UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
WASHINGTON,
D.C. 20549
SCHEDULE
13D/A
Under the
Securities Exchange Act of 1934
(Amendment
No. 1)
CHINA
BAK BATTERY, INC.
(Name of
Issuer)
COMMON
STOCK, PAR VALUE $0.001 PER SHARE
(Title of
Class of Securities)
16936Y100
(CUSIP
Number)
BAK
Industrial Park, No. 1 BAK Street
Kuichong
Town, Longgang District
People’s
Republic of China
(86-755)
8977-0093
Copies
to:
Louis A.
Bevilacqua
Pillsbury
Winthrop Shaw Pittman LLP
2300 N
Street, NW
Washington,
D.C. 20037-1122
(202)
663-8000
(Name,
Address and Telephone Number of Person
Authorized
to Receive Notices and Communications)
October
22, 2007
(Date of
Event which Requires Filing of this Statement)
If the filing person has previously
filed a statement on Schedule 13G to report the acquisition that is the subject
of this Schedule 13D, and is filing this schedule because of Rule 13d-1(e),
13d-1(f) or 13d-1(g), check the following box
¨
.
(Continued
on following pages)
(Page 1
of 8 Pages)
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CUSIP
No. 16936Y100
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13D
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Page
2 of 8 Pages
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NAMES
OF REPORTING PERSONS
IRS
IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
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CHECK
THE APPROPRIATE BOX IF A MEMBER OF A GROUP:
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(a)
o
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(b)
o
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SEC
USE ONLY
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CHECK
BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT
TO
ITEM 2(e) or 2(f)
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CITIZENSHIP
OR PLACE OF ORGANIZATION
PEOPLE’S
REPUBLIC OF CHINA
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NUMBER
OF
SHARES
BENEFICIALLY
OWNED
BY
EACH
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SOLE VOTING
POWER
19,413,887
SOLE
DISPOSITIVE
POWER
19,413,887
SHARED
DISPOSITIVE
POWER
0
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AGGREGATE
AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
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CHECK
BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN
SHARES
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¨
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PERCENT
OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
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CUSIP
No. 16936Y100
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13D
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Page
3 of 8 Pages
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Explanatory
Note
The
following constitutes Amendment No. 1 (“Amendment No. 1”) to the statement on
Schedule 13D filed by the undersigned (the “Schedule 13D
Statement”). This Amendment No. 1 amends and restates the Schedule
13D Statement in its entirety. This Amendment No. 1 shall cover
reportable events from the period January 20, 2005 to October 22,
2007.
Item
1. Security and Issuer.
This
Amendment No. 1 relates to shares of Common Stock, $0.001 par value per share
(the “Stock”), of China BAK Battery, Inc., a Nevada corporation (the
“Issuer”). The principal executive offices of the Issuer are located
at BAK Industrial Park, No. 1 BAK Street, Kuichong Town, Longgang District,
Shenzhen 518119, People’s Republic of China.
Item
2. Identity and Background.
(a) The
person filing this statement is Xiangqian Li (“Li” or the “Reporting
Person”).
(b)-(c)
The business address of Li, which also serves as his principal office, is at BAK
Industrial Park, No. 1 BAK Street, Kuichong Town, Longgang District, Shenzhen
518119, People’s Republic of China. Li’s principal occupation or
employment is serving as the President and Chief Executive Officer of the
Issuer.
(d)-(e)
During the five years preceding January 20, 2005 (the date that the Reporting
Person initially became subject to Schedule 13D reporting requirements as a
result of the Stock Exchange (as defined in Item 3 below)) and the five years
preceding the date of this Amendment No. 1, the Reporting Person has not been
(i) convicted in a criminal proceeding (excluding traffic violations or similar
misdemeanors) or (ii) a party to a civil proceeding of a judicial or
administrative body of competent jurisdiction and as a result of such proceeding
was or is subject to a judgment, decree or final order enjoining future
violations of, or prohibiting or mandating activities subject to, federal or
state securities laws or finding any violation with respect to such
laws.
(f) The
Reporting Person is a citizen of the People’s Republic of China.
Item
3. Source and Amount of Funds or Other Consideration.
The
Issuer completed a stock exchange transaction (the “Stock Exchange”) with the
stockholders of BAK International Limited, a Hong Kong company (“BAK
International”). The exchange was consummated under Nevada law pursuant to the
terms of a Securities Exchange Agreement (the “Exchange Agreement”)
dated effective as of January 20, 2005 by and among the Issuer, BAK
International and
the
stockholders of BAK International. Pursuant to the Exchange
Agreement, the Issuer issued 39,826,075 shares of its Stock to the stockholders
of BAK International, including Li, representing
approximately
97.2% of its post-exchange issued and outstanding common stock, in exchange for
100% of the outstanding capital stock of BAK International. After
giving effect to the Stock Exchange, the Issuer had 40,978,533 shares of its
Stock outstanding.
