TD vAlign=bottom width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>2. Aluminum case cells &#150; 523450AHR </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="10%"  bgColor=#e6efff></TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="10%" bgColor=#e6efff></TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="10%" bgColor=#e6efff></TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="10%" bgColor=#e6efff></TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>Unit selling price </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">5.25 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">5.01 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">4.33 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">4.02 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Unit cost </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>4.29 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>5.25 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>4.42 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>4.06 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>Gross profit (loss) &#150; per unit </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">0.96 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">(0.24</TD>
    <TD vAlign=bottom align=left width="2%" >) </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">(0.09</TD>
    <TD vAlign=bottom align=left width="2%" >) </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">(0.04</TD>
    <TD vAlign=bottom align=left width="2%" >) </TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Gross profit (loss) &#150; total </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>3,044,899 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>(768,165</TD>
    <TD vAlign=bottom align=left width="2%"  bgColor=#e6efff>)
</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>(428,769</TD>
    <TD vAlign=bottom align=left width="2%"  bgColor=#e6efff>)
</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>(127,153</TD>
    <TD vAlign=bottom align=left width="2%"  bgColor=#e6efff>)
  </TD></TR>
  <TR vAlign=top>
    <TD align=left>- Including write- down of inventories to realizable value
      (charged to cost of sales for the &nbsp;quarter) </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">137,024 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">573,491 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">- </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">44,945 </TD>
    <TD vAlign=bottom align=left width="2%"
>&nbsp;</TD></TR></TABLE><BR>
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noShade SIZE=5>
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<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=top>
    <TD align=left>Jeanne Bennett </TD></TR>
  <TR vAlign=top>
    <TD align=left>June 13, 2013 </TD></TR>
  <TR vAlign=top>
    <TD align=left>Page 19 </TD></TR></TABLE><BR>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Gross profit (loss) % </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>18.5% </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>(4.8%</TD>
    <TD vAlign=bottom align=left width="2%"  bgColor=#e6efff>)
</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>(2.1%</TD>
    <TD vAlign=bottom align=left width="2%"  bgColor=#e6efff>)
</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>(1.0%</TD>
    <TD vAlign=bottom align=left width="2%"  bgColor=#e6efff>)
  </TD></TR>
  <TR>
    <TD>&nbsp; </TD>
    <TD vAlign=bottom width="1%" >&nbsp;</TD>
    <TD vAlign=bottom width="10%">&nbsp; </TD>
    <TD vAlign=bottom width="2%" >&nbsp;</TD>
    <TD vAlign=bottom width="1%" >&nbsp;</TD>
    <TD vAlign=bottom width="10%">&nbsp; </TD>
    <TD vAlign=bottom width="2%" >&nbsp;</TD>
    <TD vAlign=bottom width="1%" >&nbsp;</TD>
    <TD vAlign=bottom width="10%">&nbsp; </TD>
    <TD vAlign=bottom width="2%" >&nbsp;</TD>
    <TD vAlign=bottom width="1%" >&nbsp;</TD>
    <TD vAlign=bottom width="10%">&nbsp; </TD>
    <TD vAlign=bottom width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Inventory value at quarter end </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>11,019,564 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>10,990,649 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>5,314,238 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>7,621,939 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD></TR>
  <TR>
    <TD>&nbsp; </TD>
    <TD vAlign=bottom width="1%" >&nbsp;</TD>
    <TD vAlign=bottom width="10%">&nbsp; </TD>
    <TD vAlign=bottom width="2%" >&nbsp;</TD>
    <TD vAlign=bottom width="1%" >&nbsp;</TD>
    <TD vAlign=bottom width="10%">&nbsp; </TD>
    <TD vAlign=bottom width="2%" >&nbsp;</TD>
    <TD vAlign=bottom width="1%" >&nbsp;</TD>
    <TD vAlign=bottom width="10%">&nbsp; </TD>
    <TD vAlign=bottom width="2%" >&nbsp;</TD>
    <TD vAlign=bottom width="1%" >&nbsp;</TD>
    <TD vAlign=bottom width="10%">&nbsp; </TD>
