10-Q

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-Q

(Mark one)

[x]	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
	For the quarterly period ended June 30, 2011
or
[ ]	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: 001-33156

`

First Solar, Inc.

(Exact name of registrant as specified in its charter)

Delaware	20-4623678
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

350 West Washington Street, Suite 600

Tempe, Arizona 85281

(Address of principal executive offices, including zip code)

(602) 414-9300

(Registrant’s telephone number, including area code)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days. Yes [x] No [ ]

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes [x] No [ ]

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer [x]	Accelerated filer [ ]	Non-accelerated filer [ ]	Smaller reporting company [ ]
		(Do not check if a smaller reporting company)

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).  Yes [ ]   No [x]

As of July 29, 2011, 86,304,748 shares of the registrant’s common stock, $0.001 par value per share, were issued and outstanding.

FIRST SOLAR, INC. AND SUBSIDIARIES

FORM 10-Q FOR THE QUARTERLY PERIOD ENDED JUNE 30, 2011

TABLE OF CONTENTS

		Page
Part I.	Financial Information (Unaudited)
Item 1.	Condensed Consolidated Financial Statements:
	Condensed Consolidated Statements of Operations for the three and six months ended June 30, 2011 and June 26, 2010	3
	Condensed Consolidated Balance Sheets as of June 30, 2011 and December 31, 2010	4
	Condensed Consolidated Statements of Cash Flows for the six months ended June 30, 2011 and June 26, 2010	5
	Notes to Condensed Consolidated Financial Statements	6
Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	32
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	50
Item 4.	Controls and Procedures	50
Part II.	Other Information	51
Item 1.	Legal Proceedings	51
Item 1A.	Risk Factors	51
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	52
Item 5.	Other Information	52
Item 6.	Exhibits	53
Signature		54

PART I.FINANCIAL INFORMATION

Item 1.Unaudited Condensed Consolidated Financial Statements

FIRST SOLAR, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except per share amounts)

(Unaudited)

	Three Months Ended					Six Months Ended
	June 30, 2011		June 26, 2010			June 30, 2011		June 26, 2010
Net sales	$	532,774	$	587,854		$	1,100,067	$	1,155,815
Cost of sales	337,976		303,660			645,604		589,585
Gross profit	194,798		284,194			454,463		566,230
Operating expenses:
Research and development	33,102		22,836			64,453		45,724
Selling, general and administrative	86,872		78,597			173,872		145,461
Production start-up	10,294		2,288			22,225		3,431
Total operating expenses	130,268		103,721			260,550		194,616
Operating income	64,530		180,473			193,913		371,614
Foreign currency gain (loss)	1,659		(2,625		)	2,609		(3,321		)
Interest income	3,417		3,035			6,440		8,683
Interest expense, net	—		(6		)	—		(6		)
Other income (expense), net	2,351		(439		)	2,002		(1,173		)
Income before income taxes	71,957		180,438			204,964		375,797
Income tax expense	10,819		21,395			27,858		44,409
Net income	$	61,138	$	159,043		$	177,106	$	331,388
Net income per share:
Basic	$	0.71	$	1.87		$	2.07	$	3.91
Diluted	$	0.70	$	1.84		$	2.03	$	3.84
Weighted-average number of shares used in per share calculations:
Basic	86,164		84,852			85,746		84,679
Diluted	87,126		86,401			87,092		86,247

See accompanying notes to these condensed consolidated financial statements.

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FIRST SOLAR, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands, except share data)

(Unaudited)

	June 30, 2011			December 31, 2010
ASSETS
Current assets:
Cash and cash equivalents	$	357,477		$	765,689
Marketable securities and investments	106,966			167,889
Accounts receivable trade, net	541,977			305,537
Accounts receivable, unbilled	63,677			1,482
Inventories	322,995			195,863
Balance of systems parts	33,656			4,579
Project assets	145,379			—
Deferred tax assets, net	3,590			388
Prepaid expenses and other current assets	260,514			143,033
Total current assets	1,836,231			1,584,460
Property, plant and equipment, net	1,727,993			1,430,789
Project assets	309,688			320,140
Deferred tax assets, net	268,243			259,236
Marketable securities	50,996			180,271
Restricted cash and investments	174,698			86,003
Goodwill	458,808			433,288
Inventories	42,713			42,728
Other assets	69,862			43,488
Total assets	$	4,939,232		$	4,380,403
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	189,875		$	82,312
Income taxes payable	36,493			16,831
Accrued expenses	242,250			244,271
Current portion of long-term debt	28,334			26,587
Other current liabilities	94,917			99,676
Total current liabilities	591,869			469,677
Accrued solar module collection and recycling liability	176,644			132,951
Long-term debt	332,492			210,804
Other liabilities	156,689			112,026
Total liabilities	1,257,694			925,458
Stockholders’ equity:
Common stock, $0.001 par value per share; 500,000,000 shares authorized; 86,290,962 and 85,843,511 shares issued and outstanding at June 30, 2011 and December 31, 2010, respectively	86			86
Additional paid-in capital	1,878,429			1,815,420
Contingent consideration	—			1,118
Accumulated earnings	1,842,670			1,665,564
Accumulated other comprehensive loss	(39,647		)	(27,243		)
Total stockholders’ equity	3,681,538			3,454,945
Total liabilities and stockholders’ equity	$	4,939,232		$	4,380,403

See accompanying notes to these condensed consolidated financial statements.

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FIRST SOLAR, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

(Unaudited)

	Six Months Ended
	June 30, 2011			June 26, 2010
Cash flows from operating activities:
Cash received from customers	$	798,159		$	955,086
Cash paid to suppliers and associates	(1,005,181		)	(824,407		)
Interest received	6,742			12,560
Interest paid	(3,119		)	(2,551		)
Income taxes paid, net of refunds	(25,643		)	(31,712		)
Excess tax benefit from share-based compensation arrangements	(16,497		)	—
Other operating activities	(1,296		)	(1,376		)
Net cash (used in) provided by operating activities	(246,835		)	107,600
Cash flows from investing activities:
Purchases of property, plant and equipment	(389,966		)	(239,506		)
Purchases of marketable securities and investments	(189,735		)	(267,304		)
Proceeds from maturities of marketable securities and investments	87,748			59,256
Proceeds from sales of marketable securities and investments	289,943			203,903
Payments received on notes receivable	—			61,658
Increase in restricted investments	(62,748		)	(43,064		)
Increase in restricted cash	(23,328		)	—
Acquisitions, net of cash acquired	(21,105		)	—
Other investing activities	214			1,308
Net cash used in investing activities	(308,977		)	(223,749		)
Cash flows from financing activities:
Proceeds from stock option exercises	7,651			3,709
Repayment of long-term debt	(114,342		)	(14,004		)
Proceeds from borrowings under credit facilities, net of discount and issuance costs	224,442			—
Excess tax benefit from share-based compensation arrangements	16,497			—
Proceeds from economic development funding	3,112			—
Other financing activities	(236		)	(2		)
Net cash provided by (used in) financing activities	137,124			(10,297		)
Effect of exchange rate changes on cash and cash equivalents	10,476			(27,571		)
Net decrease in cash and cash equivalents	(408,212		)	(154,017		)
Cash and cash equivalents, beginning of the period	765,689			664,499
Cash and cash equivalents, end of the period	$	357,477		$	510,482
Supplemental disclosure of noncash investing and financing activities:
Property, plant and equipment acquisitions funded by liabilities	$	109,685		$	30,457

See accompanying notes to these condensed consolidated financial statements.

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FIRST SOLAR, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

Note 1. Basis of Presentation

The accompanying unaudited condensed consolidated financial statements of First Solar, Inc. and its subsidiaries have been prepared in accordance with accounting principles generally accepted in the United States of America (U.S. GAAP) for interim financial information and pursuant to the instructions to Form 10-Q and Article 10 of Regulation S-X of the Securities and Exchange Commission (SEC). Accordingly, these interim financial statements do not include all of the information and footnotes required by U.S. GAAP for annual financial statements. In the opinion of management, all adjustments (consisting only of normal recurring adjustments) considered necessary for a fair statement have been included. Operating results for the three months and six months ended June 30, 2011 are not necessarily indicative of the results that may be expected for the year ending December 31, 2011, or for any other period. The balance sheet at December 31, 2010 has been derived from the audited consolidated financial statements at that date, but does not include all of the information and footnotes required by U.S. GAAP for complete financial statements. These financial statements and notes should be read in conjunction with the financial statements and notes thereto for the fiscal year ended December 31, 2010 included in our Annual Report on Form 10-K filed with the SEC.

We report our quarterly results of operations using a calendar convention. Prior to December 31, 2010, our fiscal periods ended on the Saturday closest to the end of the applicable calendar quarter. Fiscal 2011 will end on December 31, 2011.

Certain prior year balances have been reclassified to conform to the current year's presentation. Such reclassifications did not affect total net sales, operating income, or net income.

Unless expressly stated or the context otherwise requires, the terms "the Company," "we," "our," "us," and "First Solar" refer to First Solar, Inc. and its subsidiaries.

Note 2. Summary of Significant Accounting Policies

Revenue recognition — Systems Business. Our systems business provides a complete solar power system solution, which includes project development, engineering, procurement, and construction (EPC) services, operating and maintenance (O&M) services, when applicable, and project finance, when required.

We recognize revenue for arrangements entered into by the systems business generally using two revenue recognition models, following the guidance in ASC 605, Accounting for Long-term Construction Contracts or, for arrangements which include land, ASC 360, Accounting for Sales of Real Estate.

For construction contracts that do not involve land or land rights and thus are accounted for under ASC 605, we use the percentage-of-completion method using actual costs incurred over total estimated costs to complete a project (including module costs) as our basic accounting policy, unless we cannot make reasonably dependable estimates of the costs to complete the contract, in which case we would use the completed contract method. We periodically revise our contract cost and profit estimates and we immediately recognize any losses that we identify on contracts. Incurred costs include all direct materials, costs for solar modules, labor, subcontractor costs, and those indirect costs related to contract performance, such as indirect labor, supplies, and tools. We recognize direct material costs and costs for solar modules as incurred costs when the direct materials and solar modules have been installed. When contracts specify that title to direct materials and solar modules transfers to the customer before installation has been performed, we defer revenue and associated costs and recognize revenue once those materials are installed and have met all other revenue recognition requirements. We consider direct materials to be installed when they are permanently attached or fitted to the solar power systems as required by engineering designs.

For arrangements recognized under ASC 360, typically when we have gained control of land or land rights, we record the sale as revenue after construction of a project is complete, we have transferred the usual risks and rewards of ownership to the buyer, and we have received payment from the buyer. We apply the percentage-of-completion method to certain contracts covered under ASC 360, when the sale has been consummated, the initial or continuing investment criteria have been met, we have the ability to estimate our costs and progress toward completion, and other revenue recognition criteria have been met. Depending on the value of the initial and continuing payment commitment by the buyer, we may align our revenue recognition and release of project assets to cost of sales with the receipt of payment from the buyer for contracts accounted for under ASC 360.

Balance of Systems Parts. Balance of systems partsrepresent mounting, DC and AC electrical and other construction parts

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purchased for solar power plants under construction, which we hold title of and are not yet installed in a solar power plant. These parts include posts, tilt brackets, tables, harnesses, combiner boxes, inverters, cables and any other parts we purchase or assemble for the solar power plants we construct. Balance of systems parts do not include solar modules. We report these parts at the lower of cost or market, with market being based on either recoverability through installation in a solar power plant under construction or through a sale. 

Please also refer to Note 2. "Summary of Significant Accounting Policies," to our consolidated financial statements included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2010 for a more complete discussion of our significant accounting policies.

Note 3. Recent Accounting Pronouncements

In April 2011, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2011-04, Fair Value Measurement (Topic 820): Amendments to Achieve Common Fair Value Measurement and Disclosure Requirements in U.S. GAAP and IFRS. This ASU amends current fair value measurement and disclosure guidance to include increased transparency around valuation input and investment categorization. ASU 2011-04 is effective for fiscal years and interim periods beginning after December 15, 2011, with early adoption not permitted. We do not believe that the adoption of ASU 2011-04 in the first quarter of 2012 will have an impact on our financial position, results of operations, or cash flows.

In June 2011, the FASB issued ASU 2011-05, Comprehensive Income (Topic 220): Presentation of Comprehensive Income. ASU 2011-05 allows an entity to present components of net income and other comprehensive income in one continuous statement, referred to as the statement of comprehensive income, or in two separate, but consecutive statements. ASU 2011-05 eliminates the option to present the components of other comprehensive income as part of the statement of changes in stockholders' equity. While the new guidance changes the presentation of comprehensive income, there are no changes to the components that are recognized in net income or other comprehensive income under current accounting guidance. ASU 2011-05 is effective for fiscal years and interim periods beginning after December 15, 2011 and must be applied retrospectively. We do not believe that the adoption of ASU 2011-05 will have an impact on our financial position, results of operations, or cash flows.

Note 4. Acquisitions

Fiscal 2011 Acquisition

Ray Tracker

On January 4, 2011, we acquired 100% of the ownership interest of Ray Tracker, Inc., a tracking technology and photovoltaic (PV) balance of systems business in an all-cash transaction, which was not material to our consolidated balance sheets and results of operations. We have included the financial results of Ray Tracker in our condensed consolidated financial statements from the date of acquisition. During the first six months of 2011, Ray Tracker did not contribute a material amount to our net sales and net income.

Fiscal 2010 Acquisition

NextLight Renewable Power

On July 12, 2010, we completed the acquisition of NextLight Renewable Power, LLC (NextLight), a leading developer of utility-scale solar power projects in the southwestern United States. NextLight was formed by a private equity firm focused on investing in North America's energy infrastructure. This transaction expanded our pipeline of solar power projects in the southwestern United States and supports our expansion in the U.S. utility-scale power market. We have integrated NextLight into our systems business, which provides a complete PV solar power solution, including project development, EPC services, O&M services, when applicable, and project finance, when required.

The total consideration for this acquisition was $296.7 million in an all-cash transaction. In allocating the purchase price based on estimated fair values, we recorded approximately $146.8 million of goodwill, $2.5 million of net tangible assets, and $147.4 million of project assets. We have included the financial results of NextLight in our condensed consolidated financial statements beginning on the acquisition date. For the period from January 1, 2010 to June 26, 2010, NextLight did not recognize any revenue and did not incur a material net loss. Therefore, had the acquisition of NextLight occurred on December 27, 2009 (the first day of our fiscal year 2010), our reported net sales would not have changed and our reported net income would not have materially changed from the amounts previously reported.

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Note 5. Goodwill

The changes in the carrying amount of goodwill, which is generally deductible for tax purposes, for our components segment and systems segment for the six months ended June 30, 2011 were as follows (in thousands):

	Components		Systems		Consolidated
Ending balance, December 31, 2010	$	393,365	$	39,923	$	433,288
Goodwill from acquisition	—		25,520		25,520
Ending balance, June 30, 2011	$	393,365	$	65,443	$	458,808

ASC 350, Intangibles — Goodwill and Other, requires us to test goodwill for impairment at least annually, or sooner, if facts or circumstances between scheduled annual tests indicate that it is more likely than not that the fair value of a reporting unit that has goodwill might be less than its carrying value. Currently our operating segments and reporting units are identical. We estimate the fair value of our reporting units by referring to the price that would be received to sell the unit as whole in an orderly transaction between market participants at the measurement date. For the goodwill assessment of our systems business, we believe that a typical market participant for the sale of our systems reporting unit would be a solar module manufacturer seeking to acquire a systems business with a large pipeline of utility-scale solar power plant projects, with the intent that these projects would provide a captive outlet for additional future solar module production. Therefore, we model the systems reporting unit's future performance for purposes of applying the income method of fair value measurement to include some of the profitability associated with the solar module element of the solar power plants that it builds and sells.

We performed our goodwill impairment test in the fourth fiscal quarter of the year ended December 31, 2010 and determined that the fair value of our goodwill substantially exceeded the carrying value for each individual reporting unit. Therefore, we concluded that our goodwill was not impaired. We have also concluded that there have been no changes in facts and circumstances since the date of that test that would trigger an interim goodwill impairment test.

Note 6. Cash, Cash Equivalents, Marketable Securities, and Investments

Cash, cash equivalents, marketable securities, and investments consisted of the following at June 30, 2011 and December 31, 2010 (in thousands):

	June 30, 2011		December 31, 2010
Cash and cash equivalents:
Cash	$	342,818	$	742,200
Cash equivalents:
Commercial paper	4,600		1,200
Money market mutual funds	10,059		22,289
Total cash and cash equivalents	357,477		765,689
Marketable securities and investments:
Certificates of deposit	2,602		—
Commercial paper	6,846		13,343
Corporate debt securities	29,886		98,602
Federal agency debt	49,697		45,875
Foreign agency debt	22,085		133,165
Foreign government obligations	5,608		9,143
Supranational debt	39,226		48,032
U.S. government obligations	2,012		—
Total marketable securities and investments	157,962		348,160
Total cash, cash equivalents, marketable securities, and investments	$	515,439	$	1,113,849

We have classified our marketable securities and investments as "available-for-sale." Accordingly, we record them at fair value and account for net unrealized gains and losses as a part of accumulated other comprehensive income. We report realized gains and losses on the sale of our marketable securities and investments in earnings, computed using the specific identification method. During the three and six months ended June 30, 2011 we realized $0.8 million and $0.9 million, respectively, in gains and an immaterial amount in losses on our marketable securities and investments. During the three and six months ended June 26,

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2010, we realized $0.4 million and $0.7 million, respectively, in gains and $0.4 million and $0.5 million, respectively, in losses on our marketable securities and investments. See Note 10. "Fair Value Measurements," to our condensed consolidated financial statements for information about the fair value of our marketable securities and investments.

All of our available-for-sale marketable securities and investments are subject to a periodic impairment review. We consider a marketable security or investment to be impaired when its fair value is less than its carrying cost, in which case we would further review the investment to determine whether it is other-than-temporarily impaired. When we evaluate an investment for other-than-temporary impairment, we review factors such as the length of time and extent to which its fair value has been below its cost basis, the financial condition of the issuer and any changes thereto, our intent to sell, and whether it is more likely than not that we will be required to sell the investment before we have recovered its cost basis. If an investment were other-than-temporarily impaired, we would write it down through earnings to its impaired value and establish that as a new cost basis for the investment. We did not identify any of our marketable securities and investments as other-than-temporarily impaired at June 30, 2011 and December 31, 2010.

The following tables summarize the unrealized gains and losses related to our available-for-sale marketable securities and investments, by major security type, as of June 30, 2011 and December 31, 2010 (in thousands):

	As of June 30, 2011
Security Type	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value
Certificates of deposit	$	2,601	$	1	$	—	$	2,602
Commercial paper	6,845		1		—		6,846
Corporate debt securities	29,856		37		7		29,886
Federal agency debt	49,645		55		3		49,697
Foreign agency debt	22,064		24		3		22,085
Foreign government obligations	5,602		6		—		5,608
Supranational debt	39,195		34		3		39,226
U.S. government obligations	1,998		14		—		2,012
Total	$	157,806	$	172	$	16	$	157,962

	As of December 31, 2010
Security Type	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value
Commercial paper	$	13,340	$	3	$	—	$	13,343
Corporate debt securities	98,148		592		138		98,602
Federal agency debt	45,858		21		4		45,875
Foreign agency debt	132,860		425		120		133,165
Foreign government obligations	9,137		8		2		9,143
Supranational debt	47,917		115		—		48,032
Total	$	347,260	$	1,164	$	264	$	348,160

Contractual maturities of our available-for-sale marketable securities and investments as of June 30, 2011 and December 31, 2010 were as follows (in thousands):

	As of June 30, 2011
Maturity	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value
One year or less	$	106,881	$	91	$	6	$	106,966
One year to two years	44,063		75		8		44,130
Two years to three years	6,862		6		2		6,866
Total	$	157,806	$	172	$	16	$	157,962

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	As of December 31, 2010
Maturity	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value
One year or less	$	167,499	$	398	$	8	$	167,889
One year to two years	177,268		759		256		177,771
Two years to three years	2,493		7		—		2,500
Total	$	347,260	$	1,164	$	264	$	348,160

The net unrealized gain of $0.2 million and $0.9 million as of June 30, 2011 and December 31, 2010, respectively, on our available-for-sale marketable securities and investments was primarily the result of changes in interest rates. We typically invest in highly-rated securities with low probabilities of default. Our investment policy requires investments to be rated single A or higher and limits the security types, issuer concentration, and duration to maturity of our investments.

