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CAPITAL COMMITMENT AND OPERATING LEASE COMMITMENTS
 12 Months Ended
Dec. 31, 2011
CAPITAL COMMITMENT AND OPERATING LEASE COMMITMENTS

NOTE 22 – CAPITAL COMMITMENT AND OPERATING LEASE COMMITMENTS

 

As of December 31, 2011, the Company has leased a real property adjacent to Factory No. 1, with the related production facility, channels and ducts, other production equipment and the buildings located on the property, under capital lease. The future minimum lease payments required under capital lease, together with the present value of such payments, are included in the table show below.

 

The Company has leased five pieces of land under non-cancelable operating leases, which are fixed in rentals and expired through December 2030, December 2040, February 2059, August 2059 and June 2060, respectively. The Company accounts for the leases as operating leases.

 

The Company has no purchase commitment as of December 31, 2011.

 

 

The following table sets forth the Company’s contractual obligations as of December 31, 2011:

 

    Capital Lease     Operating Lease     Purchase  
    Obligations     Obligations     Obligations  
Payable within:                        
the next 12 months   $ 297,899     $ 590,037     $ -  
the next 13 to 24 months     297,898       640,837       -  
the next 25 to 36 months     297,899       645,177       -  
the next 37 to 48 months     297,898       649,681       -  
the next 49 to 60 months     297,899       654,316       -  
thereafter     4,170,582       18,009,119       -  
Total   $ 5,660,075     $ 21,189,167     $ -  
Less: Amount representing interest     (2,433,775 )                
Present value of net minimum lease payments   $ 3,226,300                  

 

Rental expenses related to operating leases of the Company amounted to $583,123, $104,940 and $42,102 were charged to the income statements for the years ended December 31, 2011, 2010 and 2009, respectively.