GUARANTY AGREEMENT

GUARANTY AGREEMENT dated as of September 6, 2002, between MEMC ELECTRONIC
MATERIALS, INC., a Delaware corporation ("MEMC" or the "Guarantor"), and TPG
WAFER PARTNERS LLC, a Delaware limited liability company ("TPG Wafer"), as Agent
and as the TPG Lender (as defined in the Credit Agreement referred to below).

Reference is made to the Second Amended and Restated Credit Agreement dated as
of September 6, 2002, between MEMC ELECTRONIC MATERIALS, S.P.A., as the
Borrower, and TPG Wafer, as the TPG Lender and as Agent, with a principal
balance outstanding of Euro 55,000,000 (as amended from time to time, the
"Credit Agreement"). Capitalized terms used herein and not defined herein shall
have the meanings assigned to such terms in the Credit Agreement.

The Initial Lender has made an Advance to the Borrower, pursuant to, and upon
the terms and subject to the conditions specified in the Amended and Restated
Credit Agreement dated as of September 22, 2001 (the "Amended and Restated
Credit Agreement"), and the Initial Lender has assigned all its rights under the
Amended and Restated Credit Agreement to the TPG Lender. The Borrower is a
wholly owned Subsidiary of MEMC, and MEMC acknowledges that it has derived, and
will derive, substantial benefit from the making of the Advance to the Borrower
and from the Credit Agreement in general. The effectiveness of the Credit
Agreement is conditioned on, among other things, the execution and delivery by
MEMC of a Guaranty Agreement in the form hereof. In consideration of the
foregoing premises and for good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged by the parties, MEMC agrees to
execute and deliver this Agreement.

Accordingly, the parties hereto agree as follows:

SECTION 1

. Definitions. As used in this Agreement, the following terms shall have the
following meanings (such meanings to be equally applicable to both the singular
and plural forms of the terms defined) and capitalized terms used herein and not
defined herein shall have the meanings assigned to such terms in the Credit
Agreement:

"Agreement" means this Guaranty Agreement.

"Affiliate" means, with respect to a specified Person, another Person that
directly, or indirectly through one or more intermediaries, controls or is
controlled by or is under common control with the Person specified.
Notwithstanding the foregoing, no individual shall be deemed to be an Affiliate
of a Person solely by reason of his or her being an officer or director of such
Person. For purposes of this definition, the term "control" (including the terms
"controlling", "controlled by" and "under common control with") of a Person
means the possession, direct or indirect, of the power to vote 50% or more of
the voting stock of such Person or to direct or cause the direction of the
management and policies of such Person, whether through the ownership of voting
stock, by contract or otherwise.

"Code" means the Internal Revenue Code of 1986, as amended from time to time.

"Commitment" has the meaning specified in Section 2.01 of the Credit Agreement.

"Consolidated" refers to the consolidation of accounts in accordance with GAAP.

"Debt" means (a) indebtedness for borrowed money, (b) obligations evidenced by
bonds, debentures, notes or other similar instruments, (c) obligations to pay
the deferred purchase price of property or services, (d) obligations as lessee
under leases which shall have been or should be, in accordance with generally
accepted accounting principles, recorded as capital leases, and (e) obligations
under direct or indirect guaranties (other than guaranties of Debt of MEMC's
Affiliates which Debt is otherwise included in Debt) in respect of, and
obligations (contingent or otherwise) to purchase or otherwise acquire, or
otherwise to assure a creditor against loss in respect of, indebtedness or
obligations of others of the kinds referred to in clause (a) through (d) of this
definition.

"Default" means any Event of Default or any event that would constitute an Event
of Default but for the requirement that notice be given or time elapse or both.

"Effective Date" has the meaning specified in Section 3.01 of the Credit
Agreement.

"ERISA" means the Employee Retirement Income Security Act of 1974, as amended
from time to time.

"ERISA Affiliate" means, at any time, each trade or business (whether or not
incorporated) that would, at the time, be treated together with MEMC or any of
its Subsidiaries as a single employer under Title IV or Section 302 of ERISA or
Section 412 of the Code.