The following table shows gross unrealized losses and estimated fair values for those marketable securities that were in an unrealized loss position as of June 30, 2011 and December 31, 2010, aggregated by major security type and the length of time that individual securities have been in a continuous loss position (in thousands):

	As of June 30, 2011
	In Loss Position for Less Than 12 Months				In Loss Position for 12 Months or Greater				Total
Security Type	Estimated Fair Value		Gross Unrealized Losses		Estimated Fair Value		Gross Unrealized Losses		Estimated Fair Value		Gross Unrealized Losses
Corporate debt securities	$	8,164	$	7	$	—	$	—	$	8,164	$	7
Federal agency debt	3,331		3		—		—		3,331		3
Foreign agency debt	4,870		3		—		—		4,870		3
Supranational debt	3,298		3		—		—		3,298		3
Total	$	19,663	$	16	$	—	$	—	$	19,663	$	16

	As of December 31, 2010
	In Loss Position for Less Than 12 Months				In Loss Position for 12 Months or Greater				Total
Security Type	Estimated Fair Value		Gross Unrealized Losses		Estimated Fair Value		Gross Unrealized Losses		Estimated Fair Value		Gross Unrealized Losses
Corporate debt securities	$	33,018	$	138	$	—	$	—	$	33,018	$	138
Federal agency debt	11,721		4		—		—		11,721		4
Foreign agency debt	46,134		120		—		—		46,134		120
Foreign government obligations	4,515		2		—		—		4,515		2
Total	$	95,388	$	264	$	—	$	—	$	95,388	$	264

Note 7. Restricted Cash and Investments

Restricted cash and investments consisted of the following at June 30, 2011 and December 31, 2010 (in thousands):

	June 30, 2011		December 31, 2010
Restricted cash	$	23,909	$	19
Restricted investments	150,789		85,984
Total restricted cash and investments — noncurrent	$	174,698	$	86,003

On May 18, 2011, in connection with the plant expansion at our German manufacturing center, First Solar Manufacturing GmbH, our indirect wholly owned subsidiary, entered into a credit facility agreement (German Facility Agreement), as disclosed in Note 13. "Debt," to these condensed consolidated financial statements. Pursuant to the German Facility Agreement, First Solar Manufacturing GmbH is required to maintain a euro-denominated debt service reserve account in the amount of €16.6 million pledged in favor of the lenders. The account is available solely to pay any outstanding interest and principal payments. As of

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June 30, 2011, the balance of this reserve account was €16.6 million ($23.9 million at the balance sheet close rate on June 30, 2011 of $1.44/€1.00).

At June 30, 2011 and December 31, 2010, our restricted investments consisted of long-term marketable securities that we hold through a custodial account to fund future costs of our solar module collection and recycling program.

We pre-fund our estimated solar module collection and recycling costs at the time of module sale through a custodial account with a large bank as the investment advisor in the name of a trust, for which First Solar Inc., First Solar Malaysia Sdn. Bhd., and First Solar Manufacturing GmbH are grantors. We fund this custodial account within 60 days after the beginning of a fiscal year for the prior year's module sales, assuming for this purpose a minimum service life of 25 years for our solar modules. To ensure that our collection and recycling program is available at all times and the pre-funded amounts are accessible regardless of our financial status in the future (even in the case of our own insolvency), we have established a trust structure under which funds are put into custodial accounts in the name of a trustee. Only the trustee can distribute funds from the custodial accounts and these funds cannot be accessed for any purpose other than for administering module collection and recycling, either by us or a third party executing the collection and recycling services. To provide further assurance that sufficient funds will be available, our module collection and recycling program, including the financing arrangement, is audited periodically by an independent third party auditor. Cash invested in this custodial account must meet the criteria of the highest quality investments, such as AAA rated government or agency bonds.

The following table summarizes unrealized gains and losses related to our restricted investments in marketable securities designated as available-for-sale by major security type as of June 30, 2011 and December 31, 2010 (in thousands):

	As of June 30, 2011
Security Type	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value
Foreign government obligations	$	141,903	$	447	$	6,937	$	135,413
U.S. government obligations	15,022		448		94		15,376
Total	$	156,925	$	895	$	7,031	$	150,789

	As of December 31, 2010
Security Type	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value
Foreign government obligations	$	73,729	$	6,529	$	72	$	80,186
U.S. government obligations	5,659		139		—		5,798
Total	$	79,388	$	6,668	$	72	$	85,984

Gross unrealized losses as of June 30, 2011 were primarily the result of changes in interest rates. We evaluated these losses and determined these unrealized losses to be temporary, because we do not intend to sell the securities, and it is not more likely than not that we will be required to sell these securities before recovery of their amortized cost basis. As of June 30, 2011 and December 31, 2010, the contractual maturities of these available-for-sale marketable securities were between 17 years and 25 years.

Note 8. Consolidated Balance Sheet Details

Accounts receivable trade, net

Accounts receivable trade, net consisted of the following at June 30, 2011 and December 31, 2010 (in thousands):

	June 30, 2011		December 31, 2010
Accounts receivable trade, gross	$	541,977	$	305,537
Allowance for doubtful accounts	—		—
Accounts receivable trade, net	$	541,977	$	305,537

During the third quarter of 2009, we amended our Supply Contracts with certain of our customers to implement a program

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which provided a price rebate to these customers for solar modules purchased from us. The initial intent of this program was to enable our customers to successfully compete in our core German market and to adjust, for eligible customers, the sales price (which was documented in framework agreements entered into several years ago) in light of market conditions.

The rebate program is offered for a defined period, during which customers may apply and claim such rebate. The most recent rebate offering, for solar modules sold on or after December 1, 2010, includes certain European geographic areas in addition to Germany.

As was the case in 2009, the rebate amounts are established so as to enable the sell-through of our products at competitive prices. The amount of rebate earned during a fiscal quarter is based on (i) the volume of solar modules shipped to a customer (measured in watts), (ii) the volume of solar modules registered for eligible projects (measured in watts), provided that those solar modules were invoiced by the buyer to an end-user, and (iii) the rebate rate. The rebate program applies a specified rebate rate to solar modules sold for solar power projects in certain geographic areas. Customers need to meet certain requirements in order to be eligible for and benefit from this program. During the six months ended June 30, 2011, we experienced approximately 92% participation in this program by eligible customers.

We account for these rebates as a reduction to the selling price of our solar modules and, therefore, as a reduction in revenue at the time of sale and recognize a contra-asset within accounts receivable trade, net. No rebates granted under this program can be claimed for cash; instead, rebates may only be applied to reduce outstanding accounts receivable balances. During the three and six months ended June 30, 2011, we extended rebates to customers in the amount of €17.3 million and €28.0 million, respectively ($24.9 million and $39.8 million at the average exchange rates of $1.44/€1.00 and $1.42/€1.00, respectively). At June 30, 2011, we had €22.3 million ($32.1 million at the balance sheet close rate on June 30, 2011 of $1.44/€1.00) of rebate claims accrued, which reduced our accounts receivable accordingly. During the three and six months ended June 26, 2010, we extended rebates to customers in the amount of €15.6 million and €35.6 million, respectively ($20.6 million and $48.4 million at the average exchange rates of $1.32/€1.00 and $1.36/€1.00, respectively).

Accounts receivable, unbilled

Accounts receivable, unbilled represents revenue that has been recognized in advance of billing the customer. This is common for construction contracts. For example, we recognize revenue from contracts for the construction and sale of solar power systems which include the sale of project assets over the contractual period using applicable accounting methods. One applicable accounting method is the percentage-of-completion method of accounting, under which sales and gross profit are recognized as work is performed based on the relationship between actual costs incurred compared to the total estimated costs for completing the entire contract. Under this accounting method, revenue could be recognized under applicable revenue recognition criteria in advance of billing the customer, resulting in an amount recorded to "Accounts receivable, unbilled." Once we meet the billing criteria under a contract, we bill our customer accordingly and reclassify the “Accounts receivable, unbilled” to “Accounts receivable trade, net.” Billing requirements vary by contract, but are generally structured around completion of certain construction milestones.

Accounts receivable, unbilled were $63.7 million and $1.5 million at June 30, 2011 and December 31, 2010, respectively. We expect to bill and collect these amounts within the next 12 months.

Inventories

Inventories consisted of the following at June 30, 2011 and December 31, 2010 (in thousands):

	June 30, 2011		December 31, 2010
Raw materials	$	197,961	$	162,190
Work in process	30,499		21,528
Finished goods	137,248		54,873
Total inventories	$	365,708	$	238,591
Inventories — current	$	322,995	$	195,863
Inventories — noncurrent (1)	$	42,713	$	42,728

(1) We purchase a critical raw material that is heavily used in our core production process in quantities that anticipate confident, but long-term future demand. We classify the raw materials that we do not expect to be consumed within our operating cycle (which is 12 months) as noncurrent.

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Prepaid expenses and other current assets

Prepaid expenses and other current assets consisted of the following at June 30, 2011 and December 31, 2010 (in thousands):

	June 30, 2011		December 31, 2010
Prepaid expenses	$	64,792	$	46,016
Deferred project costs (1)	47,390		14,446
Derivative instruments	21,174		20,986
Other current assets	127,158		61,585
Total prepaid expenses and other current assets	$	260,514	$	143,033

(1) Deferred project costs represent (i) costs that we capitalize for arrangements that we account for as real estate transactions after we have entered into a definitive sales arrangement, but before we have met the criteria to recognize the sale as revenue, (ii) recoverable pre-contract costs that we capitalize for arrangements accounted for as long-term construction contracts prior to entering into a definitive sales agreement, or (iii) costs that we capitalize for arrangements accounted for as long-term construction contracts after we have signed a definitive sales agreement, but before the revenue recognition criteria have been met.

Project assets — current and noncurrent

Project assets consist primarily of costs relating to solar power projects in various stages of development that we capitalize prior to the sale of the solar power project to a third party for further project development or the signing of a project construction contract. These costs include costs for land and costs for developing and constructing a solar power plant. Development costs can include legal, consulting, permitting, interconnect and other similar costs. Once we enter into a definitive sales agreement, we reclassify project assets to deferred project costs on our balance sheet until we have met the criteria to recognize the sale of the project assets as revenue. We classify project assets generally as noncurrent due to the time required to complete all activities to sell a specific project, which is typically longer than 12 months.

Project assets — current and noncurrent consisted of the following at June 30, 2011 and December 31, 2010 (in thousands):

	June 30, 2011		December 31, 2010
Project assets acquired through OptiSolar and NextLight	$	217,417	$	217,417
Project assets — land	15,899		13,781
Project assets — other	221,751		88,942
Total project assets	$	455,067	$	320,140
Total project assets — current	$	145,379	$	—
Total project assets — noncurrent	$	309,688	$	320,140

In connection with the acquisition of the solar power project development businesses of OptiSolar and NextLight, we measured at fair value certain acquired project assets based on the varying development stages of each project asset on the acquisition date. Subsequent to the acquisitions of OptiSolar and NextLight, we incurred additional costs to further develop these projects. Once we enter into a definitive sales agreement, we reclassify project assets to deferred project costs on our balance sheet. We expense these project assets to cost of sales as each respective project asset or solar power system is sold to a customer, since the project is constructed for a customer (matching the underlying revenue recognition method). If a project is considered not commercially viable, we impair the respective project asset and adjust it to fair value, with the resulting impairment recorded within operations.

We review project assets for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. We consider a project commercially viable if it is anticipated to be sellable for a profit once it is either fully developed or fully constructed. We consider a partially developed or partially constructed project commercially viable if the anticipated selling price is higher than the carrying value of the related project assets. We examine a number of factors to determine if the project will be profitable, the most notable of which is whether there are any changes in environmental, ecological, permitting, or regulatory conditions that impact the project. Such changes could cause the cost of the project to increase or the selling price of the project to decrease.

Property, plant and equipment, net

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Property, plant and equipment, net consisted of the following at June 30, 2011 and December 31, 2010 (in thousands):

	June 30, 2011			December 31, 2010
Buildings and improvements	$	398,115		$	286,637
Machinery and equipment	1,378,961			997,510
Office equipment and furniture	92,024			70,569
Leasehold improvements	38,211			25,354
Depreciable property, plant and equipment, gross	1,907,311			1,380,070
Accumulated depreciation	(462,941		)	(363,305		)
Depreciable property, plant and equipment, net	1,444,370			1,016,765
Land	11,758			10,355
Construction in progress	271,865			403,669
Property, plant and equipment, net	$	1,727,993		$	1,430,789

During 2010, we were granted a $16.3 million tax credit under the Advanced Energy Tax Credit program enacted by the American Reinvestment and Recovery Act of 2009 for the expansion of our Perrysburg, Ohio manufacturing facility, and we reduced the acquisition cost for the expansion of this facility accordingly.

Further, we are eligible to receive certain investment incentives related to building the expansion of our manufacturing plant in Frankfurt/Oder, Germany, including costs for the construction of buildings and the purchase of machinery and equipment. We account for these grants as a deduction to the carrying value of the fixed assets they fund when there is reasonable assurance that we comply with the conditions attached to the grants and the grants will be received. See Note 11. "Economic Development Funding," for further information about these grants.

Depreciation of property, plant and equipment was $54.4 million and $36.2 million for the three months ended June 30, 2011 and June 26, 2010, respectively, and was $101.5 million and $72.8 million for the six months ended June 30, 2011 and June 26, 2010, respectively.

Capitalized interest

We capitalized interest costs incurred into property, plant and equipment or project assets/deferred project costs as follows during the three and six months ended June 30, 2011 and June 26, 2010 (in thousands):

	Three Months Ended						Six Months Ended
	June 30, 2011			June 26, 2010			June 30, 2011			June 26, 2010
Interest cost incurred	$	(1,954	)	$	(1,923	)	$	(3,791	)	$	(4,198	)
Interest cost capitalized – property, plant and equipment	1,352			1,283			3,111			1,701
Interest cost capitalized – project assets and deferred project costs	602			634			680			2,491
Interest expense, net	$	—		$	(6	)	$	—		$	(6	)

Accrued expenses

Accrued expenses consisted of the following at June 30, 2011 and December 31, 2010 (in thousands):

	June 30, 2011		December 31, 2010
Accrued compensation and benefits	$	35,222	$	69,353
Accrued property, plant and equipment	49,836		53,741
Accrued inventory	54,835		25,686
Product warranty liability – current	10,706		11,226
Nonrecurring expenses in excess of normal product warranty liability and related expenses (1)	17,237		28,921
Other accrued expenses	74,414		55,344
Total accrued expenses	$	242,250	$	244,271

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(1) The above-referenced $17.2 million of accrued nonrecurring expenses in excess of normal product warranty liability and related expenses as of June 30, 2011 consisted of the following, each related to the manufacturing excursion described below: (i) $14.4 million in estimated expenses for certain module replacement efforts voluntarily undertaken by us beyond the normal product warranty; and (ii) $2.8 million in estimated nonrecurring post-sale expenses. During the period from June 2008 to June 2009, a manufacturing excursion occurred affecting less than 4% of the total product manufactured within the period. The excursion could result in possible premature power loss in affected modules. The root cause was identified and subsequently mitigated in June 2009. On-going testing confirms that the corrective actions have been effective. We have been working directly with impacted customers to replace the affected modules and these efforts are well underway and, in some cases, complete. Some of these efforts go beyond our normal warranty coverage.

Other current liabilities

Other current liabilities consisted of the following at June 30, 2011 and December 31, 2010 (in thousands):

	June 30, 2011		December 31, 2010
Deferred revenue (1)	$	31,010	$	14,718
Derivative instruments	53,428		22,996
Deferred tax liabilities	—		34,601
Other current liabilities	10,479		27,361
Total other current liabilities	$	94,917	$	99,676

(1) Deferred revenue will be recognized in net sales once all revenue recognition criteria are met.

Other liabilities

Other liabilities consisted of the following at June 30, 2011 and December 31, 2010 (in thousands):

	June 30, 2011		December 31, 2010
Other taxes payable	$	73,461	$	59,148
Other noncurrent liabilities	83,228		52,878
Total other liabilities	$	156,689	$	112,026

Note 9. Derivative Financial Instruments

As a global company, we are exposed in the normal course of business to interest rate and foreign currency risks that could affect our net assets, financial position, results of operations, and cash flows. We use derivative instruments to hedge against certain risks such as these, and we only hold derivative instruments for hedging purposes, not for speculative or trading purposes. Our use of derivative instruments is subject to strict internal controls based on centrally defined, performed, and controlled policies and procedures.

Depending on the terms of the specific derivative instruments and market conditions, some of our derivative instruments may be assets and others liabilities at any particular point in time. As required by ASC 815, Derivatives and Hedging, we report all of our derivative instruments that are within the scope of that accounting standard at fair value on our balance sheet. Depending on the substance of the hedging purpose for our derivative instruments, we account for changes in the fair value of some of them using cash flow hedge accounting pursuant to ASC 815 and of others by recording the changes in fair value directly to current earnings (so-called “economic hedges”). These accounting approaches, the various risk classes that we are exposed to in our business, and the risk management systems using derivative instruments that we apply to these risks are described below. See Note 10. "Fair Value Measurements," to our condensed consolidated financial statements for information about the techniques we use to measure the fair value of our derivative instruments.

The following tables present the fair values of derivative instruments included in our consolidated balance sheets as of June 30, 2011 and December 31, 2010 (in thousands):

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	June 30, 2011
	Other Assets – Current		Other Assets – Noncurrent		Other Liabilities – Current		Other Liabilities – Noncurrent
Derivatives designated as hedging instruments under ASC 815:
Foreign exchange forward contracts	$	8,787	$	—	$	39,438	$	1,425
Interest rate swap contracts	—		—		137		493
Total derivatives designated as hedging instruments	$	8,787	$	—	$	39,575	$	1,918
Derivatives not designated as hedging instruments under ASC 815:
Foreign exchange forward contracts	$	12,387	$	—	$	13,853	$	—
Total derivatives not designated as hedging instruments	$	12,387	$	—	$	13,853	$	—
Total derivative instruments	$	21,174	$	—	$	53,428	$	1,918

	December 31, 2010
	Other Assets – Current		Other Assets – Noncurrent		Other Liabilities – Current		Other Liabilities – Noncurrent
Derivatives designated as hedging instruments under ASC 815:
Foreign exchange forward contracts	$	10,115	$	880	$	12,384	$	58
Interest rate swap contracts	—		—		239		980
Total derivatives designated as hedging instruments	$	10,115	$	880	$	12,623	$	1,038
Derivatives not designated as hedging instruments under ASC 815:
Foreign exchange forward contracts	$	10,871	$	—	$	10,373	$	—
Total derivatives not designated as hedging instruments	$	10,871	$	—	$	10,373	$	—
Total derivative instruments	$	20,986	$	880	$	22,996	$	1,038

The following tables present the amounts related to derivative instruments affecting accumulated other comprehensive income (loss) and our condensed consolidated statements of operations for the three and six months ended June 30, 2011 and June 26, 2010 (in thousands):

	Amount of Gain (Loss) Recognized in Other Comprehensive Income on Derivatives							Amount of Gain (Loss) Reclassified from Accumulated Other Comprehensive Income into Income
	Three Months Ended			Six Months Ended			Location of Gain (Loss) Reclassified from Accumulated Other Comprehensive Income into Income	Three Months Ended			Six Months Ended
Derivative Type	June 30, 2011			June 30, 2011				June 30, 2011			June 30, 2011
Derivatives designated as cash flow hedges under ASC 815:
Foreign exchange forward contracts	$	(16,890	)	$	(70,642	)	Net sales	$	(26,154	)	$	(38,534	)
Interest rate swaps	(533		)	184			Interest income (expense)	(200		)	(405		)
Total derivatives designated as cash flow hedges	$	(17,423	)	$	(70,458	)		$	(26,354	)	$	(38,939	)

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	Amount of Gain (Loss) Recognized in Income on Derivatives
	Three Months Ended			Six Months Ended
Derivative Type	June 30, 2011			June 30, 2011			Location of Gain (Loss) Recognized in Income on Derivatives
Derivatives designated as cash flow hedges under ASC 815:
Foreign exchange forward contracts	$	(26,154	)	$	(38,534	)	Net sales
Interest rate swaps	$	(200	)	$	(405	)	Interest income (expense)
Derivatives not designated as hedging instruments under ASC 815:
Foreign exchange forward contracts	$	(741	)	$	468		Other income (expense)
Foreign exchange forward contracts	$	820		$	3,902		Cost of sales

	Amount of Gain (Loss) Recognized in Other Comprehensive Income on Derivatives							Amount of Gain (Loss) Reclassified from Accumulated Other Comprehensive Income into Income
	Three Months Ended			Six Months Ended			Location of Gain (Loss) Reclassified from Accumulated Other Comprehensive Income into Income	Three Months Ended			Six Months Ended
Derivative Type	June 26, 2010			June 26, 2010				June 26, 2010			June 26, 2010
Derivatives designated as cash flow hedges under ASC 815:
Foreign exchange forward contracts	$	18,055		$	54,954		Net sales	$	27,938		$	29,233
Interest rate swaps	(366		)	(821		)	Interest income (expense)	(314		)	(633		)
Total derivatives designated as cash flow hedges	$	17,689		$	54,133			$	27,624		$	28,600

	Amount of Gain (Loss) Recognized in Income on Derivatives
	Three Months Ended			Six Months Ended
Derivative Type	June 26, 2010			June 26, 2010			Location of Gain (Loss) Recognized in Income on Derivatives
Derivatives designated as cash flow hedges under ASC 815:
Foreign exchange forward contracts	$	27,938		$	29,233		Net sales
Interest rate swaps	$	(314	)	$	(633	)	Interest income (expense)
Derivatives not designated as hedging instruments under ASC 815:
Foreign exchange forward contracts	$	(4,958	)	$	(10,521	)	Other income (expense)
Foreign exchange forward contracts	$	(2,714	)	$	(7,228	)	Cost of sales
Foreign exchange forward contracts	$	340		$	—		Net sales

Interest Rate Risk

We use interest rate swap agreements to mitigate our exposure to interest rate fluctuations associated with certain of our debt instruments; we do not use such swap agreements for speculative or trading purposes. On May 29, 2009, we entered into an interest rate swap contract to hedge a portion of the floating rate loans under our Malaysian credit facility, which became effective on September 30, 2009 with a notional value of €57.3 million ($82.5 million at the balance sheet close rate on June 30, 2011 of $1.44/€1.00) and pursuant to which we are entitled to receive a six-month floating interest rate, the Euro Interbank Offered Rate (Euribor), and are required to pay a fixed rate of 2.80%. The notional amount of the interest rate swap contract is scheduled to decline in correspondence to our scheduled principal payments on the underlying hedged debt. As of June 30, 2011, the notional value of this

17

interest rate swap contract was €43.2 million ($62.2 million at the balance sheet close rate on June 30, 2011 of $1.44/€1.00). This derivative instrument qualifies for accounting as a cash flow hedge in accordance with ASC 815 and we designated it as such. We determined that our interest rate swap contract was highly effective as a cash flow hedge at June 30, 2011 and December 31, 2010. For the six months ended June 30, 2011, there was no ineffectiveness from this cash flow hedge.

