11. DEBT	3 Months Ended
Mar. 31, 2013
Debt Disclosure [Abstract]
11. DEBT	NOTE 11 – DEBT At March 31, 2013 and December 31, 2012, short-term notes payable due to various banks in the PRC were $6,066,997 and $11,054,449, respectively and due at various dates from April 2013 to September 2013. The short-term notes payable are lines of credit extended by the banks, which in turn issue the Company a bank acceptance note that can be endorsed and assigned to vendors as payments for purchases. The short-term notes payable are generally payable within three to six months, and guaranteed by the bank. The banks do not charge interest on these notes, but usually charge a transaction fee of 0.05% of the total note value. In addition, the banks usually require the Company to deposit a certain amount of cash at the bank as a guarantee deposit which is classified on the balance sheet as restricted cash. At March 31, 2013 and December 31, 2012, restricted cash as a guarantee for the notes payable amounted to $3,150,665 and 6,514,224, respectively. At March 31, 2013 and December 31, 2012, short-term loans obtained from local banks were $6,845,390 and $6,807,999, respectively. The short-term loans payable are due on various dates through November 15, 2013, with interest ranging from 6.00% to 6.56% per annum, and secured by property, plant and equipment and land use rights owned by the Company. At March 31, 2013 and December 31, 2012, the short-term loans are secured by property, plant and equipment owned by the Company of $6,124,558 and $6,099,734, respectively, and land use rights owned by the Company of $20,777,972 and $20,664,778, respectively. At March 31, 2013 and December 31, 2012, the Company has an outstanding long-term bank loan of $602,350 and $619,401, respectively. The long-term bank loan bears interest at 2.50% per annum, is due December 31, 2021, and is secured by property, plant, and equipment with a net book value of $1,226,600 at March 31, 2013.

11. DEBT

3 Months Ended

Mar. 31, 2013

NOTE 11 – DEBT

At March 31, 2013 and December 31, 2012, short-term notes payable due to various banks in the PRC were $6,066,997 and $11,054,449, respectively and due at various dates from April 2013 to September 2013. The short-term notes payable are lines of credit extended by the banks, which in turn issue the Company a bank acceptance note that can be endorsed and assigned to vendors as payments for purchases. The short-term notes payable are generally payable within three to six months, and guaranteed by the bank. The banks do not charge interest on these notes, but usually charge a transaction fee of 0.05% of the total note value. In addition, the banks usually require the Company to deposit a certain amount of cash at the bank as a guarantee deposit which is classified on the balance sheet as restricted cash. At March 31, 2013 and December 31, 2012, restricted cash as a guarantee for the notes payable amounted to $3,150,665 and 6,514,224, respectively.

At March 31, 2013 and December 31, 2012, short-term loans obtained from local banks were $6,845,390 and $6,807,999, respectively. The short-term loans payable are due on various dates through November 15, 2013, with interest ranging from 6.00% to 6.56% per annum, and secured by property, plant and equipment and land use rights owned by the Company. At March 31, 2013 and December 31, 2012, the short-term loans are secured by property, plant and equipment owned by the Company of $6,124,558 and $6,099,734, respectively, and land use rights owned by the Company of $20,777,972 and $20,664,778, respectively.

At March 31, 2013 and December 31, 2012, the Company has an outstanding long-term bank loan of $602,350 and $619,401, respectively. The long-term bank loan bears interest at 2.50% per annum, is due December 31, 2021, and is secured by property, plant, and equipment with a net book value of $1,226,600 at March 31, 2013.

- Definition

The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants.

+ References+ Details

AMERICAN ORIENTAL BIOENGINEERING INC 10-Q