    <TD vAlign=bottom width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>3. Lithium polymer cells &#150; C18650CC </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="10%" bgColor=#e6efff></TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="10%" bgColor=#e6efff></TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="10%" bgColor=#e6efff></TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="10%" bgColor=#e6efff></TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>Unit selling price </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">11.38 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">10.80 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">9.66 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">3.77 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Unit cost </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>12.13 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>11.35 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>10.65 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>9.46 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>Gross loss &#150; per unit </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">(0.75</TD>
    <TD vAlign=bottom align=left width="2%" >) </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">(0.55</TD>
    <TD vAlign=bottom align=left width="2%" >) </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">(0.99</TD>
    <TD vAlign=bottom align=left width="2%" >) </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">(5.69</TD>
    <TD vAlign=bottom align=left width="2%" >) </TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Gross loss &#150; total </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>(119,241</TD>
    <TD vAlign=bottom align=left width="2%"  bgColor=#e6efff>)
</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>(474,978</TD>
    <TD vAlign=bottom align=left width="2%"  bgColor=#e6efff>)
</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>(361,448</TD>
    <TD vAlign=bottom align=left width="2%"  bgColor=#e6efff>)
</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>(40,706</TD>
    <TD vAlign=bottom align=left width="2%"  bgColor=#e6efff>)
  </TD></TR>
  <TR vAlign=top>
    <TD align=left>- Including write- down of inventories to realizable value
      (charged to cost of sales for the quarter) </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">89,480 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">112,372 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">267,193 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">60,975 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Gross loss % </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>(6.6%</TD>
    <TD vAlign=bottom align=left width="2%"  bgColor=#e6efff>)
</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>(5.1%</TD>
    <TD vAlign=bottom align=left width="2%"  bgColor=#e6efff>)
</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>(10.2%</TD>
    <TD vAlign=bottom align=left width="2%"  bgColor=#e6efff>)
</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>(150.9%</TD>
    <TD vAlign=bottom align=left width="2%"  bgColor=#e6efff>)
  </TD></TR>
  <TR>
    <TD>&nbsp; </TD>
    <TD vAlign=bottom width="1%" >&nbsp;</TD>
    <TD vAlign=bottom width="10%">&nbsp; </TD>
    <TD vAlign=bottom width="2%" >&nbsp;</TD>
    <TD vAlign=bottom width="1%" >&nbsp;</TD>
    <TD vAlign=bottom width="10%">&nbsp; </TD>
    <TD vAlign=bottom width="2%" >&nbsp;</TD>
    <TD vAlign=bottom width="1%" >&nbsp;</TD>
    <TD vAlign=bottom width="10%">&nbsp; </TD>
    <TD vAlign=bottom width="2%" >&nbsp;</TD>
    <TD vAlign=bottom width="1%" >&nbsp;</TD>
    <TD vAlign=bottom width="10%">&nbsp; </TD>
    <TD vAlign=bottom width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Inventory value at quarter end </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>998,846 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>612,384 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>3,261,471 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>2,014,025 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD></TR>
  <TR>
    <TD>&nbsp; </TD>
    <TD vAlign=bottom width="1%" >&nbsp;</TD>
    <TD vAlign=bottom width="10%">&nbsp; </TD>
    <TD vAlign=bottom width="2%" >&nbsp;</TD>
    <TD vAlign=bottom width="1%" >&nbsp;</TD>
    <TD vAlign=bottom width="10%">&nbsp; </TD>
    <TD vAlign=bottom width="2%" >&nbsp;</TD>
    <TD vAlign=bottom width="1%" >&nbsp;</TD>
    <TD vAlign=bottom width="10%">&nbsp; </TD>
    <TD vAlign=bottom width="2%" >&nbsp;</TD>
    <TD vAlign=bottom width="1%" >&nbsp;</TD>
    <TD vAlign=bottom width="10%">&nbsp; </TD>
    <TD vAlign=bottom width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>4. Lithium polymer cells &#150; C18650CA </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="10%" bgColor=#e6efff></TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="10%" bgColor=#e6efff></TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="10%" bgColor=#e6efff></TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="10%" bgColor=#e6efff></TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>Unit selling price </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">7.30 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">8.18 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">7.78 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">7.35 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Unit cost </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>8.22 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>7.26 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>8.16 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>7.51 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>Gross profit (loss) &#150; per unit </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">(0.92</TD>
    <TD vAlign=bottom align=left width="2%" >) </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">0.92 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">(0.38</TD>
