St. Peters, MO and Hamburg, Germany, July 10, 2008 – MEMC Electronic Materials, Inc. (NYSE: WFR) and Conergy (CGY.DE) today announced the amendment of their 10-year wafer supply contract. The sales volume of the contract has been adjusted to approximately $ 4 billion compared to $ 7-8 billion in the original agreement. This provides more operational and financial flexibility for Conergy and allows MEMC to reallocate wafer volumes to other customers, primarily in the later years of the contract.
Under the terms of the amendment, MEMC will reduce the volume of solar wafers supplied to Conergy, primarily in the later years of the contract, in consideration for slightly higher prices. Conergy will continue to advance funds to MEMC in the form of a refundable capacity reservation deposit, commensurate with the volumes in each year. All other terms and conditions remain unchanged, including that MEMC will supply solar wafers to Conergy over a 10-year period, with pre-determined pricing, on a take or pay basis beginning in the third quarter of 2008, and will participate in 5% of the increase in value of Conergy’s solar subsidiary in Frankfurt (Oder).
“Conergy has taken several steps to restructure its business and create a sustainable business model for the future”, commented Nabeel Gareeb, MEMC’s Chief Executive Officer. “This new agreement supports Conergy’s move to a profitable business model, and will create a stronger partner for MEMC. Our amended contract fits in with Conergy’s new vision and allows MEMC to reallocate the remaining portion of the wafer volume and further diversify our customer mix.”
Conergy CEO Dieter Ammer commented: “We appreciate MEMC’s flexibility in allowing us to adjust the agreement to our revised business model, and at the same time secure sufficient long-term supply for our Frankfurt (Oder) plant. We view MEMC as a key strategic partner for Conergy’s long-term growth. The amendment gives us much more operational and financial flexibility as we move the company to a profitable downstream specialist with one of the most international sales and distribution networks in our industry. We anticipate making the requisite deposits in the next few weeks which will allow deliveries as agreed to commence in the third quarter of 2008.” |