Robert Bradford
214 659.4697 Phone
214 659.4827 Fax
robinbradford@andrewskurth.com
February 3, 2006
VIA EDGAR CORRESPONDENCE
- ------------------------
AND U.S. MAIL
- -------------
Jennifer R. Hardy
Legal Branch Chief
Division of Corporation Finance
U.S. Securities and Exchange Commission
100 F Street, N.W.
Washington, D.C. 20549
Edward M. Kelly
Senior Counsel
Division of Corporation Finance
U.S. Securities and Exchange Commission
100 F Street, N.W.
Washington, D.C. 20549
Re: China BAK Battery, Inc.
Registration Statement on Form SB-2 Filed December 9, 2005
File No. 333-130247
Dear Ms. Hardy and Mr. Kelly:
This letter responds to the Staff's letter of comment, dated January 4,
2006, regarding Registration Statement on Form SB-2 filed by China BAK Battery,
Inc. on December 9, 2005. Responses to comments correspond to the numbering used
in the comment letter.
1. Comment:
If applicable, comments on this registration statement are comments on
the registration statement on Form SB-2 that was filed on January 21,
2005, the annual report on Form 10-KSB that was filed on March 31,
2005, and subsequent reports under the Exchange Act and vice versa.
Jennifer R. Hardy
Edward M. Kelly
February 3, 2006
Page 2
RESPONSE:
We make note of the Commission's comment.
2. Comment
Since the shares were issued in connection with an acquisition, give us
your analysis whether any of the selling stockholders are underwriters
under Rule 145(c) of the Securities Act and whether the resale
provisions of Rule 145(d) apply.
RESPONSE:
We refer you to the first paragraph of the "Selling Stockholders"
section of the registration statement, which states "Except as
otherwise indicated in the footnotes to the below table, each selling
stockholder acquired its securities in CBBI's private placement of
securities completed on September 16, 2005." Accordingly, we do not
believe that the shares were issued in connection with an acquisition
as described by Rule 145(a) and the provisions of Rule 145 (c) and (d)
do not apply.
3. Comment
Reconcile the disclosure on page 2 describing the transaction in which
the selling stockholders acquired their shares that implies the
stockholders acquired the share in January 2005 and the disclosure on
page 47 that states the stockholders acquired the shares in September
2005.
RESPONSE:
The description on page 2 relates to the issuer's corporate history and
describes the stock exchange transaction by which BAK International, a
Hong Kong company, became a wholly owned subsidiary of China BAK
Battery, Inc. This paragraph does not make reference to the shares
being offered pursuant to this registration statement, and uses the
pronoun `we' to describe the activities of the issuer, China BAK
Battery. The later disclosure in the "Selling Stockholders" section
refers to the shares acquired by private placement and offered pursuant
to this registration statement and specifies: "Except as otherwise
indicated in the footnotes to the below table, each selling stockholder
acquired its securities in CBBI's private placement of securities
completed on September 16, 2005."
Jennifer R. Hardy
Edward M. Kelly
February 3, 2006
Page 3
4. Comment
Disclose how China BAK Battery will use the proceeds that it will
receive upon the warrants' exercise.
RESPONSE:
We have modified the disclosure in accordance with your request.
Calculation of Registration Fee
- -------------------------------
5. Comment
For the shares that China BAK Battery may issue upon the warrants'
exercise, it appears that you should calculate the registration fee
under Rule 457(g). Please advice and revise to disclose the details
relating to the fee calculation, including references to the provisions
of Rule 457 as required by Form SB-2.
RESPONSE:
We have modified the disclosure in accordance with your request.
Prospectus' Outside Front Cover Page
- ------------------------------------
6. Comment
Clarify and quantify the number of shares being offered that are
outstanding and the number that China BAK Battery may issue upon
exercise of outstanding warrants.
RESPONSE:
We have modified the disclosure in accordance with your request.
Selling Stockholders, page 47
- -----------------------------
7. Comment
For a beneficial owner that is not a natural person, identify by
footnote or otherwise the natural person or persons having sole or
shared voting and investment control over the securities held by the
beneficial owner. Refer to telephone interpretation 4S. In the
Regulation S-K section of the March 1999 supplement to our "Manual of
Publicly Available Telephone Interpretations" that is available on the
Commission's website at http://www.sec.gov, and revise.
Jennifer R. Hardy
Edward M. Kelly
February 3, 2006
Page 4
RESPONSE:
We have modified the disclosure in accordance with your request.
8. Comment
Confirm that none of the selling stockholders is a broker-dealer or a
broker-dealer's affiliate. If a selling stockholder is a broker-dealer,
tell us whether the selling stockholder acquired its securities as
compensation for underwriting activities. Unless a broker-dealer
acquired the securities as compensation for underwriting activities,
China BAK Battery must identify the broker-dealer as an underwriter in
the prospectus. Language such as "may be deemed to be" an underwriter
is unacceptable if the selling stockholder is a broker-dealer.
RESPONSE:
The selling stockholders, other than Roth Capital Partners LLC and
Global Hunter Securities LLC, have represented to the Company that they
are not a broker dealer. Note 16 to the selling stockholders table
states that the securities held by Roth Capital Partners LLC
"[r]epresents 505,591 shares of common stock issuable upon exercise of
a warrant to purchase common stock held by Roth Capital Partners LLC
with an exercise price of $7.92 per share and exercisable during a
period beginning on September 16, 2005 and expiring September 16, 2008.
The warrant was issued to Roth Capital Partners LLC as part of the fee
we paid to Roth Capital Partners LLC for acting as placement agent in
our private placement of 7,899,863 shares of our common stock that are
covered by this prospectus." Note 9 to the selling stockholders table
states that the securities held by Global Hunter Securities LLC
"[r]epresents 126,398 shares of common stock issuable upon exercise of
a warrant to purchase common stock held by Global Hunter Securities,
LLC with an exercise price of $7.92 per share and exercisable during a
period beginning on September 16, 2005 and expiring September 16, 2008.
The warrant was issued to Global Hunter Securities, LLC as part of the
fee we paid to Global Hunter Securities LLC in connection with our
private placement of 7,899,863 shares of our common stock that are
covered by this prospectus."
9. Comment
If a selling stockholder is a broker-dealer's affiliate, include
disclosure in the "Selling Stockholders' section that this
broker-dealer's affiliate:
Jennifer R. Hardy
Edward M. Kelly
February 3, 2006
Page 5
o Purchased in the ordinary course of business the securities to
be resold.
o Had no agreements or understandings, directly or indirectly,
with any person to distribute the securities at the time of
their purchase.
If China BAK Battery is unable to make the representations noted above
in the prospectus, China BAK Battery must state in the prospectus that
the selling stockholder is an underwriter. Language such as "may be
deemed to be" an underwriter is unacceptable if the selling stockholder
is an affiliate of any underwriter that cannot make these
representations. We note the disclosure in the "Plan of Distribution"
section.
RESPONSE:
We have modified the disclosure in accordance with your request.
10. Comment
Expand the disclosure in footnotes (4) and (6) to specify the
expiration date of the warrants' exercise period.
RESPONSE:
We have modified the disclosure in accordance with your request.
Very truly yours,
/s/ Robert Bradford
Robert Bradford