"ERISA Event" means (a) any "reportable event" described in Section 4043 of
ERISA or the regulations issued thereunder with respect to a Plan (other than a
"reportable event" not subject to the provision for 30-day notice to the Pension
Benefit Guaranty Corporation); (b) the existence with respect to any Plan of an
"accumulated funding deficiency" (as defined in Section 412 of the Code or
Section 302 of ERISA), whether or not waived or the filing of an application
pursuant to Section 412(e) of the Code or Section 304 of ERISA for any extension
of an amortization period; (c) the provision or filing of a notice of intent to
terminate a Plan other than a standard termination within the meaning of Section
4041 of ERISA or the treatment of a Plan amendment as a distress termination
under Section 4041 of ERISA; (d) the filing pursuant to Section 412(d) of the
Code or Section 303(d) of ERISA of an application for a waiver of the minimum
funding standard with respect to any Plan; (e) the incurrence by MEMC or any of
its ERISA Affiliates of any liability under Title IV of ERISA with respect to
the termination of any Plan; (f) the receipt by MEMC or any ERISA Affiliate from
the Pension Benefit Guaranty Corporation or a plan administrator of any notice
relating to an intention to terminate any Plan or Plans or to appoint a trustee
to administer any Plan under Section 4042 of ERISA or the occurrence or
existence of any other event or condition which might reasonably be expected to
constitute grounds for the termination of, the appointment of a trustee to
administer, any Plan other than in a standard termination within the meaning of
Section 4041 of ERISA or the imposition of any lien on the assets of MEMC or any
of its Subsidiaries or ERISA Affiliates under ERISA, including as a result of
the operation of Section 4069 of ERISA; (g) the incurrence by MEMC, any of its
Subsidiaries or any of its ERISA Affiliates of any liability with respect to the
withdrawal or partial withdrawal from any Plan or Multiemployer Plan or with
respect to the withdrawal from a Multiple Employer Plan during a plan year in
which it was a "substantial employer" as defined in Section 4001(a)(2) of ERISA
or by reason of the provisions of Section 4064 of ERISA upon the termination of
a Multiple Employer Plan; or (h) the receipt by MEMC or any ERISA Affiliate of
any notice, or the receipt by any Multiemployer Plan from MEMC or any ERISA
Affiliate of any notice, concerning the imposition of Withdrawal Liability or a
determination that a Multiemployer Plan is, or is expected to be, insolvent or
in reorganization, within the meaning of Title IV of ERISA.

"Events of Default" has the meaning specified in Section 6.01 of the Credit
Agreement.

"GAAP" means generally accepted accounting principles in the United States of
America consistently applied.

"Governmental Authority" means any nation or government, any state or other
political subdivision thereof, and any federal, state, local or foreign court or
governmental, executive, legislative, judicial, administrative or regulatory
agency, department, authority, instrumentality, commission, board or similar
body.

"Lender" means the TPG Lender and each Person that shall become a party to the
Credit Agreement pursuant to Section 9.07 of the Credit Agreement.

"Material Adverse Change" means any material adverse change in the business,
condition (financial or otherwise), operations, performance, properties or
prospects of MEMC and its Subsidiaries taken as a whole.

"Multiemployer Plan" means a multiemployer plan as defined in Section 4001(a)(3)
of ERISA.

"Multiple Employer Plan" means an employee benefit plan described in Section
4063 of ERISA.

"Note" has the meaning specified in Section 2.

"Obligations" has the meaning specified in Section 2.

"Other Taxes" has the meaning specified in Section 7(c).

"Subsidiary" of any Person means any corporation, partnership, joint venture,
limited liability company, trust or estate of which (or in which) more than 50%
of (a) the issued and outstanding capital stock having ordinary voting power to
elect a majority of the board of directors of such corporation (irrespective of
whether at the time capital stock of any other class or classes of such
corporation shall or might have voting power upon the occurrence of any
contingency), (b) the interest in the capital or profits of such limited
liability company, partnership or joint venture or (c) the beneficial interest
in such trust or estate is at the time directly or indirectly owned or
controlled by such Person, by such Person and one or more of its other
Subsidiaries or by one or more of such Person's other Subsidiaries; provided,
however, that the term "Subsidiary" shall not include any joint venture of MEMC
with respect to any action or decision of the board of directors of such joint
venture if, by written agreement, such action or decision requires a vote in
excess of the number of members of such board of directors elected or controlled
by MEMC.

"Taxes" has the meaning specified in Section 7(b).

"Withdrawal Liability" means liability to a Multiemployer Plan as a result of a
complete or partial withdrawal from such Multiemployer Plan, as such terms are
defined in Part I of Subtitle E of Title IV of ERISA.

SECTION 2.

Guaranty. The Guarantor unconditionally guaranties, as a primary obligor and not
merely as a surety, (a) the due and punctual payment of (i) the principal of and
premium, if any, and interest (including interest accruing during the pendency
of any bankruptcy, insolvency, receivership or other similar proceeding,
regardless of whether allowed or allowable in such proceeding) on the Advance,
when and as due, whether at maturity, by acceleration, upon one or more dates
set for prepayment or otherwise, (ii) each payment required to be made by any
Borrower under the Credit Agreement or any note issued pursuant to the Credit
Agreement (individually a "Note" and collectively the "Notes"), when and as due,
including payments in respect of reimbursement of disbursements, interest
thereon and obligations to provide cash collateral and (iii) all other monetary
obligations, including fees, costs, expenses and indemnities, whether primary,
secondary, direct, contingent, fixed or otherwise (including monetary
obligations incurred during the pendency of any bankruptcy, insolvency,
receivership or other similar proceeding, regardless of whether allowed or
allowable in such proceeding), of the Borrower under the Credit Agreement or any
Note, and (b) the due and punctual performance of all covenants, agreements,
obligations and liabilities of the Borrower under or pursuant to the Credit
Agreement or any Note (all the monetary and other obligations referred to in the
preceding clauses (a) through (b) being collectively called the "Obligations").
The Guarantor further agrees that the Obligations may be extended or renewed, in
whole or in part, without notice to or further assent from it, and that it will
remain bound upon its guaranty notwithstanding any extension or renewal of any
Obligation.

