China Intelligence Information Systems, Inc. was unable to repay loans from a single lender when due on August 31, 2012 in the aggregate amount of RMB 17,000,000 (approximately $2,615,300) plus accrued interest of approximately RMB 1,500,000 (approximately $230,769). The lender, Shandong Zhengjin Investment and Management Co.,Ltd an unaffiliated third party, notified the company of its default on September 19, 2012 and demanded payment within three days, and threatened legal action in the event the company did not repay the Loans.