Foreign Currency Exchange Risk

Cash Flow Exposure

We expect many of the components of our business to have material future cash flows, including revenues and expenses, that will be denominated in currencies other than the component's functional currency. Our primary cash flow exposures are customer collections and vendor payments. Changes in the exchange rates between our components' functional currencies and the other currencies in which they transact will cause fluctuations in the cash flows we expect to receive when these cash flows are realized or settled. Accordingly, we enter into foreign exchange forward contracts to hedge a portion of these forecasted cash flows. As of June 30, 2011 and December 31, 2010, these foreign exchange contracts hedged our forecasted future cash flows for up to 18 months. These foreign exchange contracts qualified for accounting as cash flow hedges in accordance with ASC 815, and we designated them as such. We initially report the effective portion of the derivative's gain or loss in “Accumulated other comprehensive income (loss)” and subsequently reclassify amounts into earnings when the hedged transaction is settled. For cash flow hedges, ineffectiveness in the hedging relationship and changes in fair value that are not included in the measurement of effectiveness are both included in other operating income (expense). We determined that these derivative financial instruments were highly effective as cash flow hedges at June 30, 2011 and December 31, 2010. During the six months ended June 30, 2011, there were immaterial amounts of ineffectiveness and amounts excluded from effectiveness testing for these cash flow hedges. In addition, during the six months ended June 30, 2011, we did not discontinue any cash flow hedges because a hedging relationship was no longer highly effective.

During the six months ended June 30, 2011, we purchased foreign exchange forward contracts to hedge the exchange risk on forecasted cash flows denominated in euro and Canadian dollars. As of June 30, 2011, the unrealized loss on these contracts was $31.1 million. The total notional value of the contracts denominated in euro and Canadian dollars were €559.0 million and CAD340.0 million, respectively ($805.0 million and $350.2 million, respectively at the balance sheet close rates on June 30, 2011 of $1.44/€1.00 and $1.03/CAD1.00). The weighted average forward exchange rates for these contracts were $1.36/€1.00 and $1.05/CAD1.00, respectively, at June 30, 2011. As of December 31, 2010, the unrealized loss on these types of contracts was $1.4 million and the total notional value of the contracts was €742.0 million ($1.1 billion at the balance sheet close rate on June 30, 2011 of $1.44/€1.00). The weighted average forward exchange rate for these contracts was $1.33/€1.00 at December 31, 2010. During the six months ended June 30, 2011, we recognized insignificant losses related to hedged forecasted transactions that did not occur by the end of the originally specified period.

In the following 12 months, we expect to reclassify to earnings $29.6 million of net unrealized losses related to these forward contracts that are included in "Accumulated other comprehensive loss" at June 30, 2011 as we realize the earnings effect of the related forecasted transactions. The amount we ultimately record to earnings will depend on the actual exchange rate when we realize the related forecasted transactions. During the three and six months ended June 30, 2011, we realized losses of $26.4 million and $38.9 million, respectively, related to our cash flow hedges.

Transaction Exposure

Many components of our business have assets and liabilities (primarily receivables, investments, accounts payable, debt, solar module collection and recycling liabilities, and inter-company transactions) that are denominated in currencies other than the component's functional currency. Changes in the exchange rates between our components' functional currencies and the other currencies in which these assets and liabilities are denominated can create fluctuations in our reported consolidated financial position, results of operations, and cash flows. We may enter into foreign exchange forward contracts or other financial instruments to economically hedge assets and liabilities against the short-term effects of currency exchange rate fluctuations. The gains and losses on the foreign exchange forward contracts will offset all or part of the transaction gains and losses that we recognize in earnings on the related foreign currency assets and liabilities.

During the six months ended June 30, 2011, we purchased foreign exchange forward contracts to hedge balance sheet exposures related to transactions with third parties. We recognize gains or losses from the fluctuation in foreign exchange rates and the valuation of these derivative contracts in "Cost of sales" and "Foreign currency gain (loss)" on our consolidated statements of operations, depending on where the gain or loss from the economically hedged item is classified on our consolidated statements of operations. As of June 30, 2011, the total unrealized loss on our foreign exchange forward contracts was $1.5 million. These

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contracts have maturities of less than three months.

As of June 30, 2011, the notional values of our foreign exchange forward contracts were as follows (notional amounts and U.S. dollar equivalents in millions):

				Balance sheet close rate on
Transaction	Currency	Notional Amount	U.S. Equivalent	June 30, 2011
Purchase	Euro	€360.0	$518.4	$1.44/€1.00
Sell	Euro	€425.6	$612.9	$1.44/€1.00
Purchase	Australian dollar	AUD 1.5	$1.6	$1.06/AUD1.00
Sell	Australian dollar	AUD 1.5	$1.6	$1.06/AUD1.00
Purchase	Malaysian ringgit	MYR 162.6	$53.7	$0.33/MYR1.00
Sell	Malaysian ringgit	MYR 20.5	$6.8	$0.33/MYR1.00
Purchase	Japanese yen	JPY 3,416.0	$34.2	$0.01/JPY1.00
Sell	Japanese yen	JPY 2,512.4	$25.1	$0.01/JPY1.00
Purchase	Canadian dollar	CAD 5.5	$5.7	$1.03/CAD1.00
Sell	Canadian dollar	CAD 8.6	$8.9	$1.03/CAD1.00

Credit Risk

We have certain financial and derivative instruments that subject us to credit risk. These consist primarily of cash, cash equivalents, investments, trade accounts receivable, interest rate swap contracts, and foreign exchange forward contracts. We are exposed to credit losses in the event of nonperformance by the counterparties to our financial and derivative instruments. We place cash, cash equivalents, investments, interest rate swap contracts, and foreign exchange forward contracts with various high-quality financial institutions and limit the amount of credit risk from any one counterparty. We continuously evaluate the credit standing of our counterparty financial institutions.

Note 10. Fair Value Measurements

ASC 820, Fair Value Measurements and Disclosures, defines fair value, establishes a framework for measuring fair value in accordance with generally accepted accounting principles, and provides financial statement disclosure requirements for fair value measurements. ASC 820 defines fair value as the price that would be received from the sale of an asset or paid to transfer a liability (an exit price) on the measurement date in an orderly transaction between market participants in the principal or most advantageous market for the asset or liability. ASC 820 specifies a hierarchy of valuation techniques, which is based on whether the inputs into the valuation technique are observable or unobservable. The hierarchy is as follows:

• Level 1 — Valuation techniques in which all significant inputs are unadjusted quoted prices from active markets for assets or liabilities that are identical to the assets or liabilities being measured.

• Level 2 — Valuation techniques in which significant inputs include quoted prices from active markets for assets or liabilities that are similar to the assets or liabilities being measured and/or quoted prices for assets or liabilities that are identical or similar to the assets or liabilities being measured from markets that are not active. Also, model-derived valuations in which all significant inputs and significant value drivers are observable in active markets are Level 2 valuation techniques.

• Level 3 — Valuation techniques in which one or more significant inputs or significant value drivers are unobservable. Unobservable inputs are valuation technique inputs that reflect our own assumptions about the assumptions that market participants would use to price an asset or liability.

When available, we use quoted market prices to determine the fair value of an asset or liability. If quoted market prices are not available, we measure fair value using valuation techniques that use, when possible, current market-based or independently-sourced market parameters, such as interest rates and currency rates. The following is a description of the valuation techniques that we use to measure the fair value of assets and liabilities that we measure and report at fair value on a recurring or one-time basis:

• Cash equivalents. At June 30, 2011 and December 31, 2010, our cash equivalents consisted of commercial paper and money market mutual funds. We value our commercial paper cash equivalents using quoted prices for securities with

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similar characteristics and other observable inputs (such as interest rates that are observable at commonly quoted intervals), and accordingly, we classify the valuation techniques that use these inputs as Level 2. We value our money market cash equivalents using observable inputs that reflect quoted prices for securities with identical characteristics, and accordingly, we classify the valuation techniques that use these inputs as Level 1.

• Marketable securities, investments, and restricted investments. At June 30, 2011, our marketable securities and investments consisted of certificates of deposit, commercial paper, corporate debt securities, federal and foreign agency debt, foreign government obligations, supranational debt, and U.S. government obligations, and our restricted investments consisted of foreign and U.S. government obligations. At December 31, 2010, our marketable securities consisted of commercial paper, corporate debt securities, federal and foreign agency debt, foreign government obligations, and supranational debt, and our restricted investments consisted of foreign and U.S. government obligations. We value our marketable securities, investments, and restricted investments using quoted prices for securities with similar characteristics and other observable inputs (such as interest rates that are observable at commonly quoted intervals), and accordingly, we classify the valuation techniques that use these inputs as Level 2. We also consider the effect of our counterparties' credit standings in these fair value measurements.

• Derivative assets and liabilities. At June 30, 2011 and December 31, 2010, our derivative assets and liabilities consisted of foreign exchange forward contracts involving major currencies and interest rate swap contracts involving benchmark interest rates. Since our derivative assets and liabilities are not traded on an exchange, we value them using industry standard valuation models. Where applicable, these models project future cash flows and discount the future amounts to a present value using market-based observable inputs including interest rate curves, credit risk, foreign exchange rates, and forward and spot prices for currencies. These inputs are observable in active markets over the terms of the instruments we hold, and accordingly, we classify these valuation techniques as Level 2. We consider the effect of our own credit standing and that of our counterparties in our valuations of our derivative assets and liabilities.

• Solar module collection and recycling liability. We account for our obligation to collect and recycle the solar modules that we sell in a similar manner to the accounting for asset retirement obligations that is prescribed by ASC 410, Asset Retirement and Environmental Obligations. When we sell solar modules, we initially record our liability for collecting and recycling those particular solar modules at the fair value of this liability, and then in subsequent periods, we accrete this fair value to the estimated future cost of collecting and recycling the solar modules. Therefore, this is a one-time nonrecurring fair value measurement of the collection and recycling liability associated with each particular solar module sold.

Since there is not an established market for collecting and recycling our solar modules, we value our liability using a valuation model (an income approach). This fair value measurement requires us to use significant unobservable inputs, which are primarily estimates of collection and recycling process costs and estimates of future changes in costs due to inflation and future currency exchange rates. Accordingly, we classify these valuation techniques as Level 3. We estimate collection and recycling process costs based on analyses of the collection and recycling technologies that we are currently developing; we estimate future inflation costs based on analysis of historical trends; and we estimate future currency exchange rates based on current rate information. We consider the effect of our own credit standing in our measurement of the fair value of this liability.

At June 30, 2011 and December 31, 2010, information about inputs into the fair value measurements of our assets and liabilities that we make on a recurring basis was as follows (in thousands):

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	As of June 30, 2011
			Fair Value Measurements at Reporting Date Using
	Total Fair Value and Carrying Value on Our Balance Sheet		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets:
Cash equivalents:
Commercial paper	$	4,600	$	—	$	4,600	$	—
Money market mutual funds	10,059		10,059		—		—
Marketable securities and investments:
Certificates of deposit	2,602		—		2,602		—
Commercial paper	6,846		—		6,846		—
Corporate debt securities	29,886		—		29,886		—
Federal agency debt	49,697		—		49,697		—
Foreign agency debt	22,085		—		22,085		—
Foreign government obligations	5,608		—		5,608		—
Supranational debt	39,226		—		39,226		—
U.S. government obligations	2,012		—		2,012		—
Restricted investments (excluding restricted cash)	150,789		—		150,789		—
Derivative assets	21,174		—		21,174		—
Total assets	$	344,584	$	10,059	$	334,525	$	—
Liabilities:
Derivative liabilities	$	55,346	$	—	$	55,346	$	—

	As of December 31, 2010
			Fair Value Measurements at Reporting Date Using
	Total Fair Value and Carrying Value on Our Balance Sheet		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets:
Cash equivalents:
Commercial paper	$	1,200	$	—	$	1,200	$	—
Money market mutual funds	22,289		22,289		—		—
Marketable securities:
Commercial paper	13,343		—		13,343		—
Corporate debt securities	98,602		—		98,602		—
Federal agency debt	45,875		—		45,875		—
Foreign agency debt	133,165		—		133,165		—
Foreign government obligations	9,143		—		9,143		—
Supranational debt	48,032		—		48,032		—
Restricted investments (excluding restricted cash)	85,984		—		85,984		—
Derivative assets	21,866		—		21,866		—
Total assets	$	479,499	$	22,289	$	457,210	$	—
Liabilities:
Derivative liabilities	$	24,034	$	—	$	24,034	$	—

Fair Value of Financial Instruments

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The carrying values and fair values of our financial instruments at June 30, 2011 and December 31, 2010 were as follows (in thousands):

	June 30, 2011				December 31, 2010
	Carrying Value		Fair Value		Carrying Value		Fair Value
Assets:
Marketable securities — current and noncurrent	$	155,360	$	155,360	$	348,160	$	348,160
Investments — current	$	2,602	$	2,602	$	—	$	—
Foreign exchange forward contract assets	$	21,174	$	21,174	$	21,866	$	21,866
Restricted investments (excluding restricted cash)	$	150,789	$	150,789	$	85,984	$	85,984
Notes receivable — noncurrent	$	10,057	$	9,441	$	9,314	$	8,836
Liabilities:
Long-term debt, including current maturities	$	360,826	$	364,825	$	237,391	$	240,176
Interest rate swap contract liabilities	$	630	$	630	$	1,219	$	1,219
Foreign exchange forward contract liabilities	$	54,716	$	54,716	$	22,815	$	22,815

The carrying values on our balance sheet of our cash and cash equivalents, accounts receivable, restricted cash, accounts payable, income taxes payable, and accrued expenses approximate their fair values due to their short maturities; therefore, we exclude them from the foregoing table.

We estimated the fair value of our long-term debt in accordance with ASC 820 using a discounted cash flows approach (an income approach). We incorporated the credit risk of our counterparty for all asset fair value measurements and our credit risk for all liability fair value measurements.

Note 11. Economic Development Funding

On February 11, 2011 we were approved to receive taxable investment incentives (Investitionszuschüsse) of approximately €6.3 million ($9.1 million at the balance sheet close rate on June 30, 2011 of $1.44/€1.00) from the State of Brandenburg, Germany. These funds will reimburse us for certain costs incurred related to the expansion of our manufacturing plant in Frankfurt/Oder, Germany, including costs for the construction of buildings and the purchase of machinery and equipment. Receipt of these incentives is conditional upon the State of Brandenburg having sufficient funds allocated to this program to pay the reimbursements we claim. Based on several factors, including the fiscal budget and credit rating of the State of Brandenburg among others, we believe that there is reasonable assurance that we will receive these grants. In addition, we are required to operate our facility for a minimum of five years and employ a specified number of associates during this period. We expect to meet these conditions based on our operating plans and current commitments. Our incentive approval expires on December 31, 2012. As of June 30, 2011, we had received cash payments of €2.2 million ($3.1 million at the transaction rate of $1.42/€1.00) under this program, and we had accrued €3.3 million ($4.8 million at the balance sheet close rate on June 30, 2011 of $1.44/€1.00) that we are eligible to receive under this program based on qualifying expenditures that we had incurred through that date.

We are also eligible to recover up to approximately €17.2 million ($24.8 million at the balance sheet close rate on June 30, 2011 of $1.44/€1.00) of expenditures related to the construction of our plant in Frankfurt/Oder, Germany under the German Investment Grant Act of 2010 (Investitionszulagen). This Act permits us to claim tax-exempt reimbursements for certain costs that we will incur related to the expansion of our manufacturing plant in Frankfurt/Oder, Germany, including costs for the construction of buildings and the purchase of machinery and equipment. Tangible assets subsidized under this program have to remain in the region for at least five years. We expect to meet these conditions based on our operating plans and current commitments. As of June 30, 2011, we had accrued €14.6 million ($21.0 million at the balance sheet close rate on June 30, 2011 of $1.44/€1.00) that we are eligible to receive under this program based on qualifying expenditures that we had incurred through that date.

We account for these grants as a deduction to the carrying value of the fixed assets they fund when there is reasonable assurance that we comply with the conditions attached to the grants and the grants will be received.

Note 12. Notes Receivable

On April 8, 2009, we entered into a credit facility agreement with a solar project entity of one of our customers for an available amount of €17.5 million ($25.2 million at the balance sheet close rate on June 30, 2011 of $1.44/€1.00) to provide financing for

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a PV power generation facility. The credit facility replaced a bridge loan that we had made to this entity. The credit facility bears interest at 8% per annum and is due on December 31, 2026. As of June 30, 2011 and December 31, 2010, the balance on this credit facility was €7.0 million ($10.1 million at the balance sheet close rate on June 30, 2011 of $1.44/€1.00). The outstanding amount of this credit facility is included within “Other assets” on our consolidated balance sheets.

Note 13. Debt

Our long-term debt at June 30, 2011 and December 31, 2010 consisted of the following (in thousands):

Type	June 30, 2011			December 31, 2010
Revolving Credit Facility	$	100,000		$	100,000
German Facility Agreement	123,734			—
France Facility Agreement	5,350			—
Malaysian Facility Agreement — Fixed rate term loan	63,324			65,009
Malaysian Facility Agreement — Floating rate term loan (1)	63,324			65,009
Director of Development of the State of Ohio	7,229			8,112
Capital lease obligations	2,658			1,736
	365,619			239,866
Less unamortized discount	(4,793		)	(2,475		)
Total long-term debt	360,826			237,391
Less current portion	(28,334		)	(26,587		)
Noncurrent portion	$	332,492		$	210,804

(1) We entered into an interest rate swap contract related to this loan. See Note 9. "Derivative Financial Instruments," to our condensed consolidated financial statements.

We did not have any short-term debt at June 30, 2011 and December 31, 2010.

Revolving Credit Facility

On September 4, 2009, we entered into a revolving credit facility with several financial institutions as lenders. JPMorgan Securities LLC and Banc of America Securities LLC served as Joint-Lead Arrangers and Bookrunners, with JPMorgan Chase Bank, N.A. also acting as Administrative Agent. The credit agreement provided First Solar, Inc. and certain of its subsidiaries with a senior secured three-year revolving credit facility in an aggregate available amount of $300.0 million, a portion of which was available for letters of credit. Proceeds from the credit facility could be used for working capital and other general corporate purposes.

On October 15, 2010, we entered into an amended and restated credit agreement governing our revolving credit facility which provides First Solar, Inc. and certain of its subsidiaries with a senior secured five-year revolving credit facility in an aggregate available amount of $600.0 million, all of which is available for letters of credit. Subject to certain conditions, we have the right to request an increase in the aggregate commitments under the credit facility up to $750.0 million.

Borrowings under the amended and restated credit agreement currently bear interest at (i) London Interbank Offered Rate (LIBOR) (adjusted for eurocurrency reserve requirements) plus a margin of 2.25% or (ii) a base rate as defined in the credit agreement plus a margin of 1.25%, depending on the type of borrowing requested by us. These margins are subject to adjustments depending on our consolidated leverage ratio. The amended and restated credit agreement contains various financial condition covenants with which we must comply, including a debt to EBITDA ratio covenant, a minimum EBITDA covenant, and a minimum liquidity covenant. Under the amended and restated credit agreement we are also subject to customary non-financial covenants. We were in compliance with these covenants through June 30, 2011.

At June 30, 2011, we had $100.0 million in borrowings outstanding and $143.4 million in letters of credit issued under the revolving credit facility, leaving a total remaining availability of $356.6 million, all of which can be used for the issuance of letters of credit. As of June 30, 2011, based on the outstanding borrowings, the all-in effective three month LIBOR borrowing rate was 2.66%. At December 31, 2010, we had $100.0 million in borrowings outstanding and $126.4 million in letters of credit issued under the revolving credit facility. 

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In addition to paying interest on outstanding principal under the credit agreement, we are required to pay a commitment fee, currently at the rate of 0.375% per annum, to the lenders based on the average daily unused commitments under the facility. The commitment fee may also be adjusted due to changes in our consolidated leverage ratio. We also pay a letter of credit fee equal to the applicable margin for eurocurrency revolving loans on the face amount of each letter of credit and a fronting fee. 

In connection with our revolving credit facility, we entered into a guarantee and collateral agreement and various foreign security agreements. Loans made to First Solar Manufacturing GmbH (a borrowing subsidiary under the credit facility) were (i) guaranteed by First Solar, Inc. pursuant to the guarantee and collateral agreement, (ii) guaranteed by certain of First Solar, Inc.'s direct and indirect subsidiaries organized under the laws of Germany, pursuant to a German guarantee agreement, (iii) secured by share pledge agreements, (iv) secured by a security interest in inter-company receivables held by First Solar Holdings GmbH, First Solar GmbH, and First Solar Manufacturing GmbH, pursuant to assignment agreements, and (v) subject to a security trust agreement, which sets forth additional terms regarding the foregoing German security documents and arrangements.

On May 6, 2011, we entered into the First Amendment to the amended and restated credit agreement which provides for, among other things, the termination of First Solar Manufacturing GmbH as a borrowing subsidiary under the credit agreement and the release of the guarantees of, and the liens securing, its obligations thereunder. The amendment also effects certain changes to the restrictions set forth in the credit agreement with respect to the incurrence of indebtedness to finance the construction or acquisition of new manufacturing facilities and assets relating thereto.  In addition, the amendment effects certain technical and clarifying amendments to the credit agreement.

