What changed in this filing

/stocks — the workspaceLOADING

Item 5. Other Information

2011-11-10 compared with 2011-08-11 · 88 added, 90 removed, 410 unchanged (30% of the section changed)

5 unchanged sentences

Form of Share Option Plan (1)

Make Good Escrow Agreement (1)

Translation of lease agreement for Product Center dated September 23, 2008 (1)

Summary translation of lease agreement for product center (2)

Translation of lease agreement for principal executive office dated December 21, 2009, effective January 1, 2010 (1)

2 unchanged sentences

Translation of distribution agreement with JMS (2)

Distribution agreement with ResMed (1)

Translation of form of independent distributor agreement (1)

2 unchanged sentences

Translation of Executive Officer Employment Agreement for Weibing Yang (1)

Translation of Executive Officer Employment Agreement for Zheng Liu (1)

Translation of Executive Officer Employment Agreement for Yong Wang (1)

Translation of Executive Officer Employment Agreement for Yanying Qi (2)

Translation of Executive Officer Employment Agreement for Xiaoqing Wang (2)

Translation of form of Purchase Agreement with Poverty Aid Office (1)

Translation of Production Agreement with Friend of Health (Chuzhou) Medical Technology Co., Ltd.

Translation of Guarantee Contract between Ping Chen and ICBC (1)

Mortgage Contract between ICBC and BTL (1)

Indemnification and Guarantee Contract between Ping Chen and BTL (1)

Description of oral loan contract between BTL and BDL (1)

Translation of approval dated November 17, 2009 to change ICBC loan repayment schedule (1)

Loss Absorption Agreement between BDL, BTL and shareholders of BTL (1)

Translation of approval dated March 18, 2010 to change ICBC loan repayment schedule (1)

Subsidiaries of the Registrant (1)

11 unchanged sentences

Incorporated by reference to the registrant’s annual report on Form 10-K, File no.

001-34661, filed on June 30, 2010.

001-34661, filed on September 30, 2010.

In accordance with the requirements of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

DEHAIER MEDICAL SYSTEMS LIMITED

August 11, 2011

November 10, 2011

/s/ Ping Chen

Chief Executive Officer

(Principal Executive Officer)

(Principal Executive Officer) and

Duly Authorized Officer

DEHAIER MEDICAL SYSTEMS LIMITED AND AFFILIATE

1 unchanged sentence

UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Condensed Consolidated Balance Sheets as of June 30, 2011 and December 31, 2010

Condensed Consolidated Statements of Income and Comprehensive Income for the six and three months ended June 30, 2011 and 2010

Condensed Consolidated Statements of Cash Flows for the six months ended June 30, 2011 and 2010

Condensed Consolidated Balance Sheets as of September 30, 2011 and December 31, 2010

Condensed Consolidated Statements of Income and Comprehensive Income for the nine and three months ended September 30, 2011 and 2010

Condensed Consolidated Statements of Cash Flows for the nine months ended September 30, 2011 and 2010

Notes to the Unaudited Condensed Consolidated Financial Statements

2 unchanged sentences

（ UNAUDITED ）

September 30,

CURRENT ASSETS:

Cash and cash equivalents

Accounts receivable-less allowance for doubtful accounts of $89,437 and $87,555 at June 30, 2011 and December 31, 2010, respectively

Accounts receivable-less allowance for doubtful accounts of $90,546 and $87,555 at September 30, 2011 and December 31, 2010, respectively

Other receivables

17 unchanged sentences

Commitments and Contingency

Common shares, $0.002731 par value, 18,307,038 shares authorized, 4,510,000 and 4,500,000 shares issued and outstanding at June 30, 2011 and December 31, 2010, respectively

Common shares, $0.002731 par value, 18,307,038 shares authorized, 4,510,000 and 4,500,000 shares issued and outstanding at September 30, 2011 and December 31, 2010, respectively

Additional paid in capital

7 unchanged sentences

CONDENSED CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME

For the six months ended

For the nine months ended

September 30,

For the three months ended

September 30,

Costs of revenue

4 unchanged sentences

Operating Income

Financial expenses (including interest expense of $26,993, $26,728, $10,816 and $7,900 for the six and three months ended June 30, 2011 and 2010, respectively)