At the
closing of the Stock Exchange, BAK International became a wholly-owned
subsidiary of the Issuer, and the Issuer succeeded to the business of BAK
International. All of the Issuer’s business operations are
conducted through BAK International. Prior to the Stock Exchange, there were no
material relationships between the Issuer and BAK International, or any of the
parties’ respective affiliates, directors or officers, or any associates of
their respective officers or directors.
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CUSIP
No. 16936Y100
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13D
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Page
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The Stock
Exchange was approved in accordance with the laws of the State of Nevada.
Pursuant to the Exchange Agreement, at the closing of the Stock Exchange, the
membership of the board of directors of the Issuer was increased from one to two
directors, and Li was appointed to serve in the newly created
directorship. Also
under the terms of the Stock Exchange, all existing officers resigned as
officers of the Issuer effective immediately following the closing of the
transaction and Li was elected as President, Chairman of the Board
and Chief Executive Officer of the Issuer.
Item
4. Purpose of Transaction.
The
contents of Item 3 above are incorporated herein by reference.
Li
acquired the reported shares pursuant to the Exchange Agreement with the purpose
of obtaining control over the Issuer. BAK International and the
Issuer structured the Stock Exchange so that the former stockholders of BAK
International would own a majority of the outstanding Stock of the Issuer and
BAK International would become a wholly-owned subsidiary of the
Issuer.
On
December 21, 2006, in connection with a private placement of stock of BAK
International (the “Private Placement”) consummated immediately before the
completion of the Stock Exchange, 1,089,775 shares of Stock placed into escrow
by Li were released to the purchasers (the “Purchasers”) in the Private
Placement pursuant to an escrow agreement dated January 20, 2005 (the “Escrow
Agreement”). Under the Escrow Agreement, 1,089,775 shares placed into
escrow by Li were to be released pro rata to the Purchasers in the event that
the Issuer did not meet a certain performance threshold for its fiscal year
ended September 30, 2006, and the Issuer did not meet this performance
threshold. Pursuant to the Escrow Agreement, the escrow agent,
Securities Transfer Corporation, released the 1,089,775 escrowed shares to the
Purchasers, without payment, by cancelling the stock certificate representing
the escrowed 1,089,775 shares, and issuing new stock certificates representing a
total of 1,089,775 shares of Stock to the Purchasers pro rata, from its Frisco,
Texas offices.
On
October 22, 2007, Li entered into a settlement agreement (the “Settlement
Agreement”) with the Issuer and BAK International, under which Li agreed to
transfer 1,089,775 shares of Stock to the Issuer in return for releases of Li
and certain other persons from claims relating to the delivery of these
shares. Under the Escrow Agreement, 1,089,775 escrowed shares were to
be released to Li in the event that the Issuer met a certain performance
threshold for its fiscal year ended September 30, 2005. Based on Li’s
understanding that the Issuer met the relevant performance threshold and that he
was therefore entitled to these shares, Li instructed the escrow agent to
release 1,089,775 shares from escrow back to him, and the escrow agent complied
with these instructions. Subsequently, it was determined that the
recognition of a compensation charge in connection with the release of the
escrowed shares back to Li would cause the Issuer’s net income for its fiscal
year ended September 30, 2005 to fall below the relevant performance threshold.
Based on Li’s understanding that the Purchasers would therefore become entitled
to the 1,089,775 shares released to him, Li undertook to transfer those shares
to the Purchasers on a pro rata basis. Notwithstanding this undertaking,
however, the 1,089,775 shares were not delivered to the Purchasers. Li entered
into the Settlement Agreement to resolve any claims of the Purchasers relating
to the 1,089,775 shares of Stock that Li placed into escrow pursuant to the
Escrow Agreement and which were subsequently released back to him. Li
instructed the Issuer’s transfer agent, Securities Transfer Agent, to transfer
these shares to the Issuer on November 2, 2007. On November 7, 2007,
Securities Transfer Corporation cancelled Li’s outstanding stock certificate and
issued a stock certificate representing 1,089,775 shares to the Issuer and
reissued a stock certificate to Li representing the balance of Li’s shares of
Stock. The shares transferred to the Issuer did not have a price; the
consideration for such shares was the release of certain
claims.