SECTION 3.

Obligations Not Waived. To the fullest extent permitted by applicable law, the
Guarantor waives presentment to, demand of payment from and protest to the
Borrower of any of the Obligations, and also waives notice of acceptance of its
guaranty and notice of protest for nonpayment. To the fullest extent permitted
by applicable law, the obligations of the Guarantor hereunder shall not be
affected by (a) the failure of the Agent or any Lender to assert any claim or
demand or to enforce or exercise any right or remedy against any Borrower or any
guarantor under the provisions of the Credit Agreement, any Note, any guaranty
agreement, or otherwise, or (b) any rescission, waiver, amendment or
modification of, or any release from any of the terms or provisions of this
Agreement, the Credit Agreement, any Note, any guaranty agreement, or any other
agreement.

SECTION 4.

Guaranty of Payment. The Guarantor further agrees that its guaranty constitutes
a guaranty of payment when due and not of collection, and waives any right to
require that any resort be had by the Agent or any Lender to the Borrower or to
any other guarantor or to any of the security held for payment of the
Obligations or to any balance of any deposit account or credit on the books of
the Agent or any other Lender in favor of any Borrower or any other person.

SECTION 5.

No Discharge or Diminishment of Guaranty. The obligations of the Guarantor
hereunder shall not be subject to any reduction, limitation, impairment or
termination for any reason (other than the indefeasible payment in full in cash
of the Obligations), including any claim of waiver, release, surrender,
alteration or compromise of any of the Obligations, and shall not be subject to
any defense or setoff, counterclaim, recoupment or termination whatsoever by
reason of the invalidity, illegality or unenforceability of the Obligations or
otherwise. Without limiting the generality of the foregoing, the obligations of
the Guarantor hereunder shall not be discharged or impaired or otherwise
affected by the failure of the Agent or any Lender or any other party to assert
any claim or demand or to enforce any remedy under the Credit Agreement, any
Note or any other agreement, by any waiver or modification of any provision of
any thereof, by any default, failure or delay, willful or otherwise, in the
performance of the Obligations, or by any other act or omission that may or
might in any manner or to any extent vary the risk of the Guarantor or that
would otherwise operate as a discharge of the Guarantor as a matter of law or
equity (other than the indefeasible payment in full in cash of all the
Obligations).

SECTION 6.

 Defenses of Borrower Waived. To the fullest extent permitted by applicable law,
the Guarantor waives any defense based on or arising out of any defense of the
Borrower or the unenforceability of the Obligations or any part thereof from any
cause, or the cessation from any cause of the liability of the Borrower, other
than the final payment in full in cash of the Obligations. The Agent or the TPG
Lender may, at its election, foreclose on any security held by judicial or
nonjudicial sale, accept an assignment of any such security in lieu of
foreclosure, compromise or adjust any part of the Obligations, make any other
accommodation with the Borrower or any other guarantor or exercise any other
right or remedy available to it against the Borrower, or any other guarantor,
without affecting or impairing in any way the liability of the Guarantor
hereunder except to the extent the Obligations have been fully and finally paid
in cash or otherwise satisfied pursuant to the terms of the Credit Agreement.
Pursuant to applicable law, the Guarantor waives any defense arising out of any
such election even though such election operates, pursuant to applicable law, to
impair or to extinguish any right of reimbursement or other right or remedy of
the Guarantor against the Borrower or any other guarantor, as the case may be,
or any security.

SECTION 7.

 Agreement to Pay; Subordination. (a) In furtherance of the foregoing and not in
limitation of any other right that the Agent, any Lender or any other party has
at law or in equity against the Guarantor by virtue hereof, upon the failure of
the Borrower to pay any Obligation when and as the same shall become due,
whether at maturity, by acceleration, after notice of prepayment or otherwise,
the Guarantor hereby promises to and will forthwith pay, or cause to be paid, to
the Agent as designated thereby in cash the amount of such unpaid Obligations.
Upon payment by the Guarantor of any sums to the Agent as provided above, all
rights of the Guarantor against the Borrower arising as a result thereof by way
of right of subrogation, contribution, reimbursement, indemnity or otherwise
shall in all respects be subordinate and junior in right of payment to the prior
payment in full in cash of all the Obligations. In addition, any indebtedness of
the Borrower now or hereafter held by the Guarantor is hereby subordinated in
right of payment to the prior payment in full of the Obligations. If any amount
shall erroneously be paid to the Guarantor on account of (i) such subrogation,
contribution, reimbursement, indemnity or similar right or (ii) any such
indebtedness of the Borrower, and if an Event of Default shall have occurred and
be continuing, such amount shall be held in trust for the benefit of the
Borrower and shall forthwith be paid to the Agent to be credited against the
payment of the Obligations, whether matured or unmatured, in accordance with the
terms of the Credit Agreement.

