HARBIN, China, Aug. 6 /PRNewswire-Asia-FirstCall/ -- Harbin Electric, Inc. ('Harbin Electric' or the 'Company', Nasdaq: HRBN), a leading developer and manufacturer of a wide array of electric motors in the People's Republic of China, today announced that it has completed the repurchase of $6 million aggregate principal amount of its outstanding Guaranteed Senior Secured Floating Rate Notes, due September 1, 2010 (the '2010 Notes').

The 2010 Notes, in an original aggregate principal amount of $12 million, were issued on August 29, 2006. The interest rate payable semi-annually on the 2010 Notes was a rate equal to LIBOR plus 4.75%. The six month LIBOR rate was 1.80375% as of March 2, 2009. The Company previously repaid $6 million aggregate principal amount of the 2010 Notes.

Pursuant to the Letter Agreement dated July 14, 2009 by and among Harbin Electric, Inc. and the current 2010 Notes holders (collectively 'the Holders'), the Company was granted the option to repurchase all (but not part) of the 2010 Notes held by the Holders at any time on or prior to July 31, 2009 for a repurchase price in cash equal to 97% of the aggregate principal amount of the 2010 Notes held by the Holders plus accrued and unpaid interest thereon to but excluding the repurchase date.

On July 31, 2009, the Company paid a total of $5,983,843.76 to repurchase the 2010 Notes, which amount was comprised of $5,820,000 representing 97% of the $6,000,000 aggregate principal amount of the 2010 Notes held by the Holders plus $163,843.76 representing accrued and unpaid interest on the 2010 Notes to but excluding the repurchase date of the 2010 Notes. Upon completion of the repurchase, the 2010 Notes were cancelled.

About Harbin Electric, Inc.

Harbin Electric, headquartered in Harbin, China, is a leading developer and manufacturer of a wide array of electric motors with a focus on innovative, customized and value-added products. Its major product lines include linear motors, automobile specialty micro-motors, and industrial rotary motors.