##### Table of Contents









UNITED STATES SECURITIES AND EXCHANGE COMMISSION


Washington, DC 20549


Form 10-Q


|   |  |                                                                                             
|-- |  | --------------------------------------------------------------------------------------------
|þ  |  | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
    SECURITIES EXCHANGE ACT OF 1934 
|  
|   |  | For the quarterly period ended October 1, 2005                                              
|  
|OR
|  
|o  |  | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
    SECURITIES EXCHANGE ACT OF 1934
|  
|   |  | For the transition period
    from          to                                              

COMMISSION FILE NUMBER 000-31687


EVERGREEN SOLAR, INC.


(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)


|                                                                   |  |                                            
|------------------------------------------------------------------ |  | -------------------------------------------
|DELAWARE                                                           |  | 04-3242254                                 
|(STATE OR OTHER JURISDICTION OF
    INCORPORATION OR ORGANIZATION) |  | (I.R.S. EMPLOYER
    IDENTIFICATION NUMBER)

138 Bartlett Street


Marlboro, Massachusetts 01752


(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES)


(508) 357-2221


(REGISTRANTS TELEPHONE NUMBER, INCLUDING AREA CODE)


(FORMER NAME, FORMER ADDRESS AND FORMER FISCAL YEAR, IF
CHANGED SINCE LAST REPORT)


þ o


þ o


o þ















---










EVERGREEN SOLAR, INC.


QUARTERLY REPORT ON FORM 10-Q


FOR THE QUARTER ENDED OCTOBER 1, 2005


TABLE OF CONTENTS


|                                                                                                      |  |  |    | 
|----------------------------------------------------------------------------------------------------- |  |  | -- | 
|PART I. FINANCIAL INFORMATION                                                                         |  |  | 3  | 
|ITEM 1. FINANCIAL
    STATEMENTS                                                                      |  |  | 3  | 
|Condensed
    Consolidated Balance Sheets                                                             |  |  | 3  | 
|Condensed
    Consolidated Statements of Operations                                                   |  |  | 4  | 
|Condensed
    Consolidated Statements of Cash Flows                                                   |  |  | 5  | 
|Notes to
    Condensed Consolidated Financial Statements                                              |  |  | 6  | 
|ITEM 2. MANAGEMENTS
    DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
    OPERATIONS |  |  | 13 | 
|ITEM 3. QUANTITATIVE
    AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK                                 |  |  | 40 | 
|ITEM 4. CONTROLS AND
    PROCEDURES                                                                   |  |  | 40 | 
|PART II. OTHER
    INFORMATION                                                                        |  |  | 41 | 
|ITEM 1. LEGAL
    PROCEEDINGS                                                                         |  |  | 41 | 
|ITEM 2. UNREGISTERED
    SALES OF EQUITY SECURITIES AND USE OF PROCEEDS                               |  |  | 41 | 
|ITEM 3. DEFAULTS UPON
    SENIOR SECURITIES                                                           |  |  | 41 | 
|ITEM 4. SUBMISSION OF
    MATTERS TO A VOTE OF SECURITY HOLDERS                                       |  |  | 42 | 
|ITEM 5. OTHER
    INFORMATION                                                                         |  |  | 42 | 
|ITEM 6. EXHIBITS                                                                                      |  |  | 42 | 
|SIGNATURES                                                                                            |  |  | 45 | 
|Ex-31.1 Section 302 Certification of CEO                                                             
|Ex-31.2 Section 302 Certification of CFO                                                             
|Ex-32.1 Section 906 Certification of CEO                                                             
|Ex-32.2 Section 906 Certification of CFO                                                             



2



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##### Table of Contents






PART I.     FINANCIAL
INFORMATION







|        |                     
|------- | --------------------
|ITEM 1. | FINANCIAL STATEMENTS

Evergreen Solar, Inc.





Condensed Consolidated Balance Sheets


(In thousands, except share data)


(Unaudited)


|                                                                                                                                                                              |                                                                                                                                                                |                            |         |       |            |   |         |        |         | 
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------------------------- | ------- | ----- | ---------- | - | ------- | ------ | ------- | 
|                                                                                                                                                                              |                                                                                                                                                                | December 31,               |         |       | October 1, |  
|                                                                                                                                                                              |                                                                                                                                                                | 2004                       |         |       | 2005       |  
|                                                                                                                                                                              |                                                                                                                                                                |                            |         |       |            |  
|ASSETS                                                                                                                                                                       
|Current assets:                                                                                                                                                               |                                                                                                                                                                |                            |         |       |            |   |         |       
|                                                                                                                                                                              | Cash and cash equivalents                                                                                                                                      |                            | $       | 5,379 |            |   | $       | 74,332 |        
|                                                                                                                                                                              | Marketable securities                                                                                                                                          |                            |         | 6,563 |            |   |         | 53,163 |        
|                                                                                                                                                                              | Accounts receivable, net of allowances for doubtful accounts and
    sales discounts of $84 and $76 at December 31, 2004 and
    October 1, 2005, respectively |                            |         | 6,166 |            |   |         | 5,322  |        
|                                                                                                                                                                              | Inventory                                                                                                                                                      |                            |         | 2,906 |            |   |         | 3,733  |        
|                                                                                                                                                                              | Interest receivable                                                                                                                                            |                            |         | 57    |            |   |         | 210    |        
|                                                                                                                                                                              | Prepaid inventory                                                                                                                                              |                            |         |      |            |   |         | 1,046  |        
|                                                                                                                                                                              | Other current assets                                                                                                                                           |                            |         | 1,411 |            |   |         | 1,779  |        
|                                                                                                                                                                              |                                                                                                                                                                |                            |         |       |            |  
|                                                                                                                                                                              |                                                                                                                                                                | Total current assets       |         |       | 22,482     |   |         |        | 139,585 | 
|Long-term investments                                                                                                                                                         |                                                                                                                                                                |                            |        |       |            |   | 2,949   |       
|Deposits on fixed assets in production                                                                                                                                        |                                                                                                                                                                |                            |        |       |            |   | 15,842  |       
|Restricted cash                                                                                                                                                               |                                                                                                                                                                |                            | 414     |       |            |   | 2,436   |       
|Deferred financing costs                                                                                                                                                      |                                                                                                                                                                |                            |        |       |            |   | 2,967   |       
|Fixed assets, net                                                                                                                                                             |                                                                                                                                                                |                            | 26,825  |       |            |   | 37,878  |       
|                                                                                                                                                                              |                                                                                                                                                                |                            |         |       |            |  
|Total assets                                                                                                                                                                  |                                                                                                                                                                | $                          | 49,721  |       |            | $ | 201,657 |       
|                                                                                                                                                                              |                                                                                                                                                                |                            |         |       |            |  
|                                                                                                                                                                             
|LIABILITIES, MINORITY INTEREST AND STOCKHOLDERS
    EQUITY                                                                                                                  
|Current liabilities:                                                                                                                                                          |                                                                                                                                                                |                            |         |       |            |   |         |       
|                                                                                                                                                                              | Accounts payable                                                                                                                                               |                            | $       | 3,074 |            |   | $       | 8,032  |        
|                                                                                                                                                                              | Short term borrowings                                                                                                                                          |                            |         | 1,500 |            |   |         | 1,500  |        
|                                                                                                                                                                              | Accrued warranty                                                                                                                                               |                            |         | 705   |            |   |         | 705    |        
|                                                                                                                                                                              | Accrued employee compensation                                                                                                                                  |                            |         | 1,187 |            |   |         | 1,413  |        
|                                                                                                                                                                              | Accrued debt interest                                                                                                                                          |                            |         |      |            |   |         | 1,017  |        
|                                                                                                                                                                              | Other accrued expenses                                                                                                                                         |                            |         | 1,295 |            |   |         | 1,628  |        
|                                                                                                                                                                              | Deferred revenue                                                                                                                                               |                            |         | 440   |            |   |         |       |        
|                                                                                                                                                                              |                                                                                                                                                                |                            |         |       |            |  
|                                                                                                                                                                              |                                                                                                                                                                | Total current liabilities  |         |       | 8,201      |   |         |        | 14,295  | 
|                                                                                                                                                                              | Subordinated convertible notes                                                                                                                                 |                            |         |      |            |   |         | 90,000 |        
|                                                                                                                                                                              |                                                                                                                                                                |                            |         |       |            |  
|                                                                                                                                                                              |                                                                                                                                                                | Total liabilities          |         |       | 8,201      |   |         |        | 104,295 | 
|Minority interest in EverQ                                                                                                                                                    |                                                                                                                                                                |                            |        |       |            |   | 5,964   |       
|Stockholders equity:                                                                                                                                                         |                                                                                                                                                                |                            |         |       |            |   |         |       
|Common stock, $0.01 par value, 100,000,000 shares
    authorized, 47,541,823 and 61,318,229 issued and outstanding at
    December 31, 2004 and October 1, 2005, respectively |                                                                                                                                                                |                            | 475     |       |            |   | 613     |       
|Additional paid-in capital                                                                                                                                                    |                                                                                                                                                                |                            | 116,764 |       |            |   | 179,803 |       
|Accumulated deficit                                                                                                                                                           |                                                                                                                                                                |                            | (75,693 | )     |            |   | (87,968 | )     
|Accumulated other comprehensive loss                                                                                                                                          |                                                                                                                                                                |                            | (26     | )     |            |   | (1,050  | )     
|                                                                                                                                                                              |                                                                                                                                                                |                            |         |       |            |  
|                                                                                                                                                                              |                                                                                                                                                                | Total stockholders equity |         |       | 41,520     |   |         |        | 91,398  | 
|                                                                                                                                                                              |                                                                                                                                                                |                            |         |       |            |  
|Total liabilities, minority interest and stockholders
    equity                                                                                                             |                                                                                                                                                                | $                          | 49,721  |       |            | $ | 201,657 |       
|                                                                                                                                                                              |                                                                                                                                                                |                            |         |       |            |  



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##### Table of Contents



Evergreen Solar, Inc.