    <TD vAlign=bottom align=left width="2%" >) </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">(0.16</TD>
    <TD vAlign=bottom align=left width="2%" >) </TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Gross profit (loss) &#150; total </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>(611,257</TD>
    <TD vAlign=bottom align=left width="2%"  bgColor=#e6efff>)
</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>2,050,709 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>(1,710,286</TD>
    <TD vAlign=bottom align=left width="2%"  bgColor=#e6efff>)
</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>(815,252</TD>
    <TD vAlign=bottom align=left width="2%"  bgColor=#e6efff>)
  </TD></TR>
  <TR vAlign=top>
    <TD align=left>- Including write- down of inventories to realizable value
      (charged to cost of sales for the quarter) </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">13,301 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">- </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">342,257 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">43,482 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Gross profit (loss) % </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>(12.6%</TD>
    <TD vAlign=bottom align=left width="2%"  bgColor=#e6efff>)
</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>11.3% </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>(4.9%</TD>
    <TD vAlign=bottom align=left width="2%"  bgColor=#e6efff>)
</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>(2.2%</TD>
    <TD vAlign=bottom align=left width="2%"  bgColor=#e6efff>)
  </TD></TR>
  <TR>
    <TD>&nbsp; </TD>
    <TD vAlign=bottom width="1%" >&nbsp;</TD>
    <TD vAlign=bottom width="10%">&nbsp; </TD>
    <TD vAlign=bottom width="2%" >&nbsp;</TD>
    <TD vAlign=bottom width="1%" >&nbsp;</TD>
    <TD vAlign=bottom width="10%">&nbsp; </TD>
    <TD vAlign=bottom width="2%" >&nbsp;</TD>
    <TD vAlign=bottom width="1%" >&nbsp;</TD>
    <TD vAlign=bottom width="10%">&nbsp; </TD>
    <TD vAlign=bottom width="2%" >&nbsp;</TD>
    <TD vAlign=bottom width="1%" >&nbsp;</TD>
    <TD vAlign=bottom width="10%">&nbsp; </TD>
    <TD vAlign=bottom width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Inventory value at quarter end </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>717,171 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>4,606,924 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>132,640 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>85,124 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD></TR></TABLE><BR>
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<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=top>
    <TD align=left>Jeanne Bennett </TD></TR>
  <TR vAlign=top>
    <TD align=left>June 13, 2013 </TD></TR>
  <TR vAlign=top>
    <TD align=left>Page 20 </TD></TR></TABLE><BR>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>5. Lithium polymer cells &#150; 10036010 </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="10%" bgColor=#e6efff></TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="10%" bgColor=#e6efff></TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="10%" bgColor=#e6efff></TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="10%" bgColor=#e6efff></TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>Unit selling price </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">5.92 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">5.76 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">5.38 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">5.24 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Unit cost </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>7.66 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>5.89 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>5.67 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>5.32 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>Gross loss &#150; per unit </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">(1.74</TD>
    <TD vAlign=bottom align=left width="2%" >) </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">(0.13</TD>
    <TD vAlign=bottom align=left width="2%" >) </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">(0.29</TD>
    <TD vAlign=bottom align=left width="2%" >) </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">(0.08</TD>
    <TD vAlign=bottom align=left width="2%" >) </TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Gross loss &#150; total </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>(1,179,336</TD>
    <TD vAlign=bottom align=left width="2%"  bgColor=#e6efff>)
</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>(175,216</TD>
    <TD vAlign=bottom align=left width="2%"  bgColor=#e6efff>)
</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>(452,742</TD>
    <TD vAlign=bottom align=left width="2%"  bgColor=#e6efff>)
</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>(89,158</TD>
    <TD vAlign=bottom align=left width="2%"  bgColor=#e6efff>)
  </TD></TR>
  <TR vAlign=top>
    <TD align=left>- Including write- down of inventories to realizable value
