China Sunergy Co., Ltd.: Additional Details Regarding REC Wafer Injunction
China Sunergy Provides Additional Details Regarding REC Wafer Injunction Granted in Norway
NANJING, China, Sept. 29 / China Sunergy Co., Ltd., a specialized solar cell manufacturer based in Nanjing, China, has provided additional insight regarding the injunction granted by the Salten District Court in Norway related to the ongoing proceedings with REC Wafer.
On September 11, 2009 the Norwegian court granted a preliminary injunction, based on China Sunergy's petition, prohibiting REC Wafer Norway AS from drawing on the USD50 million in bank guarantees. One of the key reasons for this decision is the fact that the original party to the contract, REC SITECH AS, no longer exists given its merger with REC ScanWafer AS, which later changed its name to REC Wafer Norway AS after the merger. China Sunergy was never informed of this merger despite the contractual obligations of REC to do so prior to any such action.
The court refers in particular to the fact that it has been impossible for China Sunergy to extend the guarantees. The reason for this is that the original party to the contract and supplier has merged with another company, namely REC Wafer. The court has not found evidence that Nordea Bank has consented to the merger and thus has consented to the change to the parties on the rights side. Despite the fact that REC SiTech AS never informed China Sunergy of its dissolution after the merger, even though the merger plans had come far by the time the contract was entered into, the inability of China Sunergy to extend the guarantees in the name of REC SiTech AS has been stated as a basis for REC Wafer's current claims. The preliminary injunction inhibits REC Wafer's ability to draw on the bank guarantees before the legal situation is clarified.
Salten District Court has also noted that there must be a breach of contract on the part of China Sunergy in order for REC Wafer to be able to draw on the guarantees. There have been no wafer shipments from REC Wafer to China Sunergy, and the court has found that REC Wafer has not pleaded that any fundamental breach of the contract with China Sunergy exists. The court states that the conditions for drawing on the guarantee are therefore not present.
The preliminary injunction is in effect until October 15th, 2009. The court has stated that China Sunergy and REC Wafer should clarify the legal issues that the merger has created by that time.
About China Sunergy Co., Ltd.
China Sunergy Co., Ltd. (Nasdaq: CSUN) ("China Sunergy") is a specialized manufacturer of solar cell products in China. China Sunergy manufactures solar cells from silicon wafers utilizing crystalline silicon solar cell technology to convert sunlight directly into electricity through a process known as the photovoltaic effect. China Sunergy sells solar cell products to Chinese and overseas module manufacturers and system integrators, who assemble solar cells into solar modules and solar power systems for use in various markets. For more information please visit http://www.chinasunergy.com .
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SOURCE China Sunergy Co., Ltd.
Peter Schmidt of FD Asia, +86-10-8591-1953, or email@example.com