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No. 16936Y100
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13D
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Page
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Except as
set forth in this Item 4, on the dates of the above transactions and on the date
of this amended filing, the Reporting Person had or has no plans or proposals
that relate to or that would result in any of the following
actions:
(a) The
acquisition by any person of additional securities of the Issuer, or the
disposition of securities of the Issuer;
(b) An
extraordinary corporate transaction, such as a merger, reorganization or
liquidation, involving the Issuer or any of its
subsidiaries;
(c) A
sale or transfer of a material amount of assets of the Issuer or any of its
subsidiaries;
(d) Any
change in the present board of directors or management of the Issuer, including
any plans or proposals to change the number or term of directors or to fill any
existing vacancies on the board;
(e) Any
material change in the present capitalization or dividend policy of the
Issuer;
(f) Any
other material change in the Issuer’s business or corporate
structure;
(g) Changes
in the Issuer’s charter, bylaws or instruments corresponding thereto or other
actions which may impede the acquisition of control of the Issuer by
any person;
(h) Causing
a class of securities of the Issuer to be delisted from a national securities
exchange or to cease to be authorized to be quoted in an inter-dealer
quotation system of a registered national securities association;
(i) A
class of equity securities of the Issuer becoming eligible for termination of
registration pursuant to Section 12(g)(4) of the Securities Exchange
Act of 1934, as amended (the “Exchange Act”); or
(j) Any
action similar to any of those enumerated above.
Item
5. Interest in Securities of the Issuer.
(a) For
purposes of Rule 13d-3 promulgated under the Exchange Act, the Reporting Person
beneficially owns 19,413,887 shares of the Issuer’s Stock, representing 33.7% of
the outstanding shares of the Issuer’s Stock (based on 57,680,231 shares of
Stock outstanding as of December 11, 2008, as reported in the Issuer’s Annual
Report on Form 10-K filed with the SEC on December 12, 2008). Of
these shares, the Reporting Person holds outright 19,233,887 and has the right
to acquire 180,000 within sixty days pursuant to a stock option.
(b) For
purposes of Rule 13d-3 promulgated under the Exchange Act, the Reporting Person
has sole voting and dispositive power over 19,413,887 shares of
Stock.
(c) The
contents of Items 3 and 4 above are incorporated herein by
reference.
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CUSIP
No. 16936Y100
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13D
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Page
6 of 8 Pages
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On May
16, 2005, the Issuer’s board of directors adopted the China BAK Battery, Inc.
Stock Option Plan (the “Stock Option Plan”), which was later approved by the
Issuer’s shareholders and became effective May 12, 2006. Under the Stock Option
Plan, the Issuer’s board of directors was authorized to grant to the Issuer’s
employees, non-employee directors, and advisors nonqualified stock options or
restricted stock. A maximum of 4,000,000 shares of Stock could be
issued and sold under the Stock Option Plan, as originally adopted. The exercise
price of options granted pursuant to the Stock Option Plan must be at least
equal to the fair market value of the Stock on the date of the grant. Fair
market value is determined at the discretion of the Issuer’s Compensation
Committee, as the committee appointed by the Issuer’s board of directors to
administer the Stock Option Plan, on the basis of reported sales prices for the
Stock over a ten business day period ending on the grant date.
On May
29, 2008, the Reporting Person was conditionally granted, without any
requirement of payment, an option to purchase 1,080,000 shares of Stock under
the Stock Option Plan. The issuance of the option was subject to
shareholder approval of the amendment of the Stock Option Plan to increase the
number of shares available for issuance thereunder from 4,000,000 shares to
8,000,000 shares. On July 28, 2008, at a meeting held at the Issuer’s
offices, the Issuer’s shareholders approved certain amendments to the Stock
Option Plan (“Amendment No. 1 to the Stock Option Plan”), including an amendment
increasing the total number of shares available for issuance under the Plan from
4,000,000 shares to 8,000,000 shares. As a result, the Reporting
Person became entitled to the option. Pursuant to the terms of the
option agreement between Li and the Issuer, dated May 29, 2008 (the “Option
Agreement”), the option is subject to a three-year vesting schedule, with
the first 1/12 vesting on the last day of the full fiscal quarter following the
date of grant (September 30, 2008), and the remaining 11/12 vesting in eleven
equal installments on the last day of each following fiscal
quarter. The exercise price, $4.18, is equal to the average closing
price of the five trading days preceding May 29, 2008, the date the grant was
conditionally approved. The option expires on May 28,
2013.
(d) Other
than the Reporting Person, no other person is known to have the right to receive
or the power to direct the receipt of dividends from, or the proceeds from the
sale of the Reporting Person’s securities.
(e) Not
applicable.
Item
6. Contracts, Arrangements, Understandings or Relationships With
Respect to Securities of the Issuer.
The
contents of Items 3 and 4 and section (c) of Item 5 above are incorporated
herein by reference.
