Sunways, Deutsche Solar Enter an Agreement Regarding Earlier Two Contracts

Published on 19 Jul 2012
Sunways  Deutsche Solar AG 

Today, the management board of Sunways AG, Konstanz, on the basis of a resolution passed on the same day, entered into an agreement with Deutsche Solar GmbH regarding the amendment and early termination of two long-term contracts originally concluded in 2006 and 2007 that provide for the supply of photovoltaic wafers by Deutsche Solar GmbH (at the time the contracts were concluded still under the firm Deutsche Solar AG). The supervisory board of Sunways AG approved the conclusion of this agreement.

In today's agreement, Sunways AG waived its claim for repayment of down-payments in the remaining amount of still approx. EUR 7.5 million already made by Sunways AG. In addition, the parties agreed upon an amendment of the previous terms of delivery, that provided for wafer deliveries until the end of the year 2018 and 2017, respectively, to the effect that Sunways AG will now conclusively accept the delivery of wafers in a total volume of approx. 60MW in the years 2012 and 2013. The agreement entered into today has a term until 31 December 2013 the latest. Upon fulfillment of Sunways AG's newly agreed purchase obligations until then, the two long-term supply contracts will be deemed amicably terminated as of that time.

Due to the entering into the agreement and also due to the negative market price development since the beginning of the year 2012, provisions for anticipated losses for this contractual amendment in the total amount of approx. EUR 4.6 Mio. are booked and recognised in profit or loss in the 2011 annual financial statements. However, compared to the continuation of the long-term contracts on their original terms and conditions, the agreement is economically more advantageous.

The amendment agreement to both long-term contracts is made against the background of current market developments and constitutes an advantage for Sunways AG compared to an unaltered continuity of these contracts.

In addition, the management board notifies, that a loss in the amount of half the share capital in Sunways AG has occurred (Section 92 Para. 1 AktG). The identified loss has occurred as a consequence of financial effects arising from the amendment agreement with Deutsche Solar GmbH as well as losses of Sunways AG accrued in the course of the last months. Notwithstanding, the management board of the company is still convinced that in particular the conclusion of the amendment agreement is in the best interest of the company, because the positive mid- and long-term effects of the amendment agreement outweigh its negative short-term effects. The management board will notify the shareholders` meeting taking place on 30 August 2012 of the loss of half the share capital in Sunways AG pursuant to Section 92 Para. 1 AktG.

 

Source: Sunways
ENF Profiles For Companies Mentioned in This Article

Sunways (Solar Components): http://www.enfsolar.com/directory/component/774
Sunways (Software): http://www.enfsolar.com/service/774
Deutsche Solar AG (Solar Materials): http://www.enfsolar.com/directory/material/2143
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