Financial expenses (including interest expense of $53,915, $48,255, $26,922 and $21,452 for the nine and three months ended September 30, 2011 and 2010, respectively)

Change in fair value of warrants liability

1 unchanged sentence

Provision for income tax

Non-controlling interest in (income) loss

Non-Controlling interest in income

Net income attributable to Dehaier Medical Systems Limited

9 unchanged sentences

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

For the six months ended

For the nine months ended

September 30,

Cash flows from operating activities

5 unchanged sentences

Recovery of inventory obsolescence

Provision for warranty reserve

Changes in assets and liabilities:

1 unchanged sentence

Increase in prepayments and other current assets

Decrease (Increase) in other receivables

Decrease (Increase) in inventories

Increase in other receivables

Increase in inventories

Increase in tax receivable

Increase (Decrease) in accounts payable

Decrease in advances from customers

Increase in accrued expenses and other current liabilities

Increase in advances from customers

Increase (Decrease) in accrued expenses and other current liabilities

Increase in tax payable

16 unchanged sentences

Interest paid

Non-Cash transaction of investing and financing activities

Issuance of common shares for investment relations activities

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

15 unchanged sentences

In the opinion of the Company’s management, the unaudited condensed consolidated financial statements include all adjustments necessary to present fairly the condensed consolidated financial position, results of operations and cash flows of the Company for the periods presented.

The results of operations for the six and three months ended June 30, 2011 are not necessarily indicative of operating results expected for the full year or future interim periods.

The results of operations for the nine and three months ended September 30, 2011 are not necessarily indicative of operating results expected for the full year or future interim periods.

These unaudited condensed consolidated financial statements should be read in conjunction with the audited financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2010, filed on March 7, 2011.

22 unchanged sentences

The carrying amount and classification of BTL’s assets and liabilities included in the Condensed Consolidated Balance Sheets are as follows:

September 30,

Total current assets

1 unchanged sentence

Total liabilities

The accounts of BTL are consolidated in the accompanying financial statements pursuant to Accounting Standards Codification (“ASC”) 810-10, “Consolidation.” As a VIE, BTL’s revenues are included in the Company’s service income, and its income from operations is consolidated with the Company’s.

The accounts of BTL are consolidated in the accompanying financial statements pursuant to Accounting Standards Codification (“ASC”) 810-10, “Consolidation”.

As a VIE, BTL’s revenues are included in the Company’s service income, and its income from operations is consolidated with the Company’s.

Because of the arrangements, the Company had a pecuniary interest in BTL that requires consolidation of the Company’s and BTL’s financial statements.

10 unchanged sentences

Receivables are considered past due after 3 years and written off.

In accordance with the accounting policies, management has determined that allowances of $89,437 (RMB 578,068) and $87,555 (RMB 578,068) were required at June 30, 2011 and December 31, 2010, respectively.

In accordance with the accounting policies, management has determined that allowances of $90,546 (RMB 578,068) and $87,555 (RMB 578,068) were required at September 30, 2011 and December 31, 2010, respectively.

DEHAIER MEDICAL SYSTEMS LIMITED AND AFFILIATE

3 unchanged sentences

The Company, as is the common practice in the PRC, often makes advance payments to suppliers for unassembled parts or receives advance payments from customers.

Advances to suppliers were $8,731,847 and $4,515,737 at June 30, 2011 and December 31, 2010, respectively, which were included in prepayment and other current assets.

Advances from customers were $152,969 and $269,189 as of June 30, 2011 and December 31, 2010, respectively.

Advances to suppliers were $7,522,544 and $4,515,737 at September 30, 2011 and December 31, 2010, respectively, which were included in prepayment and other current assets.

Advances from customers were $465,848 and $269,189 as of September 30, 2011 and December 31, 2010, respectively.

None of these advances was from or to any related party.

1 unchanged sentence

The carrying amounts reported in the condensed consolidated financial statements for current assets and current liabilities approximate fair value due to the short-term nature of these financial instruments.

The Company adopted the provisions of ASC topic 815, “Derivatives and Hedging.” ASC topic 815 provides a framework for determining whether an instrument is indexed to an entity’s own stock.

The Company adopted the provisions of ASC topic 815, ”Derivatives and Hedging”.

ASC topic 815 provides a framework for determining whether an instrument is indexed to an entity’s own stock.

