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Loans
 3 Months Ended
Mar. 31, 2022
Debt Disclosure [Abstract]  
Loans

14. Loans

 

Bank loans:

 

Bank borrowings as of December 31, 2021 and March 31, 2022 consisted of the followings:

 

   December 31,   March 31, 
   2021   2022 
Short-term bank borrowings  $8,811,820   $14,674,721 

 

On June 4, 2018, the Company obtained banking facilities from China Everbright Bank Dalian Branch with a maximum amount of RMB200 million (approximately $30.63 million) with the term from June 12, 2018 to June 10, 2021, bearing interest at 130% of benchmark rate of the People’s Bank of China (“PBOC”) for three-year long-term loans, at current rate 6.175% per annum. The facilities were secured by the Company’s land use rights, buildings, machinery and equipment. According to the original repayment schedule, the loans are repayable in six installments of RMB0.8 million ($0.12 million) on December 10, 2018, RMB24.3 million ($3.72 million) on June 10, 2019, RMB0.8 million ($0.12 million) on December 10, 2019, RMB74.7 million ($11.44 million) on June 10, 2020, RMB0.8 million ($0.12 million) on December 10, 2020 and RMB66.3 million ($10.16 million) on June 10, 2021. The Company repaid the bank loan of RMB0.8 million ($0.12 million), RMB24.3 million ($3.72 million) and RMB0.8 million ($0.12 million) in December 2018, June 2019 and December 2019, respectively.

 

On June 28, 2020, the Company entered into a supplemental agreement with China Everbright Bank Dalian Branch to change the repayment schedule. According to the modification agreement, the remaining RMB141.8 million (approximately $21.72 million) loans are repayable in eight instalments consisting of RMB1.09 million ($0.17 million) on June 10, 2020, RMB1 million ($0.15 million) on December 10, 2020, RMB2 million ($0.31 million) on January 10, 2021, RMB2 million ($0.31 million) on February 10, 2021, RMB2 million ($0.31 million) on March 10, 2021, RMB2 million ($0.31 million) on April 10, 2021, RMB2 million ($0.31 million) on May 10, 2021, and RMB129.7 million ($19.9 million) on June 10, 2021, respectively. As of December 31, 2021, the Company repaid all the bank loan.

 

On November 16, 2021, the Company obtained banking facilities from Shaoxing Branch of Bank of Communications Co., Ltd with a maximum amount of RMB120.1 million (approximately $19.0 million) with the term from November 18, 2021 to November 18, 2026. The facility was secured by the Company’s land use rights and buildings. Under the facility, the Company has borrowed RMB56.0 million (approximately $8.8 million) and RMB63.1 million (approximately $9.9 million) as of December 31, 2021 and March 31, 2022, respectively, for a term until November 16, 2022 to February 28, 2023, bearing interest at 4.35% per annum. 

 

The Company borrowed a series of acceptance bills from Shaoxing Branch of Bank of Communications Co., Ltd totaled RMB53.7 million (approximately $8.4 million) for various terms through April to August 2022, which was secured by the Company’s cash totaled RMB22.3 million (approximately $3.5 million) (Note 2) and bills receivables totaled RMB31.3 million (approximately $4.9 million) (Note 3).

 

The Company borrowed a series of acceptance bills from Shaoxing Branch of Bank of Communications Co., Ltd totaled RMB32.2 million (approximately $5.1 million) for various terms through May to August 2022, which was secured by the Company’s cash totaled RMB16.1 million (approximately $2.5 million) and the Company’s land use rights and buildings. (Note 9).

 

In October to December 2020, the Company borrowed a series of acceptance bills from China Merchants Bank totaled RMB13.5 million (approximately $2.07 million) for various terms through April to June 2021, which was secured by the Company’s cash totaled RMB13.5 million (approximately $2.07 million). The Company repaid the bills through April to June 2021.

 

On April 19, 2021, the Company obtained five-year acceptance bills facilities from Bank of Ningbo Co., Ltd with a maximum amount of RMB84.4 million (approximately $13.2 million). Any amount drawn under the facilities requires security in the form of cash or bank acceptance bills receivable of at least the same amount. Under the facilities, as of December 31, 2021, the Company borrowed a total of RMB10 million (approximately $1.6 million) from Bank of Ningbo Co., Ltd in the form of bills payable for a various term expiring from January to February 2022, which was secured by the Company’s cash totaled RMB10 million (approximately $1.6 million). The Company repaid the bills in January to February 2022.

 

The Company borrowed a series of acceptance bills from Agricultural Bank of China totaled RMB32.0 million (approximately $5.1 million) for various terms through April to September 2022, which was secured by the Company’s cash totaled RMB32.0 million (approximately $5.1 million) (Note 2). 