German Facility Agreement

On May 18, 2011, in connection with the plant expansion at our German manufacturing center, First Solar Manufacturing GmbH, our indirect wholly owned subsidiary, entered into a credit facility agreement (German Facility Agreement) with Commerzbank Aktiengesellschaft as arranger and Commerzbank Aktiengesellschaft, Luxembourg Branch, as facility agent and security agent. The total available loan amount is €124.5 million ($179.3 million at the balance sheet close rate on June 30, 2011 of $1.44/€1.00). Pursuant to the German Facility Agreement, we will begin making semi-annual repayments of the principal balance during 2012. Amounts repaid under this credit facility cannot be re-borrowed. This credit facility consisted of the following (in thousands):

				Outstanding		Outstanding
German Borrowings	Denomination	Interest Rate	Maturity	June 30, 2011		December 31, 2010
German Facility Agreement	EUR	Euribor plus 1.35%	2019	$	123,734	$	—
Total (1)				$	123,734	$	—

(1) €85.9 million outstanding at June 30, 2011 ($123.7 million at the balance sheet close rate on June 30, 2011 of $1.44/€1.00).

The German Facility Agreement will be used by First Solar Manufacturing GmbH to, among other things, finance and/or refinance the acquisition of certain land parcels located in Frankfurt/Oder, Germany and the construction of the plant expansion at our German manufacturing center.

Borrowings under the German Facility Agreement bear interest at a rate per annum equal to 1.35% (the “Margin”) plus mandatory costs plus a Euribor rate for the interest period selected by First Solar Manufacturing GmbH. During the period from the date of the credit agreement until the date 17 months thereafter, unutilized commitments under the German Facility Agreement are subject to a commitment fee equal to 35% of the margin.

In connection with the German Facility Agreement, First Solar Inc. entered into a guarantee agreement dated May 18, 2011 in favor of the lenders. Under this guarantor agreement, First Solar Manufacturing GmbH's obligations related to the German credit facility are guaranteed, on an unsecured basis, by First Solar, Inc. In connection with the German Facility Agreement, all of First Solar Manufacturing GmbH's obligations are (i) secured by a first-ranking abstract land charge over the parcels of land on which the new production facility will be constructed and a pledge of a debt service reserve account, and (ii) guaranteed by the German Federal Government and the Federal State of Brandenburg.

The German Facility Agreement contains various financial covenants with which we must comply, including minimum liquidity, maximum permitted leverage ratio, and minimum EBITDA. The German Facility Agreement also contains negative covenants that, among other things, restrict, subject to certain exceptions, the ability of First Solar Manufacturing GmbH to incur

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indebtedness, create liens, effect asset sales, make dividends, other distributions and share buybacks, engage in reorganizations, make acquisitions and create joint ventures, and make loans. We were in compliance with these covenants through June 30, 2011.

France Facility Agreement

On March 30, 2010, in connection with the construction of our planned manufacturing facility in Blanquefort, France, First Solar France Manufacturing SAS, our indirect wholly owned subsidiary, entered into a facility agreement with EDF Energies Nouvelles SA (EDF-EN) for the purpose of partially financing the construction of the manufacturing facility. The total available loan amount under this non-revolving credit facility is a maximum principal amount of €50.0 million ($72.0 million at the balance sheet close rate on June 30, 2011 of $1.44/€1.00). Pursuant to the terms and conditions set forth in the facility agreement, advances will be made available commencing on the start of construction of the French plant and ending June 15, 2012. Advances must be repaid in quarterly installments through the tenth anniversary of the first commercial shipments from the French plant, subject to accelerated mandatory prepayment in the event of a default under the facility or the termination of the related venture agreement or off-take agreement with EDF-EN and affiliated entities. Amounts repaid under this credit facility cannot be re-borrowed. The borrowings will bear interest at a rate of 4%. Any advances drawn under this facility will be unsecured. As of June 30, 2011, borrowings under this facility were €3.8 million ($5.4 million at the balance sheet close rate on June 30, 2011 of $1.44/€1.00). As of December 31, 2010 there were no borrowings under this facility.

Malaysian Facility Agreement

On May 6, 2008, in connection with the plant expansion at our Malaysian manufacturing center, First Solar Malaysia Sdn. Bhd. (FS Malaysia), our indirect wholly owned subsidiary, entered into an export financing facility agreement (Malaysian Facility Agreement) with a consortium of banks. The total available loan amount was €134.0 million ($193.0 million at the balance sheet close rate on June 30, 2011 of $1.44/€1.00). Pursuant to the Malaysian Facility Agreement, we began semi-annual repayments of the principal balances of these credit facilities during 2008. Amounts repaid under these credit facilities cannot be re-borrowed. These credit facilities consist of the following (in thousands):

				Outstanding		Outstanding
Malaysian Borrowings	Denomination	Interest Rate	Maturity	June 30, 2011		December 31, 2010
Fixed-rate euro-denominated term loan	EUR	4.54%	2016	$	63,324	$	65,009
Floating-rate euro-denominated term loan	EUR	Euribor plus 0.55%	2016	63,324		65,009
Total (1)				$	126,648	$	130,018

(1) €87.9 million outstanding at June 30, 2011 ($126.6 million at the balance sheet close rate on June 30, 2011 of $1.44/€1.00).

These credit facilities were used by FS Malaysia for the purpose of (i) partially financing the purchase of certain equipment used at our Malaysian manufacturing center, and (ii) financing fees paid to Euler-Hermes Kreditversicherungs-AG, the German Export Credit Agency of Hamburg, Federal Republic of Germany, which guarantees 95% of FS Malaysia's obligations related to these Malaysian credit facilities.

In addition to paying interest on outstanding principal under the facilities, FS Malaysia is obligated to pay annual agency fees and security agency fees. 

In connection with the Malaysian credit facilities, First Solar, Inc. entered into a first demand guaranty agreement dated May 6, 2008 in favor of the lenders. Thereby FS Malaysia's obligations related to the Malaysian Facility Agreement are guaranteed, on an unsecured basis, by First Solar, Inc. In connection with the Malaysian credit facilities, all of FS Malaysia's obligations are secured by a first party, first legal charge over the equipment financed by the Malaysian credit facilities, and the other documents, contracts, and agreements related to that equipment. Also in connection with the Malaysian credit facilities, any payment claims of First Solar, Inc. against FS Malaysia are subordinated to the claims of the lenders.

The Malaysian Facility Agreement contains various financial covenants with which we must comply, including debt-to-equity ratios, total leverage ratios, interest coverage ratios, and debt service coverage ratios. The Malaysian Facility Agreement also contains various customary non-financial covenants with which FS Malaysia must comply, including submitting various financial reports and business forecasts to the lenders, maintaining adequate insurance, complying with applicable laws and regulations, and restrictions on FS Malaysia's ability to sell or encumber assets, or make loan guarantees to third parties. We were in compliance

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with these covenants through June 30, 2011.

State of Ohio Loan

During the year ended December 31, 2005, we received the following loan from the Director of Development of the State of Ohio (in thousands):

	Original					Outstanding		Outstanding
Ohio Borrowing	Loan Amount		Denomination	Interest Rate	Maturity	June 30, 2011		December 31, 2010
Director of Development of the State of Ohio	$	15,000	USD	2.25%	2015	$	7,229	$	8,112
Total	$	15,000				$	7,229	$	8,112

Malaysian Ringgit Facility Agreement

On June 30, 2011, First Solar Malaysia Sdn. Bhd. (FS Malaysia), our indirect wholly owned subsidiary, entered into a Malaysian-Ringgit denominated $150.0 million equivalent facility agreement (Malaysian Ringgit Facility Agreement), among FS Malaysia, First Solar, Inc., as guarantor, CIMB Investment Bank Berhad, Maybank Investment Bank Berhad, and RHB Investment Bank Berhad, as arrangers, CIMB Investment Bank Berhad as facility agent and security agent, and the original lenders party thereto.

The proceeds of the Malaysian Ringgit Facility Agreement will be used by FS Malaysia to finance, in part, the design, construction, and commission of the FS Malaysia’s fifth and sixth manufacturing plants in Malaysia (Plants 5 and 6) and the acquisition of certain plant, equipment, and machinery to be utilized in Plants 5 and 6.

Borrowings under the Malaysian Ringgit Facility Agreement bear interest at an expected rate per annum equal to a Kuala Lumpur Interbank Offered Rate (KLIBOR) rate plus any mandatory costs. As of June 30, 2011, we had no borrowings outstanding under this facility.

FS Malaysia may voluntarily prepay outstanding loans under the Malaysian Ringgit Facility Agreement at any time without premium or penalty, subject to compensation for customary “break costs” and certain other requirements. FS Malaysia is required to prepay loans with certain insurance proceeds, and the loans are subject to mandatory prepayment upon the occurrence of a change of control, material asset disposal, or termination of the construction of Plants 5 and 6, each as described in the Malaysian Ringgit Facility Agreement.

The loans made to FS Malaysia are secured by, among other things, a first fixed legal charge over FS Malaysia’s leases over the leased lots on which Plants 5 and 6 are located and a first fixed legal charge over all plant, equipment, and machinery purchased by FS Malaysia with the proceeds of the facility or otherwise installed in or utilized in Plants 5 and 6, to the extent not financed, encumbered, charged to secure, or subject to a negative pledge under a separate financing facility relating to Plants 5 and 6. In addition, FS Malaysia’s obligations under the Malaysian Ringgit Facility Agreement are guaranteed, on an unsecured basis, by First Solar, Inc. pursuant to the Malaysian Ringgit Facility Agreement.

The Malaysian Ringgit Facility Agreement contains negative covenants that, among other things, restrict, subject to certain exceptions, the ability of FS Malaysia to incur indebtedness, create liens, effect asset sales, engage in reorganizations, issue guarantees and make loans. In addition, the Malaysian Ringgit Facility Agreement includes financial covenants relating to net total leverage ratio, interest coverage ratio, total debt to equity ratio, debt service coverage ratio, and tangible net worth. The Malaysian Ringgit Facility Agreement also contains certain representations and warranties, affirmative covenants, and events of default.

Certain of our debt-financing agreements bear interest at Euribor, LIBOR or KLIBOR. A disruption of the credit environment, as previously experienced, could negatively impact interbank lending and, therefore, negatively impact these floating rates. An increase in the LIBOR rate would increase our cost of borrowing under our revolving credit facility. An increase in the Euribor rate would impact our cost of borrowing under our German Facility Agreement, but would not impact our cost of borrowing under our Malaysian Facility Agreement as we entered into an interest rate swap agreement to mitigate such risk. An increase in the KLIBOR would increase our cost of borrowing under our Malaysian Ringgit Facility Agreement.

Note 14. Commitments and Contingencies

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Financial Guarantees

In the normal course of business, we occasionally enter into agreements with third parties under which we guarantee the performance of our subsidiaries related to certain service contracts, which may include services such as development, engineering, procurement of permits and equipment, construction management, and monitoring and maintenance related to solar power plants. These agreements meet the definition of a guarantee according to ASC 460, Guarantees. As of June 30, 2011 and December 31, 2010, none of these guarantees were material to our financial position.

Loan Guarantees

At June 30, 2011 and December 31, 2010, our only loan guarantees were guarantees of our own debt, as disclosed in Note 13. "Debt," to these condensed consolidated financial statements.

Commercial Commitments

During the normal course of business, we enter into commercial commitments in the form of letters of credit and bank guarantees to provide financial and performance assurance to third parties. Our revolving credit facility provides us the capacity to issue up to $600.0 million in letters of credit at a fee equal to the applicable margin for eurocurrency revolving loans and a fronting fee. As of June 30, 2011, we had $143.4 million in letters of credit issued under the revolving credit facility with a remaining availability of $356.6 million, all of which can be used for the issuance of letters of credit. The majority of these letters of credit were supporting our systems business. In addition, as of June 30, 2011 we had $22.0 million in bank guarantees issued by certain of our foreign subsidiaries to guarantee continuous operating obligations.

Product Warranties

We offer warranties on our products and record an estimate of the associated liability based on the number of solar modules under warranty, our historical experience with warranty claims, our monitoring of field installation sites, our in-house testing of our solar modules, and our estimated per-module replacement cost.

Product warranty activity during the three and six months ended June 30, 2011 and June 26, 2010 was as follows (in thousands):

	Three Months Ended						Six Months Ended
	June 30, 2011			June 26, 2010			June 30, 2011			June 26, 2010
Product warranty liability, beginning of period	$	32,141		$	23,375		$	27,894		$	22,583
Accruals for new warranties issued (warranty expense)	5,293			3,865			10,562			7,672
Settlements	(2,869		)	(3,123		)	(6,455		)	(8,973		)
Change in estimate of warranty liability	1,791			(255		)	4,355			2,580
Product warranty liability, end of period	$	36,356		$	23,862		$	36,356		$	23,862
Current portion of warranty liability							$	10,706		$	8,546
Noncurrent portion of warranty liability							$	25,650		$	15,316

Note 15. Share-Based Compensation

We measure share-based compensation cost at the grant date based on the fair value of the award and recognize this cost as an expense over the grant recipients’ requisite service periods, in accordance with ASC 718, Compensation - Stock Compensation. The share-based compensation expense that we recognized in our consolidated statements of operations for the three and six months ended June 30, 2011 and June 26, 2010 was as follows (in thousands):

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	Three Months Ended				Six Months Ended
	June 30, 2011		June 26, 2010		June 30, 2011		June 26, 2010
Share-based compensation expense included in:
Cost of sales	$	9,592	$	5,566	$	16,445	$	10,724
Research and development	4,013		2,957		7,300		5,038
Selling, general and administrative	16,710		16,029		31,394		27,930
Production start-up	956		490		1,699		824
Total share-based compensation expense	$	31,271	$	25,042	$	56,838	$	44,516

The increase in share-based compensation expense was primarily the result of new awards.

The following table presents our share-based compensation expense by type of award for the three and six months ended June 30, 2011 and June 26, 2010 (in thousands):

	Three Months Ended						Six Months Ended
	June 30, 2011			June 26, 2010			June 30, 2011			June 26, 2010
Stock options	$	378		$	577		$	760		$	1,555
Restricted stock units	31,471			26,646			56,913			44,872
Unrestricted stock	226			157			452			307
Net amount absorbed into inventory	(804		)	(2,338		)	(1,287		)	(2,218		)
Total share-based compensation expense	$	31,271		$	25,042		$	56,838		$	44,516

Share-based compensation cost capitalized in our inventory was $2.2 million and $0.9 million at June 30, 2011 and December 31, 2010, respectively. As of June 30, 2011, we had $0.3 million of unrecognized share-based compensation cost related to unvested stock option awards, which we expect to recognize as an expense over a weighted-average period of approximately 0.5 years, and $210.0 million of unrecognized share-based compensation cost related to unvested restricted stock units, which we expect to recognize as an expense over a weighted-average period of approximately 1.9 years.

Note 16. Income Taxes

Our effective tax rates were 15.0% and 13.6% for the three and six months ended June 30, 2011, respectively, and were 11.9% and 11.8% for the three and six months ended June 26, 2010, respectively. Our estimated annual effective tax rate was higher during the six months ended June 30, 2011 compared with the six months ended June 26, 2010 mainly due to a $170.8 million decrease in pre-tax income and a greater percentage of profits earned in jurisdictions with higher tax rates. The provision for income taxes differs from the amount computed by applying the statutory U.S. federal rate primarily due to the benefit associated with foreign income taxed at lower rates and the beneficial impact of the Malaysian tax holiday.

Our Malaysian subsidiary has been granted a long-term tax holiday that expires in 2027. The tax holiday, which generally provides for a 100% exemption from Malaysian income tax, is conditional upon our continued compliance in meeting certain employment and investment thresholds. During 2010, in connection with the expansion of our Malaysian manufacturing operations, we were granted an extension of the previously approved tax holiday by three years, contingent upon meeting additional investment requirements.

Note 17. Net Income per Share

Basic net income per share is computed by dividing net income by the weighted-average number of common shares outstanding for the period. Diluted net income per share is computed giving effect to all potential dilutive common stock, including employee stock options, restricted stock units, and contingently issuable shares.

The calculation of basic and diluted net income per share for the three and six months ended June 30, 2011 and June 26, 2010 was as follows (in thousands, except per share amounts):

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	Three Months Ended				Six Months Ended
	June 30, 2011		June 26, 2010		June 30, 2011		June 26, 2010
Basic net income per share
Numerator:
Net income	$	61,138	$	159,043	$	177,106	$	331,388
Denominator:
Weighted-average common stock outstanding	86,164		84,852		85,746		84,679
Diluted net income per share
Denominator:
Weighted-average common stock outstanding	86,164		84,852		85,746		84,679
Effect of stock options, restricted stock units outstanding, and contingent issuable shares	962		1,549		1,346		1,568
Weighted-average shares used in computing diluted net income per share	87,126		86,401		87,092		86,247

	Three Months Ended				Six Months Ended
	June 30, 2011		June 26, 2010		June 30, 2011		June 26, 2010
Per share information — basic:
Net income per share	$	0.71	$	1.87	$	2.07	$	3.91
Per share information — diluted:
Net income per share	$	0.70	$	1.84	$	2.03	$	3.84

The following number of outstanding employee stock options and restricted stock units were excluded from the computation of diluted net income per share for the three and six months ended June 30, 2011 and June 26, 2010 as they would have had an antidilutive effect (in thousands):

	Three Months Ended		Six Months Ended
	June 30, 2011	June 26, 2010	June 30, 2011	June 26, 2010
Restricted stock units and options to purchase common stock	939	75	515	157

Note 18. Comprehensive Income

Comprehensive income, which includes foreign currency translation adjustments, unrealized gains and losses on available-for-sale securities, and unrealized gains and losses on derivative instruments designated and qualifying as cash flow hedges, the impact of which, has been excluded from net income and reflected as components of stockholders’ equity, was as follows for the three and six months ended June 30, 2011 and June 26, 2010 (in thousands):

	Three Months Ended						Six Months Ended
	June 30, 2011			June 26, 2010			June 30, 2011			June 26, 2010
Net income	$	61,138		$	159,043		$	177,106		$	331,388
Foreign currency translation adjustments	6,794			(35,884		)	30,589			(68,118		)
Change in unrealized (loss) gain on marketable securities, net of tax	(3,971		)	5,680			(11,474		)	6,777
Change in unrealized gain (loss) on derivative instruments, net of tax	8,931			17,689			(31,519		)	54,133
Comprehensive income	$	72,892		$	146,528		$	164,702		$	324,180

Components of accumulated other comprehensive loss at June 30, 2011 and December 31, 2010 were as follows (in thousands):

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	June 30, 2011			December 31, 2010
Foreign currency translation adjustments	$	242		$	(30,347	)
Unrealized (loss) gain on marketable securities, net of tax	(5,703		)	5,771
Unrealized loss on derivative instruments, net of tax	(34,186		)	(2,667		)
Accumulated other comprehensive loss	$	(39,647	)	$	(27,243	)

Note 19. Statement of Cash Flows

The following table presents a reconciliation of net income to net cash (used in) provided by operating activities for the six months ended June 30, 2011 and June 26, 2010 (in thousands):

	Six Months Ended
	June 30, 2011			June 26, 2010
Net income	$	177,106		$	331,388
Adjustments to reconcile net income to net cash (used in) provided by operating activities:
Depreciation and amortization	104,287			77,747
Impairment of assets and liabilities	1,486			3,480
Impairment of project assets	3,411			638
Share-based compensation	56,838			44,516
Remeasurement of monetary assets and liabilities	6,635			3,510
Deferred income taxes	(42,048		)	(6,877		)
Excess tax benefits from share-based compensation arrangements	(16,497		)	—
Provision for doubtful accounts receivable	—			(990		)
Gain on sales of marketable securities, investments, and restricted investments, net	(3,298		)	(203		)
Other operating activities	(624		)	(736		)
Changes in operating assets and liabilities:
Accounts receivable, trade	(230,540		)	(54,211		)
Accounts receivable, unbilled	(62,195		)	(105,657		)
Prepaid expenses and other current assets	(80,795		)	(126,313		)
Other assets	(27,941		)	(4,558		)
Inventories and balance of systems parts	(153,323		)	(49,921		)
Project assets	(133,216		)	(11,126		)
Accounts payable	79,102			2,351
Income taxes payable	47,048			19,433
Accrued expenses and other liabilities	(13,391		)	(27,665		)
Accrued solar module collection and recycling liability	41,120			12,794
Total adjustments	(423,941		)	(223,788		)
Net cash (used in) provided by operating activities	$	(246,835	)	$	107,600

Note 20. Segment Reporting

ASC 280, Segment Reporting, establishes standards for companies to report in their financial statements information about operating segments, products, services, geographic areas, and major customers. The method of determining what information to report is generally based on the way that management organizes the operating segments within the company for making operating decisions and assessing financial performance.

We operate our business in two segments. Our components segment is our principal business and involves the design, manufacture, and sale of solar modules which convert sunlight into electricity. Customers of our components segment include project developers, system integrators, and operators of renewable energy projects.

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Our second segment is our fully integrated systems business, through which we provide a complete PV solar power system, which includes project development, EPC services, O&M services, when applicable, and project finance, when required. Our systems segment sells solar power systems, all of which use our solar modules, directly to investor owned utilities, independent power developers and producers, commercial and industrial companies, and other system owners who purchase completed solar power plants, EPC services, and/or O&M services from us.