ASC topic 815 became effective for the Company when warrants were issued in connection with the Company’s initial public offering.

16 unchanged sentences

The Company reviews its inventory annually for possible obsolete goods and to determine if any reserves are necessary.

The reserves for obsolescence were $49,905 (RMB 322,556) and $48,855 (RMB 322,556) for June 30, 2011 and December 31, 2010, respectively, and these provisions are included in the operating expenses in the condensed consolidated statements of operations.

The reserves for obsolescence were $50,524 (RMB 322,559) and $48,855 (RMB 322,556) for September 30, 2011 and December 31, 2010, respectively.

Property and Equipment

39 unchanged sentences

Generally, foreign exchange gains and losses resulting from the settlement of such transactions are recognized in the condensed consolidated statements of income and comprehensive income.

The foreign currency accounts of DHK, BDL and BTL are translated in accordance with ASC 830-10, “Foreign Currency Matters.” Assets and liabilities are translated at current exchange rates quoted by the People’s Bank of China at the balance sheet dates and revenues and expenses are translated at average exchange rates in effect during the periods.

The foreign currency accounts of DHK, BDL and BTL are translated in accordance with ASC 830-10, “Foreign Currency Matters”.

Assets and liabilities are translated at current exchange rates quoted by the People’s Bank of China at the balance sheet dates and revenues and expenses are translated at average exchange rates in effect during the periods.

Resulting translation adjustments are recorded as other comprehensive income (loss) and accumulated as a separate component of equity.

1 unchanged sentence

The Company provides for the estimated cost of product warranties at the time revenue is recognized.

Warranty costs are included in general and administrative expenses.

The Company’s warranty obligation is affected by product failure rates and material usage and service delivery costs incurred in correcting product failure.

1 unchanged sentence

The term of the product warranty is generally twelve months.

The reserves for warranty costs were $307,943 (RMB 1,990,363) and $301,464 (RMB 1,990,363) at June 30, 2011 and December 31, 2010, respectively.

Warranty expenses for the six months ended June 30, 2011 and 2010, and for the three months ended June 30, 2011 and 2010 were $106,648, $65,422, $77,121 and $40,402, respectively.

Warranty expenses for the nine months ended September 30, 2011 and 2010, and for the three months ended September 30, 2011 and 2010 were $163,538 $111,076, $56,890 and $45,654, respectively.

Earnings per Share

The Company follows the provisions of ASC 260-10, “Earnings per Share.” Basic earnings per share is computed by dividing net income attributable to holders of common shares by the weighted average number of common shares outstanding during the years.

The Company follows the provisions of ASC 260-10, “Earnings per Share”.

Basic earnings per share is computed by dividing net income attributable to holders of common shares by the weighted average number of common shares outstanding during the years.

Diluted earnings per share reflect the potential dilution that could occur if securities or other contracts to issue common shares were exercised or converted into common shares.

The average stock price for the first and second quarters of 2011 did not exceed the exercise price of the outstanding warrants, therefore none of the outstanding warrants were included in the diluted earnings per share.

The average stock price for the previous three quarters of 2011 did not exceed the exercise price of the outstanding warrants, therefore none of the outstanding warrants were included in the diluted earnings per share.

DEHAIER MEDICAL SYSTEMS LIMITED AND AFFILIATE

9 unchanged sentences

A valuation allowance is provided to reduce the deferred tax assets reported if, based on the weight of available positive and negative evidence, it is more likely than not that some portion or all of the deferred tax assets will not be realized.

As of each of June 30, 2011 and December 31, 2010, the Company was not required to record any deferred tax assets or liabilities.

As of each of September 30, 2011 and December 31, 2010, the Company was not required to record any deferred tax assets or liabilities.

ASC 740-10 prescribes a recognition threshold and measurement attribute for the financial statement recognition of a tax position taken or expected to be taken on a tax return.

6 unchanged sentences

The implementation of ASC 740-10 resulted in no material liability for unrecognized tax benefits and no material change to the beginning retained earnings of the Company.

As of each of June 30, 2011 and December 31, 2010, the Company did not have a liability for any unrecognized tax benefits.

As of each of September 30, 2011 and December 31, 2010, the Company did not have a liability for any unrecognized tax benefits.

The Company recognizes interest and penalties, if any, related to unrecognized tax benefits as income tax expense in the statement of operations.