      (charged to cost of sales for the quarter) </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">52,948 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">32,333 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">172,312 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">30,483 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Gross profit (loss) % </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>(29.4%</TD>
    <TD vAlign=bottom align=left width="2%"  bgColor=#e6efff>)
</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>(2.3%</TD>
    <TD vAlign=bottom align=left width="2%"  bgColor=#e6efff>)
</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>(5.4%</TD>
    <TD vAlign=bottom align=left width="2%"  bgColor=#e6efff>)
</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>(1.5%</TD>
    <TD vAlign=bottom align=left width="2%"  bgColor=#e6efff>)
  </TD></TR>
  <TR>
    <TD>&nbsp; </TD>
    <TD vAlign=bottom width="1%" >&nbsp;</TD>
    <TD vAlign=bottom width="10%">&nbsp; </TD>
    <TD vAlign=bottom width="2%" >&nbsp;</TD>
    <TD vAlign=bottom width="1%" >&nbsp;</TD>
    <TD vAlign=bottom width="10%">&nbsp; </TD>
    <TD vAlign=bottom width="2%" >&nbsp;</TD>
    <TD vAlign=bottom width="1%" >&nbsp;</TD>
    <TD vAlign=bottom width="10%">&nbsp; </TD>
    <TD vAlign=bottom width="2%" >&nbsp;</TD>
    <TD vAlign=bottom width="1%" >&nbsp;</TD>
    <TD vAlign=bottom width="10%">&nbsp; </TD>
    <TD vAlign=bottom width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Inventory value at quarter end </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>175,493 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>1,327,261 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>526,877 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>599,139 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD></TR>
  <TR>
    <TD>&nbsp; </TD>
    <TD vAlign=bottom width="1%" >&nbsp;</TD>
    <TD vAlign=bottom width="10%">&nbsp; </TD>
    <TD vAlign=bottom width="2%" >&nbsp;</TD>
    <TD vAlign=bottom width="1%" >&nbsp;</TD>
    <TD vAlign=bottom width="10%">&nbsp; </TD>
    <TD vAlign=bottom width="2%" >&nbsp;</TD>
    <TD vAlign=bottom width="1%" >&nbsp;</TD>
    <TD vAlign=bottom width="10%">&nbsp; </TD>
    <TD vAlign=bottom width="2%" >&nbsp;</TD>
    <TD vAlign=bottom width="1%" >&nbsp;</TD>
    <TD vAlign=bottom width="10%">&nbsp; </TD>
    <TD vAlign=bottom width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Total of the above </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>RMB </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>RMB </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>RMB </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>RMB </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>listed items:- </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="10%">&nbsp; </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="10%">&nbsp; </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="10%">&nbsp; </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="10%">&nbsp; </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Inventory value </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>70,804,364 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>32,296,441 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>22,037,296 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>11,825,273 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>Gross loss </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">(4,785,214</TD>
    <TD vAlign=bottom align=left width="2%" >) </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">(637,973</TD>
    <TD vAlign=bottom align=left width="2%" >) </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">(4,229,501</TD>
    <TD vAlign=bottom align=left width="2%" >) </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">(1,573,242</TD>
    <TD vAlign=bottom align=left width="2%" >) </TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>- Including write- down of inventories to
      realizable value (charged to cost of sales for the quarter) </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>851,992 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>1,948,919 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>1,837,244 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>770,762 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD></TR>
  <TR>
    <TD>&nbsp; </TD>
    <TD vAlign=bottom width="1%" >&nbsp;</TD>
    <TD vAlign=bottom width="10%">&nbsp; </TD>
    <TD vAlign=bottom width="2%" >&nbsp;</TD>
    <TD vAlign=bottom width="1%" >&nbsp;</TD>
    <TD vAlign=bottom width="10%">&nbsp; </TD>
    <TD vAlign=bottom width="2%" >&nbsp;</TD>
    <TD vAlign=bottom width="1%" >&nbsp;</TD>
    <TD vAlign=bottom width="10%">&nbsp; </TD>
    <TD vAlign=bottom width="2%" >&nbsp;</TD>
    <TD vAlign=bottom width="1%" >&nbsp;</TD>
    <TD vAlign=bottom width="10%">&nbsp; </TD>
    <TD vAlign=bottom width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Total of the above listed items:- </TD>
    <TD vAlign=bottom align=left width="1%"  bgColor=#e6efff></TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>$</TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"  bgColor=#e6efff></TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>$</TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"  bgColor=#e6efff></TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>$</TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"  bgColor=#e6efff></TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>$</TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>Gross loss-total </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">(755,731</TD>