Our Chief Operating Decision Maker (CODM), consisting of senior executive staff, views the sale of solar modules from the components segment as the core driver of our profitability, return on net assets, and cash throughput; and as a result, we view our systems segment as an enabler to drive module throughput. Therefore, we operate our systems segment with the objective to achieve break-even results before income taxes. In our operating segment financial disclosures, we include the sale of our solar modules manufactured by our components segment and installed in projects sold by our systems segment in “Net sales” of our components business.

After we have determined the amount of revenue earned for each transaction following the applicable guidance for the underlying arrangement, we allocate revenue between the components and systems segments based on how our CODM strategically views these segments. We determine the amount of revenue to be allocated between the systems business and the components business based on the principle that the systems business is an enabler operating at break-even results to drive module throughput for the components business. The amount of revenue allocated to the components segment for modules used in the systems business arrangement is equal to the cost of the solar module plus the earned margin (or estimated margin in the case of percentage-of-completion accounting) for a particular project for the period.

We also allocate the cost of sales value recognized for the solar modules in the systems business arrangements to the components business. The cost of solar modules is composed of inventory cost without any inter-company profit.

Our systems business has certain of its own dedicated administrative key functions, such as accounting, legal, finance, project finance, human resources, procurement, and marketing. Costs for these functions are recorded and included within selling, general and administrative costs for our systems segment. Our corporate key functions consist primarily of company-wide corporate tax, corporate treasury, corporate accounting/finance, corporate legal, investor relations, corporate communications, and executive management functions. We allocate corporate costs to the components segment as part of selling, general and administrative costs, since this segment currently benefits the most from the corporate functions.

In the event segment gross profit from our systems segment (after allocating the revenue from solar modules and the related cost of sales to the components segment) is less than operating expenses in a given quarter, then the components business will compensate the systems segment for the temporary shortfall. A typical shortfall can result from (i) the timing and amount of revenue recognition in comparison to the amount of fixed costs incurred in a given quarter, or (ii) a larger amount of other-than-temporary project asset impairment in any given quarter. The systems segment repays these cumulative temporary shortfalls in fiscal quarters in which its segment gross profit exceeds operating expenses. Any surplus segment income before income taxes for any given quarter after such repayment would then trigger an additional allocation of revenue from the systems segment to the components segment to achieve break-even results based on how our CODM views these segments.

Compensation by the components segment to the systems segment during the three and six months ended June 30, 2011 and June 26, 2010 was as follows (in millions):

	Three Months Ended				Six Months Ended
	June 30, 2011		June 26, 2010		June 30, 2011		June 26, 2010
Compensation by the Components Segment to the Systems Segment	$	19.7	$	—	$	45.9	$	8.9

Repayment of prior period compensation by the systems segment to the components segment during the three and six months ended June 30, 2011 and June 26, 2010 was as follows (in millions):

	Three Months Ended				Six Months Ended
	June 30, 2011		June 26, 2010		June 30, 2011		June 26, 2010
Repayment of Prior Period Compensation by the Systems Segment to the Components Segment	$	—	$	11.4	$	—	$	11.4

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Financial information about our segments during the three and six months ended June 30, 2011 and June 26, 2010 was as follows (in thousands):

	Three Months Ended						Three Months Ended
	June 30, 2011						June 26, 2010
	Components		Systems		Total		Components		Systems		Total
Net sales	$	471,947	$	60,827	$	532,774	$	500,940	$	86,914	$	587,854
Gross profit	$	189,875	$	4,923	$	194,798	$	261,656	$	22,538	$	284,194
Income before income taxes	$	71,957	$	—	$	71,957	$	180,438	$	—	$	180,438
Goodwill	$	393,365	$	65,443	$	458,808	$	251,275	$	35,240	$	286,515
Total assets	$	4,206,755	$	732,477	$	4,939,232	$	3,172,912	$	458,403	$	3,631,315

	Six Months Ended						Six Months Ended
	June 30, 2011						June 26, 2010
	Components		Systems		Total		Components		Systems		Total
Net sales	$	991,466	$	108,601	$	1,100,067	$	1,030,208	$	125,607	$	1,155,815
Gross profit	$	448,133	$	6,330	$	454,463	$	539,307	$	26,923	$	566,230
Income before income taxes	$	204,964	$	—	$	204,964	$	375,797	$	—	$	375,797
Goodwill	$	393,365	$	65,443	$	458,808	$	251,275	$	35,240	$	286,515
Total assets	$	4,206,755	$	732,477	$	4,939,232	$	3,172,912	$	458,403	$	3,631,315

Product Revenue

The following table sets forth the total amounts of solar modules and solar power systems revenue recognized for the three and six months ended June 30, 2011 and June 26, 2010. For the purposes of the following table, (i) "Solar module revenue" is composed of total revenues from the sale of solar modules to third parties, and (ii) "Solar power system revenue" is composed of total revenues from the sale of complete solar power systems and related services including the solar modules installed in the solar power system.

	Three Months Ended				Six Months Ended
(Dollars in thousands)	June 30, 2011		June 26, 2010		June 30, 2011		June 26, 2010
Solar module revenue	$	427,350	$	476,061	$	933,092	$	1,004,939
Solar power system revenue	105,424		111,793		166,975		150,876
Total net sales	$	532,774	$	587,854	$	1,100,067	$	1,155,815

Note 21. Subsequent Events

We entered into an amendment and waiver dated as of June 30, 2011 to the credit agreement governing our revolving credit facility. The amendment became effective as of June 30, 2011 upon receipt of approval thereof from the Required Lenders (as defined in the Credit Agreement) on July 11, 2011. The amendment provides for, among other things, the ability of Restricted Subsidiaries (as defined in the amended and restated credit agreement) to incur indebtedness and guarantee obligations pursuant to letters of credit, bank guarantees or similar instruments issued in the ordinary course of business; provided that the aggregate stated or face amount of all such letters of credit, bank guarantees, and similar instruments shall not exceed $50.0 million for all Restricted Subsidiaries outstanding at any time.

On August 3, 2011, First Solar Malaysia Sdn. Bhd. entered into a €60.0 million Facility Agreement with a consortium of banks. The obligations of First Solar Malayisa Sdn. Bhd. under the Facility Agreement are guaranteed by First Solar, Inc. In addition, certain obligations in respect of the Facility Agreement will be guaranteed (the “Euler Hermes Guarantee”) by the Federal Republic of Germany, represented by Euler Hermes Kreditversicherungs-AG (“Euler Hermes”).

Item 2.Management's Discussion and Analysis of Financial Condition and Results of Operations

Cautionary Statement Regarding Forward-Looking Statements

This Quarterly Report on Form 10-Q contains forward-looking statements within the meaning of the Securities Exchange Act

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of 1934 (Exchange Act) and the Securities Act of 1933, which are subject to risks, uncertainties, and assumptions that are difficult to predict. All statements in this Quarterly Report on Form 10-Q, other than statements of historical fact, are forward-looking statements. These forward-looking statements are made pursuant to safe harbor provisions of the Private Securities Litigation Reform Act of 1995. The forward-looking statements include statements, among other things, concerning: our business strategy, including anticipated trends and developments in and management plans for our business and the markets in which we operate (including the expansion of our project development business); future financial results, operating results, revenues, gross margin, operating expenses, products, projected costs, and capital expenditures; our ability to continue to reduce the cost per watt of our solar modules; research and development programs and our ability to improve the conversion efficiency of our solar modules; sales and marketing initiatives; and competition. In some cases, you can identify these statements by forward-looking words, such as “estimate,” “expect,” “anticipate,” “project,” “plan,” “intend,” “believe,” “forecast,” “foresee,” “likely,” “may,” “should,” “goal,” “target,” “might,” “will,” “could,” “predict,” and “continue” the negative or plural of these words and other comparable terminology. Forward-looking statements are only predictions based on our current expectations and our projections about future events. All forward-looking statements included in this Quarterly Report on Form 10-Q are based upon information available to us as of the filing date of this Quarterly Report on Form 10-Q. You should not place undue reliance on these forward-looking statements. We undertake no obligation to update any of these forward-looking statements for any reason. These forward-looking statements involve known and unknown risks, uncertainties, and other factors that may cause our actual results, levels of activity, performance, or achievements to differ materially from those expressed or implied by these statements. These factors include, but are not limited to, the matters discussed for the fiscal year ended December 31, 2010 in Item 1A: “Risk Factors,” and elsewhere in this Quarterly Report on Form 10-Q and in our Annual Report on Form 10-K. You should carefully consider the risks and uncertainties described under this section.

The following discussion and analysis should be read in conjunction with our condensed consolidated financial statements and the accompanying notes contained in this Quarterly Report on Form 10-Q. Unless expressly stated or the context otherwise requires, the terms “we,” “our,” “us,” and “First Solar” refer to First Solar, Inc. and its subsidiaries.

Executive Overview

We manufacture and sell solar modules with an advanced thin-film semiconductor technology, and we design, construct, and sell photovoltaic (PV) solar power systems.

In furtherance of our goal of delivering the lowest cost of solar electricity and achieving price parity with conventional fossil-fuel-based peak electricity generation, we are continually focused on reducing PV solar system costs in four primary areas: module manufacturing, balance of systems (BoS) costs (consisting of the costs of the components of a solar power system other than the solar modules, such as inverters, mounting hardware, grid interconnection equipment, wiring and other devices, and installation labor costs), project development costs, and the cost of capital. First, with respect to our module manufacturing costs, our advanced technology has allowed us to reduce our average module manufacturing costs to the lowest in the world, based on publicly available information. In the three months ended June 30, 2011, our total average manufacturing costs were $0.75 per watt, which we believe is significantly less than those of traditional crystalline silicon solar module manufacturers. By continuing to improve conversion efficiency and production line throughput, lower material costs, and drive volume scale to further decrease overhead costs, we believe that we can further reduce our manufacturing costs per watt and maintain our cost advantage over traditional crystalline silicon solar module manufacturers. Second, by continuing to improve conversion efficiency, leverage volume procurement around standardized hardware platforms, and accelerate installation time, we believe we can continue to make reductions in BoS costs, which represent over half of all of the costs associated with a typical utility-scale PV solar power system. Third, with respect to project development costs, we seek optimal site locations in an effort to minimize transmission and permitting costs, and to accelerate lead time to electricity generation. Finally, we believe that continuing to strengthen our financial position, including our balance sheet and credit profile, together with our increasing solar power system operating experience, will enable us to continue to lower the cost of capital associated with our solar power systems, thereby further enhancing the economic viability of our projects and lowering the cost of electricity generated by solar power systems that incorporate our modules and technology.

We believe that combining our reliable, low-cost module manufacturing capability with our systems business enables us to more rapidly reduce the price of solar electricity, accelerate the adoption of our technology in large scale systems, identify and break constraints to the successful migration to sustainable solar markets, and further our mission to create enduring value by enabling a world powered by clean, affordable solar electricity.

We operate our business in two segments. Our components segment designs, manufactures, and sells solar modules to solar project developers and system integrators. Through our systems segment, we have the capability to provide a complete PV solar power system, using our solar modules, for utility-scale or large commercial systems. Providing a complete PV solar power system includes project development, engineering, procurement, and construction (EPC), operating and maintenance (O&M) services, when applicable, and project finance, when required. We view the sale of solar modules from the components segment as the core

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driver of our profitability, return on net assets, and cash throughput. We view our systems segment as an enabler to drive module throughput for our components business with the objective of achieving break-even results before income taxes for our systems segment. See Note 20. "Segment Reporting," to our condensed consolidated financial statements included in this Quarterly Report on Form 10-Q.

Manufacturing Capacity

As of June 30, 2011, we operated 34 production lines with an annual global manufacturing capacity of approximately 2.1 GW (based on the average per line run rate for the second quarter of 2011 at our existing plants) at our manufacturing plants in Perrysburg, Ohio, Frankfurt/Oder, Germany, and Kulim, Malaysia. We expect to increase our manufacturing capacity to 44 production lines (including our previously announced 4-line plants in Vietnam and Mesa, Arizona) by the end of 2012, with an annual global manufacturing capacity of approximately 2.7 GW (based on the average per line run rate for the second quarter of 2011 at our existing plants).

Market Overview

In addressing overall growing global demand for PV solar electricity, we target markets with varying approaches depending on the underlying economics, market requirements, and distribution channels. In subsidized feed-in-tariff (FiT) markets, such as Germany, we have historically sold most of our solar modules to solar project developers, system integrators, and independent power producers. In other markets, such as the United States, the demand for solar has been primarily driven by state level renewable portfolio standards requiring regulated utilities to supply a portion of their total retail sales of electricity from renewable energy sources such as solar PV generating facilities. To meet the needs of these markets and enable BoS cost reductions, we have developed a fully integrated systems business that can provide a low-cost turn-key utility-scale PV system solution for system owners and low cost electricity to utility end-users. Our fully integrated systems business has enabled us to increase module throughput, drive cost reduction across the value chain, identify and break constraints to sustainable markets, and to deliver the most compelling solutions to our customers and end-users. With our fully integrated systems business, we believe we are in a position to expand our business in transition markets and eventually economically sustainable markets (in which subsidies or incentives are minimal), which are expected to develop in areas with abundant solar resources and sizable electricity demand. We are committed to continually lowering the cost of solar electricity, and in the long term, we plan to compete on an economic basis with conventional fossil-fuel-based peaking power generation.

The major European governments continue to seek to balance subsidy costs with their commitment to the EU directive's goal of a 20% share of energy from renewable sources in the EU by 2020. Governments in Germany, France, and Italy are in the process of evaluating additional changes to their FiT structures, market caps, and/or tender processes. Such changes and the resulting market uncertainties have contributed to demand pauses in the first half of 2011, which, in conjunction with increased industry-wide manufacturing capacity, have contributed to excess industry channel inventories. In the first half of 2011, industry average module pricing declined as competitors reduced prices to sell-through inventories in Europe in light of these FiT policy uncertainties. Lower industry module pricing, while currently challenging for solar manufacturers, in particular those with high cost structures, is expected to contribute to global market diversification and volume elasticity. Over time, declining average selling prices are consistent with the erosion of one of the primary historical constraints to widespread solar market penetration, namely its overall affordability. In the near term, however, in light of continually evolving FiT structures in our core European markets, it is uncertain whether growing demand from other countries and markets could absorb industry-wide module supply without further inventory build-up and/or price reductions, and our results of operations could be adversely affected. We continue to mitigate this uncertainty in part by executing on and building our North American utility-scale systems pipeline as a buffer against demand fluctuations in Europe and elsewhere, and by continuing the development of other geographic markets, including those in India, Australia, the Middle East, and China.

In North America, we have continued to execute on our utility-scale systems pipeline. In June 2011, the AV Solar Ranch One, Sunlight, and Topaz utility scale projects in California collectively received $4.5 billion in U.S. Department of Energy loan guarantee commitments. In April 2011, California, the state where the majority of solar installations and solar power module and system sales have taken place in the U.S., enacted legislation amending the state's existing renewable portfolio standard to require obligated load serving entities to procure 33% of their retail electricity sales from eligible renewable resources by 2020.

In the PV module segment, we continue to face intense competition from manufacturers of crystalline silicon solar modules and other types of solar modules and PV systems. Solar module manufacturers compete with one another in several product performance attributes, including reliability and module cost per watt, and, with respect to solar power systems, return on equity (ROE) and levelized cost of electricity (LCOE), meaning the net present value of total life cycle costs of the solar power project divided by the quantity of energy which is expected to be produced over the system's life. The ability to expand manufacturing capacity quickly is another source of differentiation among solar module manufacturers, and certain of our competitors may have

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a faster response time to capacity expansion than we do and/or an ability to expand capacity in finer increments than we can. We are the lowest cost PV module manufacturer in the solar industry, based on publicly available information, and our average manufacturing cost per watt declined from $0.76 during the three months ended June 26, 2010 to $0.75 during the three months ended June 30, 2011. This cost advantage is reflected in the price at which we sell our modules or fully integrated systems and enables our systems to compete favorably in respect of their ROE or LCOE. Our cost competitiveness is based in large part on our proprietary technology (which enables conversion efficiency improvements and enables us to produce a module in less than 2.5 hours using a continuous and highly automated industrial manufacturing process, as opposed to a batch process), our scale, and our operational excellence. In addition, our modules use approximately 1-2% of the amount of semiconductor material that is used to manufacture traditional crystalline silicon solar modules. The cost of polysilicon is a significant driver of the manufacturing cost of crystalline silicon solar modules. The timing and rate of change in the cost of silicon feedstock could lead to changes in solar module pricing levels. Although we are not a crystalline silicon module manufacturer, we estimate, based on industry research and public disclosures of our competitors, that a $10 per Kg increase or decrease in the price of polysilicon could increase or decrease, respectively, our competitors' manufacturing cost per watt by approximately $0.06 over time. Given the lower conversion efficiency of our modules compared to crystalline silicon modules, there may be higher BoS costs associated with systems using our modules. Thus, to compete effectively on the basis of LCOE, our modules may need to maintain a certain cost advantage per watt compared to crystalline silicon-based modules. During the three months ended June 30, 2011, we reduced our manufacturing cost per watt by 1% from our cost per watt in the three months ended June 26, 2010 and continued to reduce BoS costs associated with systems using our modules.

While our modules currently enjoy competitive advantages in these product performance attributes, there can be no guarantee that these advantages will continue to exist in the future to the same extent or at all. Any declines in the competitiveness of our products could result in margin compression, a decline in the average selling prices of our solar modules, erosion in our market share for modules, a decrease in the rate of revenue growth, and/or a decline in overall revenues. We have taken, and continue to take, various actions to mitigate the potential impact resulting from competitive pressures, including adjusting our pricing policies as necessary in core market segments to drive module volumes, continuously making progress along our module and BoS cost reduction roadmaps, and focusing our research and development on increasing the conversion efficiency of our solar modules.

As we expand our systems business into transition and sustainable markets, we can offer value beyond the PV module, reduce our exposure to module-only competition, and provide comprehensive utility-scale PV systems solutions that significantly reduce solar electricity costs. Thus, our systems business allows us to play a more active role than many of our competitors in managing the demand for our solar modules. Finally, we seek to form and develop strong partner relationships with our customers and continue to develop our range of offerings, including EPC capabilities and O&M services, in order to enhance the competitiveness of systems using our solar modules.

Financial Operations Overview

The following describes certain line items in our statement of operations and some of the factors that affect our operating results.

Net sales

Components Business

Currently, the majority of our net sales are generated from the sale of solar modules. We price and sell our solar modules per watt of power. During the six months ended June 30, 2011, we sold the majority of our solar modules to solar power system project developers, system integrators, and operators headquartered in Germany, France, India, Italy, and the United States, which either resell our solar modules to end-users or integrate them into power plants that they own, operate, or sell.

As of June 30, 2011, we had supply contracts for the sale of solar modules expiring at the end of 2012 with fourteen solar power system project developers and system integrators headquartered within the European Union (Supply Contracts). These contracts account for a significant portion of our planned production over the period from 2011 through 2012 and, therefore, will significantly affect our overall financial performance.

Our sales prices under the Supply Contracts are denominated in euro, exposing us to risks from currency exchange rate fluctuations. During the three and six months ended June 30, 2011, 68% and 79%, respectively, of our components business net sales were denominated in euro and were subject to fluctuations in the exchange rate between the euro and U.S. dollar.

In the past, we have amended pricing and other terms in our Supply Contracts on a prospective basis in order to remain competitive, and we may decide in the future to further amend these contracts in order to address the highly competitive environment

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for solar modules. During 2009, we amended our Supply Contracts with certain of our customers to implement a program which provided a price rebate to these customers for solar modules purchased from us. The intent of this program was initially to enable our customers to successfully compete in our core German market and to adjust, for eligible customers, the sales price (which was documented in framework agreements entered into several years ago) in light of market conditions. The rebate program is offered for a defined period, during which customers may apply and claim such rebate. The most recent rebate offering, for solar modules sold on or after December 1, 2010, includes certain European geographic areas in addition to Germany. The rebate amounts continue to be established so as to enable the sell-through of our products at competitive prices. The rebate program applies a specified rebate rate to solar modules sold for solar power projects in certain geographic areas. Customers need to meet certain requirements in order to be eligible for and benefit from this program. During the six months ended June 30, 2011, we experienced approximately 92% participation in this program by eligible customers.

We account for these rebates as a reduction to the selling price of our solar modules and, therefore, as a reduction in revenue at the time of sale and recognize a contra-asset within accounts receivable trade, net. No rebates granted under this program can be claimed for cash; instead, rebates may only be applied to reduce outstanding accounts receivable balances. During the three and six months ended June 30, 2011, we extended rebates to customers in the amount of €17.3 million and €28.0 million, respectively ($24.9 million and $39.8 million at the average exchange rates of $1.44/€1.00 and $1.42/€1.00, respectively). At June 30, 2011, we had €22.3 million ($32.1 million at the balance sheet close rate on June 30, 2011 of $1.44/€1.00) of rebate claims accrued, which reduced our accounts receivable accordingly. During the three and six months ended June 26, 2010, we extended rebates to customers in the amount of €15.6 million and €35.6 million, respectively ($20.6 million and $48.4 million at an average exchange rate of $1.32/€1.00 and $1.36/€1.00, respectively).

We also enter into one-time module sales agreements with customers for specific projects.

Under our customer contracts, we transfer title and risk of loss to the customer and recognize revenue upon shipment. Our customers do not have extended payment terms or rights of return under these contracts.

Systems Business

Through our fully integrated systems business, we provide a complete solar power system solution using our solar modules, which may include project development, EPC services, O&M services, when applicable, and project finance, when required.