Condensed Consolidated Statements of Operations


(In thousands, except per share data)


(Unaudited)


|                                                                                                                       |                                                                             |               |        |              |              |   |        |               |   |   |            |        |  |   |         |        |  
|---------------------------------------------------------------------------------------------------------------------- | --------------------------------------------------------------------------- | ------------- | ------ | ------------ | ------------ | - | ------ | ------------- | - | - | ---------- | ------ |  | - | ------- | ------ | -
|                                                                                                                       |                                                                             |               |        | Year-to-Date |             
|                                                                                                                       |                                                                             | Quarter Ended |        |              | Period Ended |  
|                                                                                                                       |                                                                             |               |        |              |              |  
|                                                                                                                       |                                                                             | September 30, |        |              | October 1,   |   |        | September 30, |   |   | October 1, |       
|                                                                                                                       |                                                                             | 2004          |        |              | 2005         |   |        | 2004          |   |   | 2005       |       
|                                                                                                                       |                                                                             |               |        |              |              |   |        |               |   |   |            |       
|Revenues:                                                                                                              |                                                                             |               |        |              |              |   |        |               |   |   |            |        |  |   |         |       
|                                                                                                                       | Product revenues                                                            |               | $      | 5,604        |              |   | $      | 11,092        |   |   | $          | 12,975 |  |   | $       | 32,059 |  
|                                                                                                                       | Research revenues                                                           |               |        | 369          |              |   |        | 94            |   |   |            | 861    |  |   |         | 328    |  
|                                                                                                                       |                                                                             |               |        |              |              |   |        |               |   |   |            |       
|Total revenues                                                                                                         |                                                                             |               | 5,973  |              |              |   | 11,186 |               |   |   | 13,836     |        |  |   | 32,387  |       
|                                                                                                                       |                                                                             |               |        |              |              |   |        |               |   |   |            |       
|Operating expenses:                                                                                                    |                                                                             |               |        |              |              |   |        |               |   |   |            |        |  |   |         |       
|                                                                                                                       | Cost of product revenues                                                    |               |        | 7,230        |              |   |        | 9,934         |   |   |            | 20,945 |  |   |         | 29,887 |  
|                                                                                                                       | Research and development expenses, including costs of research
    revenues |               |        | 1,335        |              |   |        | 3,065         |   |   |            | 3,233  |  |   |         | 8,037  |  
|                                                                                                                       | Selling, general and administrative expenses                                |               |        | 2,126        |              |   |        | 3,115         |   |   |            | 5,460  |  |   |         | 8,067  |  
|                                                                                                                       |                                                                             |               |        |              |              |   |        |               |   |   |            |       
|Total operating expenses                                                                                               |                                                                             |               | 10,691 |              |              |   | 16,114 |               |   |   | 29,638     |        |  |   | 45,991  |       
|                                                                                                                       |                                                                             |               |        |              |              |   |        |               |   |   |            |       
|Operating loss                                                                                                         |                                                                             |               | (4,718 | )            |              |   | (4,928 | )             |   |   | (15,802    | )      |  |   | (13,604 | )     
|Other income                                                                                                           |                                                                             |               |        |              |              |   |        |               |   |   |            |        |  |   |         |       
|                                                                                                                       | Foreign exchange gains, net                                                 |               |        | 40           |              |   |        | 48            |   |   |            | 49     |  |   |         | 134    |  
|                                                                                                                       | Interest income                                                             |               |        | 71           |              |   |        | 1,163         |   |   |            | 181    |  |   |         | 1,912  |  
|                                                                                                                       | Interest expense                                                            |               |        |             |              |   |        | (1,156        | ) |   |            |       |  |   |         | (1,350 | )
|                                                                                                                       |                                                                             |               |        |              |              |   |        |               |   |   |            |       
|Loss from operations before minority interest                                                                          |                                                                             |               | (4,607 | )            |              |   | (4,873 | )             |   |   | (15,572    | )      |  |   | (12,908 | )     
|                                                                                                                       | Minority interest in EverQ                                                  |               |        |             |              |   |        | 310           |   |   |            |       |  |   |         | 633    |  
|                                                                                                                       |                                                                             |               |        |              |              |   |        |               |   |   |            |       
|Net loss                                                                                                               |                                                                             |               | (4,607 | )            |              |   | (4,563 | )             |   |   | (15,572    | )      |  |   | (12,275 | )     
|Accretion, dividends and conversion premiums on Series A
    convertible preferred stock                               |                                                                             |               |        |              |              |   |       |               |   |   | (2,904     | )      |  |   |        |       
|                                                                                                                       |                                                                             |               |        |              |              |   |        |               |   |   |            |       
|Net loss attributable to common stockholders                                                                           |                                                                             | $             | (4,607 | )            |              | $ | (4,563 | )             |   | $ | (18,476    | )      |  | $ | (12,275 | )     
|                                                                                                                       |                                                                             |               |        |              |              |   |        |               |   |   |            |       
|Net loss per share attributable to common stockholders (basic
    and diluted)                                         |                                                                             | $             | (0.10  | )            |              | $ | (0.07  | )             |   | $ | (0.66      | )      |  | $ | (0.21   | )     
|Weighted average shares used in computing basic and diluted net
    loss per share attributable to common stockholders |                                                                             |               | 47,523 |              |              |   | 61,178 |               |   |   | 28,187     |        |  |   | 59,049  |       



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Evergreen Solar, Inc.





Condensed Consolidated Statements of Cash Flows


(In thousands)


(Unaudited)


|                                                             |                                                                                                     |                                                             |                      |         |            |        |         |         |       |        |  
|------------------------------------------------------------ | --------------------------------------------------------------------------------------------------- | ----------------------------------------------------------- | -------------------- | ------- | ---------- | ------ | ------- | ------- | ----- | ------ | -
|                                                             |                                                                                                     | Year-to-Date                                                |                     
|                                                             |                                                                                                     | Period Ended                                                |                     
|                                                             |                                                                                                     |                                                             |                     
|                                                             |                                                                                                     | September 30,                                               |                      |         | October 1, |       
|                                                             |                                                                                                     | 2004                                                        |                      |         | 2005       |       
|                                                             |                                                                                                     |                                                             |                      |         |            |       
|Cash flows from operating activities:                        |                                                                                                     |                                                             |                      |         |            |        |         |        
|                                                             | Net loss                                                                                            |                                                             | $                    | (15,572 | )          |        | $       | (12,275 | )    
|                                                             | Adjustments to reconcile net loss to net cash provided by (used
    in) operating activities:       |                                                             |                      |         |            |        |         |         |      
|                                                             |                                                                                                     | Depreciation expense                                        |                      |         | 2,579      |        |         |         | 2,961 |       
|                                                             |                                                                                                     | Loss on disposal of fixed assets                            |                      |         | 1,985      |        |         |         | 56    |       
|                                                             |                                                                                                     | Minority interest in EverQ                                  |                      |         |           |        |         |         | (633  | )     
|                                                             |                                                                                                     | Amortization of convertible debt financing costs            |                      |         |           |        |         |         | 94    |       
|                                                             |                                                                                                     | Bad debt expense and provision for early payment discounts  |                      |         | 41         |        |         |         | (8    | )     
|                                                             |                                                                                                     | Amortization (accretion) of bond premiums                   |                      |         | 280        |        |         |         | (879  | )     
|                                                             |                                                                                                     | Compensation expense associated with employee stock options |                      |         | 67         |        |         |         |      |       
|                                                             |                                                                                                     | Changes in operating assets and liabilities:                |                      |         |            |        |         |         |       |       
|                                                             |                                                                                                     |                                                             | Accounts receivable  |         |            | (3,487 | )       |         |       | 852    |  
|                                                             |                                                                                                     |                                                             | Prepaid inventory    |         |            |       |         |         |       | (1,046 | )
|                                                             |                                                                                                     |                                                             | Inventory            |         |            | (1,257 | )       |         |       | (827   | )
|                                                             |                                                                                                     |                                                             | Interest receivable  |         |            | (5     | )       |         |       | (153   | )
|                                                             |                                                                                                     |                                                             | Other current assets |         |            | (61    | )       |         |       | (182   | )
|                                                             |                                                                                                     |                                                             | Accounts payable     |         |            | 934    |         |         |       | 5,201  |  
|                                                             |                                                                                                     |                                                             | Accrued expenses     |         |            | 683    |         |         |       | 1,152  |  
|                                                             |                                                                                                     |                                                             |                      |         |            |       
|Net cash used in operating activities                        |                                                                                                     |                                                             | (13,813              | )       |            |        | (5,687  | )      
|                                                             |                                                                                                     |                                                             |                      |         |            |       
|Cash flows from investing activities:                        |                                                                                                     |                                                             |                      |         |            |        |         |        
|                                                             | Purchases of fixed assets                                                                           |                                                             |                      | (7,681  | )          |        |         | (30,252 | )    
|                                                             | Purchases of investments                                                                            |                                                             |                      | (2,418  | )          |        |         | (69,282 | )    
|                                                             | Increase in restricted cash                                                                         |                                                             |                      |        |            |        |         | (2,100  | )    
|                                                             | Proceeds from sale and maturity of investments                                                      |                                                             |                      | 9,754   |            |        |         | 19,950  |      
|                                                             |                                                                                                     |                                                             |                      |         |            |       
|Net cash used in investing activities                        |                                                                                                     |                                                             | (345                 | )       |            |        | (81,684 | )      
|                                                             |                                                                                                     |                                                             |                      |         |            |       
|Cash flows from financing activities:                        |                                                                                                     |                                                             |                      |         |            |        |         |        
|                                                             | Proceeds from convertible debt financing, net of offering costs                                     |                                                             |                      |        |            |        |         | 86,939  |      
|                                                             | Proceeds from the issuance of common stock, net of offering costs                                   |                                                             |                      | 18,771  |            |        |         | 62,335  |      
|                                                             | Capital contribution to EverQ from minority interest holder                                         |                                                             |                      |        |            |        |         | 6,830   |      
|                                                             | Dividend and conversion premium paid on Series A
    convertible preferred stock                    |                                                             |                      | (2,230  | )          |        |         |        |      
|                                                             | Increase in short-term borrowings                                                                   |                                                             |                      | 1,500   |            |        |         |        |      
|                                                             | Proceeds from exercise of stock options and shares purchased
    under Employee Stock Purchase Plan |                                                             |                      | 11      |            |        |         | 842     |      
|                                                             |                                                                                                     |                                                             |                      |         |            |       
|Net cash provided by financing activities                    |                                                                                                     |                                                             | 18,052               |         |            |        | 156,946 |        
|Effect of exchange rate changes on cash and cash equivalents |                                                                                                     |                                                             |                     |         |            |        | (622    | )      
|                                                             |                                                                                                     |                                                             |                      |         |            |       
|Net increase in cash and cash equivalents                    |                                                                                                     |                                                             | 3,894                |         |            |        | 68,953  |        
|Cash and cash equivalents at beginning of period             |                                                                                                     |                                                             | 4,620                |         |            |        | 5,379   |        
|                                                             |                                                                                                     |                                                             |                      |         |            |       
|Cash and cash equivalents at end of period                   |                                                                                                     | $                                                           | 8,514                |         |            | $      | 74,332  |        
|                                                             |                                                                                                     |                                                             |                      |         |            |       
|Supplemental cash flow information:                          |                                                                                                     |                                                             |                      |         |            |        |         |        
|                                                             | Interest paid                                                                                       |                                                             | $                    | 13      |            |        | $       | 103     |      
|                                                             | Non-cash Series A convertible preferred stock dividends
    earned                                  |                                                             |                      | 27,704  |            |        |         |        |      
|                                                             | Non-cash conversion of Series A convertible preferred stock
    to common stock                     |                                                             |                      | 187     |            |        |         |        |      