The
description of the terms of the Exchange Agreement in Item 3 is qualified by
reference to the provisions of this agreement. The Exchange Agreement
is incorporated herein by reference to Exhibit 1 filed with this Amendment No.
1.
The
description of the terms of the Escrow Agreement in Item 4 is qualified by
reference to the provisions of this agreement. The Escrow Agreement
is incorporated herein by reference to Exhibit 2 filed with this Amendment No.
1.
On
January 20, 2005, Li and the Issuer entered into a lock-up agreement (the
“Lock-Up Agreement”), in which Li agreed to restrictions on transfer of the
shares of Stock held by him for a period of 12 months. This
description of the terms of the Lock-Up Agreement is qualified by reference to
the provisions of this agreement. The Lock-Up Agreement is
incorporated herein by reference to Exhibit 3 filed with this Amendment No.
1.
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CUSIP
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13D
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Page
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The
description of the terms of the Stock Option Plan and Amendment No. 1 to the
Stock Option Plan in section (c) of Item 5 is qualified by reference to the
provisions of the Stock Option Plan and Amendment No. 1 to the Stock Option
Plan. The Stock Option Plan is incorporated herein by reference to
Exhibit 4 filed with this Amendment No. 1. Amendment No. 1 to the
Stock Option Plan is incorporated herein by reference to Exhibit 5 filed with
this Amendment No. 1.
The
description of the terms of the Option Agreement in section (c) of Item 5 is
qualified by reference to the provisions of the Option Agreement. The
Option Agreement is incorporated herein by reference to Exhibit 6 filed with
this Amendment No. 1.
The
description of the terms of the Settlement Agreement in Item 4 is qualified by
reference to the provisions of this agreement. The Settlement
Agreement is incorporated herein by reference to Exhibit 7 filed with this
Amendment No. 1.
Except as
set forth in Items 3 and 4 and section (c) of Item 5 above and this Item 6,
there are no contracts, arrangements, understandings or relationships (legal or
otherwise) between the Reporting Person and any person with respect to any
securities of the issuer, including but not limited to transfer or voting of any
of the securities, finder's fees, joint ventures, loan or option arrangements,
puts or calls, guarantees of profits, division of profits or loss, or the giving
or withholding of proxies, except those that relate only to standard default and
similar provisions contained in loan agreements.
Item
7. Material to be Filed as Exhibits.
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Exhibit
1:
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Securities
Exchange Agreement, dated as of January 20, 2005, by and among Medina
Coffee, Inc., BAK International Limited, and the Shareholders of BAK
International Limited (incorporated by reference to Exhibit 10.1 to the
Issuer’s Current Report on Form 8-K filed on January 21, 2005 with the
Securities and Exchange Commission in File No.
000-49712).
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Exhibit
2:
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Escrow
Agreement by and among Medina Coffee, Inc., certain investors indicated
therein, Xiangqian Li, and Securities Transfer Corporation, dated as of
January 20, 2005 (incorporated by reference to Exhibit 10.2 to the
Issuer’s Current Report on Form 8-K filed on January 21, 2005 with the
Securities and Exchange Commission in File No.
000-49712).
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Exhibit
3:
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Lock-Up
Agreement by and between Medina Coffee, Inc. and Xiangqian Li dated as of
January 20, 2005 (incorporated by reference to Exhibit 10.3 to the
Issuer’s Current Report on Form 8-K filed on January 21, 2005 with the
Securities and Exchange Commission in File No.
000-49712).
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Exhibit
4:
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China
BAK Battery, Inc. Stock Option Plan (incorporated by reference to Exhibit
10. 1 to the Issuer’s Quarterly Report on Form 10-Q filed on August 22,
2006).
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Exhibit
5:
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Amendment
No. 1 to the China BAK Battery, Inc. Stock Option Plan (incorporated by
reference to Exhibit 4.1 to the Issuer’s Quarterly Report on Form 10-Q
filed on August 8, 2008).
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Exhibit
6:
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Option
Agreement by and between China BAK Battery, Inc. and Xiangqian Li, dated
May 29, 2008.
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CUSIP
No. 16936Y100
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13D
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Page
8 of 8 Pages
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Exhibit
7:
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Delivery
of Make-Good Shares, Settlement and Release Agreement, effective October
22, 2007, by and among Xiangqian Li, BAK International Limited, and China
BAK Battery, Inc. (incorporated by reference to Exhibit 10.2 to the
Issuer’s Current Report on Form 8-K filed on November 6,
2007).
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SIGNATURES
After
reasonable inquiry and to the best of my knowledge and belief, I certify that
the information set forth in this statement is true, complete and
correct.
Dated: January
15, 2009
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/s/ Xiangqian Li
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Xiangqian
Li
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