During each of the six months ended June 30, 2011 and 2010, the Company did not incur any interest or penalties.

During each of the nine months ended September 30, 2011 and 2010, the Company did not incur any interest or penalties.

Income tax returns for years prior to 2008 are no longer subject to examination by tax authorities.

5 unchanged sentences

These modifications did not have any impact to the Company’s Condensed Consolidated statement of income and Comprehensive income.

Recently Issued Accounting Standard

On May 12, 2011, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update 2011-04 (“ ASU 2011-04 ”), Fair Value Measurement (Topic 820) Amendments to Achieve Common Fair Value Measurement and Disclosure Requirements in U.S.

GAAP and IFRS .

ASU 2011-04 completes a major project of the boards’ joint work to improve IFRS and US GAAP and to bring about their convergence.

For US GAAP, ASU 2011-04 will supersede most of the guidance in Topic 820, although many of the changes are clarifications of existing guidance or wording changes to align with IFRS 13.

It also reflects the FASB’s consideration of the different characteristics of public and non-public entities and the needs of users of their financial statements.

ASU 2011-04 will be effective for public entities for interim and annual periods beginning after December 15, 2011, and should be applied prospectively.

The adoption of this accounting standard is not expected to have a material effect on the Company’s condensed consolidated financial statements.

On June 16, 2011, FASB issued Accounting Standards Update 2011-05 (“ ASU 2011-05 ”), Comprehensive Income (Topic 220)-Presentation of Comprehensive Income.

ASU 2011-05 eliminates the current option to report other comprehensive income and its components in the statement of changes in equity, and requires that all nonowner changes in stockholders’ equity be presented either in a single continuous statement of comprehensive income or in two separate but consecutive statements.

The amendments in ASU 2011-05 should be applied retrospectively.

For public entities, the amendments are effective for fiscal years, and interim periods within those years, beginning after December 15, 2011.

The adoption of this accounting standard is not expected to have a material effect on the Company’s condensed consolidated financial statements.

DEHAIER MEDICAL SYSTEMS LIMITED AND AFFILIATE

2 unchanged sentences

Prepayment and other current assets consist of the following:

September 30,

Advances to suppliers

Prepayment for equipment purchase

Prepayment for equipment purchases

Other prepaid expenses

1 unchanged sentence

Property and equipment consist of the following:

September 30,

Land use rights

3 unchanged sentences

Property and equipment, net

At June 30, 2011 and December 31, 2010, BTL’s building was pledged to a bank as collateral for short-term borrowings of RMB 10,000,000 (US$1,547,170) and RMB 10,000,000 (US$1,514,620), respectively (see Note 6).

Depreciation and amortization expenses were $219,976, $172,314, $110,603 and $86,564, for the six and three months ended June 30, 2011 and 2010, respectively.

At September 30, 2011 and December 31, 2010, BTL’s building was pledged to a bank as collateral for short-term borrowings of RMB10,000,000 (US$1,547,170) and RMB10,000,000 (US$1,514,620), respectively (see Note 6).

Depreciation and amortization expenses were $333,580, $261,438, $113,604 and $89,124, for the nine and three months ended September 30, 2011 and 2010, respectively.

Land Use Rights

6 unchanged sentences

Tax receivable consists of the following:

September 30,

Value added tax receivable

2 unchanged sentences

A credit is available whereby VAT paid on the purchases of unassembled medical components of the Company’s product used in contract and production can be used to offset the VAT due on sales of the product.

The tax receivable as of June 30, 2011 and December 31, 2010 represents VAT credit on the purchased products.

The tax receivable as of September 30, 2011 and December 31, 2010 represents VAT credit on the purchased products.

These amounts can be used to offset the VAT due on sales of the finished product.

SHORT-TERM BORROWINGS

The Company has a line of credit for RMB 10,000,000 (US$1,574,620 at December 31, 2010 and US$1,547,170 at June 30, 2011) with a commercial bank in the PRC to finance its working capital.

The credit line bears interest at a variable rate and is renewed annually on June 15th.

The Company has a line of credit for RMB10,000,000 (USD1,574,620 at December 31, 2010 and USD1,566,350 at September 30, 2011) with a commercial bank in the PRC to finance its working capital.

The credit line bears interest at a variable rate and is due on June 15, 2012.