    <TD vAlign=bottom align=left width="2%" >) </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">(100,782</TD>
    <TD vAlign=bottom align=left width="2%" >) </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">(667,387</TD>
    <TD vAlign=bottom align=left width="2%" >) </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">(251,743</TD>
    <TD vAlign=bottom align=left width="2%" >) </TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>- Including write- down of inventories to
      realizable value (charged to cost of sales for the quarter) </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>134,556 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>307,876 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>289,905 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>123,334 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD></TR>
  <TR>
    <TD>&nbsp; </TD>
    <TD vAlign=bottom width="1%" >&nbsp;</TD>
    <TD vAlign=bottom width="10%">&nbsp; </TD>
    <TD vAlign=bottom width="2%" >&nbsp;</TD>
    <TD vAlign=bottom width="1%" >&nbsp;</TD>
    <TD vAlign=bottom width="10%">&nbsp; </TD>
    <TD vAlign=bottom width="2%" >&nbsp;</TD>
    <TD vAlign=bottom width="1%" >&nbsp;</TD>
    <TD vAlign=bottom width="10%">&nbsp; </TD>
    <TD vAlign=bottom width="2%" >&nbsp;</TD>
    <TD vAlign=bottom width="1%" >&nbsp;</TD>
    <TD vAlign=bottom width="10%">&nbsp; </TD>
    <TD vAlign=bottom width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Inventory value </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>11,245,928 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>5,081,972 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>3,505,941 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>1,897,722 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD></TR></TABLE><BR>
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<!--$$/page=--><A name=page_21></A><BR>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=top>
    <TD align=left>Jeanne Bennett </TD></TR>
  <TR vAlign=top>
    <TD align=left>June 13, 2013 </TD></TR>
  <TR vAlign=top>
    <TD align=left>Page 21 </TD></TR></TABLE><BR>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=top>
    <TD align=left>Consolidated:- </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="10%">&nbsp; </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="10%">&nbsp; </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="10%">&nbsp; </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="10%">&nbsp; </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Gross loss </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>(3,870,132</TD>
    <TD vAlign=bottom align=left width="2%"  bgColor=#e6efff>)
</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>(5,062,898</TD>
    <TD vAlign=bottom align=left width="2%"  bgColor=#e6efff>)
</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>(3,624,975</TD>
    <TD vAlign=bottom align=left width="2%"  bgColor=#e6efff>)
</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>(4,239,010</TD>
    <TD vAlign=bottom align=left width="2%"  bgColor=#e6efff>)
  </TD></TR>
  <TR vAlign=top>
    <TD align=left>- Including write- down of inventories to realizable value
      (charged to cost of sales for the quarter) </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">1,958,048 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">2,394,541 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">3,985,949 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">19,985,972 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Inventory value </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>58,785,685 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>59,994,029 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>65,383,829 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>60,567,344 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD></TR></TABLE>
<P align=center>* * * * </P>
<P align=justify style="text-indent: 5%">In connection with the Company&#146;s response to the foregoing
comments, the Company hereby acknowledges that </P>
<UL style="TEXT-ALIGN: justify">
  <LI>
  <p style="margin-left: 5%; margin-bottom: 12">the Company is responsible for the adequacy and accuracy of the disclosure
  in the filing;
  <LI>
  <p style="margin-left: 5%; margin-bottom: 12">Staff comments or changes to disclosure in response to Staff comments do
  not foreclose the Commission from taking any action with respect to the
  filing; and
  <LI>
  <p style="margin-left: 5%; margin-bottom: 12">the Company may not assert Staff comments as a defense in any proceeding
  initiated by the Commission or any person under the federal securities laws of
  the United States. </LI></UL>
<P align=justify style="text-indent: 5%">If you would like to discuss any of our responses to the
Staff&#146;s comments or if you would like to discuss any other matters, please
contact Thomas M. Shoesmith at (650)-233-4553, of Pillsbury Winthrop Shaw
Pittman LLP, our outside counsel. </P>
<P style="MARGIN-LEFT: 50%" align=justify>Sincerely, </P>
<P style="MARGIN-LEFT: 50%" align=justify>CHINA BAK BATTERY, INC. </P>
<P style="MARGIN-LEFT: 50%" align=justify>By: <U>/s/ Xiangqian Li</U>
<BR>Xiangqian Li <BR>Chief Executive Officer </P>
<HR align=center width="100%" color=black noShade SIZE=5>

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end
</TEXT>
</DOCUMENT>
</SEC-DOCUMENT>
