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Loans
 6 Months Ended
Jun. 30, 2022
Debt Disclosure [Abstract]  
Loans

14. Loans

 

Bank loans:

 

Bank borrowings as of December 31, 2021 and June 30, 2022 consisted of the followings:

 

   December 31,   June 30, 
   2021   2022 
Short-term bank borrowings  $8,811,820   $16,875,223 

 

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 loans.

 

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 $18.0 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 RMB73.1 million (approximately $10.9 million) as of December 31, 2021 and June 30, 2022, respectively, for a term until November 16, 2022 to May 16, 2023, bearing interest at 4.2% - 4.35% per annum. 

 

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.

 

On March 21, 2022, the Company renewed the above acceptance bills facilities from Bank of Ningbo Co., Ltd with a maximum amount of RMB71.6 million ($10.7 million) with other terms remain the same. Under the facilities, as of June 30, 2022, the Company borrowed a total of RMB9.2 million (approximately $1.4 million) in the form of bills payable for a various term expiring in November 2022, which was secured by the Company’s cash totaled RMB9.2 million (approximately $1.4 million) (Note 2).

 

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 $1.5 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 $1.5 million) on the same date for a term until January 16, 2023.

 

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 $1.5 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 $1.5 million) on the same date for a term until January 28, 2023.

 

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 $1.5 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 $1.5 million) on the same date. On May 17, 2022, the Company early repaid the loan principal and related loan interests.

 

On April 28, 2022, the Company obtained a three-year term facility from Industrial and Commercial Bank of China Nanjing Gaochun branch, with a maximum amount of RMB12 million (approximately $1.8 million) with the term from April 21, 2022 to April 21, 2025. The facilities were guaranteed by the Company’s CEO, Mr. Yunfei Li and Mr. Yunfei Li’s wife Ms. Qinghui Yuan. Under the facility, the Company borrowed RMB10 million (approximately $1.5 million) on April 29, 2022, bearing interest at 3.95% per annum for a term until April 29, 2023. 

 
On June 22, 2022, the Company obtained another one-year term facility from China Zheshang Bank Co., Ltd. Shangyu Branch with a maximum amount of RMB10 million (approximately $1.5 million) bearing interest at 4.5% 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 $1.5 million) on the same date for a term until June 21, 2022.

 

The Company borrowed a series of acceptance bills from Agricultural Bank of China totaled RMB71.0 million (approximately $10.6 million) for various terms through July to December 2022, which was secured by the Company’s cash totaled RMB71.0 million (approximately $10.6 million) (Note 2). 

 

The Company borrowed a series of acceptance bills from China Zheshang Bank Co. Ltd Shangyu Branch totaled RMB30.0 million (approximately $4.5 million) for various terms through October 2022, which was secured by the Company’s cash totaled RMB15.9 million (approximately $2.4 million) (Note 2) and the Company’s bills receivable totaled RMB15.5 million (approximately $2.3 million) (Note 3).

 

The Company borrowed a series of acceptance bills from China Zheshang Bank Co. Ltd Shenyang Branch totaled RMB84.3 million (approximately $12.6 million) for various terms through July to November 2022, which was secured by the Company’s cash totaled RMB84.3 million (approximately $12.6 million) (Note 2).

 

The Company borrowed a series of acceptance bills from Shaoxing Branch of Bank of Communications Co., Ltd totaled RMB39.5 million (approximately $5.9 million) for various terms through July to August 2022, which was secured by the Company’s cash totaled RMB33.5 million (approximately $5.0 million) (Note 2) and the Company’s land use rights (Note 9) and buildings.

 

The Company borrowed a series of acceptance bills from China Merchants Bank Dalian Branch totaled RMB34.3 million (approximately $5.1 million) for various terms through November to December 2022, which was secured by the Company’s cash totaled RMB34.3 million (approximately $5.1 million) (Note 2).

 

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

 

   December 31,   June 30, 
   2021   2022 
Pledged deposits (note 2)  $18,996,749   $37,117,237 
Bills receivables (note 3)   4,446,553    2,313,697 
Right-of-use assets (note 9)   6,268,473    5,860,141 
Buildings   8,565,837    8,076,882 
   $38,277,612   $53,367,957 

 

As of June 30, 2022, the Company had unutilized committed banking facilities totaled $6.5 million.

 

During the three months ended June 30, 2021 and 2022, interest of $92,912 and $163,138 were incurred on the Company’s bank borrowings, respectively.

 

During the six months ended June 30, 2021 and 2022, interest of $306,495 and $286,111 were incurred on the Company’s bank borrowings, respectively.

 

Other short-term loans:

 

Other short-term loans as of December 31, 2021 and June 30, 2022 consisted of the following:

 

       December 31,   June 30, 
   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    140,912 
– Shareholders   (c)    94,971    90,090 
– Mr. Junnan Ye (Note 11)        3,933,848    
-
 
         4,282,119    331,002 
Advances from unrelated third party               
– Mr. Wenwu Yu   (d)    17,282    16,394 
– Ms. Longqian Peng   (d)    301,044    285,573 
– Suzhou Zhengyuanwei Needle Ce Co., Ltd   (e)    78,677    74,633 
         397,003    376,600 
        $4,679,122   $707,602 

 

  (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 June 30, 2022, loan amount of RMB0.5 million ($0.1 million) remained outstanding.

 

During the three months ended June 30, 2021 and 2022, interest of $2,347 and $2,296 were incurred on the Company’s borrowings from unrelated parties, respectively.

 

During the six months ended June 30, 2021 and 2022, interest of $4,661 and $4,658 were incurred on the Company’s borrowings from unrelated parties, respectively.