(b)  Any and all payments by the Guarantor hereunder shall be made free and
clear of and without deduction for any and all present or future taxes, levies,
imposts, deductions, charges or withholdings, and all liabilities with respect
thereto, excluding, in the case of each Lender and the Agent, net income taxes
(or franchise taxes imposed in lieu thereof) that are imposed on such Lender or
the Agent by the state or foreign jurisdiction under the laws of which such
Lender or the Agent (as the case may be) is organized or any political
subdivision thereof and, in the case of each Lender, net income taxes (or
franchise taxes imposed in lieu thereof) that are imposed on such Lender by the
state or foreign jurisdiction of such Lender's Domestic Lending Office or any
political subdivision thereof (all such nonexcluded taxes, levies, imposts,
deductions, charges, withholdings and liabilities in respect of payments
hereunder being hereinafter referred to as "Taxes"). If the Guarantor shall be
required by law to deduct any Taxes from or in respect of any sum payable
hereunder, under the Credit Agreement or under any Note, (i) the sum payable
shall be increased as may be necessary so that, after making all required
deductions (including deductions applicable to additional sums payable under
this Section 7), such Lender or the Agent receives an amount equal to the sum it
would have received had no such deductions been made, (ii) the Guarantor shall
make such deductions and (iii) the Guarantor shall pay the full amount deducted
to the relevant taxation authority or other authority in accordance with
applicable law.

(c) In addition, the Guarantor shall pay any present or future stamp,
documentary, excise, property or other taxes, charges or levies that arise from
any payment made hereunder or from the execution, delivery or registration of,
or otherwise with respect to, this Guaranty (hereinafter referred to as "Other
Taxes").

(d) The Guarantor shall indemnify each Lender and the Agent for the full amount
of Taxes or Other Taxes and for the full amount of Taxes or Other Taxes imposed
by any jurisdiction on amounts payable under this Section 7 imposed on or paid
by such Lender or the Agent (as the case may be) or any liability (including
penalties, additions to tax, interest and expenses) arising therefrom or with
respect thereto, whether or not such Taxes or Other Taxes were correctly or
legally asserted. This indemnification shall be made within 30 days from the
date such Lender or the Agent makes written demand therefor.

(e) Within 30 days after the date of any payment of Taxes, the Guarantor shall
furnish to the Agent, at its address referred to in Section 9.02 of the Credit
Agreement, the original receipt of payment or a certified copy of such receipt.
If no Taxes are payable in respect of any payment hereunder, the Guarantor shall
furnish to the Agent, at such address, a certificate from each appropriate
taxing authority, or an opinion of counsel acceptable to the Lenders, in either
case stating that such payment is exempt from or not subject to Taxes.

(f) Each Lender organized under the laws of a jurisdiction outside the United
States shall, prior to payment of unpaid Obligations by the Guarantor pursuant
to Section 7(a) and from time to time thereafter if requested in writing by the
Guarantor or the Agent (but only so long as such Lender remains lawfully able to
do so), provide each of the Guarantor and the Agent with Internal Revenue
Service form W-8, W-8BEN or W-8ECI, as appropriate, or any successor or other
form prescribed by the Internal Revenue Service, certifying that such Lender is
exempt from or entitled to a reduced rate of United States withholding tax on
payments of interest pursuant to this Guaranty. If any form or document referred
to in this subsection (f) requires the disclosure of information, other than
information necessary to compute the tax payable and information required on the
date hereof by Internal Revenue Service form W-8, W-8BEN or W-8ECI, that the
Lender reasonably considers to be confidential, the Lender shall give notice
thereof to the Guarantor and shall not be obligated to include in such form or
document such confidential information.

(g) For any period with respect to which a Lender has failed to provide the
Guarantor with the appropriate form described in Section 7(f) (other than if
such failure is due to a change in law occurring subsequent to the date on which
a form originally was required to be provided), such Lender shall not be
entitled to indemnification under Section 7(b) with respect to Taxes imposed by
the United States until such form is provided; provided, however, that should
such Lender become subject to Taxes because of its failure to deliver a form
required hereunder, the Guarantor shall take such steps as such Lender shall
reasonably request to assist such Lender to recover such Taxes.

(h) If following any amount paid under this Section 7, the Lender receives or is
granted a credit against or remission for any Taxes or Other Taxes payable by
such Lender which the Lender determines, in its sole and absolute discretion, is
attributable to any Taxes or Other Taxes paid hereunder, such Lender shall,
subject to the Guarantor having made any increased payment hereunder and to the
extent such Lender can do so in its sole opinion without prejudicing the
retention of the amount of such credit or remission and without prejudice to its
rights to obtain any other relief or allowance which may be available to such
Lender and to conduct its own tax affairs as it sees fit, reimburse such amount
to the Guarantor as the Lender shall in its sole and absolute discretion certify
to be the proportion of such credit or remission as will leave the Lender (after
such reimbursement) in no worse position than it would have been in had no
payment been required under this Section 7. Such reimbursement shall be made
promptly upon the Lender certifying that the amount of such credit or remission
has been received by it; provided, however, that no such payment shall be made
so long as an Event of Default shall have occurred and be continuing. The
disallowance or reduction of any credit or remission of Taxes or Other Taxes
with respect to which a Lender has made a payment to Guarantor under this
Section 7 shall be treated as Taxes for which Guarantor is obligated to
indemnify such Lender hereunder. Notwithstanding the above, no Lender shall (i)
be under any obligation to claim a tax credit in priority to any other claim,
relief, credit or deduction available to such Lender or (ii) be obligated to
disclose any information regarding its tax affairs or computations to the
Guarantor.

SECTION 8.

 Information. The Guarantor assumes all responsibility for being and keeping
itself informed of the Borrower's financial condition and assets, and of all
other circumstances bearing upon the risk of nonpayment of the Obligations and
the nature, scope and extent of the risks that the Guarantor assumes and incurs
hereunder, and agrees that none of the Agent or any other Lender will have any
duty to advise the Guarantor of information known to it or any of them regarding
such circumstances or risks.

SECTION 9.

 Representations and Warranties. Effective as of the date hereof, MEMC
represents and warrants as follows:

(a) MEMC is a corporation duly organized, validly existing and in good standing
under the laws of the State of Delaware.

(b) The execution, delivery and performance by MEMC of this Agreement are within
MEMC's corporate powers, have been duly authorized by all necessary corporate
action, and do not contravene (i) MEMC's charter or by-laws or (ii) any law or
any contractual restriction binding on or affecting MEMC, except such
contractual restrictions for which MEMC has received a valid waiver.

(c) No authorization or approval or other action by, and no notice to or filing
with, any Governmental Authority is required for the due execution, delivery and
performance by MEMC of this Agreement.

(d) This Agreement has been duly executed and delivered by MEMC. This Agreement
is a legal, valid and binding obligation of MEMC enforceable against MEMC in
accordance with its terms.

(e) The Consolidated balance sheets of MEMC and its Subsidiaries as of
December 31, 2001 and June 30, 2002, and the related Consolidated statements of
income and cash flows of MEMC and its Subsidiaries for the fiscal year and the
six months then ended, copies of which have been furnished to the Lenders,
fairly present the financial condition of MEMC and its Subsidiaries as at such
dates and the results of the operations of MEMC and its Subsidiaries for the
periods ended on such dates, all in accordance with GAAP. Since June 30, 2002,
there has been no Material Adverse Change.

(f) There is no pending or threatened action or proceeding affecting MEMC or any
of its Subsidiaries before any court, governmental agency or arbitrator, that
(i) may materially adversely affect the financial condition or operations of
MEMC and its Subsidiaries taken as a whole or (ii) purports to affect the
legality, validity or enforceability of the Credit Agreement, this Agreement or
the consummation of the transactions contemplated hereby.

(g) MEMC is not engaged in the business of extending credit for the purpose of
purchasing or carrying margin stock (within the meaning of Regulation U issued
by the Board of Governors of the Federal Reserve System), and no proceeds of any
Advance will be used to purchase or carry any margin stock or to extend credit
to others for the purpose of purchasing or carrying any margin stock.

(h) The obligations of MEMC under this Agreement rank pari passu with all other
unsecured obligations of MEMC that are not, by their terms, expressly
subordinate to such other obligations of MEMC.

(i) The representations and warranties of the Borrower set forth in the Credit
Agreement are true and accurate.

(j) No event has occurred or is continuing that constitutes a Default.

SECTION 10.

 Covenants.  (a)  Affirmative Covenants. For so long as any Advance shall remain
unpaid or any Lender shall have any Commitment under the Credit Agreement, MEMC
will, unless the Required Lenders shall otherwise consent in writing:

(i) Compliance with Laws, Etc. Comply, and cause each of its Subsidiaries to
comply, in all material respects, with all applicable laws, rules, regulations
and orders, such compliance to include, without limitation, compliance with
ERISA and environmental laws.

(ii) Payment of Taxes, Etc. Pay and discharge, and cause each of its
Subsidiaries to pay and discharge, before the same shall become delinquent,
(i) all taxes, assessments and governmental charges or levies imposed upon it or
upon its property and (ii) all lawful claims that, if unpaid, might by law
become a lien upon its property; provided, however, that neither MEMC nor any of
its Subsidiaries shall be required to pay or discharge any such tax, assessment,
charge or claim that is being contested in good faith and by proper proceedings
and as to which appropriate reserves are being maintained, unless and until any
lien resulting therefrom attaches to its property and becomes enforceable
against its other creditors.

(iii) Preservation of Corporate Existence, Etc. Preserve and maintain, and cause
each of its Subsidiaries to preserve and maintain, its corporate existence,
rights (charter and statutory) and franchises; provided, however, that neither
MEMC nor any of its Subsidiaries shall be required to preserve any right or
franchise if the board of directors of MEMC or a Subsidiary shall determine that
the preservation thereof is no longer desirable in the conduct of the business
of MEMC or such Subsidiary, as the case may be, and that the loss thereof is not
disadvantageous in any material respect to MEMC, the Subsidiary or the Lenders.

(iv) Keeping of Books. Keep, and cause each of its Subsidiaries to keep, proper
books of record and account, in which full and correct entries shall be made of
all financial transactions and the assets and business of MEMC and each such
Subsidiary in accordance with GAAP or, in the case of any Subsidiary organized
under the laws of a jurisdiction other than the United States or any state
thereof, the equivalent of GAAP applicable in such jurisdiction.

(v) Maintenance of Properties, Etc. Maintain and preserve, and cause each of its
Subsidiaries to maintain and preserve, all of its properties that are used or
useful in the conduct of its business in good working order and condition,
ordinary wear and tear excepted.

(vi) Reporting Requirements. Furnish to the Lenders:

(A) within 90 days after the end of each fiscal year of MEMC, its audited
consolidated balance sheet and related statements of operations, stockholders'
equity and cash flows as of the end of and for such year, setting forth in each
case in comparative form the figures for the previous fiscal year, all reported
on by KPMG LLP or other independent public accountants of recognized national
standing (without a "going concern" or like qualification or exception and
without any qualification or exception as to the scope of such audit) to the
effect that such consolidated financial statements present fairly, in all
material respects, the consolidated financial condition and results of
operations of MEMC and the Subsidiaries on a consolidated basis in accordance
with GAAP consistently applied;

(B) within 45 days after the end of each of the first three fiscal quarters of
each fiscal year of MEMC, its unaudited consolidated balance sheet and related
statements of operations, stockholders' equity and cash flows as of the end of
and for such fiscal quarter and the then elapsed portion of the fiscal year,
setting forth in each case in comparative form the figures for the corresponding
period or periods of (or, in the case of the balance sheet, as of the end of)
the previous fiscal year, all certified by one of its financial officers
(including the chief financial officer, principal accounting officer, treasurer
or controller) as presenting fairly in all material respects the consolidated
financial condition and results of operations of MEMC and the Subsidiaries on a
consolidated basis in accordance with GAAP consistently applied, subject to
normal year-end audit adjustments and the absence of footnotes;

(C) as soon as possible and in any event within ten days after the occurrence of
each Default continuing on the date of such statement, a statement of the chief
financial officer of MEMC setting forth details of such Default and the action
that MEMC has taken and proposes to take with respect thereto;

(D) promptly after the sending or filing thereof, copies of all reports which
MEMC sends to any of its securityholders, and copies of all reports and
registration statements which MEMC or any of its Subsidiaries files with the
Securities and Exchange Commission or any national securities exchange;

(E) promptly upon any financial officer (including the chief financial officer,
principal accounting officer, treasurer or controller) of MEMC obtaining
knowledge thereof, written notice of the occurrence of any ERISA Event that,
alone or together with any other ERISA Events that have occurred, could
reasonably be expected to result in liability of MEMC and the Subsidiaries in an
aggregate amount exceeding U.S.$2,500,000;

(F) promptly after the commencement thereof, notice of all actions and
proceedings before any court, governmental agency or arbitrator affecting MEMC
or any of its Subsidiaries of the type described in Section 9(f); and

(G) such other information respecting MEMC or any of its Subsidiaries as any
Lender through the Agent may from time to time reasonably request.

(b) Negative Covenants. On and after the date hereof, and so long as any Advance
shall remain unpaid or any Lender shall have any Commitment under the Credit
Agreement, MEMC will not, unless the Required Lenders shall otherwise consent in
writing:

(i) Liens, Etc. Create or suffer to exist, or permit any of its Subsidiaries to
create or suffer to exist, any lien, security interest or other charge or
encumbrance, or any other type of preferential arrangement, upon or with respect
to any of its properties, whether now owned or hereafter acquired, or assign, or
permit any of its Subsidiaries to assign, any right to receive income, in each
case to secure any Debt of any Person, other than:

(A) purchase money liens or purchase money security interests upon or in any
property acquired or held by MEMC or any Subsidiary in the ordinary course of
business to secure the purchase price of such property or to secure indebtedness
incurred solely for the purpose of financing the acquisition of such property;

(B) liens or security interests existing on such property at the time of its
acquisition (other than any such lien or security interest created in
contemplation of such acquisition);

(C) liens for taxes, assessments and governmental charges or levies to the
extent not required to be paid under Section 10(a)(ii) hereof;