 

The Company borrowed a series of acceptance bills from China Zheshang Bank Co. Ltd Shenyang Branch totaled RMB89.6 million (approximately $14.1 million) for various terms through April to September 2022, which was secured by the Company’s cash totaled RMB88.9 million (approximately $14.0 million) (Note 2) and the Company’s bills receivable totaled RMB0.7 million (approximately $0.1 million) (Note 3).

 

On January 17, 2022, the Company obtained a one-year term facility from Agricultural Bank of China with a maximum amount of RMB10 million (approximately $1.6 million) bearing interest at 105% of benchmark rate of the People’s Bank of China (“PBOC”) for short-term loans, which is 3.85% per annum. The facility was guaranteed by the Company’s CEO, Mr. Yunfei Li and Mr. Yunfei Li’s wife Ms. Qinghui Yuan. The Company borrowed RMB10 million (approximately $1.6 million) up to the date of this report.

 

On February 9, 2022, the Company obtained a one-year term facility from Jiangsu Gaochun Rural Commercial Bank with a maximum amount of RMB10 million (approximately $1.6 million) bearing interest at 124% of benchmark rate of the People’s Bank of China (“PBOC”) for short-term loans, which is 4.94% per annum. The facility was guaranteed by the Company’s CEO, Mr. Yunfei Li and Mr. Yunfei Li’s wife Ms. Qinghui Yuan. The Company borrowed RMB10 million (approximately $1.6 million) up to the date of this report.

 

On March 8, 2022, the Company obtained a one-year term facility from China Zheshang Bank Co., Ltd. Shangyu Branch with a maximum amount of RMB10 million (approximately $1.6 million) bearing interest at 5.5% per annum. The facility was guaranteed by 100% equity in CBAK Power held by BAK Asia and the Company’s CEO, Mr. Yunfei Li. The Company borrowed RMB10 million (approximately $1.6 million) up to the date of this report.

 

On April 29, 2022, the Company obtained a one-year term facility from Industrial and Commercial Bank of China Nanjing Gaochun branch, with a maximum amount of RMB10 million (approximately $1.6 million) bearing interest at 3.95% per annum. The facility was guaranteed by the Company’s CEO, Mr. Yunfei Li and Mr. Yunfei Li’s wife Ms. Qinghui Yuan. The Company borrowed RMB10 million (approximately $1.6 million) up to the date of this report. 

 

The facilities were also secured by the Company’s assets with the following carrying amounts:

 

   December 31,   March 31, 
   2021   2022 
Pledged deposits (note 2)  $18,996,749   $25,141,517 
Bills receivables (note 3)   4,446,553    5,041,978 
Right-of-use assets (note 9)   6,268,473    6,236,789 
Buildings   8,565,837    8,494,371 
   $38,277,612   $44,914,655 

 

As of March 31, 2022, the Company had unutilized committed banking facilities totaled $6.6 million.

 

During the three months ended March 31, 2021 and 2022, interest of $213,583 and $122,973 were incurred on the Company’s bank borrowings, respectively.

 

Other short-term loans:

 

Other short-term loans as of December 31, 2021 and March 31, 2022 consisted of the following:

 

      December 31,   March 31, 
   Note  2021   2022 
Advance from related parties           
– Mr. Xiangqian Li, the Company’s Former CEO  (a)  $100,000   $100,000 
– Mr. Yunfei Li  (b)   153,300    153,639 
– Shareholders  (c)   94,971    95,180 
– Mr. Junnan Ye (Note 11)      3,933,848    
-
 
       4,282,119    348,819 
Advances from unrelated third party             
– Mr. Wenwu Yu  (d)   17,282    17,320 
– Ms. Longqian Peng  (d)   301,044    301,709 
– Suzhou Zhengyuanwei Needle Ce Co., Ltd  (e)   78,677    78,851 
       397,003    397,880 
      $4,679,122   $746,699 

 

(a)Advances from Mr. Xiangqian Li, the Company’s former CEO, was unsecured, non-interest bearing and repayable on demand.

 

(b)Advances from Mr. Yunfei Li, the Company’s CEO, was unsecured, non-interest bearing and repayable on demand.

 

(c)The earnest money paid by certain shareholders in relation to share purchase were unsecured, non-interest bearing and repayable on demand.

 

(d)Advances from unrelated third parties were unsecured, non-interest bearing and repayable on demand.

 

(e)In 2019, the Company entered into a short term loan agreement with Suzhou Zhengyuanwei Needle Ce Co., Ltd, an unrelated party to loan RMB0.6 million (approximately $0.1 million), bearing annual interest rate of 12%. As of March 31, 2022, loan amount of RMB0.5 million ($0.1 million) remained outstanding.

 

During the three months ended March 31, 2021 and 2022, interest of $2,314 and $7,167 were incurred on the Company’s borrowings from unrelated parties, respectively.