Net sales from our systems segment are impacted by numerous factors, including the magnitude and effectiveness of renewable portfolio standards, economic incentives (such as European FiTs, the U.S. federal investment tax credit, grants in lieu of tax credits under Section 1603 of the American Recovery and Reinvestment Act of 2009, U.S. Department of Energy loan guarantees, or accelerated depreciation), and other PV system demand drivers.

For a given solar power project, we recognize revenue for our systems business either after execution of an EPC agreement with a third party, specifying the terms and conditions of the construction of the solar power plant; by applying the provisions for real estate accounting; by applying the percentage-of-completion method of accounting; or upon the sale of the complete system solution. We apply any particular one of these methods as appropriate based on the specific facts and circumstances related to each project and its sale.

The following tables summarize, as of August 4, 2011, our 2.5 GW AC North American utility systems advanced project pipeline:

Projects Sold/Under Contract

(includes sold projects, projects under contracts for sale subject to conditions precedent, EPC contracts and partner developed contracts)

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Project/Location	Project Size in MW AC	Power Purchase Agreement (PPA)	Third Party Owner/Purchaser
Agua Caliente, Arizona	290	PG&E	NRG
Copper Mountain 2, Nevada	150	PG&E	Sempra (1)
St. Clair, Ontario, Canada	40	OPA (2)	NextEra
Santa Teresa, New Mexico	20	El Paso	NRG (1)
Walpole, Ontario, Canada	20	OPA (2)	GE/Plutonic
Belmont, Ontario, Canada	20	OPA (2)	GE/Plutonic
Paloma, Gila Bend, Arizona	17	UOG (3)	APS
PNM, New Mexico	15	UOG (3)	PNM
Amherstburg 2, Ontario, Canada	15	OPA (2)	Enbridge
Amherstburg 1, Ontario, Canada	10	OPA (2)	GE/Plutonic
Total	597

Projects Permitted – Not Sold

Project/Location	Project Size in MW AC	Power Purchase Agreement (PPA)
AV Solar Ranch One, California	230	PG&E
Silver State North, Nevada	50	NV Energy
Total	280

Projects in Development with Executed PPA

Project/Location	Project Size in MW AC	Power Purchase Agreement (PPA)
Topaz, California	550	PG&E
Sunlight, California	300	PG&E
Sunlight, California	250	SCE
Stateline, California	300	SCE
Silver State South, Nevada	250	SCE
Total	1,650

Key:

(1)    EPC contract/partner developed project

(2)    OPA = Ontario Power Authority RESOP program

(3)    UOG = Utility Owned Generation

Cost of sales

Components Business

Our cost of sales includes the cost of raw materials and components for manufacturing solar modules, such as tempered back glass, transparent conductive oxide coated front glass, cadmium telluride, laminate, connector assemblies, laminate edge seal, and other items. Our cost of sales also includes direct labor for the manufacturing of solar modules and manufacturing overhead such as engineering, equipment maintenance, environmental health and safety, quality and production control, and procurement costs. Cost of sales also includes depreciation of manufacturing plant and equipment and facility-related expenses. In addition, we accrue warranty and solar module collection and recycling costs to our cost of sales.

Overall, we expect our cost of sales per watt to continue to decrease over the next several years due to an increase in sellable watts per solar module, an increase in unit output per production line, continued geographic expansion into lower-cost manufacturing regions, and more efficient absorption of fixed costs driven by economies of scale.

Systems Business

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Within our systems business, project-related costs include standard EPC costs (consisting primarily of BoS costs for inverters, electrical and mounting hardware, project management and engineering costs, and installation labor costs), site specific costs, and development costs (including transmission upgrade costs, interconnection fees, and permitting costs). As further described in Note 20. "Segment Reporting," to our condensed consolidated financial statements included within this Quarterly Report on Form 10-Q, at the time when the revenue recognition criteria are met, we include the sale of our solar modules manufactured by our components business and used by our systems business (excluding inter-company profit) as net sales of our components business. Therefore, the related cost of sales are also included within our components business at that time.

Deferred project costs represent (i) costs that we capitalize for arrangements that we account for as real estate transactions after we have entered into a definitive sales arrangement, but before we have met the criteria to recognize the sale as revenue, (ii) recoverable pre-contract costs that we capitalize for arrangements accounted for as long-term construction contracts prior to entering into a definitive sales agreement, or (iii) costs that we capitalize for arrangements accounted for as long-term construction contracts after we have signed a definitive sales agreement, but before the revenue recognition criteria have been met. Deferred project costs capitalized on our balance sheet at June 30, 2011 and December 31, 2010 were $47.4 million and $14.4 million, respectively.

Gross profit

Gross profit is affected by numerous factors, including our module average selling prices, foreign exchange rates, the existence and effectiveness of subsidies and other economic incentives, market mix, our manufacturing costs, BoS costs, project development costs, the effective utilization of our production facilities, and the ramp of production on new plants due to a reduced ability to absorb fixed costs until full production volumes are reached. Gross profit is also subject to competitive pressures, and we have in the past and may in the future decide to amend our Supply Contracts, which specify our sales price per watt. Gross profit margin is also affected by the mix of net sales generated by our components and systems businesses. Our systems business generally operates at a lower gross profit margin due to the pass-through nature of certain BoS components procured from third parties. Gross profit for our systems business excludes the sales and cost of sales for solar modules, which we include in the gross profit of our components business.

Research and development

Research and development expense consists primarily of salaries and personnel-related costs, the cost of products, materials, and outside services used in our process, and product research and development activities. We acquire equipment for general use in further process developments and record the depreciation of this equipment as research and development expense. Currently, the majority of our research and development expenses are attributable to our components segment.

Selling, general and administrative

Selling, general and administrative expense consists primarily of salaries and other personnel-related costs, professional fees, insurance costs, travel expenses, and other selling expenses. We expect these expenses to increase in the near term in order to support the growth of our business as we expand our sales and marketing efforts, improve our information processes and systems, and implement the financial reporting, compliance, and other infrastructure required for an expanding public company. Over time, we expect selling, general and administrative expense to decline as a percentage of net sales and on a cost per watt basis as our net sales and our total watts produced increase.

Our systems business has certain of its own dedicated administrative key functions, such as accounting, legal, finance, project finance, human resources, procurement, and marketing. Costs for such functions are recorded and included within selling, general and administrative costs for our systems segment. Our corporate key functions consist primarily of company-wide corporate tax, corporate treasury, corporate accounting/finance, corporate legal, investor relations, corporate communications, and executive management functions. Currently our components business benefits the most from these functions and, therefore, we have allocated these costs to this segment as part of selling, general and administrative costs.

Production start-up

Production start-up expense consists primarily of salaries and personnel-related costs and the cost of operating a production line before it has been qualified for full production, including the cost of raw materials for solar modules run through the production line during the qualification phase. It also includes all expenses related to the selection of a new site and the related legal and regulatory costs, and the costs to maintain our plant replication program, to the extent we cannot capitalize these expenditures. In general, we expect production start-up expense per production line to be higher when we build an entirely new manufacturing

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facility compared with the addition of new production lines at an existing manufacturing facility, primarily due to the additional infrastructure investment required when building an entirely new facility. Over time, we expect production start-up expense to decline as a percentage of net sales and on a cost per watt basis as a result of economies of scale. Production start-up expense is attributable to our components segment.

Foreign currency gain (loss)

Foreign currency gain (loss) consists of gains and losses resulting from holding assets and liabilities and conducting transactions denominated in currencies other than our functional currencies.

Interest income

Interest income is earned on our cash, cash equivalents, marketable securities, investments, and restricted cash and investments. Interest income also includes interest received from notes receivable and interest collected for late customer payments.

Interest expense, net

Interest expense, net of amounts capitalized, is incurred on various debt financings. We capitalize interest expense into our property, plant and equipment, project assets, and deferred project costs.

Income tax expense

Income taxes are imposed on our income by taxing authorities in the various jurisdictions in which we operate, principally the United States, Germany, and Malaysia. The statutory federal corporate income tax rate in the United States is 35.0%, whereas the tax rates in Germany and Malaysia are approximately 28.6% and 25.0%, respectively. In Malaysia, we have been granted a long-term tax holiday, scheduled to expire in 2027, pursuant to which substantially all of our income earned in Malaysia is exempt from income tax.

Use of estimates

Our discussion and analysis of our financial condition and results of operations are based upon our unaudited condensed consolidated financial statements, which have been prepared in accordance with U.S. GAAP for interim financial information. The preparation of these financial statements requires us to make estimates and judgments that affect the reported amount of assets, liabilities, net sales, and expenses and related disclosure of contingent assets and liabilities. On an on-going basis, we evaluate our estimates, including those related to revenue recognition, allowances for doubtful accounts receivable, inventory write-downs, estimates of future cash flows from and the economic useful lives of long-lived assets, asset impairments, certain accrued liabilities, income taxes and tax valuation allowances, accrued warranty expense, accrued collection and recycling expense, share-based compensation costs and fair value estimates. We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities.

Results of Operations

The following table sets forth our consolidated statements of operations as a percentage of net sales for the periods indicated:

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	Three Months Ended				Six Months Ended
	June 30, 2011		June 26, 2010		June 30, 2011		June 26, 2010
Net sales	100.0	%	100.0	%	100.0	%	100.0	%
Cost of sales	63.4	%	51.7	%	58.7	%	51.0	%
Gross profit	36.6	%	48.3	%	41.3	%	49.0	%
Research and development	6.2	%	3.9	%	5.9	%	4.0	%
Selling, general and administrative	16.3	%	13.4	%	15.8	%	12.6	%
Production start-up	1.9	%	0.4	%	2.0	%	0.3	%
Operating income	12.1	%	30.6	%	17.6	%	32.1	%
Foreign currency gain (loss)	0.3	%	(0.4	)%	0.2	%	(0.3	)%
Interest income	0.6	%	0.5	%	0.6	%	0.8	%
Interest expense, net	—	%	—	%	—	%	—	%
Other income (expense), net	0.4	%	(0.1	)%	0.2	%	(0.1	)%
Income tax expense	2.0	%	3.6	%	2.5	%	3.8	%
Net income	11.5	%	27.0	%	16.1	%	28.7	%

Three Months Ended June 30, 2011 and June 26, 2010

Net sales

	Three Months Ended
(Dollars in thousands)	June 30, 2011		June 26, 2010		Three Month Period Change
Net sales	$	532,774	$	587,854	$	(55,080	)	(9	)%

Our net sales during the three months ended June 30, 2011 decreased by 9% compared with the three months ended June 26, 2010, primarily due to a 24% decrease in our module average selling price and a 30% decrease in the amount of revenue recognized by the systems business, partially offset by a 22% increase in the MW volume of solar modules sold. The increase in the MW volume of solar modules sold was attributable to the full ramp of our eight-line capacity expansion in our Malaysian manufacturing center and a 5% increase in our annual line run rate due to improvements in our module average conversion efficiency and our line throughput at existing manufacturing facilities.

The decline in our module average selling price was attributable to the following: a 5% decrease due to annual contractual agreements and an additional 12% decrease due to competitive pressures (including our customer rebate program), a 6% decrease due to customer and geographical mix, and a 1% decrease due to a decline in the blended foreign exchange rate between the euro and U.S. Dollar.

Revenue recognized for our systems business decreased by $26.1 million during the three months ended June 30, 2011 compared to the three months ended June 26, 2010, primarily due to the timing of achieving all required milestones necessary for revenue recognition related to the construction of various utility-scale solar power systems.

Cost of sales

	Three Months Ended
(Dollars in thousands)	June 30, 2011			June 26, 2010			Three Month Period Change
Cost of sales	$	337,976		$	303,660		$	34,316	11	%
% of net sales	63.4		%	51.7		%

The increase in cost of sales was primarily due to a $53.5 million increase in personnel and other manufacturing costs related to increased production volume and correlating volume sold, an increase in costs due to the strengthening of the euro against the U.S. dollar exchange rate, and an increase in production ramp costs related to our Malaysian and German plant capacity expansions. These increases were partially offset by a decrease in costs of sales resulting from lower net sales of our systems business, continuous cost reductions in our manufacturing operations, and a $14.3 million decrease resulting from lower manufacturing excursion costs described below. During the three months ended June 30, 2011 watts sold increased by approximately 22%.

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Our average manufacturing cost per watt declined by $0.01 per watt, or 1%, from $0.76 in the three months ended June 26, 2010 to $0.75 in the three months ended June 30, 2011 and included $0.01 of non-cash share-based compensation.

Cost of sales for the three months ended June 26, 2010 included $17.8 million related to an increase in estimated expenses for certain module replacement efforts beyond normal warranty. During the period from June 2008 to June 2009, a manufacturing excursion occurred affecting less than 4% of the total product manufactured within the period. The excursion could result in possible premature power loss in the affected modules. The root cause was identified and subsequently mitigated in June 2009. On-going testing confirms that the corrective actions taken have been effective. We have been working directly with impacted customers to replace the affected modules and these efforts are well underway and, in some cases, complete. Some of these efforts go beyond our normal warranty coverage. We accrued $41.5 million in total-to-date to cover the replacement of the anticipated affected module population in the field. Such amounts include $3.6 million in expenses accrued during the second quarter of 2011, reflecting updated best estimates of the total replacement costs, based on our field data and execution-to-date of the module replacement program.

Gross profit

	Three Months Ended
(Dollars in thousands)	June 30, 2011			June 26, 2010			Three Month Period Change
Gross profit	$	194,798		$	284,194		$	(89,396	)	(31	)%
% of net sales	36.6		%	48.3		%

Gross profit as a percentage of net sales decreased by 11.7percentage points in the three months ended June 30, 2011 compared with the three months ended June 26, 2010. This decrease was attributable to the following: a 13.5percentage point reduction due to a decline in our module average selling prices, a 0.9 percentage point reduction due to the strengthening of the euro against the U.S. dollar exchange rate, partially offset by a 2.7 percentage point improvement resulting from lower incremental manufacturing excursion costs discussed above under "Cost of sales." We expect that gross profit will be impacted in future periods by the volatility of the exchange rate between the U.S. dollar and the euro and the product mix between our components and systems businesses.

Research and development

	Three Months Ended
(Dollars in thousands)	June 30, 2011			June 26, 2010			Three Month Period Change
Research and development	$	33,102		$	22,836		$	10,266	45	%
% of net sales	6.2		%	3.9		%

The increase in research and development expense was due to a $3.5 million increase in personnel-related expenses (including a $1.1 million increase in share-based compensation expense) resulting from increased hiring for various R&D projects, a $5.7 million increase in depreciation, testing, and qualification material costs, and a $1.1 million increase in other expenses. During the three months ended June 30, 2011, we continued the development of solar modules with increased efficiencies at converting sunlight into electricity and increased the conversion efficiency of our modules by approximately 4% compared with the three months ended June 26, 2010 from 11.2% to 11.7%.

Selling, general and administrative

	Three Months Ended
(Dollars in thousands)	June 30, 2011			June 26, 2010			Three Month Period Change
Selling, general and administrative	$	86,872		$	78,597		$	8,275	11	%
% of net sales	16.3		%	13.4		%

The increase in selling, general and administrative expense was due to a $5.8 million increase in salaries and personnel-related expenses related to the overall growth of our business (including $0.7 million of share-based compensation expense), a $6.5 million increase in infrastructure spending, a $4.4 million increase in expenses related to our systems business, partially offset by a $3.1 million decrease in professional fees and a $5.3 million decrease in other expenses primarily due to $5.6 million in estimated nonrecurring post-sale expenses relating to the manufacturing excursion discussed above under "Cost of Sales" during the three months ended June 26, 2010.

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Production start-up

	Three Months Ended
(Dollars in thousands)	June 30, 2011			June 26, 2010			Three Month Period Change
Production start-up	$	10,294		$	2,288		$	8,006	350	%
% of net sales	1.9		%	0.4		%

During the three months ended June 30, 2011, we incurred $10.3 million of production start-up expenses primarily for our manufacturing expansions in Germany, Vietnam, and Arizona, including legal, regulatory, and personnel costs, compared with $2.3 million of production start-up expenses for our Malaysian manufacturing expansion during the three months ended June 26, 2010. Production start-up expenses are composed of the cost of labor and material and depreciation expense to run and qualify the production lines, related facility expenses, management of our replication process, and legal and regulatory costs.

Foreign currency gain (loss)

	Three Months Ended
(Dollars in thousands)	June 30, 2011		June 26, 2010			Three Month Period Change
Foreign currency gain (loss)	$	1,659	$	(2,625	)	$	4,284	(163	)%

Foreign currency gain recognized during the three months ended June 30, 2011 was primarily due to the appreciation of the euro during the three months ended June 30, 2011.

Interest income

	Three Months Ended
(Dollars in thousands)	June 30, 2011		June 26, 2010		Three Month Period Change
Interest income	$	3,417	$	3,035	$	382	13	%

Interest income increased during the three months ended June 30, 2011 compared with the three months ended June 26, 2010, primarily as a result of interest received on long-term investments during the three months ended June 30, 2011.

Interest expense, net

	Three Months Ended
(Dollars in thousands)	June 30, 2011		June 26, 2010			Three Month Period Change
Interest expense, net	$	—	$	(6	)	$	6	(100	)%

Interest expense, net of amounts capitalized, remained consistent during the three months ended June 30, 2011 compared with the three months ended June 26, 2010, primarily as a result of interest expense capitalized during both periods.

Other income (expense), net

	Three Months Ended
(Dollars in thousands)	June 30, 2011		June 26, 2010			Three Month Period Change
Other income (expense), net	$	2,351	$	(439	)	$	2,790	(636	)%

Other income, net, increased during the three months ended June 30, 2011 compared with the three months ended June 26, 2010, primarily as a result of gains on the sale of investments during the three months ended June 30, 2011.

Income tax expense

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	Three Months Ended
(Dollars in thousands)	June 30, 2011			June 26, 2010			Three Month Period Change
Income tax expense	$	10,819		$	21,395		$	(10,576	)	(49	)%
Effective tax rate	15.0		%	11.9		%

Income tax expense decreased by $10.6 million during the three months ended June 30, 2011 compared with the three months ended June 26, 2010. Substantially all of this decrease resulted from a $108.5 million decrease in pre-tax income, partially offset by a greater percentage of profits earned in higher tax jurisdictions. See Note 16. "Income Taxes," to our condensed consolidated financial statements included with this Quarterly Report on Form 10-Q for additional information.

Six Months Ended June 30, 2011 and June 26, 2010

Net sales

	Six Months Ended
(Dollars in thousands)	June 30, 2011		June 26, 2010		Six Month Period Change
Net sales	$	1,100,067	$	1,155,815	$	(55,748	)	(5	)%

Our net sales during the six months ended June 30, 2011 decreased by 5% compared with the six months ended June 26, 2010, primarily due to an 18% decrease in our module average selling price and a 14% decrease in revenue recognized by our systems business, partially offset by a 19% increase in the MW volume of solar modules sold. The increase in the MW volume of solar modules sold was attributable to the full ramp of our eight-line capacity expansion in our Malaysian manufacturing center, and a 5% increase to our annual line run rate due to improvements in our module average conversion efficiency and our line throughput at existing manufacturing facilities.

The decline in our module average selling price was attributable to the following: a 4% decrease due to annual contractual agreements, an 8% decrease due to competitive pressures (including our customer rebate program), a 4% decrease due to customer and geographical mix, and a 2% decrease due to due to a decline in the blended foreign exchange rate between the euro and U.S. Dollar.

Revenue recognized by our systems business decreased from $125.6 million during the six months ended June 26, 2010 to $108.6 million during the six months ended June 30, 2011. The decrease was primarily due to the timing of achieving all required milestones necessary for revenue recognition related to the construction of various utility-scale solar power systems.

Cost of sales

	Six Months Ended
(Dollars in thousands)	June 30, 2011			June 26, 2010			Six Month Period Change
Cost of sales	$	645,604		$	589,585		$	56,019	10	%
% of net sales	58.7		%	51.0		%

The increase in cost of sales was primarily due to a $93.4 million increase in personnel and other manufacturing costs related to increased production volume and correlating volume sold, an increase in costs due to the strengthening of the euro against the U.S. dollar exchange rate, an increase in production ramp costs related to our Malaysian and German plant capacity expansions and an increase in cost of sales of our systems business. These increases were partially offset by continuous cost reductions in our manufacturing operations and an $18.8 million decrease resulting from lower incremental manufacturing excursion costs described below. During the six months ended June 30, 2011, we increased our watts sold by approximately 19%.

Our average manufacturing cost per watt declined by $0.04 per watt, or 5%, from $0.79 in the six months ended June 26, 2010 to $0.75 in the six months ended June 30, 2011 and included $0.01 of non-cash share-based compensation.

Cost of sales for the six months ended June 26, 2010 included $22.4 million related to an increase in estimated expenses for certain module replacement efforts beyond normal warranty. During the period from June 2008 to June 2009, a manufacturing excursion occurred affecting less than 4% of the total product manufactured within the period. The excursion could result in possible premature power loss in the affected modules. The root cause was identified and subsequently mitigated in June 2009.

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On-going testing confirms that the corrective actions taken have been effective. We have been working directly with impacted customers to replace the affected modules and these efforts are well underway and, in some cases, complete. Some of these efforts go beyond our normal warranty coverage. We accrued $41.5 million in total-to-date to cover the replacement of the anticipated affected module population in the field. Such amounts include $3.6 million in expenses accrued during the second quarter of 2011, reflecting updated best estimates of the total replacement costs, based on our field data and execution-to-date of the module replacement program.

Gross profit

	Six Months Ended
(Dollars in thousands)	June 30, 2011			June 26, 2010			Six Month Period Change
Gross profit	$	454,463		$	566,230		$	(111,767	)	(20	)%
% of net sales	41.3		%	49.0		%

Gross profit as a percentage of net sales decreased by 7.7percentage points in the six months ended June 30, 2011 compared with the six months ended June 26, 2010. This decrease was attributable to the following: a 9.2percentage point reduction due to a decline in our module average selling prices, a 1.3 percentage point reduction due to the strengthening of the euro against the U.S. dollar exchange rate, and a 0.6percentage point decrease due to segment mix between our components and systems businesses, partially offset by a 1.6 percentage point margin improvement attributable to continued manufacturing scale and reductions in our manufacturing cost per watt and a 1.8 percentage point improvement resulting from lower incremental manufacturing excursion costs discussed above under "Cost of sales." We expect that gross profit will be impacted in future periods by the volatility of the exchange rate between the U.S. dollar and the euro and product mix between our components and systems businesses.

Research and development

	Six Months Ended
(Dollars in thousands)	June 30, 2011			June 26, 2010			Six Month Period Change
Research and development	$	64,453		$	45,724		$	18,729	41	%
% of net sales	5.9		%	4.0		%

The increase in research and development expense was due to a $9.5 million increase in personnel-related expenses (including a $2.3 million increase in share-based compensation expense) resulting from increased hiring for various R&D projects. In addition, testing and qualification material costs increased by $9.3 million, other expenses increased by $4.5 million, and facilities and utilities decreased by $4.6 million. During the six months ended June 30, 2011, we continued the development of solar modules with increased efficiencies at converting sunlight into electricity and increased the conversion efficiency of our modules by approximately 5% compared with the six months ended June 26, 2010 from 11.1% to 11.7%.

Selling, general and administrative

	Six Months Ended
(Dollars in thousands)	June 30, 2011			June 26, 2010			Six Month Period Change
Selling, general and administrative	$	173,872		$	145,461		$	28,411	20	%
% of net sales	15.8		%	12.6		%

The increase in selling, general and administrative expense was due to a $11.3 million increase in salaries and personnel-related expenses (including a $3.5 million increase in share-based compensation expense), a $7.8 million increase in infrastructure spending primarily related to the implementation of a new ERP system, a $7.7 million increase in non-capitalizable development expenses related to our systems business, and a $1.6 million increase in travel, consulting, and other expenses relating to the development of new markets.

Production start-up

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	Six Months Ended
(Dollars in thousands)	June 30, 2011			June 26, 2010			Six Month Period Change
Production start-up	$	22,225		$	3,431		$	18,794	548	%
% of net sales	2.0		%	0.3		%

During the six months ended June 30, 2011, we incurred $22.2 million of production start-up expenses primarily due to our expansions in Malaysia, Germany, France, Vietnam, and Arizona, including legal, regulatory and personnel costs, compared with $3.4 million of production start-up expenses for our Malaysian and Perrysburg, Ohio manufacturing expansions during the six months ended June 26, 2010. Production start-up expenses are composed of the cost of labor and material and depreciation expense to run and qualify the production lines, related facility expenses, management of our replication process, and legal and regulatory costs.

Foreign currency gain (loss)

	Six Months Ended
(Dollars in thousands)	June 30, 2011		June 26, 2010			Six Month Period Change
Foreign currency gain (loss)	$	2,609	$	(3,321	)	$	5,930	(179	)%

Foreign currency gain recognized during the six months ended June 30, 2011 was primarily due to the appreciation of the euro during the six months ended June 30, 2011.

Interest income

	Six Months Ended
(Dollars in thousands)	June 30, 2011		June 26, 2010		Six Month Period Change
Interest income	$	6,440	$	8,683	$	(2,243	)	(26	)%

Interest income decreased during the six months ended June 30, 2011 compared with the six months ended June 26, 2010, primarily as a result of interest received from notes receivable and penalties for late customer payments during the six months ended June 26, 2010.

Interest expense, net

	Six Months Ended
(Dollars in thousands)	June 30, 2011		June 26, 2010			Six Month Period Change
Interest expense, net	$	—	$	(6	)	$	6	(100	)%

Interest expense, net of amounts capitalized, remained consistent during the six months ended June 30, 2011 compared with the six months ended June 26, 2010, primarily as a result of interest expense capitalized during both periods.

Other income (expense), net

	Six Months Ended
(Dollars in thousands)	June 30, 2011		June 26, 2010			Six Month Period Change
Other income (expense), net	$	2,002	$	(1,173	)	$	3,175	(271	)%

Other income, net, increased during the six months ended June 30, 2011 compared with the six months ended June 26, 2010, primarily as a result of gains on the sale of investments during the six months ended June 30, 2011.

Income tax expense

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	Six Months Ended
(Dollars in thousands)	June 30, 2011			June 26, 2010			Six Month Period Change
Income tax expense	$	27,858		$	44,409		$	(16,551	)	(37	)%
Effective tax rate	13.6		%	11.8		%

Income tax expense decreased by $16.6 million during the six months ended June 30, 2011 compared with the six months ended June 26, 2010. Substantially all of this decrease resulted from a $170.8 million decrease in pre-tax income, partially offset by a greater percentage of profits earned in higher tax jurisdictions. See Note 16. "Income Taxes," to our condensed consolidated financial statements included with this Quarterly Report on Form 10-Q for additional information.

Business Segment Review

	Three Months Ended						Six Months Ended
(Dollars in thousands)	June 30, 2011		June 26, 2010		% Change		June 30, 2011		June 26, 2010		% Change
Net sales
Components	$	471,947	$	500,940	(6	)%	$	991,466	$	1,030,208	(4	)%
Systems	60,827		86,914		(30	)%	108,601		125,607		(14	)%
Total	$	532,774	$	587,854	(9	)%	$	1,100,067	$	1,155,815	(5	)%
Income before income taxes (Segment profit)
Components	$	71,957	$	180,438	(60	)%	$	204,964	$	375,797	(45	)%
Systems	—		—		—	%	—		—		—	%
Total	$	71,957	$	180,438	(60	)%	$	204,964	$	375,797	(45	)%

Our CODM, consisting of senior executive staff, views the sale of solar modules from the components segment as the core driver of our profitability, return on net assets, and cash throughput; and as a result, we view our systems segment as an enabler to drive module throughput. Therefore, we operate our systems segment with the objective to achieve break-even results before income taxes. We include the sale of our solar modules manufactured by the components segment and installed in projects sold by our systems segment in “net sales” of our components business. See Note 20. "Segment Reporting," to our condensed consolidated financial statements included with this Quarterly Report on Form 10-Q for more information.

Components Segment

	Three Months Ended						Six Months Ended
(Dollars in thousands)	June 30, 2011		June 26, 2010		% Change		June 30, 2011		June 26, 2010		% Change
Net sales	$	471,947	$	500,940	(6	)%	$	991,466	$	1,030,208	(4	)%
Cost of sales	$	282,072	$	239,284	18	%	$	543,333	$	490,901	11	%
Income before income taxes (Segment profit)	$	71,957	$	180,438	(60	)%	$	204,964	$	375,797	(45	)%

Components segment net sales decreased by 6% in the three months ended June 30, 2011 compared with the three months ended June 26, 2010, primarily due to a decrease in our module average selling price, partially offset by an increase in the MW volume of solar modules sold and an increase in the average conversion efficiency of our solar modules. Our module average selling price, excluding the impact of systems segment break-even reporting, decreased by approximately 24% during the three months ended June 30, 2011 compared with the three months ended June 26, 2010. The effect of our segment reporting adjustments, to achieve break-even results before income taxes for our systems segment, decreased the module average selling price by an additional 1%.

Components segment net sales decreased by 4% during the six months ended June 30, 2011 compared with the six months ended June 26, 2010, primarily due to a decrease in our module average selling price, partially offset by an increase in the volume of solar modules sold and an increase in the average conversion efficiency of our solar modules. The increase in the MW volume of solar modules sold was attributable to the full production ramp of our eight-line Malaysian manufacturing center.

Components segment cost of sales increased by 18% in the three months ended June 30, 2011 compared with the three months

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ended June 26, 2010, primarily due to an increase in personnel and other manufacturing costs related to increased production volume and correlating volume sold, an increase in ramp costs related to the capacity expansion in our Malaysian manufacturing center, partially offset by continuous cost reductions in our manufacturing operations.

Components segment cost of sales increased by 11% in the six months ended June 30, 2011 compared with the six months ended June 26, 2010, primarily due to an increase in personnel and other manufacturing costs related to increased production volumes and correlating volumes sold, an increase in ramp costs related to the capacity expansion in our Malaysian manufacturing center and additional manufacturing capacity related to our new manufacturing plants in Malaysia, partially offset by continuous cost reductions in our manufacturing operations.

Components segment profit decreased by 60% in the three months ended June 30, 2011 compared with the three months ended June 26, 2010, primarily due to $19.7 million of compensation to our systems segment for a temporary shortfall during the three months ended June 30, 2011, lower net sales mainly due to a decrease in our module average selling prices, and an increase in cost of sales.

Components segment profit decreased by 45% during the six months ended June 30, 2011 compared with the six months ended June 26, 2010, primarily due to $45.9 million of compensation to our systems segment for a temporary shortfall during the six months ended June 30, 2011, lower net sales mainly due to a decrease in our module average selling prices, and an increase in cost of sales.

Systems Segment

	Three Months Ended						Six Months Ended
(Dollars in thousands)	June 30, 2011		June 26, 2010		% Change		June 30, 2011		June 26, 2010		% Change
Net sales	$	60,827	$	86,914	(30	)%	$	108,601	$	125,607	(14	)%
Cost of sales	$	55,904	$	64,376	(13	)%	$	102,271	$	98,684	4	%
Income before income taxes (Segment profit)	$	—	$	—	—	%	$	—	$	—	—	%

Systems segment net sales decreased from $86.9 million in the three months ended June 26, 2010 to $60.8 million in the three months ended June 30, 2011, primarily due to the timing of achieving all required milestones necessary for revenue recognition for the construction of utility-scale solar power systems.

Systems segment net sales decreased from $125.6 million during the six months ended June 26, 2010 to $108.6 million during the six months ended June 30, 2011, primarily due to the timing of achieving all required milestones necessary for revenue recognition for the construction of utility-scale solar power systems.

Systems segment cost of sales decreased from $64.4 million in the three months ended June 26, 2010 to $55.9 million in the three months ended June 30, 2011, primarily due to lower net sales. See also Item 2: “Management's Discussion and Analysis of Financial Condition and Results of Operations – Financial Operations Overview – Cost of Sales – Systems Business" for a description of cost of sales for our systems business.

Systems segment cost of sales increased from $98.7 million in the six months ended June 26, 2010 to $102.3 million in the six months ended June 30, 2011, primarily due an increase in construction activities for various utility-scale solar power projects in North America during the six months ended June 30, 2011 compared to the six months ended June 26, 2010. See also Item 2: “Management's Discussion and Analysis of Financial Condition and Results of Operations – Financial Operations Overview – Cost of sales – Systems Business" for a description of cost of sales for our systems business.

Systems segment profit was zero for the three and six months ended June 30, 2011 and June 26, 2010. As noted above, we operate our systems segment with the objective to achieve break-even results before income taxes. See Note 20. "Segment Reporting," to our condensed consolidated financial statements included with this Quarterly Report on Form 10-Q for more information.

Product Revenue

The following table sets forth the total amounts of solar modules and solar power systems revenue recognized for the three and six months ended June 30, 2011 and June 26, 2010. For the purposes of the following table, (i) "Solar module revenue" is composed of total revenues from the sale of solar modules to third parties, and (ii) "Solar power system revenue" is composed of

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total revenues from the sale of complete solar power systems and related services including the solar modules installed in the solar power system.

	Three Months Ended				Six Months Ended
(Dollars in thousands)	June 30, 2011		June 26, 2010		June 30, 2011		June 26, 2010
Solar module revenue	$	427,350	$	476,061	$	933,092	$	1,004,939
Solar power system revenue	105,424		111,793		166,975		150,876
Total net sales	$	532,774	$	587,854	$	1,100,067	$	1,155,815

Critical Accounting Policies and Estimates

In preparing our financial statements in conformity with generally accepted accounting principles in the United States (U.S. GAAP), we make estimates and assumptions about future events that affect the amounts of reported assets, liabilities, revenues, and expenses, as well as the disclosure of contingent liabilities in our financial statements and the related notes thereto. Some of our accounting policies require the application of significant judgment by management in the selection of the appropriate assumptions for making these estimates. We base our judgments and estimates on our historical experience, our forecasts, and other available information as appropriate. We believe that the assumptions, judgments, and estimates involved in the accounting for revenue recognition, allowances for doubtful accounts receivable, accrued solar module collection and recycling liability, product warranties, accounting for income taxes, and goodwill have the greatest potential impact on our condensed consolidated financial statements.

Revenue Recognition — Systems Business. Through our fully integrated systems business, we provide a complete solar power system solution using our solar modules, which may include project development, EPC services, O&M services, when applicable, and project finance, when required. We base revenue recognition for arrangements entered into by our systems business generally using two distinct revenue recognition models, following the guidance in ASC 605, Accounting for Long-term Construction Contracts or, for arrangements which include land, ASC 360, Accounting for Sales of Real Estate. For long-term construction contracts recognized under ASC 605, we use the percentage-of-completion methodology as our basic accounting policy, unless we cannot make reasonably dependable estimates of the costs to complete the contract, in which case we would use the completed contract method. Revenue recognized for fixed price contracts applying the percentage-of-completion methodology requires us to estimate actual costs incurred over total estimated contract costs to complete a project. We periodically revise our contract cost and profit estimates and we immediately recognize any losses that we identify on contracts. Typically, we have full control over the procurement of balance of systems parts (BOS) with predictable pricing, delivery, and installation schedules and, therefore, mainly unexpected change orders will result in changes to our estimates.

Incurred costs used in our percentage-of-completion calculation include all direct materials, costs for solar modules, labor, subcontractor costs, and those indirect costs related to contract performance, such as indirect labor, supplies, and tools. We recognize direct material costs as incurred costs when the direct materials have been installed. We consider direct materials to be installed when they are permanently attached or fitted to the solar power systems as required by engineering designs.

For a description of our remaining critical accounting policies that affect our more significant judgments and estimates used in the preparation of our condensed consolidated financial statements, refer to our Annual Report on Form 10-K for the fiscal year ended December 31, 2010 filed with the Securities and Exchange Commission.

Recent Accounting Pronouncements

See Note 3. "Recent Accounting Pronouncements," to our condensed consolidated financial statements included with this Quarterly Report on Form 10-Q for a summary of recent accounting pronouncements.

Liquidity and Capital Resources

As of June 30, 2011, we had $515.4 million in cash, cash equivalents, marketable securities, and investments compared with $1,113.8 million as of December 31, 2010. The decrease in our cash, cash equivalents, marketable securities, and investments was primarily due to the repayment of long-term debt, annual payments for the funding of our collection and recycling program, an increase in our working capital, and incentive compensation, partially offset by proceeds from the issuance of debt. As of June 30, 2011 and December 31, 2010, $417.0 million and $684.0 million, respectively, of our cash, cash equivalents, marketable securities, and investments were held by foreign subsidiaries and are generally based in euro and U.S. dollar-denominated holdings.

We believe that our current cash, cash equivalents, marketable securities, investments, cash flows from operating activities,

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credit facilities, and access to the capital markets will be sufficient to meet our working capital and capital expenditure needs for at least the next 12 months. We intend to continue to carefully execute our growth plans and manage credit and market risk. However, if our financial results or operating plans change from our current assumptions, we may not have sufficient resources to support our business plan.

Our expanding systems business is expected to have increasing liquidity requirements in the future. Solar power project development cycles, which span the time between the identification of land and the commercial operation of a photovoltaic power plant, vary substantially and can take many months or years to mature. As a result of these long project cycles, we may need to make significant up-front investments of resources in advance of the signing of power purchase agreements and EPC contracts and the receipt of any revenue. These amounts include payment of interconnection and other deposits (some of which are non-refundable), entering into of letters of credit, and incurring preliminary engineering, permitting, legal, and other expenses. We have historically financed these up-front investments primarily using working capital and cash on hand. In the future, we may also engage in one or more debt or equity financings. Such financings could result in increased expenses or dilution to our existing stockholders. If we are unable to obtain debt or equity financing on reasonable terms, we may be unable to execute our expansion strategy.

Cash Flows

The following table summarizes the key cash flow metrics for the six months ended June 30, 2011 and June 26, 2010 (in thousands):

	Six Months Ended
	June 30, 2011			June 26, 2010
Net cash (used in) provided by operating activities	$	(246,835	)	$	107,600
Net cash used in investing activities	(308,977		)	(223,749		)
Net cash provided by (used in) financing activities	137,124			(10,297		)
Effect of exchange rate changes on cash and cash equivalents	10,476			(27,571		)
Net decrease in cash and cash equivalents	$	(408,212	)	$	(154,017	)

Operating Activities

Cash used in operating activities was $246.8 million during the six months ended June 30, 2011 compared with cash provided by operating activities of $107.6 million during the six months ended June 26, 2010. The decrease in operating cash flows during the six months ended June 30, 2011 was primarily due to an increase in payments to suppliers and associates, a decrease in cash received from customers, and an increase in overall working capital requirements. In addition, we recorded excess tax benefits related to share-based compensation arrangements, which decreased our June 30, 2011 operating cash flow by $16.5 million (see "Financing Activities" for further information).

Cash paid to suppliers and associates increased from $824.4 million during the six months ended June 26, 2010 to $1,005.2 million during the six months ended June 30, 2011, mainly due to an increase in raw material and component purchases, an increase in personnel-related costs due to higher headcount, and other costs supporting our growth. Cash received from customers decreased from $955.1 million during the six months ended June 26, 2010 to $798.2 million during the six months ended June 30, 2011, primarily as a result of non-linear shipments to our customers during the second quarter of 2011. As a result, our accounts receivable increased by $230.5 million during the six months ended June 30, 2011.

Interest received decreased from $12.6 million during the six months ended June 26, 2010 to $6.7 million during the six months ended June 30, 2011, primarily as a result of interest received from notes receivable and penalties for late customer payments in the prior period.

Investing Activities

Cash used in investing activities was $309.0 million during the six months ended June 30, 2011, compared with $223.7 million during the six months ended June 26, 2010. Cash used in investing activities during the six months ended June 30, 2011 included capital expenditures of $390.0 million, which increased by $150.5 million from $239.5 million during the six months ended June 26, 2010. The increase in capital expenditures was primarily due to our manufacturing expansions in Malaysia and Germany, and construction of new plants in Vietnam and Mesa, Arizona. Also, we decreased our net investment in marketable securities and investments by $188.0 million during the six months ended June 30, 2011 compared with an increase of our net investment in

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marketable securities and investments of $4.1 million during the six months ended June 26, 2010. Cash used to fund our estimated future end-of-life collection and recycling costs of solar modules that we sold during fiscal 2010 was $62.7 million during the six months ended June 30, 2011, compared with $43.1 million during the six months ended June 26, 2010. Amounts that we set aside for future solar module collection and recycling costs are deposited in a custodial account, under the name of a trust, with a large bank as investment advisor. Amounts in this account are invested in long-term marketable securities, which we classify as "Restricted cash and investments" on our balance sheet. Restricted cash increased by $23.3 million primarily due to debt reserve requirements related to our German credit facility. On January 4, 2011, we acquired Ray Tracker, Inc., a tracking technology and photovoltaic balance of systems firm in an all-cash transaction.

Cash used in investing activities during the six months ended June 26, 2010 resulted primarily from capital expenditures of $239.5 million, the net purchase of marketable securities of $4.1 million, and an increase in our restricted cash and investments of $43.1 million, partially offset by payments received on notes receivable of $61.7 million. Capital expenditures were primarily due to the construction of two new plants adjacent to our existing plants in Malaysia and the expansion of our plant in Perrysburg, Ohio.

At the beginning of each fiscal year we pre-fund our estimated solar module collection and recycling costs for solar modules that we sold during the prior fiscal year through a custodial account with a large bank as investment advisor, in the name of a trust, for which First Solar, Inc., First Solar Malaysia Sdn. Bhd, and First Solar Manufacturing GmbH are grantors. For this purpose we assume a minimum service life of 25 years for our solar modules. At June 30, 2011 and December 31, 2010, we had $150.8 million and $86.0 million, respectively, in the custodial account, which we classified in our restricted investments on our balance sheet. See Note 7. "Restricted Cash and Investments," to our condensed consolidated financial statements included with this Quarterly Report on Form 10-Q for additional information.

Financing Activities

Cash provided by financing activities was $137.1 million during the six months ended June 30, 2011 compared with $10.3 million used in financing activities during the six months ended June 26, 2010. Cash provided by financing activities during the six months ended June 30, 2011 resulted primarily from the proceeds from borrowings under credit facilities, net of discount and issuance costs of $224.4 million, cash provided by employee stock option exercises of $7.7 million, excess tax benefits from share-based compensation arrangements of $16.5 million, and proceeds from economic development funding of $3.1 million, partially offset by the repayment of long-term debt of $114.3 million.

Cash used in financing activities during the six months ended June 26, 2010 resulted primarily from the repayment of long-term debt of $14.0 million, partially offset by stock option exercise proceeds of $3.7 million. We did not record any excess tax benefits from share-based compensation arrangements during the six months ended June 26, 2010.

