XI'AN, China, Dec. 15, 2011 /PRNewswire-Asia/ -- China Recycling Energy Corp. (NASDAQ: CREG or "the Company"), a leading industrial waste-to-energy solution provider in China, today announced that its wholly-owned subsidiary, Xi'an TCH Energy Technology Co., Ltd. ("Xi'an TCH"), has obtained an energy saving and emission reduction loan with Industrial Bank Co., Ltd., Xi'an Branch (the "Lender"), whereby the Lender agrees to loan RMB 130,000,000 (approximately USD $20,312,500) to Xi'an TCH for a term of 48 months (16 quarters) from the first take-down of the loan. The first 9 months (3 quarters) of the loan will be a grace period where repayment is not requirement. Xi'an TCH will start to make repayment on the 28th day of the last month of each quarter after the grace period and each payment will include principal in no less than RMB 10,000,000 (approximately USD $1,562,500). The loan agreement has a floating interest rate that resets each quarter at 115% of the national base interest rate for the same term and same level loan per annum. The present national base interest rate -- People's Bank of China (PBOC) rate is 7.05% and 115% of that rate will be 8.1075% per annum. These funds will be deployed by CREG to further the construction of a 23 MW waste-to-energy system for its customer Shanxi Datong Coal Group.
With the new special energy saving and emission reduction loan to fund the development of its energy saving projects at a much lower interest rate, the Company will then initiate the repayment of RMB 75,000,000 in convertible notes and trust loans held by China Cinda Asset Management Co. Ltd and its affiliates ("Cinda"). The original financing of RMB 100,000,000 was completed under a Note Purchase Agreement and a Trust Loan Agreement as a part of the strategic cooperation agreement signed on August 18, 2010. The interest rate on the convertible notes and trust loan under August 2010 agreements was 18% per annum unless the Cinda chooses to convert such notes and loans to common stock shares of the Company. Following the repayment, Cinda will still hold RMB 25,000,000 convertible note in CREG and a seat on the Company's Board of Directors. Cinda will continue their strategic partnership with the Company in regards to current and future project development and financing of these projects.
Mr. Guohua Ku, Chairman and Chief Executive Officer of CREG, commented, "Over the past several quarters, we have been ardently focused on securing lower borrowing rates from both domestic and international financiers. CREG is a highly capital intensive business and therefore, obtaining attractive interest rates on our loans has been of the utmost importance to our management team. As a result, we are very pleased to be in a position to pay-down a significant portion of our Cinda loan and utilize discounted interest rates offered by the Industrial Bank, Co., Ltd. to energy-saving solutions providers such as CREG. Cinda still remains a strategic partner to our company and will continue to work with us on furthering our project development and operations moving forward."
For more information on this press release, please refer Form 8-K filed with the Securities and Exchange Commission on December 15, 2011.About the Industrial Bank Co., Ltd. Industrial Bank Co., Ltd. provides commercial banking services in the People's Republic of China. The company accepts various deposit products, as well as offers short-term, medium-term, and long-term loans. It also provides local and international payment and settlement; bills acceptance and discounting; agency issuing, agency cashing, and underwriting of government bonds; inter-bank borrowing and lending; and custody services for securities investment funds and social securities funds. In addition, the company engages in the trade of government bonds and financial bonds; dealing derivative products of financial institutions; and trading or agency trade of foreign exchange, as well as issues financial bonds. Further, Industrial Bank provides settlement and sales services of foreign currencies, letter of credit services and guarantee, agency collection and payment services, and safe-box services, as well as involves in bank card business. It operates 55 branches and 552 sub-branches in cities of Fuzhou, Xiamen, Ningde, Putian, Quanzhou, Zhangzhou, Longyan, Sanming, Nanping, Shanghai, Shenzhen, Changsha, Beijing, Hangzhou, Guangzhou, Nanjing, Ningbo, Chongqing, Jinan, Wuhan, Shenyang, Tianjin, Chengdu, Zhengzhou, Sian, Taiyuan, Kunming, Hefei, Nanchang, Urumchi, Qingdao, Dalian, Nanning, Harbin, and Shijiazhuang. Industrial Bank Co., Ltd. was founded in 1988 and is headquartered in Fuzhou, China. About China Recycling Energy Corp. China Recycling Energy Corp. (NASDAQ: CREG or "the Company") is based in Xi'an, China and provides environmentally friendly waste-to-energy technologies to recycle industrial byproducts for steel mills, cement factories and coke plants in China. Byproducts include heat, steam, pressure, and exhaust to generate large amounts of lower-cost electricity and reduce the need for outside electrical sources. The Chinese government has adopted policies to encourage the use of recycling technologies to optimize resource allocation and reduce pollution. Currently, recycled energy represents only an estimated 1% of total energy consumption and this renewable energy resource is viewed as a growth market due to intensified environmental concerns and rising energy costs as the Chinese economy continues to expand. The management and engineering teams have over 20 years of experience in industrial energy recovery in China. For more information about CREG, please visit http://www.creg-cn.com. Safe Harbor Statement This press release may contain certain "forward-looking statements" relating to the business of China Recycling Energy Corp. and its subsidiary companies. All statements, other than statements of historical fact included herein are "forward-looking statements." These forward-looking statements are often identified by the use of forward-looking terminology such as "believes," "expects" or similar expressions, involve known and unknown risks and uncertainties. Although the Company believes that the expectations reflected in these forward-looking statements are reasonable, they do involve assumptions, risks and uncertainties, and these expectations may prove to be incorrect. Investors should not place undue reliance on these forward-looking statements, which speak only as of the date of this press release. The Company's actual results could differ materially from those anticipated in these forward-looking statements as a result of a variety of factors, including those discussed in the Company's periodic reports that are filed with the Securities and Exchange Commission and available on its website at http://www.sec.gov. All forward-looking statements attributable to the Company or persons acting on its behalf are expressly qualified in their entirety by these factors. Other than as required under the securities laws, the Company does not assume a duty to update these forward-looking statements. For more information, please contact: