**Exhibit 10.42**

**CONFIDENTIAL TREATMENT**

**SOLAR WAFER SUPPLY AGREEMENT**

This Solar Wafer Supply Agreement is entered into as of October 25, 2007, by and between **MEMC ELECTRONIC MATERIALS, INC.**, a Delawarecorporation with its principal place of business at 501 Pearl Drive (City of O’Fallon), St. Peters, Missouri 63376, United States of America, or its designated majority-owned subsidiary (“MEMC”), and **CONERGY AG**, a Germancorporation with its principal place of business at Anckelmannsplatz 1, 20537 Hamburg, Germany (“Conergy”) or its designated majority-owned subsidiary. MEMC and Conergy together shall be referred to as the “Parties”and individually as a “Party”. 

RECITALS: 

WHEREAS, MEMC is in the business of designing, developing, manufacturing, marketing and selling wafers, and Conergy’s businesses include designing,developing, manufacturing, marketing, selling and installing photovoltaic cells and modules; and 

WHEREAS, Conergy wishes to secure asupply of solar wafers and to purchase quantities of solar wafers from MEMC, and MEMC wishes to provide a supply of solar wafers and to sell quantities of solar wafers to Conergy. 

NOW, THEREFORE, in consideration of the foregoing and the mutual representations, warranties, covenants and agreements herein contained, MEMC and Conergyagree as follows: 

ARTICLE I 

DEFINITIONS 

1.1 Definitions. The following terms shall have the following meanings for the purposes of this Agreement:

(a) “Additional Wafer Supply” shall have the meaning set forth in Section 2.14. 

(b) “Agreement” shall mean this Solar Wafer Supply Agreement, including all Attachments and Exhibits hereto, as it may beamended, modified or supplemented from time to time in accordance with its terms. 

(c) “Business Day” shall meanany day of the year other than (i) any Saturday or Sunday or (ii) any other day on which banks located in New York, New York generally are closed for business. 

(d) “Contract Year” shall mean a twelve (12) month period commencing on July 1 of a particular year and ending onJune 30 of the following year. For example, the first Contract Year under the Agreement shall be the twelve (12) month period from July 1, 2008 to June 30, 2009 and the tenth Contract Year under the Agreement shall be the twelve(12) month period from July 1, 2017 to June 30, 2018. 

(e) “CSM” shall have the meaning set forthin Section 3.2. 

 

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(f) “Dollar”, “Dollars” or numbers preceded by the symbol“$” shall mean amounts in United States Dollars. 

(g) “Effective Date” shall mean July 1, 2008.

(h) “Force Majeure Event” shall have the meaning set forth in Section 2.11. 

(i) “Governmental Authority” shall mean any federal, state, local or foreign government or subdivision thereof, or any entity,body or authority exercising executive, legislative, judicial, regulatory or administrative functions of or pertaining to any federal, state, local or foreign government. 

(j) “Incoterms 2000” shall have the meaning set forth in Section 2.5(a). 

(k) “Indemnified Person” shall mean the Person or Persons entitled to, or claiming a right to, indemnification under Article V.

(l) “Indemnifying Person” shall mean the Person or Persons claimed by the Indemnified Person to be obligated toprovide indemnification under Article V. 

(m) “Initial Term” shall have the meaning set forth in Section 4.1.

(n) “Interest” shall have the meaning set forth in Section 3.2. 

(o) “Law” shall mean any law, statute, regulation, ordinance, rule, order, decree or governmental requirement enacted,promulgated or imposed by any Governmental Authority. 

(p) “LC Bank” shall have the meaning set forth inSection 3.1(c). 

(q) “Letter of Credit Amount” shall have the meaning set forth in Section 3.1(c).

(r) “Loss” or “Losses” shall mean any and all damages, fines, fees, Taxes, penalties, deficiencies,losses (including lost profits or diminution in value) and expenses, including interest, reasonable expenses of investigation, court costs, reasonable fees and expenses of attorneys, accountants and other experts or other expenses of litigation orother proceedings or of any claim, default or assessment (such fees and expenses to include all fees and expenses, including fees and expenses of attorneys, incurred in connection with (i) the investigation or defense of any third party claims,(ii) asserting or disputing any rights under this Agreement against any Party hereto or otherwise, or (iii) settling any action or proceeding or threatened action or proceeding). 

(s) “MEMC Competitor” shall mean any Person engaged in (i) the design, development, manufacture, marketing or sale ofsilicon wafers for use in semiconductors; or (ii) the design, development, manufacture, marketing or sale of Multi Wafers or Mono Wafers for use in solar cells or (iii) the production of polysilicon or polysilicon ingots. 

 

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(t) “Missed Delivery” or “Missed Deliveries” shall have themeaning set forth in Section 2.2(f). 

(u) “Mono Wafers” shall mean monocrystalline silicon wafers for use insolar cells. 

(v) “Multi Wafers” shall mean multi-crystalline silicon wafers for use in solar cells. 

(w) “Person” shall mean any natural person, corporation, proprietorship, firm, partnership, limited partnership, limitedliability company or partnership, trust, joint venture, union, association, Governmental Authority or other entity. 

(x)“Purchase Shortfall” shall have the meaning set forth in Section 2.2(a). 

(y) “Refundable CapacityReservation Deposit” shall have the meaning set forth in Section 3.1. 

(z) “Restricted Conergy Business”shall mean (i) the design, development, manufacture, marketing or sale of Multi Wafers or Mono Wafers for use in solar cells or (ii) the production of solar grade polysilicon or solar ingots. 

(aa) “Restricted MEMC Business” shall mean the design, development, manufacture, marketing or sale of photovoltaic cells andphotovoltaic modules. 

(bb) “Restrictive Conergy Covenants shall have the meaning set forth in Section 2.12(b).

(cc) “Restrictive MEMC Covenants shall have the meaning set forth in Section 2.13(b). 

(dd) “Retained Refundable Capacity Reservation Deposit Amount” shall have the meaning set forth in Section 3.1. 

(ee) “Subsidiaries” shall mean any Person subject to control by either Party, or any of their respective affiliates. The term“control” as used in the preceding sentence means, with respect to a corporation, the right to exercise, directly or indirectly, fifty percent (50%) or more of the voting rights attributable to the shares of such corporation, or withrespect to any Person other than a corporation, the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of such Person. 

(ff) “Tax” or “Taxes” means all (i) federal, state, local, foreign and other taxes, assessments, duties orsimilar charges of any kind whatsoever, including all corporate franchise, income, sales, use, ad valorem, receipts, value added, profits, license, withholding, payroll, employment, excise, property, net worth, capital gains, transfer, stamp,documentary, social security, payroll, environmental, alternative minimum, occupation, recapture and other taxes, and including any interest, penalties and additions imposed with respect to such amounts; and (ii) liability for the payment ofany amounts as a result of an express or implied obligation to indemnify any other Person with respect to the payment of any amounts of the type described in clause (i). 

 

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(gg) “Wafering Assets” shall have the meaning set forth inSection 2.12(a). 

(hh) “Wafers” shall mean Multi Wafers and/or Mono Wafers. 

(ii) “Yearly Minimum Quantity(ies)” shall have the meaning set forth in Section 2.2(a). 

(jj) “Yearly Target Quantity(ies)” shall have the meaning set forth in Section 2.2(a). 

ARTICLE II 

SUPPLY OF WAFERS 

2.1 Wafer Specifications. The Wafers to be supplied under this Agreement shall meet the specifications as agreed to by the Parties as set forthin Attachment A to this Agreement. MEMC shall maintain, in accordance with MEMC’s standard procedures, accurate records and data for any quality testing done by or for MEMC of any Wafers purchased by Conergy hereunder and shall make suchrecords and test data available to Conergy upon reasonable request. Any deviation, modification, or change of such specifications can only be made, in writing, in accordance with Section 2.8(a). 

2.2 Quantity and Price. 

(a) Target Purchase Quantities and Minimum Purchase Quantities. Each Contract Year, as set forth below in this Section 2.2(a), Conergy agrees to purchase from MEMC, over the course of the Contract Year, a target quantity ofWafers (such yearly target purchase quantity commitments, measured in megawatts, the “Yearly Target Quantity”), at the prices set forth on Attachment B hereto. Each Contract Year, as set forth below in thisSection 2.2(a), MEMC agrees to supply Conergy, over the course of the Contract Year, with the Yearly Target Quantity per Contract Year, at the prices set forth on Attachment B hereto, which Yearly Target Quantity will not fall below theYearly Minimum Quantities (as such term is defined in Section 2.2(a)(i) below for Contract Years one through five and in Section 2.2(a)(ii) below for Contract Years six through ten). 

(i) For Contract Years one through five, the minimum quantities to be purchased by Conergy (such quantities, the “Yearly MinimumQuantities”) shall be equal to the greater of (A) **[***]**% of the Yearly Target Quantities set forth on Attachment B hereto and (B) approximately **[***]**% of Conergy’s then current solar wafer demand(measured in Watts), *provided* that MEMC can accommodate **[***]**% of Conergy’s actual then current solar wafer demand (as part of and pursuant to the rolling forecast process set forth in Section 2.2(e) hereof). For ContractYears one through five, MEMC shall be obligated to supply Conergy quantities only up to **[***]**% of the Yearly Target Quantities set forth on 

 

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Attachment B hereto for such Contract Years, unless MEMC has been given at least three (3) years advance notice of Conergy’s requestfor quantities in excess of **[***]**% of the Yearly Target Quantities in such years, and MEMC has agreed to supply such increased quantities. In addition, for calendar 2008 only, MEMC has agreed to consider providing potential upside volume toConergy of **[***]**, at the prices set forth on Attachment B. MEMC will communicate its ability to supply these potential upside volumes to Conergy on a quarterly basis during calendar 2008. These additional upside quantities are notincluded in the calculations set forth on Attachment B, but will be included should the additional upside quantities be committed by MEMC and Conergy agrees to accept such additional volume. In the event that MEMC indicates to Conergy thatMEMC intends to supply such additional volume in 2008, and Conergy agrees to accept such volume, if Wafer delivery has not yet commenced under this Agreement, then all remaining unpaid Refundable Capacity Reservation Deposit amounts for the firstContract Year under Section 3.1(a) hereof shall be paid to MEMC no less than five (5) Business Days prior to the first shipment date for Wafers. 

(ii) For Contract Years six through ten, no later than the first day of Contract Year three (July 1, 2010), the Parties agree to commence a review to determine the exact quantities to be purchased and supplied forContract Years six through ten. Notwithstanding the foregoing, for Contract Years six through ten, the minimum quantities to be purchased by Conergy (again, for such Contract Years, such quantities, the “Yearly Minimum Quantities”)shall be equal to the greater of (A) **[***]**% of the Yearly Target Quantities set forth on Attachment B hereto and (B) approximately **[***]**% of Conergy’s then current solar wafer demand (measured in Watts);*provided* that MEMC can accommodate **[***]**% of Conergy’s actual then current solar wafer demand (as part of and pursuant to the rolling forecast process set forth in Section 2.2(e) hereof). For Contract Years six through ten,Conergy shall be obligated to purchase the Yearly Minimum Quantities for such Contract Years with the following exceptions: 

(A) With three (3) years advance notice, Conergy may reduce its purchase obligation to a quantity for any given Contract Year by up to **[***]** percent (**[***]**%) from the Yearly Minimum Quantity for that Contract Year;

(B) With two (2) years advance notice, Conergy may reduce its purchase obligation to a quantity for any givenContract Year by up to **[***]** percent (**[***]**%) from the Yearly Minimum Quantity for that Contract Year; 

(C)Once a reduced purchase obligation for a Contract Year has been communicated to MEMC by Conergy, MEMC shall observe this reduced purchase obligation as the maximum quantity to be delivered by MEMC for that Contract Year, which maximum quantitycannot be exceeded without written consent from both Parties. 

 

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(iii) If Conergy demonstrates that its cell efficiency exceeds the measured inherentefficiency of MEMC wafers on the same process by more than **[***]** percent (**[***]**%), then Conergy may reduce the Yearly Minimum Quantity for a particular Contract Year that Conergy is obligated to purchase under this Agreement by aquantity equal to the result of the following formula. 

[***] 

whereby: 

A shall be [***], 

B shall be [***] and 

C shall be [***]. 

(iv) The Yearly Minimum Quantities may also be reduced, for any Contract Year, pursuant to and in accordance with the provisions ofSection 2.2(f)(i)(A). 

(b) Mix Between Multi Wafers and Mono Wafers. Attachment B sets forth theaggregate yearly quantities of Multi Wafers and Mono Wafers to be supplied in each Contract Year, and does not differentiate for the purpose of aggregate yearly quantities between Multi Wafers and Mono Wafers. In the first three Contract Years, thepercentage mix between Multi Wafers and Mono Wafers supplied shall be at MEMC’s discretion; *provided, however*, that in such first three (3) Contract Years MEMC may choose not to supply any Mono Wafers. In Contract Years four throughten, MEMC shall change the percentage mix between Multi Wafers and Mono Wafers based on Conergy’s request; *provided, however*that (i) in no event will MEMC be obligated to supply up to **[***]** percent (**[***]**%) of Wafersin any Contract Year as Mono Wafers unless Conergy has given MEMC at least two (2) years advance notice of such requested change in percentage mix between Multi Wafers and Mono Wafers and MEMC can reasonably accommodate such requested change inpercentage mix between Multi Wafers and Mono Wafers; and (ii) in no event will MEMC be obligated to supply up to **[***]** percent (**[***]**%) of Wafers in any Contract Year as Mono Wafers unless Conergy has given MEMC at least three(3) years advance notice of such requested change in percentage mix between Multi Wafers and Mono Wafers and MEMC can reasonably accommodate such requested change in percentage mix between Multi Wafers and Mono Wafers, unless a greaterpercentage of Mono Wafers is requested by Conergy and agreed to by MEMC. Once MEMC has committed to supply a specific percentage of Mono Wafers for a particular period, that percentage shall then be MEMC’s minimum supply obligation of MonoWafers for that period. MEMC also agrees, if requested by Conergy, to provide Conergy with specifications for other types of wafers (e.g., **[***]**) that MEMC could deliver for a future Contract Year, in each case with prices to be negotiated bythe Parties at such time. 

 

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(c) Prices. The prices set forth on Attachment B hereto are on a Dollarper Watt basis. Attachment B also includes, for illustration purposes, the prices on a per Wafer basis, which price per Wafer calculations are based on an indicative average efficiency factor of **[***]**% for Multi Wafers and anindicative average efficiency factor of **[***]**% for Mono Wafers. The Parties agree that the actual average efficiency factor for both Multi Wafers and Mono Wafers experienced by Conergy when using MEMC Wafers shall be used to calculate theprice per Wafer, subject to any adjustments mutually agreed by the Parties pursuant to the procedures on Attachment B. These actual average efficiency factors shall be subject to audit and/or verification as mutually agreed by the Parties.The Parties agree that after an average efficiency factor for both Multi Wafers and Mono Wafers is established, all prices per Multi Wafer or Mono Wafer calculated using such average efficiency factor for the purposes of invoicing underSection 2.4 hereof shall be based on such average efficiency factor until the average efficiency factor is changed pursuant to the procedures on Attachment B. The Parties also agree and acknowledge that as the average efficiency factorincreases, based on actual measurements by the mutually agreed method of producing solar cells based on the Baseline Cell Process (as such term is defined in Attachment B), the price per Wafer will increase (while the price per Watt remainsfixed) and the quantity of Wafers supplied will decrease (while quantities of Watts remains fixed). All prices per Wafer set forth on Attachment B hereto (for the purposes of invoicing under Section 2.4 hereof) shall be updated forefficiency changes at least as frequently as is set forth on Attachment B. 

(d) Purchase Shortfalls. IfConergy purchases fewer Watts than the lesser of (i) the Yearly Minimum Quantity, as calculated in accordance with Section 2.2(a) or (ii) the amount of Watts tendered for delivery by MEMC during any Contract Year, Conergy shallpay to MEMC via wire transfer of immediately available funds, within ten (10) days after being invoiced therefor, the difference between (A) the amount that would have been payable by Conergy during such Contract Year if Conergy hadpurchased the lesser of (i) the Yearly Minimum Quantity as calculated in accordance with Section 2.2(a) or (ii) the amount of Watts tendered for delivery by MEMC during the entire Contract Year, and (B) the amount payableby Conergy during such Contract Year for the actual volume of Watts purchased by Conergy from MEMC based on the applicable price listed on Attachment B hereto (such calculated amount, the “Purchase Shortfall”). The PurchaseShortfall shall accrue interest at the rate of one and one-half percent (1.5%) per month from the date of the invoice therefor, unless prohibited by Law. 

(e) Monthly Planning; Rolling Forecast. For planning purposes only, no laterthan the third (3rd) Business Day of each calendar month, Conergy shall deliver to MEMC a forecast of the quantities of Wafers that Conergyanticipates that it will order from MEMC over the subsequent rolling twelve (12) months. Such rolling forecasts are for capacity planning purposes only, and such estimated amounts in the rolling forecasts shall have no effect on Conergy’sobligation to purchase some or all of Conergy’s Yearly Minimum Quantity for any Contract Year or MEMC’s obligation to deliver the indicated quantities, unless such quantity is confirmed pursuant to the procedures of Section 2.3.

(f) Missed Deliveries. If, in a Contract Year, MEMC fails to deliver in the first three Contract Years **[***]**percent (**[***]**%) or more of the Yearly Minimum Quantities of Wafers, or in the fourth Contract Year **[***]** percent (**[***]**%) or more 

 

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of the Yearly Minimum Quantity of Wafers, or in the fifth Contract Year **[***]** percent (**[***]**%) or more of the Yearly Minimum Quantity ofWafers, or in any of the sixth through tenth Contract Years **[***]**percent (**[***]**%) or more of the Yearly Minimum Quantity of Wafers, MEMC would be required to deliver pursuant to the provisions of Section 2.2(a) (a “MissedDelivery”), and such Missed Deliveries continue uncured by the end of such Contract Year, then the following provisions shall apply: 

(i) MEMC shall have the right to try to “make up” Missed Deliveries for any Contract Year (the “Missed Delivery Year”) through the end of the Contract Year that immediately follows theMissed Delivery Year (the “Make up Year”). The Wafer price for such Missed Deliveries shall be the Wafer price at the time of shipment of such Missed Deliveries. If MEMC fails to make up the Missed Deliveries prior to the end of theMake Up Year, then: 

(A) Conergy shall have the right, but not theobligation, which right must be exercised by Conergy, in writing (and if not so exercised, shall be automatically waived for such Contract Year, and only such Contract Year), no later than five (5) Business Days after the end of the Make UpYear, to reduce the Yearly Minimum Quantity for that actual Contract Year by an amount equal to one-half ( 1/2) of theMissed Deliveries of the Missed Delivery Year that were not made up for in the Make Up Year (taking into account the actual deliveries made by MEMC in the Make Up Year intended as make up deliveries for the relevant Missed Delivery Year); and

(B) If Conergy chooses to reduce its Yearly Minimum Quantity for such next following Contract Year pursuant to theprovisions of Section 2.2(f)(i)(A), then a corresponding reduction in the Letter of Credit Amount shall be made pursuant to the provisions of Section 3.1(c). 

(C) If Conergy chooses to reduce its Yearly Minimum Quantity for such next following Contract Year pursuant to the provisions ofSection 2.2(f)(i)(A), then MEMC shall also be required to credit a pro-rata portion of the Retained Refundable Capacity Reservation Deposit Amount in the subsequent Contract Year. 

(g) Missed Deliveries in Contract Years One through Three. In addition to the provisions of Section 2.2(f), only for ContractYears one, two and three, if MEMC is unable to deliver the Yearly Minimum Quantities pursuant to the provisions of Section 2.2(a), for those three (3) Contract Years the following provisions shall also apply. If in any of the first threeContract Years MEMC’s actual deliveries against committed purchase orders (pursuant to MEMC’s standard Order Acknowledgement procedures in accordance with Section 2.2(f)(i) hereof) are lower than such committed quantities (suchdelivery failure, a “Wafer Delivery Miss”), then MEMC shall be required to offer Conergy the option of purchasing polysilicon from MEMC in an amount up to the Wafer Delivery Miss (with amounts of Wafers (Watts) converted tokilograms of polysilicon at MEMC’s 

 

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experienced conversion rate for the prior three (3) months) at the prices set forth on Attachment D. The offer of any polysilicon pursuant tothese provisions shall be made no later than ten (10) days after the applicable measurement period, with a reasonable delivery schedule for polysilicon to be agreed to by the Parties within five (5) Business Days thereafter. MEMC agrees touse commercially reasonable best efforts to delivery polysilicon as quickly as possible in the event that MEMC is required to deliver polysilicon hereunder. If Conergy actually purchases polysilicon pursuant to the provisions of thisSection 2.2(g), the decision to “count” such polysilicon sales against any requirement to deliver Wafers or to makeup missed Wafer sales for the Contract Year shall be at MEMC’s discretion. If MEMC decides that such deliveredpolysilicon will be counted for purposes of fulfilling MEMC’s Wafer delivery obligation under Section 2.2(a) hereof for the current Contract Year, then no changes will be made to the subsequent Contract Year’s Yearly Minimum Quantity,Letter of Credit or Refundable Capacity Reservation Deposit under Section 2.2(a) hereof. 

2.3 Purchase Orders and OrderAcknowledgements. Conergy will issue a written purchase order to MEMC through email, fax or internationally recognized carrier on at least a monthly basis. Such purchase orders shall contain the requested delivery dates. All such purchase ordersshall be subject to the terms and conditions set forth in this Agreement. MEMC shall, within five (5) Business Days after it receives any such purchase order, respond to such Conergy purchase orders with a written MEMC Order Acknowledgement,which MEMC Order Acknowledgement will set forth those requested Conergy quantities for which MEMC can then confirm a quantity (which quantity may be a partial quantity of the Conergy purchase order) and an estimated shipment calendar week. MEMCOrder Acknowledgements shall reference the applicable Conergy purchase order. Until such time as MEMC has provided Conergy with an MEMC Order Acknowledgement for all Wafers requested on a Conergy purchase order, such purchase order shall not bedeemed accepted by MEMC for the full amount of Wafers, but shall only be deemed accepted by MEMC for that amount of Wafers for which a confirmed quantity and shipment week has been provided. At all times during the term of this Agreement, unlessotherwise mutually agreed by the parties, Conergy shall have provided MEMC with binding purchase orders requesting shipments of Wafers over at least the next ninety (90) days. Unless expressly agreed in writing by MEMC and Conergy, noadditional or different terms or conditions contained in any quotation, sales order, acknowledgement form, purchase order or other communication from MEMC or Conergy shall be binding upon MEMC or Conergy, and each Party hereby objects to any suchadditional or different terms or conditions. To the extent there is any conflict among the terms and conditions of this Agreement, any Conergy purchase order and any MEMC Order Acknowledgement, the terms of this Agreement shall apply. 

2.4 MEMC Invoices. MEMC invoices shall reference the applicable Conergy purchase order and shall be submitted for payment by MEMC to the Conergyaccounts payable address specified in writing from time to time by Conergy. To the extent there is any conflict between the terms and conditions of this Agreement and of any such invoice, the terms of this Agreement shall apply. All prices in theinvoices shall be based on the then-current price for each Wafer, calculated in accordance with the provisions set forth on Attachment B, on the date of confirm. 

 

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2.5 Terms of Sale; Shipment Terms. 

(a) Terms of Sale. All sales of Wafers hereunder shall be made Ex Works (Incoterms 2000: EXW) MEMC’s designated location.“Incoterms 2000” means the version of “Incoterms” adopted by the International Chamber of Commerce effective January 1, 2000, including all amendments thereof, but excluding any amendments thereof specifically agreedto by the Parties as not being applicable to this Agreement. 

(b) Shipment Date. Per Section 2.3 above, thescheduled shipment date for Wafers will be specified by MEMC in the MEMC Order Acknowledgment. 

(c) ShipmentInstructions. Conergy shall furnish written shipping instructions to MEMC from time to time, and such shipping instructions, if different from the last shipping instructions provided by Conergy to MEMC, shall take effect no earlier than ten(10) Business Days after receipt of such written instructions by MEMC. MEMC shall pack and ship Wafers in accordance with then-current industry standards and practice. 

(d) Shipment Date Change Requests. Conergy may request to delay or pull in shipment of an individual delivery or any part thereofupon written notice to MEMC, subject to the following conditions: 

(i) Unless agreed to by MEMC, the shipment date changerequest notice must be received by MEMC at least ninety (90) days prior to the scheduled shipment date; and 

(ii) Ifthe shipment date change request notice is a delay request (a push out of requested delivery date), Conergy must commit to nonetheless purchase the delayed Wafers no later than the end of the Contract Year in which such shipment was originallyscheduled by MEMC; and 

(iii) MEMC must agree to such request in writing; and 

(iv) In the event of an accepted shipment date change request, Conergy shall accept delivery of and pay for Wafers already manufactured orin the process of manufacture for such accepted purchase order at the time the shipment date change request notice is received by MEMC. 

(e) In no event shall delay of any shipment or any part thereof as requested by Conergy pursuant to Section 2.5(d) affect, in any way, Conergy’s obligation to purchase some or all of Conergy’s YearlyMinimum Quantity for any Contract Year, unless the provisions of Section 2.2(a) hereof would otherwise require a change to Conergy’s Yearly Minimum Quantities for that Contract Year or a subsequent Contract Year. 

2.6 Title and Risk of Loss. Title to and risk of loss of Wafers shall pass to Conergy pursuant to and consistent with the Incoterms 2000 term ofsale of Ex Works MEMC’s designated location. 

 

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2.7 Payment Terms; Delivery Terms; Freight Terms. 

(a) MEMC shall issue an invoice to Conergy for each shipment of Wafers. All invoices will be in Dollars. Payment of invoices by Conergyshall be in Dollars, by wire transfer, check or by other means mutually agreed on by the Parties. Payment is due thirty (30) days from the date of the invoice. MEMC reserves the right to assess a late payment charge of one and one-half percent(1.5%) per month on the unpaid balance of any past due amount, unless prohibited by Law. If Conergy fails to pay the purchase price when due for any shipment, MEMC may, but need not, require receipt of payment in full prior to manufacturing thebalance of any outstanding or subsequent order. Payment of sums due from Conergy shall be made upon terms set forth above. MEMC may recover for each delivery hereunder as a separate transaction, without reference to any other delivery. If Conergyhas been failing to pay the purchase price when due for one or more shipments, and MEMC reasonably concludes that Conergy is in unsound financial condition and has notified Conergy of such conclusion, and the Parties have then negotiated in goodfaith for at least ten (10) Business Days to remedy such conclusion, or if Conergy is in default with respect to any of the material terms and conditions of this or any other agreement with MEMC, MEMC shall forthwith have the right to demandcash payment in advance or additional financial assurance until such time as said credit has been reestablished or default cured to MEMC’s satisfaction. If Conergy fails to pay the purchase price when due for any shipment, MEMC may also, butneed not, (i) immediately offset any late payments against the Refundable Capacity Reservation Deposit and/or the Letter of Credit required by Section 3.1(c) and (ii) prior to any further shipments of Wafers, require that Conergyreplenish the Refundable Capacity Reservation Deposit and/or the Letter of Credit required by Section 3.1(c) in accordance with the terms of this Agreement. 

(b) All prices are based on Ex Works MEMC’s designated location. Conergy shall pay all transportation charges on a freight collectbasis. Any Taxes, levies or assessments (including related interest and penalties) imposed, levied, assessed or arising by virtue of this Agreement other than Taxes based upon the net income of MEMC shall be the liability and responsibility ofConergy. If any charges are exempt from sales or use Tax liability, Conergy must provide MEMC with evidence of tax exemption acceptable to the relevant taxing authority. 

2.8 Annual Technology Reviews; Quality Considerations. 

(a) Annual TechnologyReviews. Both MEMC and Conergy agree that, starting no later than July 1, 2008, the Parties will conduct, at least annually, a review of the technology evolution for Wafers, polysilicon and solar cells. The implementation of any output fromsuch technology reviews as it relates to Wafers, Wafer manufacturing or polysilicon manufacturing shall be made by mutual agreement. The Parties also agree and acknowledge that continuous improvement efforts to Wafers and Wafer specifications (setforth in Attachment A hereto) will be made by MEMC, and Conergy will cooperate with MEMC to accommodate reasonable changes to such specifications, such as changes in Wafer thickness within industry norms (e.g., Conergy may need to makereasonable changes in its cell production processes, such as improved handling processes, to account 

 

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for thinner Wafers). Similarly, Conergy may also request changes to Wafer specifications, such as Wafer dimensions, with appropriate notice. MEMC will makereasonable efforts to accommodate these requests. 

(b) Quality Considerations. The parties acknowledge that there arecertain Wafer quality characteristics that, by their nature, may fall outside of the agreed upon specifications set forth in Attachment A hereto, but still may affect product performance at the cell level or module level (i.e., the Wafersmeet all specifications, but still cause significant deviation in performance or in Conergy’s production line). For those Wafer quality characteristics that are part of the agreed upon specifications set forth in Attachment A,Section 2.9 addresses these issues. For those Wafer quality characteristics that are not part of the agreed upon specifications, and such characteristics appear to cause significant deviation in Wafer performance or in Conergy’s productionline, the parties will jointly agree to address such non-specification Wafer quality characteristics on a continuous improvement basis after joint analysis of Wafer characteristics can be correlated to any such issues (e.g., the Parties will worktogether to ensure that the Wafer breakage rate is within industry norms, assuming that Conergy’s processes (including handling) fall within industry norms), provided that such meetings or working together shall not be deemed to be a waiver ofany rights Conergy may have under this Agreement. 

2.9 Representations and Warranties. MEMC represents and warrants that the Wafersdelivered to Conergy under this Agreement shall meet the specifications set forth in Attachment A hereto. EXCEPT AS SET FORTH IN THE PRECEDING SENTENCE, MEMC MAKES NO OTHER WARRANTIES OR REPRESENTATIONS, EXPRESS OR IMPLIED, OF FITNESS OF THEWAFERS FOR PARTICULAR USE OR OTHERWISE, INCLUDING WITHOUT LIMITATION, WARRANTY OF MERCHANTABILITY AND/OR FITNESS FOR A PARTICULAR PURPOSE. 

2.10 Limitation of Liability. 

(a) Limitation. MEMC’s total liability, and Conergy’sexclusive remedy, for any and all Losses and damages, arising out of any cause whatsoever under any theory of contract, tort, strict liability, or other legal or equitable theory, including under a breach of representations and warranties made underSection 2.9 hereof, shall be limited solely to Conergy’s actual direct damages directly caused by the failure of the Wafers to meet the specifications set forth in Attachment A hereto; *provided, however*, that such actualdirect damages may not exceed the purchase price of the Wafers that caused the damages, or, at MEMC’s option, the repair or replacement of such Wafers; and *provided further* that in order to recover for the failure of the Wafers to meetthe specifications set forth in Attachment A hereto, Conergy shall be required to prove that such Wafers do not meet such specifications. In no event shall MEMC be liable for lost profits, special, incidental, consequential or punitivedamages. MEMC shall not be liable for, and Conergy assumes liability for, all personal injury and property damage connected with the handling, transportation, possession, processing, further manufacture, other use or resale of the Wafers, whetherthe Wafers are used alone or in combination with any other material. 

 

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(b) Technical Advice. If MEMC furnishes technical or other advice to Conergy,whether or not at Conergy’s request, with respect to processing, further manufacture, other use or resale of the Wafers, MEMC shall not be liable for, and Conergy assumes all risk of, such advice and the results thereof, if such advice isfollowed by Conergy. Similarly, if MEMC offers technical or other advice to Conergy, whether or not at Conergy’s request, with respect to processing, further manufacture, other use or resale of the Wafers, and Conergy declines to follow suchadvice, MEMC shall not be liable for, and Conergy assumes all risk of, such declination of advice and the results thereof. 

2.11 ForceMajeure. 

(a) MEMC shall not be liable for any delay or failure to perform due to any cause or condition beyond itsreasonable control, whether foreseeable or not, including, without limitation, Acts of God, war, riot, fire, explosion, accident, flood or sabotage; lack of adequate fuel, power or raw materials, labor, containers or transportation facilities;compliance with governmental requests, Laws, regulations, orders, action or national defense requirements; embargoes or acts of civil or military authorities; theft, breakage or failure of machinery or apparatus; or in the event of labor trouble,strike, lockout or injunction (provided that MEMC shall not be required to settle a labor dispute against its own best judgment) (all of such events, a “Force Majeure Event”). MEMC shall give prompt written notice to Conergy of anysuch Force Majeure Event and any associated delivery changes. 

(b) If a Force Majeure Event occurs, MEMC shall not beresponsible for any damage, increased costs, or Losses which Conergy may sustain by reason of such failure of performance, but this Agreement shall not be regarded as terminated or frustrated as a result such failure of performance. If a ForceMajeure Event occurs, MEMC shall take appropriate means to minimize or remove the effects of the Force Majeure Event and, within the shortest practicable time, attempt to resume performance of its obligations under this Agreement affected by theForce Majeure Event, except as may be permitted by Section 2.11(c). 

(c) If MEMC has suffered a Force Majeure Event andis unable to perform substantially all of its obligations under this Agreement for eighteen (18) months or more after suspension of its performance after the occurrence of a Force Majeure Event, then Conergy and MEMC may mutually terminate thisAgreement if the Parties mutually agree to terminate. Notwithstanding anything in this Agreement to the contrary, in no event shall the occurrence of a Force Majeure Event hereunder excuse either Party from its obligations to pay to the other Partyany sums accrued or due hereunder to such other Party. 

 

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2.12 Noncompete in Favor of MEMC. 

(a) Conergy understands that MEMC shall be entitled to protect and preserve the going concern value of its business to the extentpermitted by Law and that MEMC would not have entered into this Agreement absent the provisions of this Section 2.12. Therefore, during the Initial Term (and any extensions of the Initial Term pursuant to Section 4.1 hereof), except as maybe agreed to in writing by MEMC in advance of engaging in any activities, Conergy shall not, and shall cause each of its affiliates and Subsidiaries to not, directly or indirectly, engage in any Restricted Conergy Business anywhere in the worldincluding (A) owning any interest in, managing, operating, controlling or participating in any Person which owns or operates a Restricted Conergy Business, (B) soliciting any customer or prospective customer of MEMC anywhere in the worldto purchase any products or services which compete with those provided by MEMC and (C) assisting any Person in any way to do, or attempt to do, anything prohibited above; *provided, however,* that the ownership by Conergy as of the date ofthis Agreement of ****the existing installed and ordered [***] wire saws and related downstream wafering equipment [***] shall be permitted.****

(b) If, at the time of enforcement of the covenants contained in this Section 2.12 (the “Restrictive Conergy Covenants”), a court shall hold that the duration, scope or area restrictions statedherein are unreasonable under circumstances then existing, the Parties agree that the maximum duration, scope or area reasonable under such circumstances shall be substituted for the stated duration, scope or area and that the court shall be allowedand directed to revise the restrictions contained herein to cover the maximum period, scope and area permitted by Law. Upon advice of legal counsel, Conergy has determined and hereby acknowledges that the Restrictive Conergy Covenants are reasonablein terms of duration, scope and area restrictions. Conergy acknowledges that both MEMC and Conergy have been doing business throughout the world. 

(c) If Conergy or any of its affiliates or Subsidiaries breaches, or threatens to commit a breach of, any of the Restrictive Conergy Covenants, MEMC shall have the following rights and remedies, each of which rightsand remedies shall be independent of the others and severally enforceable, and each of which is in addition to, and not in lieu of, any other rights and remedies available to MEMC at law or in equity: 

(i) the right and remedy to have the Restrictive Conergy Covenants specifically enforced by any court of competent jurisdiction, it beingagreed that any breach or threatened breach of the Restrictive Conergy Covenants would cause irreparable injury to MEMC and that money damages would not provide an adequate remedy to MEMC; and 

(ii) the right and remedy to require such Person to account for and pay over to MEMC any profits, monies, accruals, increments or otherbenefits derived or received by such Person as the result of any transactions constituting a breach of the Restrictive Conergy Covenants; and 

 

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(iii) the right and remedy to cease deliveries of Wafers hereunder until the breachof any of the Restrictive Conergy Covenants is cured. 

2.13 Noncompete in Favor of Conergy. 

(a) MEMC understands that Conergy shall be entitled to protect and preserve the going concern value of its business to the extentpermitted by Law and that Conergy would not have entered into this Agreement absent the provisions of this Section 2.13. Therefore, during the Initial Term (and any extensions of the Initial Term pursuant to Section 4.1 hereof), except asmay be agreed to in writing by Conergy in advance of engaging in any activities, MEMC shall not, and shall cause each of its affiliates and Subsidiaries to not, directly or indirectly, engage in any Restricted MEMC Business anywhere in the worldincluding (A) owning any interest in, managing, operating, controlling or participating in any Person which owns or operates a Restricted MEMC Business, (B) soliciting any customer or prospective customer of Conergy anywhere in the worldto purchase any products or services which compete with those provided by Conergy and (C) assisting any Person in any way to do, or attempt to do, anything prohibited above; *provided, however,* that the ownership by MEMC of up to a**[***]** percent (**[***]**%) interest in any Person in a Restricted MEMC Business shall be permitted. 

(b) If, atthe time of enforcement of the covenants contained in this Section 2.13 (the “Restrictive MEMC Covenants”), a court shall hold that the duration, scope or area restrictions stated herein are unreasonable under circumstancesthen existing, the Parties agree that the maximum duration, scope or area reasonable under such circumstances shall be substituted for the stated duration, scope or area and that the court shall be allowed and directed to revise the restrictionscontained herein to cover the maximum period, scope and area permitted by Law. Upon advice of legal counsel, MEMC has determined and hereby acknowledges that the Restrictive MEMC Covenants are reasonable in terms of duration, scope and arearestrictions. MEMC acknowledges that both Conergy and MEMC have been doing business throughout the world. 

(c) If MEMC orany of its affiliates or Subsidiaries breaches, or threatens to commit a breach of, any of the Restrictive MEMC Covenants, Conergy shall have the following rights and remedies, each of which rights and remedies shall be independent of the others andseverally enforceable, and each of which is in addition to, and not in lieu of, any other rights and remedies available to Conergy at law or in equity: 

(i) the right and remedy to have the Restrictive MEMC Covenants specifically enforced by any court of competent jurisdiction, it being agreed that any breach or threatened breach of the Restrictive MEMC Covenantswould cause irreparable injury to Conergy and that money damages would not provide an adequate remedy to Conergy and 

(ii)the right and remedy to require such Person to account for and pay over to Conergy any profits, monies, accruals, increments or other benefits derived or received by such Person as the result of any transactions constituting a breach of theRestrictive MEMC Covenants. 

 

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2.14 Preferred Vendor. The quantities of Wafers to be supplied by MEMC hereunder assume thatin any Contract Year such amount of Wafers will be approximately **[***]**% of Conergy’s then current solar wafer demand, and the Yearly Target Quantities of Wafers set forth in Attachment B, as modified by Section 2.2(a),reflect this mutual intention of the parties. In addition, MEMC shall be considered as a preferred vendor and shall have an annual right of first refusal (but not an obligation, unless MEMC would be so obligated pursuant to Section 2.2(a)hereof) to negotiate with Conergy to supply Conergy with additional Wafers, in excess of **[***]** percent (**[***]**%) of Conergy’s then current demand for Wafers (such potential amount, the “Additional Wafer Supply”).The price per watt for such Additional Wafer Supply shall be negotiated by the parties. If the parties are unable to reach agreement on price and quantity for such Additional Wafer Supply by May 1 for the ensuing Contract Year commencing onJuly 1, Conergy may buy such Additional Wafer Supply from other suppliers. Such Additional Wafer Supply, if supplied by MEMC, shall not be added to the Yearly Minimum Quantity for the then current Contract Year or any Contract Year thereafterunless the parties expressly agree. 

ARTICLE III 

REFUNDABLE CAPACITY RESERVATION DEPOSIT AND LETTER OF CREDIT; 

EXECUTION OF ADDITIONAL AGREEMENTS

3.1 Refundable Capacity Reservation Deposit. To induce MEMC to invest in additional polysilicon production and wafer manufacturingcapacity, Conergy agrees to pay to MEMC, per the schedule set forth on Attachment C hereto, the amount of $1,005.5 million (the “Refundable Capacity Reservation Deposit”), as a means of securing Conergy’s obligations toMEMC, which Refundable Capacity Reservation Deposit shall be repaid by MEMC, without interest, up to the amount of $965.3 million (96% of the aggregate Refundable Capacity Reservation Deposit amount, such retained amount of $40.2 million, the“Retained Refundable Capacity Reservation Deposit Amount”), according to the repayment schedule set forth on Attachment C hereto, unless Conergy has not purchased the Yearly Minimum Quantities in any Contract Year under the“take or pay” provisions of Section 2.2(a) hereof, in which case MEMC may choose to offset pursuant to this Article III any payments required from Conergy under Section 2.2(a) hereof against MEMC’s obligation to repay theRefundable Capacity Reservation Deposit. 

(a) In any Contract Year when Conergy is required to pay MEMC a portion of theRefundable Capacity Reservation Deposit per the schedule set forth on Attachment C, payment by Conergy to MEMC shall be made, in full, no later than the fifth Business Day of the applicable Contract Year; *provided, however,*thatConergy shall be entitled to request MEMC to calculate the difference between the amount of the Refundable Capacity Reservation Deposit repayable by MEMC pursuant to Section 3.1(b) and the amount of the Refundable Capacity Reservation Depositpayable by Conergy in any Contract Year, and Conergy shall pay such difference to MEMC no later than the fifth Business Day of the applicable Contract Year. In connection with the Refundable Capacity Reservation Deposit amount to be paid by Conergyto MEMC for the first Contract Year, twenty five 

 

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percent (25%) of the Refundable Capacity Reservation Deposit amount to be paid by Conergy to MEMC for that first Contract Year shall be paid to MEMC nolater than six (6) months prior to first delivery of Wafers hereunder (which payment date is anticipated to be no later than January 2, 2008) and the remaining seventy five percent (75%) of the Refundable Capacity Reservation Depositamount to be paid by Conergy to MEMC for that first Contract Year shall be paid to MEMC no later than five (5) Business Days prior to first delivery of Wafers hereunder. 

(b) In any Contract Year when MEMC is required to repay a portion of the Refundable Capacity Reservation Deposit to Conergy per theschedule set forth on Attachment C, payment by MEMC to Conergy shall be made, in full, no later than the fifth Business Day of the applicable Contract Year; *provided, however*, that if in any Contract Year there is a Purchase Shortfallthat has not been paid by Conergy via wire transfer to MEMC in accordance with the provisions of Section 2.2(d) hereof, MEMC shall not be required to repay that portion of the Refundable Capacity Reservation Deposit up to the Purchase Shortfallin the next Contract Year, but instead MEMC may retain the amount of the Refundable Capacity Reservation Deposit up to the Purchase Shortfall (including the amount of any interest accrued on the Purchase Shortfall in accordance withSection 2.2(d) hereof, until the date that MEMC actually transfers or retains such amount); and *provided further*, that if in any Contract Year there is a Purchase Shortfall (or an aggregate Purchase Shortfall from more than one ContractYear) that has not been paid by Conergy to MEMC in excess of the amount of any Refundable Capacity Reservation Deposit not yet repaid by MEMC, MEMC may withhold repayment in any future Contract Years of the Refundable Capacity Reservation Deposit upto the amount of the aggregate unpaid Purchase Shortfall. If the aggregate unpaid Purchase Shortfall(s) exceed the remaining Refundable Capacity Reservation Deposit not yet repaid by MEMC, MEMC shall have any and all remedies available to it torecover from Conergy immediately the amount of any aggregate unpaid Purchase Shortfall, including drawing on the Letter of Credit pursuant to the provisions of Section 3.1(c). 

(c) The Parties have also agreed that the amount of the Refundable Capacity Reservation Deposit outstanding in any Contract Year is lessthan the appropriate amount of security to be held by MEMC in order to ensure payment for Conergy’s “take or pay” obligations under Section 2.2(a) hereof. Accordingly, the Parties have agreed that Conergy will be required todeliver to MEMC, no later than the seventh Business Day of each Contract Year, an irrevocable Letter of Credit drawn on a bank that is requested by Conergy and approved by MEMC (the “LC Bank”), in an amount equal to the RequiredLetter of Credit Amount for such Contract Year as is set forth on Attachment C (the “Letter of Credit Amount”), and that expires on the eighth Business Day of the subsequent Contract Year. Conergy may, in its discretion, usequarterly or half-year revolving Letters of Credit to cover the full Letter of Credit Amount during any respective Contract Year;*provided, however,* that in no event shall there ever be a gap in coverage (i.e., a Letter of Credit will not bepermitted to expire before a replacement Letter of Credit is put in place). MEMC’s right to unilaterally draw on the Letter of Credit (after exhaustion of the Refundable Capacity Reservation Deposit amount then held by MEMC) shall besubstantially similar to those rights set forth in Section 3.1(b) above. The Letter of Credit Amount set forth on Attachment C for each Contract Year was calculated as follows: 

(i) In Contract Year one, the Letter of Credit Amount shall be equal to twelve (12) months of MEMC’s revenue under thisAgreement, based on the Yearly Target Quantity of Wafers for that Contract Year at the pricing for that Contract Year (assuming all Multi Wafers), less the cumulative net amount of the Refundable Capacity Reservation Deposit then held byMEMC; 

 

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(ii) In Contract Year two, the Letter of Credit Amount shall be equal to nine(9) months of MEMC’s revenue under this Agreement, based on the Yearly Target Quantity of Wafers for that Contract Year at the pricing for that Contract Year (assuming all Multi Wafers), less the cumulative net amount of theRefundable Capacity Reservation Deposit then held by MEMC; and 

(iii) In Contract Year three through Contract Year ten, theLetter of Credit Amount shall be equal to six (6) months of MEMC’s revenue under this Agreement, based on the Yearly Target Quantity of Wafers for that Contract Year at the pricing for that Contract Year (assuming a split between MultiWafers and Mono Wafers of **[***]**%/**[***]**%, respectively), less the cumulative net amount of the Refundable Capacity Reservation Deposit then held by MEMC. 

(iv) In any Contract Year for which the Yearly Target Quantity is adjusted upward or downward pursuant to the provisions ofSection 2.2(a) or Section 2.2(f)(i)(A), the Letter of Credit Amount will also be adjusted upward or downward consistent with the provisions of this Section 3.1(c). 

3.2 Interest in Conergy Subsidiary. In connection with this Agreement, Conergy and MEMC agree that MEMC shall also be entitled to receive fromConergy, within thirty (30) Business Days after the date that is five (5) years after the Effective Date, a payment equal to five percent (5%) of the increase in value (starting as of the Effective Date and ending on the date that isfive (5) years after the Effective Date) of Conergy Solarmodule GmbH & Co. KG (“CSM”) due to MEMC’s contributions under this Agreement (such interest, the “Interest”). The value of the Interestshall be paid to MEMC at such time by Conergy, in cash or in freely salable and tradable shares of stock of Conergy, at Conergy’s discretion. The valuation of the Interest shall be determined by an appraisal performed by an independent“Big Four” accounting firm (to be mutually agreed by the Parties at the time of the appraisal). The Parties shall negotiate and execute a detailed agreement outlining the valuation method and related matters within [***] of the date ofthis Agreement. In case the Parties cannot reach such a detailed agreement, one of the independent “Big Four” accounting firms that is not the auditor for either Party shall make the valuation determination. 

 

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ARTICLE IV 

TERM AND TERMINATION 

4.1 Term. The Term of this Agreement shall commence on the Effective Date andshall expire ten (10) years following the Effective Date (the “Initial Term”). No less than twelve (12) months prior to the expiration of the Initial Term, the Parties agree to negotiate in good faith to extend the InitialTerm of the Agreement, with such negotiations intended to address price, quantity (including minimum quantities) and length of any extension term. In no event shall this Agreement be extended beyond the Initial Term unless the Parties expresslyagree on all material terms of such extension. 

4.2 Termination by Either Party. Either Party to this Agreement may terminate thisAgreement by written notice to the other Party if, and only if, such other Party (a) becomes insolvent, (b) makes a general assignment for the benefit of creditors, (c) suffers or permits the appointment of a receiver for its businessor assets, (d) becomes subject as the debtor to any proceeding under any bankruptcy or insolvency Law, whether domestic or foreign, and such proceeding is not dismissed with prejudice within sixty (60) days after filing, or(e) commences liquidation or dissolution proceedings, voluntarily or otherwise. In addition, if a Force Majeure Event has occurred, and the Parties have mutually agreed to terminate this Agreement pursuant to the provisions ofSection 2.11(c), this Agreement shall be so terminated on the date the Parties have agreed shall be the termination date. 

4.3Termination by MEMC. 

(a) In the event that Conergy has failed to pay a Purchase Shortfall to MEMC within five(5) Business Days of being notified thereof, and the amount of the unpaid Purchase Shortfall is greater than the amount of the Refundable Capacity Reservation Deposit and Letter of Credit then held by MEMC, then MEMC shall have the right, uponat least ten (10) Business Days prior written notice to Conergy in accordance with the notice provisions of Section 7.4, to immediately terminate this Agreement if: 

(i) Conergy has not paid to MEMC, in immediately available funds, the amount of theunpaid Purchase Shortfall (after MEMC shall have retained the Refundable Capacity Reservation Deposit and drawn on the Letter of Credit) no later than the ninth (9th) Business Day after receiving such written notice; and 

(ii) Conergy has not replenished the Refundable Capacity Reservation Deposit to be held by MEMC (after MEMC has retained the Refundable Capacity Reservation Deposit) by wiring MEMC, in immediately available funds, theamount of the Refundable Capacity Reservation Deposit as would be required for such Contract Year by Attachment B (taking into account the provisions of Section 2.2(a), Section 2.2(f) and Section 3.1(c) hereof) and replaced theLetter of Credit with a new Letter of Credit in the amount of the Letter of Credit Amount required for such Contract Year by Attachment B (taking into account the provisions of Section 2.2(a), Section 2.2(f) and Section 3.1(c)hereof) no later than the ninth (9th) Business Day after receiving such written notice. 

 

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4.4 Termination by Conergy. 

(a) In the event that MEMC has failed to deliver the Yearly Minimum Quantities as would be required to be delivered pursuant to theprovisions of Section 2.2(a) hereof (taking into account the provisions, including the recovery provisions, of Section 2.2(f)(i) hereof) for three (3) consecutive Contract Years, then, no later than thirty (30) days after the endof such third consecutive Contract Year, Conergy may provide written notice to MEMC that Conergy intends to immediately terminate this Agreement. Such termination will take effect five (5) Business Days thereafter if the breach is not cured (inwhich case delivery shall be made for such deliveries only DDP Incoterms 2000 Conergy’s designated location) by MEMC within such five (5) Business Day period; *provided, however*, that Conergy shall be required to accept delivery ofand pay for Wafers already manufactured or in the process of manufacture for any accepted purchase orders at the time the termination notice pursuant to this Section 4.4(a) is received by MEMC in accordance with the notice provisions ofSection 7.4. 

(b) If Conergy would have the right to terminate this Agreement pursuant to Section 4.4(a), butConergy does not provide written notice of such intent to terminate to MEMC within the prescribed time frames of Section 4.4(a), then Conergy may not terminate this Agreement pursuant to Section 4.4(a) for that entire Contract Year, andwill be deemed to have waived such right to terminate this Agreement pursuant to Section 4.4(a) for that three (3) Contract Year period of missed deliveries. In such event, Conergy can still “count” the two most recent ContractYears of missed deliveries of Wafers (as would be required to be delivered by MEMC pursuant to the provisions of Section 2.2(a) hereof (taking into account the recovery provisions of Section 2.2(f)(i) hereof)) for the purposes ofdetermining whether, at the end of the subsequent Contract Year, a new right to terminate this Agreement pursuant to Section 4.4(a) has been triggered. In such case, the provisions of both Section 4.4(a) and this Section 4.4(b) shallagain apply. 

4.5 Effect of Termination. Upon termination or expiration of this Agreement, the Parties’ obligations hereundershall terminate. Notwithstanding the foregoing, the provisions of Section 2.2, Section 2.10, Article V and Article VI are of a continuing nature and shall survive termination of this Agreement for any reason. No such termination shallrelieve any Party from liability for any prior or subsequent breach of this Agreement. If the termination was validly made by Conergy pursuant to Section 4.2 or Section 4.4(a), MEMC shall return to Conergy the balance of RefundableCapacity Reservation Deposit and pro rated for each Missed Delivery the Retained Refundable Capacity Reservation Deposit Amount of the previous years within sixty (60) days of the termination. 

ARTICLE V 

INDEMNIFICATION 

5.1 Indemnification Generally. Conergy shall indemnify and defend MEMC and its directors, officers, employees, contractors and agents, from anyliability (including reasonable attorneys’ fees) for any Loss or injury to persons or property which may result from Conergy’s breach of its representations, warranties or covenants in this Agreement. 

 

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5.2 Resolution of Disputes; Litigation. 

(a) Prior to initiating any legal or other action or proceeding against the other, the Parties shall attempt in good faith to resolve anycontroversy or claim arising from or relating to this Agreement promptly by negotiations between the respective representatives of the Parties. The disputing Party shall give the other Party written notice of the dispute. Within twenty(20) days after receipt of such notice, the receiving Party shall submit a written response to the other Party. The notice and response shall include a statement of the respective Party’s position and arguments supporting its position. Therepresentatives shall meet at a mutually acceptable time and place within thirty (30) days after the date of the disputing Party’s notice and thereafter as often as they reasonably deem necessary to exchange relevant information and toattempt to resolve the dispute. If the matter has not been resolved through negotiation within sixty (60) days after the date of the disputing Party’s notice, or if either Party will not meet with the other Party within thirty(30) days after the date of the disputing Party’s notice, then either Party is free to bring any legal action or proceeding, so long as such legal action or proceeding complies with the provisions of Section 7.12 hereof. All deadlinesspecified herein may be extended by mutual written agreement of the Parties. 

(b) If no agreement can be reached between theParties after good faith negotiation above, either Conergy or MEMC may bring any legal action or proceeding, so long as such legal action or proceeding complies with the provisions of Section 7.12 hereof, unless the amount of the damage or lossis at issue in a pending action or proceeding involving a third party claim, in which event such action or proceeding shall not be commenced until such amount is ascertained or both Parties agree to the action or proceeding. 

(c) In the event that any suit or action is instituted to enforce any provision in this Agreement, the prevailing Party in such disputeshall be entitled to recover from the losing Party all fees, costs and expenses of enforcing any right of such prevailing Party under or with respect to this Agreement, including without limitation, such reasonable fees and expenses of attorneys andaccountants, which shall include, without limitation, all fees, costs and expenses of appeals. 

5.3 Time Limits. Any right toindemnification or other recovery under this Article V shall only apply to Losses arising from claims with respect to which the Indemnified Person shall have notified the Indemnifying Person in writing within one (1) year of the occurrence ofthe facts giving rise to the underlying claim; *provided, however*, that such obligations to indemnify and hold harmless shall not terminate with respect to any Losses arising from claims as to which the Indemnified Person shall have, beforethe expiration of the one (1) year period, previously delivered a notice pursuant to Section 5.2 to the Indemnifying Person. 

 

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5.4 General Indemnification Provisions. 

(a) The Indemnifying Party shall pay the Indemnified Party immediately available funds on an as-incurred basis for any Losses for whichthe Indemnified Party is entitled to indemnification hereunder. Any such indemnification payments shall include interest at the rate of 5% per annum (computed on the basis of a 360-day year) from the date any such Losses are suffered orsustained by the Indemnified Party. 

(b) If and to the extent that any provision of Section 5.1 is unenforceable forany reason, each Party hereto agrees to make the maximum contribution to the payment and satisfaction of any Losses as to which such Party would otherwise have been responsible for indemnification which is permissible under applicable Law.

(c) Each Indemnifying Party hereby waives (i) presentment, demand, protest, notice of protest, notice of dishonor andnotice of nonpayment; (ii) the right, if any, to the benefit of, or to direct the application of, any security hypothecated to Indemnified Party (if any), until all indemnification liability of another Indemnifying Party to Indemnified Party,howsoever arising, shall have been satisfied; (iii) the right to require the Indemnified Party to proceed against another Indemnifying Party, or to pursue any other remedy in Indemnified Party’s power (if any); and agrees that IndemnifiedParty may proceed against Indemnifying Party directly and independently of any other Indemnifying Party, and that any extension, forbearance, amendment, or acceptance, release or substitution of security, or any impairment or suspension ofIndemnified Party’s remedies or rights against another Indemnifying Party or the cessation of the liability for indemnification hereunder of another Indemnifying Party for any reason other than full satisfaction of the indemnificationobligation at issue, shall not in anywise affect the liability of Indemnifying Party hereunder. 

ARTICLE VI 

CONFIDENTIAL INFORMATION 

6.1Confidential Information; Public Disclosure. 

(a) MEMC agrees that it will not disclose to any third party theexistence of or the details of this Agreement and any trade secrets or other proprietary information it obtains with respect to Conergy during or after the term of this Agreement except as expressly permitted hereunder, and that it will treat allsuch information as confidential and will use such information only for carrying out the purposes of this Agreement; *provided, however*, that MEMC will not be obligated to treat as confidential any information acquired by it that is eitherknown to the general public or to the industry, or known to, or in the possession of, MEMC prior to disclosure by Conergy, that is disclosed as required by Law, or that is independently developed by MEMC. The confidentiality obligations of MEMChereunder shall continue during the term of this Agreement and for a period of ten (10) years after termination. 

 

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(b) Conergy agrees that it will not disclose to any third party the existence of orthe details of this Agreement and any trade secrets or other proprietary information it obtains with respect to MEMC during or after the term of this Agreement except as expressly permitted hereunder, and that it will treat all such information asconfidential and will use such information only for carrying out the purposes of this Agreement; provided, however, that Conergy will not be obligated to treat as confidential any information acquired by it that is either known to the general publicor to the industry, or known to, or in the possession of, Conergy prior to disclosure by MEMC, that is disclosed as required by Law, or that is independently developed by Conergy. The confidentiality obligations of Conergy hereunder shall continueduring the term of this Agreement and for a period of ten (10) years after termination. 

(c) The Parties to thisAgreement shall consult with each other as to the form, substance and timing of any press release or other public disclosure related to this Agreement or the transactions contemplated hereby and no such press release or other public disclosure shallbe made without the consent of the other Party hereto, which consent shall not be unreasonably withheld or delayed; *provided*, *however*, that the Parties may make such disclosure to the extent permitted above or to the extent required byapplicable Law, including the requirements of the New York Stock Exchange or the United States Securities and Exchange Commission. 

6.2Equitable Relief. Notwithstanding any other provision of this Agreement, it is understood and agreed that the remedy of indemnity payments pursuant to Article V and other remedies at law may be inadequate in the case of any breach of thecovenants contained in this Article VI. Accordingly, either Party shall be entitled to seek equitable relief, including the remedy of specific performance, with respect to any breach or attempted breach of such covenants. 

ARTICLE VII 

GENERAL PROVISIONS

7.1 No Partnership. Nothing contained in this Agreement shall create or shall be construed as creating a partnership, a jointventure or an agency relationship between the Parties to this Agreement. The Parties agree to perform in accordance with this Agreement only as independent contractors. Neither Party has the right or authority to assume or create any obligations orresponsibilities, express or implied, on behalf of the other Party, and neither Party may bind the other Party in any manner or thing whatsoever. Neither Party shall be liable, except as expressly provided otherwise in this Agreement, for anyexpenses, liabilities or other obligations incurred by the other. 

7.2 Expenses. Each Party hereto shall bear its own fees andexpenses with respect to the transactions contemplated hereby. 

7.3 Amendment. This Agreement may be amended, modified orsupplemented only in writing signed by MEMC and Conergy. 

 

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7.4 Notices. Any notice, request, instruction or other document to be given or deliveredhereunder by a Party hereto shall be in writing and shall be deemed to have been delivered, (a) when received if given in Person or by courier or a courier service, or (b) on the date of transmission if sent by facsimile transmission(receipt confirmed) on a Business Day during the normal business hours of the intended recipient, and if not so sent on such a day and at such a time, on the following Business Day: 

If to MEMC, addressed as follows: 

MEMCElectronic Materials, Inc. 

501 Pearl Drive (City of O’Fallon) 

P.O. Box 8 

St. Peters, MO 63376

Attention: Chief Executive Officer 

Tele: 636-474-5000 

Fax: 636-474-5162 

cc: MEMC General Counsel 

If to Conergy, addressed as follows: 

Conergy AG 

Anckelmannsplatz 1 

D 20537 Hamburg, Germany 

Attention:Chief Executive Officer 

Tele: +49 (0) 40 / 27 142-1000 

Fax: +49 (0) 40 / 27 142-1100 

or to such other individual or address as a Party hereto may designate for itself bynotice given as herein provided. 

7.5 Waivers. Except as otherwise provided in Section 5.3, the failure of a Party hereto atany time or times to require strict performance of any provision hereof or claim damages with respect thereto shall in no manner affect its right at a later time to enforce the same. No waiver by a Party of any condition or of any breach of anyterm, covenant, representation or warranty contained in this Agreement shall be effective unless in writing, and no waiver in any one or more instances shall be deemed to be a further or continuing waiver of any such condition or breach in otherinstances or a waiver of any other condition or breach of any other term, covenant, representation or warranty. 

7.6 Assignment.This Agreement shall be binding upon and inure to the benefit of the Parties hereto and their respective successors and permitted assigns; *provided, however*, that, except with the written consent of the other Party, no assignment of thisAgreement or any rights or obligations hereunder, by operation of Law or otherwise, may be made by either Party, other than to an at least eighty percent (80%) owned Subsidiary of such Party (but no such assignment shall relieve the assigningParty of its obligations hereunder), and any assignment in contravention of this Section 7.6 shall be of no effect and shall be void. 

 

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7.7 Captions. Captions of Sections or Articles of this Agreement are included for referenceonly, shall not be construed as part of this Agreement and shall not be used to define, limit, extend or interpret the terms of this Agreement. 

7.8 Severability. If any provision of this Agreement shall be held invalid, illegal or unenforceable, the validity, legality or enforceability of the other provisions hereof shall not be affected thereby, and there shall be deemedsubstituted for the provision at issue a valid, legal and enforceable provision as similar as possible to the provision at issue. 

7.9Entire Understanding; Conflicts. This Agreement sets forth the entire agreement and understanding of the Parties hereto with respect to the transactions contemplated hereby and supersedes any and all prior agreements, arrangements andunderstandings, both written and oral, among the Parties relating to the subject matter hereof. 

7.10 Language. Each of MEMC andConergy agree that the language used in this Agreement is the language chosen by the Parties to express their mutual intent, and that no rule of strict construction is to be applied against MEMC or Conergy. Each of MEMC and Conergy and theirrespective counsel have reviewed and negotiated the terms of this Agreement. 

7.11 Applicable Law. This Agreement shall be governedby and construed and enforced in accordance with the internal Laws of the State of New York, without giving effect to the principles of conflicts of law thereof. 

7.12 Jurisdiction for Disputes. Subject to the provisions of Section 5.2 which shall govern any claim for indemnification as discussed therein, each Party to this Agreement hereby (a) agrees that anyproceeding in connection with or relating to this Agreement or any matters contemplated hereby may be brought by either Party in a court of competent jurisdiction located within New York City, New York, whether a state or federal court;(b) agrees that in connection with any such proceeding, such Party shall consent and submit to personal jurisdiction in any such court described in clause (a) of this Section 7.12 and to service of process upon it in accordancewith the rules and statutes governing service of process; (c) agrees to waive to the full extent permitted by Law any objection that it may now or hereafter have to the venue of any such proceeding in any such court or that any such proceedingwas brought in an inconvenient forum; (d) agrees to service of process in any such proceeding by mailing of copies thereof to such Party at its address set forth in Section 7.4; (e) agrees that any service made as provided hereinshall be effective and binding service in every respect; and (f) agrees that nothing herein shall affect the rights of either Party to effect service of process in any other manner permitted by Law. 

7.13 Cumulative Remedies. Each and every right and remedy under this Agreement is cumulative with each and every other right and remedy in thisAgreement or in any other agreement between the Parties or under applicable Law. 

7.14 Counterparts; Facsimile Signatures. ThisAgreement may be executed in counterparts, and when so executed each counterpart shall be deemed to be an original, and said counterparts together shall constitute one and the same instrument. This Agreement may be executed and delivered byfacsimile and upon such delivery the facsimile signature shall be deemed to have the 

 

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same effect as if the original signature had been delivered to the other part(ies). The original signature copy shall be delivered to the other part(ies) byexpress overnight delivery. The failure to deliver the original signature copy and/or the nonreceipt of the original signature copy shall have no effect upon the binding and enforceable nature of this Agreement. 

[remainder of page intentionally left blank; signature page follows] 

 

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IN WITNESS WHEREOF, the Parties hereto have caused this Agreement to be executed and delivered as ofthe date first above written. 

 
**MEMC ELECTRONIC MATERIALS, INC.**  **CONERGY AG**By: 
/s/ Nabeel Gareeb
  By: 
/s/ Hans-Martin Rüter
 Nabeel Gareeb   Hans-Martin Rüter President and Chief Executive Officer   Chief Executive Officer
SIGNATURE PAGE TO 

SOLAR WAFER SUPPLY AGREEMENT 

**CONFIDENTIAL TREATMENT**

 

**Attachment A – Specifications**

**[****]**

 

A-4 

**CONFIDENTIAL TREATMENT**

 

**Attachment B – Yearly Target Quantities**

**[****]**

 

B-1 

**CONFIDENTIAL TREATMENT**

 

**Attachment B**

**[****]**

 

B-2 

**CONFIDENTIAL TREATMENT**

 

**Attachment C – Refundable Capacity Reservation Deposit Amounts; Letter of Credit Amounts**

**[****]**

 

C-1 

**CONFIDENTIAL TREATMENT**

 

**Attachment D**

**[****]**

 

D-1