Any outstanding loan balance must be repaid before annual renewal.

Average interest rates for the six months ended June 30, 2011 and 2010 were 6.94% and 5.84%, respectively.

Average interest rates for the nine months ended September 30, 2011 and 2010 were 6.94% and 5.84%, respectively.

Pursuant to the terms of the agreement, the line of credit is secured by BTL’s building (see Note 4) and guaranteed by BDL and an officer of the Company.

1 unchanged sentence

Non-controlling interest consists of the following:

September 30,

Original paid-in capital

8 unchanged sentences

The shares were required to remain in escrow until the Company filed its Form 10-K with the Securities and Exchange Commission for the year ended December 31, 2010.

The shares in escrow (the “Make-Good Shares”) are accounted for as an element of the IPO, and the Company would not recognize any compensation expense upon the return of such Make-Good Shares to the holders.

The shares in escrow (the “Make-Good Shares”) were accounted for as an element of the IPO, and the Company would not recognize any compensation expense upon the return of such Make-Good Shares to the holders.

To the extent the Company’s earnings per share for the year ended December 31, 2010 were less than $0.80, the Company would redeem, pro rata, such shares to the extent needed to raise earnings per share to $0.80.

6 unchanged sentences

These non-cancelable leases have lease terms expiring through December 2012.

Approximate future minimum lease payments under these leases at June 30, 2011, are as follows:

Future payment for the twelve months ending June 30,

Approximate future minimum lease payments under these leases at September 30, 2011, are as follows:

Future payment for the twelve months ending September 30,

Total minimum lease payments

Rent expenses for the six and three months ended June 30, 2011 and 2010, were $72,155, $56,605, $54,876 and $43,315, respectively.

Rent expenses paid to the spouse of the Chief Executive Officer for the six and the three months ended June 30, 2011 and 2010 were $0, $11,638, $0 and $7,472, respectively.

Rent expenses for the nine and three months ended September 30, 2011 and 2010, were $131,229, $77,702, $59,074 and $21,097, respectively.

Rent expenses paid to the spouse of the Chief Executive Officer for the nine and the three months ended September 30, 2011 and 2010 were $0, $11,638, $0 and $7,472, respectively.

The Labor Contract Law of the People’s Republic of China, requires employers to assure the liability of the severance payments if employees are terminated and have been working for the employers for at least two years.

The Company has estimated its possible severance payments of approximately $217,000 and $188,000 as of September 30, 2011 and December 31, 2010, respectively, which have not been reflected in its condensed consolidated financial statements, because it is more likely than not that this will not be paid or incurred.

DEHAIER MEDICAL SYSTEMS LIMITED AND AFFILIATE

NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

COMMITMENTS AND CONTINGENCY (CONTINUED)

The Company has estimated its possible severance payments of approximately $229,000 and $188,000 as of June 30, 2011 and December 31, 2010, respectively, which have not been reflected in its condensed consolidated financial statements, because it is more likely than not that this will not be paid or incurred.

On March 8, 2011, Dehaier issued 10,000 unregistered common shares for investment relationship activities provided.

The fair value of the shares on the issuance date based on the closing price was $59,300.

WARRANTS LIABILITY

2 unchanged sentences

(“Hawk”), the Company’s investor relations consultancy.

The Company had 157,500 warrants outstanding as of June 30, 2011.

The Company had 157,500 warrants outstanding as of September 30, 2011.

All the warrants issued to A&S have the right to purchase one common share for an exercise price of $10.00 per share with a term of 5 years.

All the warrants granted to Hawk have the right to purchase one common share for an exercise price of $9.60 per share with a term of 5 years.

The fair value of the outstanding warrants at June 30, 2011 for A&S was calculated using the Black Scholes Model with the following assumptions:

The fair value of the outstanding warrants at September 30, 2011 for A&S was calculated using the Black Scholes Model with the following assumptions:

Fair value per share

4 unchanged sentences

Expected volatility

The fair value of the outstanding warrants at June 30, 2011 for Hawk was calculated using the Black Scholes Model with the following assumptions:

The fair value of the outstanding warrants at September 30, 2011 for Hawk was calculated using the Black Scholes Model with the following assumptions:

Fair value per share

4 unchanged sentences

Expected volatility

The following table sets forth by level within the fair value hierarchy our financial assets and liabilities that were accounted for at fair value on a recurring basis as of June 30, 2011.