(D) liens imposed by law, such as materialmen's, mechanics', carriers',
workmen's and repairmen's liens and other similar liens arising in the ordinary
course of business securing obligations that are not overdue for a period of
more than 30 days;

(E) pledges or deposits to secure obligations under workers' compensation laws
or similar legislation or to secure public or statutory obligations;

(F) easements, rights of way and other encumbrances on title to real property
that do not render title to the property encumbered thereby unmarketable or
materially adversely affect the use of such property for its present purposes;

(G) sales of accounts receivable of MEMC Japan Ltd. ("MJL"), a subsidiary of
MEMC, without recourse, by MJL, to a third party at a market discount rate not
to exceed 8 % per annum and in an amount such that the aggregate invoice amount
of such receivables sold shall not exceed $40 million at any one time;

(H) liens incurred or deposits made in the ordinary course of business to secure
the performance of letters of credit, bids, tenders, sales contracts, leases,
surety, appeal and performance bonds and other similar obligations not incurred
in connection with the borrowing of money; and

(I) liens created or otherwise permitted under the Reimbursement Documentation,
the Revolving Loan Documentation and the Indenture Documentation.

(J) liens set forth on Schedule 10(b) attached hereto.

(ii) Accounting Changes. Make or permit, or permit any of its Subsidiaries to
make or permit, any change in accounting policies or reporting practices, except
as allowed by generally accepted accounting principles.

(c) Required Repayment under the Credit Agreement. On and after the Effective
Date and so long as any Advance shall remain unpaid or any Lender shall have any
Commitment under the Credit Agreement, MEMC will, unless the Required Lenders
shall otherwise consent in writing, cause the Borrower to comply with any and
all of its obligations under the Credit Agreement. For the avoidance of doubt,
it is understood by the parties hereto that the provision in Section 5.03 of the
Credit Agreement limiting the Borrower's obligation to effect an Italian
Redemption Offer only to the extent that Net Proceeds are made available to the
Borrower shall in no way limit MEMC's obligation under this Agreement to cause
the Borrower to comply with the Borrower's obligations under the Credit
Agreement. It is further understood that MEMC agrees to use the reasonable
commercial effort required of it pursuant to, and to use such reasonable
commercial effort in accordance with, Sections 5.02 and 5.03 of the Credit
Agreement.

SECTION 11

.  Termination. The Guaranty made hereunder (a) shall terminate when all the
Obligations have been paid in full and the Lenders have no further commitment to
lend to any Borrower under the Credit Agreement and (b) shall be reinstated if,
at any time after the Guaranty made hereunder has terminated, payment, or any
part thereof, of any Obligation is rescinded or must otherwise be restored by
the Guarantor or any other guarantor upon the bankruptcy or reorganization of
any Borrower, MEMC, any other guarantor or otherwise.

SECTION 12

.  Binding Effect; Several Agreement; Assignments. Whenever in this Agreement
any of the parties hereto is referred to, such reference shall be deemed to
include the successors and assigns of such party; and all covenants, promises
and agreements by or on behalf of MEMC that are contained in this Agreement
shall bind and inure to the benefit of each party hereto and their respective
successors and assigns. This Agreement shall become effective as to MEMC when a
counterpart hereof executed on behalf of MEMC shall have been delivered to the
Agent, and a counterpart hereof shall have been executed on behalf of the Agent,
and thereafter shall be binding upon MEMC and the Agent and their respective
successors and assigns, and shall inure to the benefit of MEMC, the Agent and
the Lenders, and their respective successors and assigns, except MEMC shall not
have the right to assign its rights or obligations hereunder or any interest
herein (and any such attempted assignment shall be void).

SECTION 13

.  Waivers; Amendment.

(a) No failure or delay of the Agent or any Lender in exercising any power or
right hereunder shall operate as a waiver thereof, nor shall any single or
partial exercise of any such right or power, or any abandonment or
discontinuance of steps to enforce such a right or power, preclude any other or
further exercise thereof or the exercise of any other right or power. The rights
and remedies of the Agent and of the Lenders hereunder and under the Credit
Agreement and under any Note are cumulative and are not exclusive of any rights
or remedies that they would otherwise have. No waiver of any provision of this
Agreement or consent to any departure by MEMC therefrom shall in any event be
effective unless the same shall be permitted by paragraph (b) below, and then
such waiver or consent shall be effective only in the specific instance and for
the purpose for which given. No notice or demand on MEMC in any case shall
entitle MEMC to any other or further notice or demand in similar or other
circumstances.

(b) Neither this Agreement nor any provision hereof may be waived, amended or
modified except pursuant to a written agreement entered into between MEMC and
the Agent, with the prior written consent of the Required Lenders (except as
otherwise provided in the Credit Agreement).

SECTION 14

.  GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.

SECTION 15.

 Notices. All communications and notices hereunder shall be in writing and given
as provided in Section 9.02 of the Credit Agreement, except the address for MEMC
shall be 501 Pearl Drive (City of O'Fallon), St. Peters, Missouri 63376,
Attention: Treasurer (telecopier number (636) 474-5158).