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##### Table of Contents



Evergreen Solar, Inc.





Notes to Condensed Consolidated Financial Statements




|   |                      
|-- | ---------------------
|1. | Basis of Presentation







6



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##### Table of Contents



Evergreen Solar, Inc.


Notes to Condensed Consolidated Financial
Statements  (Continued)










|                                                                                                                        |  |                    |        |   |                           |   |       |                    |  |   |                 |   |  |              |       |   |          |   |         |              |  |   |          |   |  |   |         |   |  |   |       |  
|----------------------------------------------------------------------------------------------------------------------- |  | ------------------ | ------ | - | ------------------------- | - | ----- | ------------------ |  | - | --------------- | - |  | ------------ | ----- | - | -------- | - | ------- | ------------ |  | - | -------- | - |  | - | ------- | - |  | - | ----- | -
|                                                                                                                        |  | Quarter Ended      |        |   | Year-to-Date Period Ended |  
|                                                                                                                        |  |                    |        |   |                           |  
|                                                                                                                        |  | September 30, 2004 |        |   | October 1, 2005           |   |       | September 30, 2004 |  |   | October 1, 2005 |  
|                                                                                                                        |  |                    |        |   |                           |   |       |                    |  |   |                 |  
|                                                                                                                        |  | Net Loss           |        |   | Net Loss                  |   |       | Net Loss           |  |   | Net Loss        |   |  | Net Loss     |       |   | Net Loss |   |         | Net Loss     |  |   | Net Loss |  
|                                                                                                                        |  | Attributable       |        |   | per                       |   |       | Attributable       |  |   | per             |   |  | Attributable |       |   | per      |   |         | Attributable |  |   | per      |  
|                                                                                                                        |  | to Common          |        |   | Common                    |   |       | to Common          |  |   | Common          |   |  | to Common    |       |   | Common   |   |         | to Common    |  |   | Common   |  
|                                                                                                                        |  | Stockholders       |        |   | Share                     |   |       | Stockholders       |  |   | Share           |   |  | Stockholders |       |   | Share    |   |         | Stockholders |  |   | Share    |  
|                                                                                                                        |  |                    |        |   |                           |   |       |                    |  |   |                 |   |  |              |       |   |          |   |         |              |  |   |          |  
|Net loss attributable to common stockholders, as reported                                                               |  | $                  | (4,607 | ) |                           | $ | (0.10 | )                  |  | $ | (4,563          | ) |  | $            | (0.07 | ) |          | $ | (18,476 | )            |  | $ | (0.66    | ) |  | $ | (12,275 | ) |  | $ | (0.21 | )
|Add: Stock-based employee compensation expense included in
    reported results                                         |  |                    | 12     |   |                           |   |      |                    |  |   |                |   |  |              |      |   |          |   | 67      |              |  |   |         |   |  |   |        |   |  |   |      |  
|Deduct: Total stock-based employee compensation expense
    determined under the fair-value-based method for all awards |  |                    | (501   | ) |                           |   | (0.01 | )                  |  |   | (1,086          | ) |  |              | (0.02 | ) |          |   | (1,783  | )            |  |   | (0.06    | ) |  |   | (2,559  | ) |  |   | (0.04 | )
|                                                                                                                        |  |                    |        |   |                           |   |       |                    |  |   |                 |   |  |              |       |   |          |   |         |              |  |   |          |  
|Pro forma net loss attributable to common stockholders                                                                  |  | $                  | (5,096 | ) |                           | $ | (0.11 | )                  |  | $ | (5,649          | ) |  | $            | (0.09 | ) |          | $ | (20,192 | )            |  | $ | (0.72    | ) |  | $ | (14,834 | ) |  | $ | (0.25 | )
|                                                                                                                        |  |                    |        |   |                           |   |       |                    |  |   |                 |   |  |              |       |   |          |   |         |              |  |   |          |  



|   |                          
|-- | -------------------------
|2. | Net Loss per Common Share



7



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Evergreen Solar, Inc.


Notes to Condensed Consolidated Financial
Statements  (Continued)




|   |          
|-- | ---------
|3. | Inventory



|                |  |              |       |  |            |   |       | 
|--------------- |  | ------------ | ----- |  | ---------- | - | ----- | 
|                |  | December 31, |       |  | October 1, |  
|                |  | 2004         |       |  | 2005       |  
|                |  |              |       |  |            |  
|Raw materials   |  | $            | 2,230 |  |            | $ | 3,146 | 
|Work-in-process |  |              | 138   |  |            |   | 335   | 
|Finished goods  |  |              | 538   |  |            |   | 252   | 
|                |  |              |       |  |            |  
|                |  | $            | 2,906 |  |            | $ | 3,733 | 
|                |  |              |       |  |            |  





|   |             
|-- | ------------
|4. | Fixed Assets



|                                       |  |                                       |           |              |       |   |            |      |       |   |        |  
|-------------------------------------- |  | ------------------------------------- | --------- | ------------ | ----- | - | ---------- | ---- | ----- | - | ------ | -
|                                       |  |                                       |           | December 31, |       |   | October 1, |     
|                                       |  | Useful Life                           |           |              | 2004  |   |            | 2005 |      
|                                       |  |                                       |           |              |       |   |            |      |      
|Laboratory and manufacturing equipment |  |                                       | 3-7 years |              |       | $ | 20,310     |      |       | $ | 26,606 |  
|Computer and office equipment          |  |                                       | 3-7 years |              |       |   | 457        |      |       |   | 585    |  
|Leasehold improvements                 |  | Lesser of 15 to 20years or lease term |           |              | 7,433 |   |            |      | 8,360 |  
|Land                                   |  |                                       |           |              |       |   |           |      |       |   | 585    |  
|Assets under construction              |  |                                       |           |              |       |   | 5,084      |      |       |   | 11,002 |  
|                                       |  |                                       |           |              |       |   |            |      |      
|                                       |  |                                       |           |              |       |   | 33,284     |      |       |   | 47,138 |  
|Less: Accumulated depreciation         |  |                                       |           |              |       |   | (6,459     | )    |       |   | (9,260 | )
|                                       |  |                                       |           |              |       |   |            |      |      
|                                       |  |                                       |           |              |       | $ | 26,825     |      |       | $ | 37,878 |  
|                                       |  |                                       |           |              |       |   |            |      |      





|   |                       
|-- | ----------------------
|5. | Guarantor Arrangements





| |                 
| | ----------------
| | Product Warranty



8



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Evergreen Solar, Inc.


Notes to Condensed Consolidated Financial
Statements  (Continued)




|                                                                      |  |      |         |  |      |   |         | 
|--------------------------------------------------------------------- |  | ---- | ------- |  | ---- | - | ------- | 
|                                                                      |  | 2004 |         |  | 2005 |  
|                                                                      |  |      |         |  |      |  
|Balance at January 1                                                  |  | $    | 426,000 |  |      | $ | 705,000 | 
|Accruals for warranties issued during the period                      |  |      | 163,000 |  |      |   |        | 
|                                                                      |  |      |         |  |      |  
|Balance at quarter ended September 30 and October 1,
    respectively |  | $    | 589,000 |  |      | $ | 705,000 | 
|                                                                      |  |      |         |  |      |  



| |                           
| | --------------------------
| | Indemnification Agreements





|   |                      
|-- | ---------------------
|6. | Deferred Compensation





|   |                     
|-- | --------------------
|7. | Stockholders Equity





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Evergreen Solar, Inc.


Notes to Condensed Consolidated Financial
Statements  (Continued)








|   |           
|-- | ----------
|8. | EverQ GmbH



|                                      |  |   |        | 
|------------------------------------- |  | - | ------ | 
|Current assets                        |  |   | 3,894  | 
|Deposits on fixed assets              |  |   | 15,822 | 
|Restricted cash                       |  |   | 2,022  | 
|Fixed assets                          |  |   | 8,750  | 
|                                      |  |   |       
|Total assets                          |  | $ | 30,488 | 
|                                      |  |   |       
|Accounts payable and accrued expenses |  | $ | 6,536  | 
|                                      |  |   |       
|Net loss                              |  | $ | 2,543  | 
|                                      |  |   |       



|   |                      
|-- | ---------------------
|9. | Short-term Borrowings









10



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##### Table of Contents



Evergreen Solar, Inc.


Notes to Condensed Consolidated Financial
Statements  (Continued)






|    |                                     
|--- | ------------------------------------
|10. | Accumulated Other Comprehensive Loss





|    |               
|--- | --------------
|11. | Long-Term Debt



|                                                               |  |           |         | 
|-------------------------------------------------------------- |  | --------- | ------- | 
|Redemption Period                                              |  | Price (%) |        
|                                                               |  |           |        
|Beginning on July 1, 2010 and ending on September 30,
    2011 |  |           | 101.250 | 
|Beginning on July 1, 2011 and ending on September 30,
    2012 |  |           | 101.625 | 
|On July 1, 2012                                                |  |           | 100.000 | 









|    |                                 
|--- | --------------------------------
|12. | Recent Accounting Pronouncements



11



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##### Table of Contents



Evergreen Solar, Inc.


Notes to Condensed Consolidated Financial
Statements  (Continued)










|    |                  
|--- | -----------------
|13. | Subsequent Events



12



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|        |                                                                                          
|------- | -----------------------------------------------------------------------------------------
|ITEM 2. | MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL
    CONDITION AND RESULTS OF OPERATIONS

CONCERNS REGARDING FORWARD-LOOKING STATEMENTS




EXECUTIVE OVERVIEW




13



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Financing Transactions




14



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##### Table of Contents







|                                                               |  |           |         | 
|-------------------------------------------------------------- |  | --------- | ------- | 
|Redemption Period                                              |  | Price (%) |        
|                                                               |  |           |        
|Beginning on July 1, 2010 and ending on September 30,
    2011 |  |           | 101.250 | 
|Beginning on July 1, 2011 and ending on September 30,
    2012 |  |           | 101.625 | 
|On July 1, 2012                                                |  |           | 100.000 | 







CRITICAL ACCOUNTING POLICIES AND ESTIMATES




Warranty




15



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##### Table of Contents





Sales Discount Allowance




RESULTS OF OPERATION


Revenues.


Cost of product revenues.


Research and development expenses, including cost of research
revenues.


Selling, general and administrative expenses.


Other income.


Minority interest.


16



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##### Table of Contents



Dividends on preferred stock.


Net loss attributable to common stockholders.


Comparison of Quarters Ended October 1, 2005 and
September 30, 2004


Revenues.






|              |                                    |               |     |    |            |  |     |    |  
|------------- | ---------------------------------- | ------------- | --- | -- | ---------- |  | --- | -- | -
|              |                                    | Quarter Ended |    
|              |                                    |               |    
|              |                                    | September 30, |     |    | October 1, | 
|              |                                    | 2004          |     |    | 2005       | 
|              |                                    |               |     |    |            | 
|By geography: |                                    |               |     |    |            |  |     |   
|              | U.S. distributors                  |               |     | 23 | %          |  |     | 38 | %
|              | U.S. Government (research revenue) |               |     | 6  | %          |  |     | 1  | %
|              | Germany                            |               |     | 69 | %          |  |     | 61 | %
|              | All other                          |               |     | 2  | %          |  |     | 0  | %
|              |                                    |               |     |    |            | 
|              |                                    |               | 100 | %  |            |  | 100 | % 
|              |                                    |               |     |    |            | 
|By customer:  |                                    |               |     |    |            |  |     |   
|              | European distributor #1            |               |     | 44 | %          |  |     | 17 | %
|              | European distributor #2            |               |     | 25 | %          |  |     | 12 | %
|              | All other                          |               |     | 31 | %          |  |     | 71 | %
|              |                                    |               |     |    |            | 
|              |                                    |               | 100 | %  |            |  | 100 | % 
|              |                                    |               |     |    |            | 

17



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##### Table of Contents



Cost of product revenues.




Research and development expenses, including cost of research
revenues.


Selling, general and administrative expenses.


Other income.


Net loss attributable to common stockholders.


Comparison of Year-to-Date Periods Ended October 1, 2005
and September 30, 2004


Revenues.


18



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|              |                                    |               |     |    |            |  |     |    |  
|------------- | ---------------------------------- | ------------- | --- | -- | ---------- |  | --- | -- | -
|              |                                    | Year-to-Date  |    
|              |                                    | Period Ended  |    
|              |                                    |               |    
|              |                                    | September 30, |     |    | October 1, | 
|              |                                    | 2004          |     |    | 2005       | 
|              |                                    |               |     |    |            | 
|By geography: |                                    |               |     |    |            |  |     |   
|              | U.S. distributors                  |               |     | 26 | %          |  |     | 36 | %
|              | U.S. Government (research revenue) |               |     | 6  | %          |  |     | 1  | %
|              | Germany                            |               |     | 66 | %          |  |     | 63 | %
|              | All other                          |               |     | 2  | %          |  |     | 0  | %
|              |                                    |               |     |    |            | 
|              |                                    |               | 100 | %  |            |  | 100 | % 
|              |                                    |               |     |    |            | 
|By customer:  |                                    |               |     |    |            |  |     |   
|              | European distributor #1            |               |     | 43 | %          |  |     | 20 | %
|              | European distributor #2            |               |     | 21 | %          |  |     | 15 | %
|              | U.S. Government (research revenue) |               |     | 6  | %          |  |     | 1  | %
|              | All other                          |               |     | 30 | %          |  |     | 64 | %
|              |                                    |               |     |    |            | 
|              |                                    |               | 100 | %  |            |  | 100 | % 
|              |                                    |               |     |    |            | 

Cost of product revenues.


Research and development expenses, including cost of research
revenues.


Selling, general and administrative expenses.


19



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Other income.


Net loss attributable to common stockholders.


Liquidity and Capital Resources














20



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##### Table of Contents











Certain Factors Which May Affect Future Results


Investors should carefully consider the risks described below
before deciding whether to invest in our common stock. The risks
described below are not the only ones we face. Additional risks
not presently known to us or that we currently believe are
immaterial may also impair our business operations and financial
results. If any of the following risks actually occurs, our
business, financial condition or results of operations could be
adversely affected. In such case, the trading price of our
common stock could decline and you could lose all or part of
your investment. Our filings with the Securities and Exchange
Commission also contain forward-looking statements that involve
risks and uncertainties. Our actual results could differ
materially from those anticipated in these forward-looking
statements as a result of certain factors, including the risks
we face described below.


Risks Relating to Our Financial Results




| |                                                                                                                
| | ---------------------------------------------------------------------------------------------------------------
| | Evaluating our business and future prospects may be
    difficult due to the rapidly changing market landscape.





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| |                                                                                                                                                                                                   
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | We have a history of losses, expect to incur substantial
    further losses and may not achieve or maintain profitability in
    the future, which may decrease the market value of our
    stock.





| |   |                                                                                                                                                                                              
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | expand our manufacturing operations, whether domestically or
    internationally, including the manufacturing facility in Germany
    contemplated by our strategic partnership with Q-Cells;
|
| |  | develop our distribution network;                                                                                                                                                            
|
| |  | continue to research and develop our products and manufacturing
    technologies;                                                                                                            
|
| |  | implement internal systems and infrastructure in conjunction
    with our growth; and                                                                                                        
|
| |  | hire additional personnel.                                                                                                                                                                   



Risks Relating to Our Industry, Products and Operations




| |                                                                                                                                                                                                                                                                                                                           
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | We may need to raise significant additional capital in
    order to fund our operations and to continue to grow our
    business, which subjects us to the risk that we may be unable to
    maintain or grow our business as planned and that our
    stockholders may be subject to substantial additional
    dilution.





22



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##### Table of Contents





| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Our ability to expand our manufacturing capacity and
    therefore to increase revenue and achieve profitability depends
    to a large extent upon the success of our strategic partnership
    with Q-Cells. Our strategic partnership with Q-Cells is subject
    to numerous risks, many of which are outside of our control, and
    we cannot assure you that the strategic partnership will achieve
    its objective or otherwise be successful. If the strategic
    partnership is not successful, our business would be materially
    and adversely harmed and our stock price would decline.





| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | the strategic partnership will be highly dependent on
    Q-Cellss expertise in the rapid development of solar
    product manufacturing facilities in Germany; therefore, if for
    any reason, Q-Cells does not devote the personnel necessary to
    assist us in the development of our facility, the strategic
    partnership may experience delays and cost-overruns or may be
    unsuccessful in the establishment of the operation;                                                                                                                                                                                                                                         
|
| |  | the strategic partnership contemplates that both we and Q-Cells
    will contribute certain technologies to the strategic
    partnership in order to establish a novel manufacturing
    processes based on a combination of our respective technologies;
    as such, the success of the strategic partnership depends on our
    ability to integrate our respective technologies and
    manufacturing processes in order to produce competitive solar
    products in the world marketplace; such integration is unproven
    and if we are unable to integrate our technologies and
    manufacturing processes, the prospects for the strategic
    partnership would be limited;
|
| |  | government grants that have been approved may be subject to
    forfeiture or repayment in whole or in part if EverQ fails to
    continue to meet the conditions for such grants or if such
    grants for any reason become unavailable from German or European
    Union sources;                                                                                                                                                                                                                                                                                                                                                                                                    
|
| |  | the establishment of the facility may result in cost overruns,
    delays, equipment problems and construction, start-up and other
    operating difficulties, any of which could adversely affect the
    ability of the strategic partnership to achieve or grow revenue
    on the timeframe we expect;                                                                                                                                                                                                                                                                                                                                                                              

23



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##### Table of Contents





| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | although initially a minority shareholder in the strategic
    partnership, Q-Cells will have the ability to influence the
    strategic direction of the strategic partnership and other
    material decisions of the strategic partnership; as a result, we
    may be unable to take certain actions that we believe would be
    in our best interests, which, given the expected materiality of
    the strategic partnership to our combined operations, could
    significantly harm our business; further, we may be liable to
    third parties for the material decisions and actions of Q-Cells
    in the strategic partnership, which actions may harm the
    strategic partnership and our business;
|
| |  | the establishment of the strategic partnership will require
    significant management attention and will place significant
    strain on our ability to manage effectively both our operations
    in Marlboro and the operations of the strategic partnership in
    Germany;                                                                                                                                                                                                                                                                                                                                                                                                                                     
|
| |  | the strategic partnership may subject us to multiple,
    conflicting and changing laws, regulations and tax schemes;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|
| |  | the strategic partnership may be unable to obtain, maintain or
    enforce adequate intellectual property rights and protection due
    to limited or unfavorable intellectual property protection and
    may be subject to claims or suits alleging infringement of third
    party intellectual property rights;                                                                                                                                                                                                                                                                                                                                                                                                 
|
| |  | EverQ may be unable to obtain, maintain or enforce adequate
    intellectual property rights and protection due to limited or
    unfavorable intellectual property protection and may be subject
    to claims or suits alleging infringement of third party
    intellectual property rights;                                                                                                                                                                                                                                                                                                                                                                                                                     
|
| |  | under certain circumstances, if we exit the strategic
    partnership with Q-Cells, the strategic partnership entity will
    continue to have certain rights to our proprietary technologies
    that we are licensing to it and thereby compete with us;                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|
| |  | two years after the date of the strategic partnership agreement,
    Q-Cells may engage in ribbon technology-related activities in
    competition with us;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|
| |  | limitations on dividends or restrictions against repatriation of
    earnings may limit our ability to capitalize on earnings from
    the strategic partnership;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|
| |  | the operation of the manufacturing facility may experience
    seasonal reductions in productivity common in certain foreign
    countries, such as the summer months in Europe;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|
| |  | EverQ may be subject to increases in tariffs, duties, price
    controls or other restrictions on foreign currencies or trade
    barriers imposed by foreign countries;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|
| |  | the strategic partnership may be unable to successfully hire and
    retain the additional personnel necessary to operate the
    facility, which is expected to require approximately 400
    employees for the initial capacity expansion;                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|
| |  | we will be exposed to fluctuations in currency exchange
    rates; and                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|
| |  | we may experience difficulties in staffing and managing
    international operations, including the difficulty in managing a
    geographically dispersed workforce in compliance with diverse
    local laws and customs.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          





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| |                                                                                                                                                                                                                                                                                          
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | The continuing improvement of our manufacturing facility
    in Marlboro, Massachusetts may take longer, cost more than we
    expect and may not deliver the performance improvements that we
    expect, which would likely result in lower revenues and earnings
    than anticipated.





| |   |                                                                                                                                                                                                         
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | we may experience cost overruns, delays, equipment problems and
    other operating difficulties;                                                                                                       
|
| |  | our manufacturing processes use custom-built equipment that may
    not be delivered and installed in a timely manner;                                                                                  
|
| |  | our custom-built equipment may take longer and cost more to
    debug than planned and may never operate as designed;                                                                                   
|
| |  | we are incorporating first-time equipment designs and technology
    improvements, which we expect to lower unit capital and
    operating costs, but this new technology may not be
    successful; and
|
| |  | we may elect to use a portion of our manufacturing capacity for
    research and development purposes, thereby reducing our
    commercial output from our Marlboro facility.                           





| |                                                                                                                                                                                                                                                                                                                                                                                                                                   
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Our future success substantially depends on our ability to
    significantly increase our manufacturing capacity through the
    development of additional manufacturing facilities. We may be
    unable to achieve our capacity expansion goals as a result of a
    number of risks, which would limit our growth potential, impair
    our operating results and financial condition and cause our
    stock price to decline.





| |   |                                                                                                                                                                                                                                                                                                                                                                
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | we may need to continue to raise significant additional capital
    through the issuance of equity or convertible or debt securities
    in order to finance the costs of development of any additional
    facility, which we may be unable to do on reasonable terms or at
    all, and which could be dilutive to our existing stockholders;                
|
| |  | the build-out of any additional facility will be subject to the
    risks inherent in the development of a new manufacturing
    facility, including risks of delays and cost overruns as a
    result of a number of factors, many of which may be out of our
    control, such as delays in government approvals or problems with
    supplier relationships;
|
| |  | our manufacturing processes, particularly those that incorporate
    improvements to our String Ribbon technology, are unproven at
    large scale and may prove difficult to implement in any new
    facility;                                                                                                                                               
|
| |  | we may be required to depend on third parties or strategic
    partnerships that we establish in the development and operation
    of a facility, which may subject us to risks that such third
    parties do not fulfill their obligations to us under our
    arrangements with them;                                                                       

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| |   |                                                                                                                                                                                                                                                                                                                                               
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | the establishment of any new facility will require significant
    management attention, and our management team, which has limited
    experience in the development of such facilities, may be unable
    to execute the expansion plan effectively; and                                                                                    
|
| |  | if a new facility is established internationally, we may
    encounter legal restrictions and liability, encounter commercial
    restrictions and incur taxes and other expenses to do so and
    otherwise be subject to the risks inherent in conducting
    business in a foreign jurisdiction as described elsewhere in
    this section.





| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Because we depend on single and sole source suppliers for
    a number of specialized materials, including silicon, string and
    others necessary to manufacture our solar power products, we are
    susceptible to supplier and industry-wide supply shortages and
    price volatility, which could adversely affect our ability to
    meet existing and future customer demand for our products and
    cause us to make fewer shipments, generate lower than
    anticipated revenues and manufacture our products at higher than
    expected costs.





| |                                                                                                                                                                                                                                                                                                                                                            
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Our dependence on a limited number of third party
    suppliers for raw materials, key components for our solar power
    products and custom-built equipment for our operations could
    prevent us from delivering our products to our customers within
    required timeframes, which could result in order cancellations
    and loss of market share.



26



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| |                                                                                                                                                                          
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | We may fail to successfully bring to market our new solar
    power products under development, which may prevent us from
    achieving increased sales and market share.





| |                                                                                                                                         
| | ----------------------------------------------------------------------------------------------------------------------------------------
| | Our solar power products may not gain market acceptance,
    which would prevent us from achieving increased sales and market
    share.





| |   |                                                                                                                                                                                                                                                 
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | our failure to produce solar power products that compete
    favorably against other solar power products on the basis of
    cost, quality and performance;                                                                                    
|
| |  | our failure to produce solar power products that compete
    favorably against conventional energy sources and alternative
    distributed generation technologies, such as wind and biomass,
    on the basis of cost, quality and performance;
|
| |  | whether or not customers accept our new module designs under
    development and the techniques we are developing to mount
    them; and                                                                                                        
|
| |  | our failure to develop and maintain successful relationships
    with distributors, systems integrators and other resellers, as
    well as strategic partners.                                                                                 





| |                                                                                                                                                                                                   
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Technological changes in the solar power industry could
    render our solar power products uncompetitive or obsolete, which
    could reduce our market share and cause our sales to
    decline.



27



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| |                                                                                                                                                                                     
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Our ability to increase market share and sales depends on
    our ability to successfully maintain our existing distribution
    relationships and expand our distribution channels.





| |                                                                                                                                                                                                                                               
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | We face risks associated with the marketing, distribution
    and sale of our solar power products internationally, and if we
    are unable to effectively manage these risks, it could impair
    our ability to expand our business abroad.





| |   |                                                                                                                                                                                                                                               
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | difficult and expensive compliance with the commercial and legal
    requirements of international markets, with which we have only
    limited experience;                                                                                   
|
| |  | inability to obtain, maintain or enforce intellectual property
    rights;                                                                                                                                                                    
|
| |  | encountering trade barriers such as export requirements,
    tariffs, taxes and other restrictions and expenses, which could
    affect the competitive pricing of our solar power products and
    reduce our market share in some countries;
|
| |  | fluctuations in currency exchange rates relative to the
    U.S. dollar;                                                                                                                                                                      
|
| |  | difficulty in recruiting and retaining individuals skilled in
    international business operations;                                                                                                                                          
|
| |  | increased costs associated with maintaining international
    marketing efforts;                                                                                                                                                              
|
| |  | difficulty of enforcing revenue collection
    internationally; and                                                                                                                                                                           
|
| |  | inability to develop, manufacture, market and sell our products
    and services in German and other international markets due to,
    for example, third-party intellectual property rights.                                                 

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| |                                                                                                                              
| | -----------------------------------------------------------------------------------------------------------------------------
| | Our dependence on a small number of resellers may cause
    significant fluctuations or declines in our product
    revenues.





| |   |                                                                                                                         
| | - | ------------------------------------------------------------------------------------------------------------------------
| |  | reduction, delay or cancellation of orders from one or more of
    our significant resellers;                           
|
| |  | selection by one or more of our significant resellers of
    products competitive with ours;                            
|
| |  | loss of one or more of our significant resellers and our failure
    to recruit additional or replacement resellers; and
|
| |  | failure of any of our significant resellers to make timely
    payment of our invoices.                                 



| |                                                                                                                                                                                                              
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Problems with product quality or product performance may
    cause us to incur warranty expenses and may damage our market
    reputation and prevent us from achieving increased sales and
    market share.





| |                                                                                                                                                                                                                                                              
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Our success in the future may depend on our ability to
    establish and maintain strategic alliances, and any failure on
    our part to establish and maintain such relationships would
    adversely affect our market penetration and revenue
    growth.



29



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| |                                                                                                                                                                                                  
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | The success of our business depends on the continuing
    contributions of our key personnel and our ability to attract
    and retain new qualified employees in a competitive labor
    market.







| |                                                                      
| | ---------------------------------------------------------------------
| | We may be affected by skilled labor shortages and labor
    disputes.





| |                                                                                                                                                                                                                                                                                                                                                
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | If we fail to maintain an effective system of internal
    controls, we may not be able to accurately report our financial
    results or prevent fraud. As a result, current and potential
    stockholders could lose confidence in our financial reporting,
    which could harm our business and the trading price of our
    common stock.



30



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| |                                                                                                                                                                    
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Our management team may not be able to successfully
    implement our business strategies because it has limited
    experience managing a rapidly growing company.





| |                                                                                                                                                                                                                                                                                                       
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | If solar power technology is not suitable for widespread
    adoption or sufficient demand for solar power products does not
    develop or takes longer to develop than we anticipate, our sales
    would not significantly increase and we would be unable to
    achieve or sustain profitability.





| |   |                                                                                                                                 
| | - | --------------------------------------------------------------------------------------------------------------------------------
| |  | cost-effectiveness of solar power technologies as compared with
    conventional and non-solar alternative energy technologies; 
|
| |  | performance and reliability of solar power products as compared
    with conventional and non-solar alternative energy products;
|
| |  | success of alternative distributed generation technologies such
    as fuel cells, wind power and micro turbines;               

31



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| |   |                                                                                                                                                                                                                           
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | fluctuations in economic and market conditions that impact the
    viability of conventional and non-solar alternative energy
    sources, such as increases or decreases in the prices of oil and
    other fossil fuels;
|
| |  | capital expenditures by customers that tend to decrease when the
    United States or global economy slows;                                                                                                               
|
| |  | continued deregulation of the electric power industry and
    broader energy industry; and                                                                                                                                
|
| |  | availability of government subsidies and incentives.                                                                                                                                                                      



| |                                                                                                                                                                                                                     
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | We face intense competition from other companies producing
    solar power and other energy generation products. If we fail to
    compete effectively, we may be unable to increase our market
    share and sales.







| |                                                                                                                                             
| | --------------------------------------------------------------------------------------------------------------------------------------------
| | If we are unable to protect our intellectual property
    adequately, we could lose our competitive advantage in the solar
    power market.





| |   |                                                                                                                                                                                                                                   
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | we cannot be certain that our pending United States and foreign
    patent applications will result in issued patents or that the
    claims allowed are or will be sufficiently broad to protect our
    technology or processes;
|
| |  | given the costs of obtaining patent protection, we may choose
    not to protect certain innovations that later turn out to be
    important;                                                                                     

32



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| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | our license, but not our right, to practice the String Ribbon
    technology terminated upon the expiration of the underlying
    patents, which occurred during 2003 and 2004, and our historical
    operating experience with String Ribbon technology and our
    related patented and proprietary manufacturing processes may not
    adequately protect our competitive advantage;                                                                                                                                                                                                                                                                               
|
| |  | third parties may design around our patented technologies or
    seek to challenge or invalidate our intellectual property rights
    and there is no assurance that our intellectual property rights
    will deter infringement or misappropriation of our intellectual
    property;                                                                                                                                                                                                                                                                                                                                                                                
|
| |  | we may incur significant costs and diversion of management
    resources in prosecuting or defending intellectual property
    infringement suits;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|
| |  | we may not be successful in prosecuting or defending
    intellectual property infringement suits and, as a result, may
    need to seek to obtain a license of the third partys
    intellectual property rights, which may not be available to us,
    whether on reasonable terms or at all;                                                                                                                                                                                                                                                                                                                                                                       
|
| |  | the contractual provisions we rely on to protect our trade
    secrets and proprietary information, such as our confidentiality
    and non-disclosure agreements with our employees, consultants
    and other third parties, may be breached and our trade secrets
    and proprietary information may be disclosed to competitors,
    strategic partners and the public; and                                                                                                                                                                                                                                                                                       
|
| |  | while our license to the underlying patents directed to the
    String Ribbon technology has expired, we own 5 United States
    patents, 8 pending United States patent applications, 2 granted
    European patent applications that have enforceable rights in 10
    foreign jurisdictions and 16 pending foreign patent applications
    directed to various aspects of the String Ribbon technology;
    however, our historical operating experience with String Ribbon
    technology and our related patented and proprietary
    manufacturing processes may not adequately protect our
    competitive advantage now that the licensed patents have expired.



| |                                                                                                            
| | -----------------------------------------------------------------------------------------------------------
| | If we are subject to litigation and infringement claims,
    they could be costly and disrupt our business.









| |   |                                                                                                                
| | - | ---------------------------------------------------------------------------------------------------------------
| |  | assert claims of infringement or misappropriation of or
    otherwise enforce our intellectual property rights;
|
| |  | protect our trade secrets or know-how; or                                                                      
|
| |  | determine the enforceability, scope and validity of our
    intellectual property rights or those of others.   

33



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| |                                                                                                                                                                                                 
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | We may be unable to adequately protect or enforce our
    proprietary information, which may result in its unauthorized
    use or reduced sales or otherwise reduce our ability to
    compete.









| |   |                                                                                                     
| | - | ----------------------------------------------------------------------------------------------------
| |  | independently develop substantially equivalent proprietary
    information, products and techniques;
|
| |  | otherwise gain access to our proprietary information; or                                            
|
| |  | design around our patents or other intellectual property.                                           





| |                                                                                                                                                                                                                                            
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | If the effective term of our patents is decreased due to
    changes in patent laws or if we need to refile some of our
    patent applications, the value of our patent portfolio and the
    revenues we derive from it may be decreased.



34



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| |                                                                                                                                                                                                                                                                                               
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | International intellectual property protection is
    particularly uncertain and costly, and we have not obtained or
    sought patent or trademark protection in many foreign countries
    where our solar power products and services may be developed,
    manufactured, marketed or sold.





| |                                                                                                                                                                                                                                  
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Existing regulations and changes to such regulations may
    present technical, regulatory and economic barriers to the
    purchase and use of solar power products, which may
    significantly reduce demand for our products.







| |                                                                                                                                                   
| | --------------------------------------------------------------------------------------------------------------------------------------------------
| | The reduction or elimination of government subsidies and
    economic incentives for on-grid applications could cause our
    revenues to decline.



35



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| |                                                                                                                         
| | ------------------------------------------------------------------------------------------------------------------------
| | The lack or inaccessibility of financing for off-grid
    solar power applications could cause our sales to
    decline.





| |                                                                                                                                                                                                                                          
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Our reliance on government contracts to partially fund our
    research and development programs could impair our ability to
    commercialize our solar power technologies and would increase
    our research and development expenses.







| |                                                                                                                                                                                                         
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Compliance with environmental regulations can be
    expensive, and noncompliance with these regulations may result
    in adverse publicity and potentially significant monetary
    damages and fines.



36



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| |                                                                                                                            
| | ---------------------------------------------------------------------------------------------------------------------------
| | Product liability claims against us could result in
    adverse publicity and potentially significant monetary
    damages.



Risks Related to Our Common Stock




| |                                                                                           
| | ------------------------------------------------------------------------------------------
| | Substantial leverage and debt service obligations may
    adversely affect our cash flows.





| |   |                                                                                                                                                                                                                                          
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | make it difficult for us to make payments on the notes;                                                                                                                                                                                  
|
| |  | make it difficult for us to obtain financing for working
    capital, acquisitions or other purposes on favorable terms, if
    at all, including financing to fund the development or expansion
    of EverQs manufacturing operations;
|
| |  | make us more vulnerable to industry downturns and competitive
    pressures; and                                                                                                                                                         
|
| |  | limit our flexibility in planning for, or reacting to changes
    in, our business.                                                                                                                                                      





| |                                                                                                                                                
| | -----------------------------------------------------------------------------------------------------------------------------------------------
| | Our officers and directors control approximately 9.5% of
    our voting stock and may be able to significantly influence
    corporate actions.





| |                                                 
| | ------------------------------------------------
| | The price of our common stock has been volatile.



37



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| |   |                                                                                                                                                                                                                                                  
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | the size and timing of customer orders for or shipments of our
    products;                                                                                                                                                                     
|
| |  | the rate and cost at which we are able to expand our
    manufacturing capacity to meet product demand, including the
    rate and cost at which we are able to implement advances in our
    String-Ribbon technology;                          
|
| |  | our ability to establish and expand key customer and distributor
    relationships;                                                                                                                                                              
|
| |  | our ability and the terms upon which we are able to raise
    capital sufficient to finance the expansion of our manufacturing
    capacity and our sales and marketing efforts;                                                                 
|
| |  | our ability to establish a manufacturing facility in Germany as
    contemplated by our joint venture with Q-Cells at the costs and
    on the time frame that we expect;                                                                        
|
| |  | the extent to which Q-Cells increases its ownership in EverQ in
    the future and thereby reduces our share of profits and losses
    of EverQ in future periods;                                                                               
|
| |  | the extent to which any change in the capital structure of EverQ
    in the future causes us to be unable to consolidate EverQs
    financial results;                                                                                          
|
| |  | our ability to establish strategic relationships with third
    parties to accelerate our growth plans;                                                                                                                                          
|
| |  | the amount and timing of expenses associated with our research
    and development programs and our ability to develop enhancements
    to our manufacturing processes and our products;                                                         
|
| |  | delays associated with the supply of specialized materials
    necessary for the manufacture of our solar power products;                                                                                                                        
|
| |  | our ability to execute our cost reduction programs;                                                                                                                                                                                              
|
| |  | one time charges resulting from replacing existing equipment or
    technology with new or improved equipment or technology as part
    of our strategy to expand our manufacturing capacity and to
    decrease our per unit manufacturing cost;
|
| |  | developments in the competitive environment, including the
    introduction of new products or technological advancements by
    our competitors; and                                                                                            
|
| |  | the timing of adding the personnel necessary to execute our
    growth plan.                                                                                                                                                                     



38



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| |                                                                                                                                                     
| | ----------------------------------------------------------------------------------------------------------------------------------------------------
| | Because we do not intend to pay dividends, stockholders
    will benefit from an investment in our common stock only if it
    appreciates in value.





| |                                                                                                                                                                                                                                     
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | We are subject to anti-takeover provisions in our charter
    and by-laws and under Delaware law that could delay or prevent
    an acquisition of our company, even if the acquisition would be
    beneficial to our stockholders.





| |                                                                                                                      
| | ---------------------------------------------------------------------------------------------------------------------
| | We can issue shares of preferred stock that may adversely
    affect the rights of a stockholder of our common stock.





| |   |                                                                                                                                   
| | - | ----------------------------------------------------------------------------------------------------------------------------------
| |  | adversely affect the voting power of the stockholders of our
    common stock;                                                    
|
| |  | make it more difficult for a third party to gain control of us;                                                                   
|
| |  | discourage bids for our common stock at a premium;                                                                                
|
| |  | limit or eliminate any payments that the stockholders of our
    common stock could expect to receive upon our
    liquidation; or
|
| |  | otherwise adversely affect the market price of our common stock.                                                                  

39



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| |                                                                                                                                                                                                                               
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Our failure to comply with applicable listing standards
    could result in the ineligibility of our common stock for
    quotation on the Nasdaq National Market and severely limit the
    ability to sell our common stock.








|        |                                                              
|------- | -------------------------------------------------------------
|ITEM 3. | QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET
    RISK

INTEREST RATE RISK




FOREIGN CURRENCY EXCHANGE RATE RISK











|        |                        
|------- | -----------------------
|ITEM 4. | CONTROLS AND PROCEDURES

EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES




40



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MATERIAL WEAKNESS IN INTERNAL CONTROL OVER FINANCIAL
REPORTING










MANAGEMENTS REMEDIATION PLAN




41



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INTERNAL CONTROL OVER FINANCIAL REPORTING




LIMITATIONS INHERENT IN ALL CONTROLS







PART II.     OTHER
INFORMATION







|        |                  
|------- | -----------------
|ITEM 1. | LEGAL PROCEEDINGS








|        |                                                                
|------- | ---------------------------------------------------------------
|ITEM 2. | UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF
    PROCEEDS








|        |                                
|------- | -------------------------------
|ITEM 3. | DEFAULTS UPON SENIOR SECURITIES



42



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|        |                                                    
|------- | ---------------------------------------------------
|ITEM 4. | SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS



|                      |  |           |            |  |                |  |           | 
|--------------------- |  | --------- | ---------- |  | -------------- |  | --------- | 
|                      |  | Votes For |            |  | Votes Withheld | 
|                      |  |           |            |  |                | 
|Charles J. McDermott* |  |           | 49,109,351 |  |                |  | 2,168,598 | 
|Dr. Gerald L. Wilson  |  |           | 49,150,705 |  |                |  | 2,127,476 | 





| |                                                          
| | ---------------------------------------------------------
| | Term expiring at the 2006 Annual Meeting of Stockholders:
| | Philip J. Deutch                                         
| | Timothy Woodward                                         
|
| | Term expiring at the 2007 Annual Meeting of Stockholders:
| | Michael El-Hillow                                        
| | Dr. William P. Sommers*                                  
| | Richard M. Feldt                                         






|  |                                                                                                                                                                                                                                                                                                                                        
|- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|* | Mr. McDermott and Dr. Sommers resigned effective
    September 29, 2005. Mr. Edward C. Grady was appointed
    a Class I director with a term expiring at the 2007 Annual
    Meeting of Stockholders and Mr. Allan H. Cohen was
    appointed a Class II director with a term expiring at the
    2008 Annual Meeting of Stockholders.





|  |                                                                                                                                                                                                                                                                                                                                                             
|- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | The stockholders ratified the appointment of
    PricewaterhouseCoopers LLP as the Companys independent
    registered public accounting firm for the fiscal year ending
    December 31, 2005. There were 51,032,810 votes cast for the
    ratification, 48,240 votes cast against the ratification, 37,231
    abstentions and 159,900 broker non-votes.
| 
| | The stockholders approved the amendment and restatement of the
    Companys Amended 2000 Stock Option and Incentive Plan (the
    Stock Option Plan). There were 32,864,060 votes cast
    for the Stock Option Plan, 5,195,797 votes cast against the
    Stock Option Plan, 76,408 abstentions and 13,141,916 broker
    non-votes.                    
| 
| | The stockholders approved the amendment and restatement of the
    Companys 2000 Employee Stock Purchase Plan (the
    Employee Plan). There were 37,545,276 votes cast for
    the Employee Plan, 525,316 votes cast against the Employee Plan,
    65,673 abstentions and 13,141,916 broker non-votes.                                                 






|        |                  
|------- | -----------------
|ITEM 5. | OTHER INFORMATION








|        |         
|------- | --------
|ITEM 6. | EXHIBITS

|       |   |             |  |                                                                                                                                                                                      
|------ | - | ----------- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Number |   | Description
|       |   |            
|       | 1 | .1(1)       |  | Underwriting Agreement dated as of February 3, 2005, by and
    among the Company, SG Cowen & Co., LLC and First
    Albany Capital Inc.                                             
|      
|       | 3 | .1(2)       |  | Third Amended and Restated Certificate of Incorporation.
    (Exhibit 3.2)                                                                                                           
|      
|       | 3 | .2(2)       |  | Second Amended and Restated By-laws. (Exhibit 3.4)                                                                                                                                   
|      
|       | 3 | .3(3)       |  | Certificate of Amendment of Third Amended and Restated
    Certificate of Incorporation filed with the Secretary of State
    of the State of Delaware on May 15, 2003. (Exhibit 4.3)
|      
|       | 3 | .4(3)       |  | Certificate of the Powers, Designations, Preferences and Rights
    of the Series A Convertible Preferred Stock of the Company.
    (Exhibit 4.4)                                    

43



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|       |    |             |  |                                                                                                                                                                                                                     
|------ | -- | ----------- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Number |    | Description
|       |    |            
|      
|       | 3  | .5(4)       |  | Certificate of Amendment of Third Amended and Restated
    Certificate of Incorporation filed with the Secretary of State
    of the State of Delaware on August 20, 2004.
    (Exhibit 4.5)                        
|      
|       | 4  | .1(5)       |  | Warrant issued to CRT Capital Group LLC. (Exhibit 4.1)                                                                                                                                                              
|      
|       | 4  | .2(6)       |  | Warrant to Purchase Stock issued to Silicon Valley Bank on
    August 26, 2004. (Exhibit 4.1)                                                                                                                       
|      
|       | 4  | .3(6)       |  | Registration Rights Agreement dated as of August 26, 2004.
    (Exhibit 4.2)                                                                                                                                        
|      
|       | 4  | .4(11)      |  | Indenture, dated as of June 29, 2005, between the
    Registrant and U.S. Bank National Association, as Trustee.
    (Exhibit 4.4)                                                                                  
|      
|       | 4  | .5(11)      |  | Form of 4.375% Convertible Subordinated Notes due 2012                                                                                                                                                              
|      
|       | 10 | .1(2)*      |  | 1994 Stock Option Plan. (Exhibit 10.1)                                                                                                                                                                              
|      
|       | 10 | .2(2)*      |  | 2000 Stock Option and Incentive Plan. (Exhibit 10.2)                                                                                                                                                                
|      
|       | 10 | .3(14)*     |  | Amended and Restated 2000 Stock Option and Incentive Plan.
    (Exhibit 99.1)                                                                                                                                       
|      
|       | 10 | .4(14)*     |  | Amended and Restated 2000 Employee Stock Purchase Plan.
    (Exhibit 99.2)                                                                                                                                          
|      
|       | 10 | .5(2)       |  | Lease Agreement between Company and W9/TIB Real Estate Limited
    Partnership dated as of January 31, 2000, as amended.
    (Exhibit 10.5)                                                                         
|      
|       | 10 | .6(5)       |  | Lease Agreement between Company and One Hundred Twenty Bartlett
    Street Marlboro LLC dated as of January 26, 2004.
    (Exhibit 10.6)                                                                            
|      
|       | 10 | .7(2)+      |  | Agreement between Company and Emanuel M. Sachs dated as of
    September 30, 1994, as amended. (Exhibit 10.7)                                                                                                       
|      
|       | 10 | .8(2)       |  | Series D Preferred Stock Purchase Agreement dated as of
    December 28, 1999. (Exhibit 10.8)                                                                                                                       
|      
|       | 10 | .9(2)       |  | Form of Indemnification Agreement between Company and each of
    its directors and executive officers. (Exhibit 10.9)                                                                                              
|      
|       | 10 | .10(7)      |  | Stock and Warrant Purchase Agreement dated as of March 21,
    2003. (Exhibit 10.1)                                                                                                                                 
|      
|       | 10 | .11(7)      |  | Form of Registration Rights Agreement. (Exhibit 10.3)                                                                                                                                                               
|       | 10 | .12(7)      |  | Voting Agreement dated as of March 21, 2003.
    (Exhibit 10.2)                                                                                                                                                     
|      
|       | 10 | .13(9)      |  | Stock and Warrant Purchase Agreement dated June 16, 2004.
    (Exhibit 10.1)                                                                                                                                        
|      
|       | 10 | .14(9)      |  | Warrant Agreement dated June 21, 2004. (Exhibit 10.2)                                                                                                                                                               
|      
|       | 10 | .15(9)      |  | Form of Warrants. (Exhibit 10.3)                                                                                                                                                                                    
|      
|       | 10 | .16(9)      |  | Registration Rights Agreement dated June 21, 2004.
    (Exhibit 10.4)                                                                                                                                               
|      
|       | 10 | .17(9)      |  | Conversion, Consent, Voting and Lock-Up Agreement dated
    June 21, 2004. (Exhibit 10.5)                                                                                                                           
|      
|       | 10 | .18(10)++   |  | Master Strategic Partnership Agreement entered into as of
    January 14, 2005 by and between Evergreen Solar, Inc. and
    Q-Cells AG. (Exhibit 10.1)                                                              
|      
|       | 10 | .19(10)++   |  | License and Technology Transfer Agreement by and between
    Evergreen Solar, Inc. and EverQ GmbH, dated January 14,
    2005. (Exhibit 10.2)                                                                       
|      
|       | 10 | .20(8)      |  | Evergreen Solar, Inc. Management Incentive Policy.
    (Exhibit 10.20)                                                                                                                                              
|      
|       | 10 | .21(13)     |  | Purchase Agreement, dated June 23, 2005 between the
    Registrant and SG Cowen & Co., LLC, as representatives
    of the Initial Purchasers. (Exhibit 10.24)                                                       
|      
|       | 10 | .22(11)     |  | Registration Rights Agreement, dated June 29, 2005, between
    the Registrant and SG Cowen & Co., LLC, as
    representative of the Initial Purchasers. (Exhibit 10.21)                                            
|      
|       | 31 | .1          |  | Certification of the Chief Executive Officer pursuant to
    Rule 13a-14(a) and Rule 15d-14(a) of the Securities
    Exchange Act of 1934, as adopted pursuant to Section 302 of
    the Sarbanes-Oxley Act of 2002.
|      
|       | 31 | .2          |  | Certification of the Chief Financial Officer pursuant to
    Rule 13a-14(a) and Rule 15d-14(a) of the Securities
    Exchange Act of 1934, as adopted pursuant to Section 302 of
    the Sarbanes-Oxley Act of 2002.

44



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|       |    |             |  |                                                                                                                                                           
|------ | -- | ----------- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------
|Number |    | Description
|       |    |            
|      
|       | 32 | .1          |  | Certification of Chief Executive Officer Pursuant to
    18 U.S.C. Section 1350, as adopted Pursuant to
    Section 906 of the Sarbanes-Oxley Act of 2002.
|      
|       | 32 | .2          |  | Certification of Chief Financial Officer Pursuant to
    18 U.S.C. Section 1350, as adopted Pursuant to
    Section 906 of the Sarbanes-Oxley Act of 2002.






|   |  |                                                                                   
|-- |  | ----------------------------------------------------------------------------------
|+  |  | Confidential treatment granted as to certain
    portions.                        
|  
|++ |  | Confidential treatment requested as to certain
    portions.                      
|  
|*  |  | Indicates a management contract or compensatory
    plan, contract or arrangement.



| |     |                                                                                                                                                                                                                                                                                  
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (1) | Incorporated herein by reference to the exhibits to the
    Companys Current Report on Form 8-K dated
    February 3, 2005 (File No. 000-31687). The number
    given in parenthesis indicates the corresponding exhibit number
    in such Form 8-K.                           
|
| | (2) | Incorporated herein by reference to the exhibits to the
    Companys Registration Statement on Form S-1, as
    amended (file No. 333-43140). The number given in
    parenthesis indicates the corresponding exhibit number in such
    Form S-1.                              
|
| | (3) | Incorporated herein by reference to the exhibits to the
    Companys Registration Statement on Form S-8 dated
    June 9, 2003, as amended (file No. 333-105963). The
    number given in parenthesis indicates the corresponding exhibit
    number in such Form S-8.          
|
| | (4) | Incorporated herein by reference to the exhibits to the
    Companys Registration Statement on Form S-3 filed on
    October 21, 2004 (file No. 333-119864). The number
    given in parenthesis indicates the corresponding exhibit number
    in such Form S-3.               
|
| | (5) | Incorporated herein by reference to the exhibits to the
    Companys Annual Report on Form 10-K for the period
    ended December 31, 2004 filed on March 10, 2005.                                                                                                             
|
| | (6) | Incorporated herein by reference to the exhibits to the
    Companys Quarterly Report on Form 10-Q for the period
    ended September 30, 2004 filed on November 12, 2004.
    The number given in parenthesis indicates the corresponding
    exhibit number in such Form 10-Q.
|
| | (7) | Incorporated herein by reference to the exhibits to the
    Companys Current Report on Form 8-K dated
    March 24, 2003 (File No. 000-31687). The number given
    in parenthesis indicates the corresponding exhibit number in
    such Form 8-K.                             
|
| | (8) | Incorporated herein by reference to the exhibits to the
    Companys Current Quarterly Report on Form 10-Q for
    the period ended April 2, 2005 filed on May 2, 2005.
    The number given in parenthesis indicates the corresponding
    exhibit number in such Form 10-Q.   
|
| | (9) | Incorporated herein by reference to the exhibits to the
    Companys Current Report on Form 8-K dated
    June 22, 2004 (File No. 000-31687). The number given
    in parenthesis indicates the corresponding exhibit number in
    such Form 8-K.                              



|     |                                                                                                                                                                                                                                                                           
|---- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(10) | Incorporated herein by reference to the exhibits to the
    Companys Current Report on Form 8-K dated
    January 14, 2005 (File No. 000-31687). The number
    given in parenthesis indicates the corresponding exhibit number
    in such Form 8-K.                    
|    
|(11) | Incorporated herein by reference to the exhibits to the
    Companys Current Report on Form 8-K dated
    June 29, 2005 (File No. 000-31687). The number given
    in parenthesis indicates the corresponding exhibit number in
    such Form 8-K.                       
|    
|(12) | Incorporated herein by reference to the exhibits to the
    Companys Current Report on Form 8-K dated
    July 15, 2005 (File No. 000-31687). The number given
    in parenthesis indicates the corresponding exhibit number in
    such Form 8-K.                       
|    
|(13) | Incorporated herein by reference to the exhibits to the
    Companys Quarterly Report on Form 10-Q for the period
    ending July 2, 2005 filed on August 11, 2005. The
    number given in parenthesis indicates the corresponding exhibit
    number in such Form 10-Q.

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##### Table of Contents






SIGNATURES






| |                                         
| | ----------------------------------------
| | EVERGREEN SOLAR, INC.                   
|
| | /s/ Richard G. Chleboski                
| |                                         
| | Richard G. Chleboski                    
| | Chief Financial Officer, Vice President,
| | Treasurer and Secretary                 
| | (Principal Financial Officer)           



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