The following table sets forth by level within the fair value hierarchy our financial assets and liabilities that were accounted for at fair value on a recurring basis as of September 30, 2011.

Carrying Value at

June 30, 2011

September 30, 2011

Fair Value Measurement at

June 30, 2011

September 30, 2011

Warrants liability

6 unchanged sentences

Fair value change of the issued warrants included in earnings

Ending balance, June 30, 2011

Ending balance, September 30, 2011

(1) Fair Value of Underlying Common Shares

The $2.67 is the closing price of the Company’s common shares on June 30, 2011.

The $2.03 is the closing price of the Company’s common shares on September 30, 2011.

(2) Exercise price

9 unchanged sentences

The volatility of the underlying common shares during the life of the warrants was estimated based on the historical stock price volatility of listed comparable companies over a period comparable to the expected term of the warrants.

The fair value of each A&S warrant at June 30, 2011 was $1.12.

The total fair value of such warrants was $168,242 at June 30, 2011.

The fair value of the each A&S warrant at September 30, 2011 was $0.94.

The total fair value of such warrants was $140,751 at September 30, 2011.

The fair value of the warrants for A&S was $270,000 on the date of grant which was recognized as IPO expense.

The decrease in the fair value of the warrants during the period was recognized as a change in fair value of warrants liability which was included in condensed consolidated statements of income and comprehensive income.

The fair value of each Hawk warrant at June 30, 2011 was $1.14.

The fair value of each Hawk warrant at September 30, 2011 was $0.95.

The total fair value of such warrants was $7,146, which has not been reflected in the Company’s condensed consolidated financial statements due to immateriality.

9 unchanged sentences

BDL is a joint-venture company and the statutory surplus reserve provisions will be determined by its board of directors.

As of June 30, 2011, BDL’s board of directors has not yet made such determination.

As of September 30, 2011, BDL’s board of directors has not yet made such determination.

Therefore, no amount was allocated to the statutory surplus reserve account.

BTL appropriated 10% of its net profits as statutory surplus reserve, which is included as part of the non-controlling interest in the equity section.

For the six months ended June 30, 2011 statutory surplus reserve activity was as follows:

For the six months ended September 30, 2011 statutory surplus reserve activity was as follows:

Balance at December 31, 2010

Addition to statutory reserves

Balance at June 30, 2011

Balance at September 30, 2011

British Virgin Islands

10 unchanged sentences

In 2009, BDL updated its certification for “high technology” company.

Therefore, BDL used a 15% income tax rate to calculate the income tax expense for the six months ended June 30, 2011 and 2010.

The high technology certification will expire in 2012.

Therefore, BDL used a 15% income tax rate to calculate the income tax expense for the nine months ended September 30, 2011 and 2010.

The high technology certification will expire and be renewed by 2012.

The tax rate for BTL is 25% in 2011 and 2010.

1 unchanged sentence

Major Customers

For the six months ended June 30, 2011 and 2010, and for the three months ended June 30, 2011 and 2010, approximately 13%, 10%, 15% and 16% of the Company’s revenues were received from one customer.

At June 30, 2011 and 2010, receivables from four customers were approximately 12%, 10%, 10%, 9% and 11%, 11%, 10%, 8%, respectively.

For the six months ended June 30, 2011 and 2010, and for the three months ended June 30, 2010 and 2011, the Company’s three top selling products accounted, in the aggregate, for approximately 80%, 56%, 82% and 53%, respectively, of its total net revenues.

For the nine months ended September 30, 2011 and 2010, and for the three months ended September 30, 2011 and 2010, approximately 10%, 11%, 22% and 19% of the Company’s revenues were received from one customer.

At September 30, 2011 and 2010, receivables from four customers were approximately 10%, 9%, 8%, 8% and 11%, 11%, 8%, 8%, respectively.

For the nine months ended September 30, 2011 and 2010, and for the three months ended September 30, 2010 and 2011, the Company’s three top selling products accounted, in the aggregate, for approximately 75%, 51%, 87% and 53%, respectively, of its total net revenues.

The following represents the revenues by products, all derived from operations in the PRC:

For the six months ended

For the nine months ended

September 30,

For the three months ended

September 30,

Medical Devices

2 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 5. Other Information