SECTION 16

.  Survival of Agreement; Severability.

(a) All covenants, agreements, representations and warranties made by MEMC
herein and in the certificates or other instruments prepared or delivered in
connection with or pursuant to this Agreement or the Credit Agreement shall be
considered to have been relied upon by the Agent and the other parties and shall
survive the making by the Lenders of the Advances to the Borrower, and shall
continue in full force and effect as long as the principal of or any accrued
interest on any Advance to the Borrower or any other fee or amount payable under
this Agreement, the Credit Agreement or any Note by the Borrower is outstanding
and unpaid.

(b) In the event any one or more of the provisions contained in this Agreement,
the Credit Agreement or any Note should be held invalid, illegal or
unenforceable in any respect, the validity, legality and enforceability of the
remaining provisions contained herein and therein shall not in any way be
affected or impaired thereby (it being understood that the invalidity of a
particular provision in a particular jurisdiction shall not in and of itself
affect the validity of such provision in any other jurisdiction). The parties
shall endeavor in good-faith negotiations to replace the invalid, illegal or
unenforceable provisions with valid provisions the economic effect of which
comes as close as possible to that of the invalid, illegal or unenforceable
provisions.

SECTION 17

.  Counterparts. This Agreement may be executed in counterparts, each of which
shall constitute an original, but all of which when taken together shall
constitute a single contract, and shall become effective as provided in
Section 12. Delivery of an executed signature page to this Agreement by
facsimile transmission shall be as effective as delivery of a manually executed
counterpart of this Agreement.

SECTION 18

.  Rules of Interpretation. The rules of interpretation specified in
Section 1.01 of the Credit Agreement shall be applicable to this Agreement.

SECTION 19

.  Jurisdiction; Consent to Service of Process.

(a) MEMC hereby irrevocably and unconditionally submits, for itself and its
property, to the nonexclusive jurisdiction of any New York State court or
Federal court of the United States of America sitting in New York City, and any
appellate court from any thereof, in any action or proceeding arising out of or
relating to this Agreement, the Credit Agreement or any Note or for recognition
or enforcement of any judgment, and each of the parties hereto hereby
irrevocably and unconditionally agrees that all claims in respect of any such
action or proceeding may be heard and determined in such New York State or, to
the extent permitted by law, in such Federal court. Each of the parties hereto
agrees that a final judgment in any such action or proceeding shall be
conclusive and may be enforced in other jurisdictions by suit on the judgment or
in any other manner provided by law. Nothing in this Agreement shall affect any
right that the Agent, any Lender or any other party may otherwise have to bring
any action or proceeding relating to this Agreement, the Credit Agreement or any
Note against MEMC or its properties in the courts of any jurisdiction.

(b) MEMC hereby irrevocably and unconditionally waives, to the fullest extent it
may legally and effectively do so, any objection that it may now or hereafter
have to the laying of venue of any suit, action or proceeding arising out of or
relating to this Agreement, the Credit Agreement or any Note in any New York
State or Federal court. Each of the parties hereto hereby irrevocably waives, to
the fullest extent permitted by law, the defense of an inconvenient forum to the
maintenance of such action or proceeding in any such court.

(c) Each party to this Agreement irrevocably consents to service of process in
the manner provided for notices in Section 15. Nothing in this Agreement will
affect the right of any party to this Agreement to serve process in any other
manner permitted by law.

SECTION 20.  WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY
JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF, UNDER
OR IN CONNECTION WITH THIS AGREEMENT, THE CREDIT AGREEMENT OR ANY NOTE. EACH
PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY
OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD
NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B)
ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER
INTO THIS AGREEMENT AND THE CREDIT AGREEMENT, AS APPLICABLE, BY, AMONG OTHER
THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 20.

SECTION 21

.  Right of Setoff. If an Event of Default shall have occurred and be
continuing, the Lender is hereby authorized at any time and from time to time,
to the fullest extent permitted by law, to set off and apply any and all
deposits (general or special, time or demand, provisional or final) at any time
held and other indebtedness at any time owing by such Lender to or for the
credit or the account of MEMC against any or all the obligations of MEMC now or
hereafter existing under this Agreement, the Credit Agreement or any Note held
by such Lender, irrespective of whether or not such party shall have made any
demand under this Agreement, the Credit Agreement or any Note and although such
obligations may be unmatured. The rights of each party under this Section 21 are
in addition to other rights and remedies (including other rights of setoff)
which such party may have.

 IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement as of
the day and year first above written.

.

MEMC ELECTRONIC MATERIALS, INC.

By /s/ Kenneth L. Young
Name: Kenneth L. Young
Title: Treasurer

 

 

TPG WAFER PARTNERS LLC, as Agent and as TPG Lender

By Richard A. Ekleberry
Name: Richard A. Eklberry
Title: Vice President