Contractual Obligations

Our contractual obligations other than in the ordinary course of business have not materially changed since the end of our fiscal year 2010 with the exception of our German and Malaysian Ringgit Facility Agreements (See Note 13. "Debt," to our condensed consolidated financial statements included with this Quarterly Report on Form 10-Q for additional information). See also our Annual Report on Form 10-K for the fiscal year ended December 31, 2010, for additional information regarding our contractual obligations.

Off-Balance Sheet Arrangements

We had no off-balance sheet arrangements as of June 30, 2011.

Item 3.Quantitative and Qualitative Disclosures About Market Risk

There have been no material changes from the information previously provided under Item 7A of our Annual Report on Form 10-K for the fiscal year ended December 31, 2010.

Item 4.Controls and Procedures

Evaluation of Disclosure Controls and Procedures

Our management, including our Chief Executive Officer and Chief Financial Officer, conducted an evaluation as of June 30, 2011 of the effectiveness of our “disclosure controls and procedures” as defined in Exchange Act Rule 13a-15(e). Based on that

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evaluation, our Chief Executive Officer and Chief Financial Officer concluded that as of June 30, 2011 our disclosure controls and procedures were effective to ensure that information we are required to disclose in reports that we file or submit under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in the rules and forms of the SEC and is accumulated and communicated to our management as appropriate to allow timely decisions regarding required disclosure.

Changes in Internal Control over Financial Reporting

Our management, including our Chief Executive Officer and Chief Financial Officer, conducted an evaluation of our “internal control over financial reporting” as defined in Exchange Act Rule 13a-15(f) to determine whether any changes in our internal control over financial reporting occurred during the fiscal quarter ended June 30, 2011 that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting. Based on that evaluation, there have been no such changes in our internal control over financial reporting during the fiscal quarter ended June 30, 2011.

We are in the process of converting to a new enterprise resource planning (ERP) system. Implementation of the new ERP system is scheduled to occur in phases and we expect to complete Phase II of this implementation in our third fiscal quarter of 2011. For a discussion of risks relating to the implementation of a new ERP system, please see the risk factor entitled “Implementing a new enterprise resource planning system could interfere with our business or operations and could adversely impact our financial position, results of operations, and cash flows.” in Item 1A: “Risk Factors” in our Annual Report on Form 10-K for the fiscal year ended December 31, 2010. We will continue to implement our new financial system in stages, and each stage may affect significant components of our internal control over financial reporting.

CEO and CFO Certifications

We have attached as exhibits to this Quarterly Report on Form 10-Q the certifications of our Chief Executive Officer and Chief Financial Officer, which are required in accordance with the Exchange Act. We recommend that this Item 4 be read in conjunction with those certifications for a more complete understanding of the subject matter presented.

Limitations on the Effectiveness of Controls

Control systems, no matter how well designed and operated, can provide only reasonable, not absolute, assurance that the control systems' objectives are being met. Further, the design of any control systems must reflect the fact that there are resource constraints, and the benefits of all controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within a company have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty and that breakdowns can occur because of simple error or mistake. Control systems can also be circumvented by the individual acts of some persons, by collusion of two or more people, or by management override of the controls. The design of any system of controls is based in part on certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions. Over time, controls may become inadequate because of changes in conditions or deterioration in the degree of compliance with policies or procedures.

PART II.OTHER INFORMATION

Item 1.Legal Proceedings

General

In the ordinary conduct of our business, we are subject to periodic lawsuits, investigations, and claims, including, but not limited to, routine employment matters. Although we cannot predict with certainty the ultimate resolution of lawsuits, investigations, and claims asserted against us, we do not believe that any currently pending legal proceeding to which we are a party will have a material adverse effect on our business, results of operations, cash flows, or financial condition.

Item 1A.Risk Factors

In addition to the other information set forth in this report, you should carefully consider the factors discussed in Part I, “Item 1A: Risk Factors” in our Annual Report on Form 10-K for the fiscal year ended December 31, 2010, which could materially affect our business, results of operations, cash flows, or financial condition. The risks described in our Annual Report on Form 10-K are not the only risks facing our company. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial also may materially adversely affect our business, financial condition, or future results. There have been no material

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changes in the risk factors contained in our Annual Report on Form 10-K.

Item 2.Unregistered Sales of Equity Securities and Use of Proceeds

Recent Sales of Unregistered Securities

During the three months ended June 30, 2011, 8,316 Holdback Shares (as defined below) were issued to OptiSolar Holdings LLC. As previously reported in a Current Report on Form 8-K filed with the SEC on April 9, 2009, on April 3, 2009, we completed the acquisition of the solar power project development business (Project Business) of OptiSolar Inc., a Delaware corporation (OptiSolar). Pursuant to an Agreement and Plan of Merger (Merger Agreement) dated as of March 2, 2009 by and among First Solar, Inc., First Solar Acquisition Corp., a Delaware corporation (Merger Sub), OptiSolar and OptiSolar Holdings LLC, a Delaware limited liability company (OptiSolar Holdings), Merger Sub merged with and into OptiSolar, with OptiSolar surviving as a wholly-owned subsidiary of First Solar (Merger). Pursuant to the Merger, all the outstanding shares of common stock of OptiSolar held by OptiSolar Holdings were exchanged for the Merger Shares. The Merger Shares consisted of 2,972,420 shares of First Solar common stock, par value $0.001 per share, including (i) 732,789 shares that have been issued and deposited with an escrow agent to support certain indemnification obligations of OptiSolar Holdings, and (ii) 355,096 shares that were issuable upon satisfaction of conditions relating to the satisfaction of certain then existing liabilities of OptiSolar (Holdback Shares). The Merger Shares and certain Holdback Shares were issued, and any remaining Holdback Shares will be issued in a private placement exempt from registration pursuant to Section 4(2) of the Securities Act of 1933, as amended. First Solar has prepared and filed with the SEC a registration statement under the Securities Act covering the resale of 2,801,435 of the Merger Shares.

As of June 30, 2011, all of the Holdback Shares had been issued to OptiSolar Holdings.

Item 5. Other Information

On August 3, 2011, First Solar Malaysia Sdn. Bhd. (the “Borrower”), a wholly owned subsidiary of the Company, entered into a EUR 60,000,000 Facility Agreement (the “Facility Agreement”) among the Borrower, Commerzbank Aktiengesellschaft, as arranger and original lender, Commerzbank Aktiengesellschaft, Luxembourg Branch, as facility agent (the “Facility Agent”) and security agent (the “Security Agent”), and Natixis Zweigniederlassung Deutschland, as arranger and original lender. A copy of the Facility Agreement is attached hereto as Exhibit 10.1 and is incorporated herein by reference.

Concurrently with the execution of the Facility Agreement, the Company entered into a First Demand Guaranty dated as of August 3, 2011 (the “Guaranty”), among the Company, the Borrower, the Facility Agent and the Security Agent. A copy of the Guaranty is attached hereto as Exhibit 10.2 and is incorporated herein by reference.

At the same time, the Borrower and the Company also entered into a Subordination Agreement, pursuant to which the Company agreed to subordinate all obligations and liabilities of the Borrower to the Company to the obligations and liabilities of the Borrower to the lenders, the arrangers, the Facility Agent and the Security Agent under the Facility Agreement and related documents, except with respect to certain permitted payments.

The obligations of the Borrower under the Facility Agreement are guaranteed by the Company pursuant to the Guaranty. In addition, certain obligations in respect of the Facility Agreement will be guaranteed (the “Euler Hermes Guarantee”) by the Federal Republic of Germany, represented by Euler Hermes Kreditversicherungs-AG (“Euler Hermes”).

Three euro denominated term loan facilities (the “Facilities”) will be made available to the Borrower under the Facility Agreement in the following maximum aggregate amounts: EUR 27,119,313, EUR 31,995,220 and EUR 885,467. The proceeds of the Facilities will be used by the Borrower to effect an export financing of equipment for use in two solar module manufacturing plants (the “KLM 5 and 6”) located in Kulim Hi Tech Park, Kedah, Malaysia (including to partially finance the payment of fees to be paid to Euler Hermes in connection with the Euler Hermes Guarantee). Borrowings under the Facilities will bear interest at a rate per annum equal to a euribor rate for the interest period selected by the Borrower plus 1.00%.

The Borrower will pay to the Facility Agent in the form of a one time upfront payment for the account of Commerzbank Aktiengesellschaft, as arranger, an arrangement fee of 0.35% and for the account of the lenders a participation fee of 0.65%, in each case of the aggregate amount of the Facilities as of the date of the Facility Agreement. The arrangement fee will be due and payable on the earlier of the date of the first utilization of the Facilities and the date that is three months after the date of the Facility Agreement. The participation fee will be due and payable on the date of the first utilization of the Facilities.

During the period from the date of the Facility Agreement until November 25, 2011, the lenders' available commitments under the Facilities are subject to a commitment fee equal to 0.35% per annum.

Upon the earlier of May 25, 2012 and the date that is six months after the date of readiness of KLM 5 and 6 for operation (the “First Repayment Date”), all loans made to the Borrower under the Facilities will be consolidated into a single loan, which shall

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be repaid in 14 semi-annual equal consecutive installments based on the aggregate amount of all loans borrowed by the Borrower under the Facilities as at the close of business on May 25, 2012, divided by 14. The Borrower may voluntarily cancel in whole or in part any of the Facilities without penalty. At any time after the First Repayment Date, the Borrower may voluntarily prepay loans outstanding under the Facilities on the last day of the interest period applicable thereto (subject to certain requirements, including with respect to minimum prepayment amounts). If the Euler Hermes Guarantee ceases to be in full force and effect or is repudiated, the Facility Agent at the direction of the lenders will cancel the available commitments under the Facilities and declare the outstanding loans due and payable.

The Facility Agreement contains negative covenants that, among other things, restrict, subject to certain exceptions, the ability of the Borrower to grant liens over the equipment financed by the Facilities, effect asset sales, provide guarantees, change its business, engage in mergers, consolidations and restructurings and enter into contracts with the Company and its subsidiaries. In addition, the Facility Agreement includes financial covenants relating to maximum total debt to equity ratio, maximum total leverage ratio, minimum interest coverage ratio and minimum debt service coverage ratio. The Facility Agreement also contains certain representations and warranties, affirmative covenants and events of default.

The foregoing summary of the Facility Agreement and the Guaranty, and the transactions contemplated thereby, does not purport to be complete and is subject to, and qualified in its entirety by, the full text of each of the documents described herein, which are filed as Exhibits 10.1 and 10.2 hereto, respectively, and incorporated herein by reference.

Item 6.Exhibits

The following exhibits are filed with this Quarterly Report on Form 10-Q:

Exhibit
Number	Exhibit Description
10.1	Facility Agreement, dated as of August 3, 2011 among First Solar Malaysia Sdn. Bhd., Commerzbank Aktiengesellschaft, as arranger and original lender, Commerzbank Aktiengesellschaft, Luxembourg Branch, as facility agent and security agend, and Natixis Zweigniederlassung Deutschalnd, as arranger and original lender
10.2	First Demand Guaranty, dated as of August 3, 2011, among First Solar, Inc., First Solar Malaysia Sdn. Bhd. and Commerzbank Aktiengesellschaft, Luxembourg Branch, as facility agent and security agent
31.01	Certification of Chief Executive Officer pursuant to 15 U.S.C. Section 7241, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.02	Certification of Chief Financial Officer pursuant to 15 U.S.C. Section 7241, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.01*	Certification of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101.INS**	XBRL Instance Document
101.SCH**	XBRL Taxonomy Extension Schema Document
101.CAL**	XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF**	XBRL Taxonomy Extension Definition Linkbase Document
101.LAB**	XBRL Taxonomy Label Linkbase Document
101.PRE**	XBRL Taxonomy Extension Presentation Linkbase Document

* This exhibit shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933 or the Securities Exchange Act of 1934, whether made before or after the date hereof and irrespective of any general incorporation language in any filings.

** Furnished herewith.

53

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 FIRST SOLAR, INC.

By: /s/  JAMES ZHU

 James Zhu

Principal Accounting Officer

August 5, 2011

54

EX-10.1

C L I F F O R D	CLIFFORD CHANCE PARTNERSCHAFTSGESELLSCHAFT
C H A N C E

		Execution Version
		Exhibit 10.1
3 August 2011
EUR 60,000,000 FACILITY AGREEMENT between FIRST SOLAR MALAYSIA SDN. BHD. (COMPANY NO. 758827-T) as Borrower COMMERZBANK AKTIENGESELLSCHAFT as Arranger and Original Lender COMMERZBANK AKTIENGESELLSCHAFT, LUXEMBOURG BRANCH as Facility Agent and Security Agent NATIXIS ZWEIGNIEDERLASSUNG DEUTSCHLAND as Arranger and Original Lender
	EXPORT FINANCING OF EQUIPMENT IN RELATION TO TWO SOLAR MODULE MANUFACTURING PLANTS LOCATED IN KULIM HI TECH PARK, KEDAH, MALAYSIA

CLIFFORD CHANCE PARTNERSCHAFTSGESELLSCHAFT VON RECHTSANWÄLTEN, WIRTSCHAFTSPRÜFERN, STEUERBERATERN UND SOLICITORS • SITZ: FRANKFURT AM MAIN • AG FRANKFURT AM MAIN PR 1000

Contents
Clause		Page
1.	Definitions and Interpretation	2
2.	The Facilities	16
3.	Utilisation of the Facilities	19
4.	Interest	20
5.	Interest Rate and Payment of Interest	21
6.	Market Disruption and Alternative Interest Rates	22
7.	Notification	23
8.	Repayment	23
9.	Voluntary Cancellation and Prepayments	24
10.	Mandatory Cancellation and Prepayments	25
11.	Taxes	26
12.	VAT	28
13.	Tax Receipts	28
14.	Increased Costs	28
15.	Illegality	30
16.	Mitigation	30
17.	Representations and Warranties	31
18.	Financial Information	32
19.	Financial Covenants	34
20.	Covenants	37
21.	Events of Default	39
22.	Fees	42
23.	Costs and Expenses	43
24.	Indemnity and Break Costs	44
25.	Payments	45
26.	Sharing	47
27.	The Facility Agent, the Security Agent, the Arrangers and the Lenders	48
28.	Assignments and Transfers	53
29.	Calculations and Evidence of Debt	55
30.	Remedies and Waivers, Partial Invalidity	56
31.	Notices	56
32.	Counterparts	59
33.	Amendments	59
34.	Hermes Guarantee	60
35.	Non Applicability of Section 181 BGB	60
36.	Governing Law	60
37.	Jurisdiction	60
38.	Language	61
	Schedule 1 The Original Lenders	63
	Schedule 2 Form of Transfer Agreement	64
	Schedule 3 Conditions Precedent	67
	Schedule 4 Form of Drawdown Request	70
	Schedule 5 Form of Selection Notice	72
	Schedule 6 Form of Compliance Certificate	73
	Schedule 7 Authorisations	74
	Schedule 8 Form of Starting Point Confirmation	75
	Schedule 9 Form of Repayment Schedule	76
	Schedule 10 Conditions Subsequent	77

THIS AGREEMENT is made on 3 August 2011 (the"Agreement")

BETWEEN

(1) FIRST SOLAR MALAYSIA SDN. BHD. (Company No. 758827-T), a company limited by shares, incorporated, organised and validly existing under the laws of Malaysia, having its registered place of business at 8, Jalan Hi-Tech 3/3, Zoon Industri Fasa 3, Kulim Hi-Tech Park 09000 Kulim, Kedah Darul Aman, Malaysia (the "Borrower");

(2) COMMERZBANK AKTIENGESELLSCHAFT, (in its capacity as "Arranger 1"),

(3) COMMERZBANK AKTIENGESELLSCHAFT, Luxembourg Branch, (in its capacity as "Facility Agent" and "Security Agent");

(4) Natixis Zweigniederlassung Deutschland, (in its capacity as "Arranger 2" and together with the Arranger1 referred to as the "Arrangers"); and

(5) THE PERSONS listed in Schedule 1 (The Original Lenders) (each an "Original Lender" and together the "Original Lenders").

WHEREAS

(A) In view of its business development in Asia, First Solar Inc., Tempe, Arizona, incorporated in Delaware, United States of America (the "Sponsor") took out in May 2008 through the Borrower as its indirect subsidiary an export financing guaranteed by the Federal Republic of Germany under its credit insurance scheme, in relation to the construction of four solar module manufacturing plants in Malaysia (KLM I to KLM IV).

(B) In light of further expanding its solar module business, the Sponsor asked the Arrangers to arrange additional export financing, intended to be guaranteed by the Federal Republic of Germany under its credit insurance scheme in relation to the construction of two solar module manufacturing plants consisting of eight lines (= 445.6 MW) ("KLM V" and "KLM VI", respectively, each a "KLM" and together the "KLMs") in Malaysia (the "Project").

(C) The KLMs will produce First Solar CdTe solar modules intended to be sold primarily in the EU, US and Asian markets. The Project will require an estimated capital investment of USD 365 million in equipment and real estate. The Project's infrastructure is fully developed with new roads and a seaport nearby.

(D) The Project will be owned and operated by the Borrower. The Project commenced construction in January 2010. KLM V and KLM VI are expected to reach full volume production by the second calendar quarter of 2011 and the third calendar quarter of 2011, respectively.

(E) The two main components of the KLMs, the semiconductor coater and metalizer as well as the conveyor (each together with the other goods and services to be provided under the Supply Contracts (as defined below) and any of them being referred to as the "Equipment") are, inter alia, to be provided under the relevant Supply Contracts by the German suppliers von Ardenne Anlagentechnik GmbH, Dresden, Germany (the "Exporter A"), Gebr. Schmid GmbH & Co., Freudenstadt, Germany (the "Exporter B"), Bürkle North America Inc., California, United States of America (the "Exporter C") and Olbricht Glastechnik-Huttentechnik, Hamminkeln, Germany (the "Exporter D" and together with Exporter A, B and C, the "Exporters").

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(F) The Equipment shall be delivered by the Exporters under the terms of the Supply Contracts.

(G) It is intended that the Project benefits from cover by (i) the ECA-Guarantor (as defined below) under the Hermes Guarantee (as defined below) and (ii) the Sponsor under the Sponsor's Guarantee (as defined below).

(H) The Original Lenders have agreed to make available to the Borrower a facility of up to EUR 60,000,000 to partially finance the supply and construction of the Equipment and certain finance costs.

IT IS AGREED as follows:

1. DEFINITIONS AND INTERPRETATION

1.1 Definitions

In this Agreement:

"Advance" means an advance (as from time to time consolidated, divided or reduced by repayment or prepayment in accordance with the terms thereof) made or to be made by the Lenders under the Facilities.

"Advisors" means the Legal Advisors and/or any other adviser of the Lenders specified in writing by the Facility Agent and the Borrower as such for the purposes of this Agreement.

"Annualised Debt Service" has the meaning ascribed thereto in Clause 19.1 (Financial Definitions).

"Annualised DSCR" has the meaning ascribed thereto in Clause 19.1 (Financial Definitions).

"Annualised EBITDA" has the meaning ascribed thereto in Clause 19.1 (Financial Definitions).

"Annualised Net Interest Expense" has the meaning ascribed thereto in Clause 19.1 (Financial Definitions).

"Assignment" has the meaning ascribed thereto in Clause 28.3(a) (Assignment and Transfers by the Lenders).

"Auditor" means any of Ernst & Young, KPMG, PricewaterhouseCoopers or Deloitte & Touche or such other firm of independent auditors of international good standing nominated by the Borrower.

"Authorisations" means any consent, registration, filing, notarisation, certificate, licence, approval, permit, confirmation, no-objection or exemption from or by or with any national, regional, administrative, fiscal or governmental body, commission, agency, authority or similar entity and all creditors' and shareholders' consents or approvals required (i) to ensure the timely transfer of all amounts due under this Agreement; (ii) for the implementation and operation of the Project; and (iii) for the valid and binding execution and implementation of this Agreement and the Security Documents, or any part thereof, including, but not limited to, the items set out in Schedule 7 (Authorisations).

"Authorised Signatory" means, in relation to the Borrower, any person who is duly authorised and in respect of whom the Facility Agent has received a certificate signed by a director or another Authorised Signatory of the Borrower setting out the name and signature of such person and

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confirming such person's authority to act.

"Availability Period" means the period from and including the date of this Agreement to and including the respective Final Availability Date.

"Available Commitment I" means, in relation to a Lender at any time and save as otherwise provided herein, its Commitment under Facility I less the aggregate amount which it has advanced under Facility I at such time.

"Available Commitment II" means, in relation to a Lender at any time and save as otherwise provided herein, its Commitment under Facility II less the aggregate amount which it has advanced under Facility II at such time.

"Available Commitment III" means, in relation to a Lender at any time and save as otherwise provided herein, its Commitment under Facility III less the aggregate amount which it has advanced under Facility III at such time.

"Available Commitments" means Available Commitment I, Available Commitment II and Available Commitment III and "Available Commitment" means any of them.

"Available Facility I" means, at any time, the aggregate amount of the Available Commitment I adjusted in the case of any proposed drawdown so as to take into account any reduction in the Available Commitment I of a Lender pursuant to the terms hereof.

"Available Facility II" means, at any time, the aggregate amount of the Available Commitment II adjusted in the case of any proposed drawdown so as to take into account any reduction in the Available Commitment II of a Lender pursuant to the terms hereof.

"Available Facility III" means, at any time, the aggregate amount of the Available Commitment III adjusted in the case of any proposed drawdown so as to take into account any reduction in the Available Commitment III of a Lender pursuant to the terms hereof.

"Available Facilities" means Available Facility I, Available Facility II and Available Facility III and "Available Facility" means any of them.

"BGB" means the German Civil Code (Bürgerliches Gesetzbuch).

"Break Costs" means any costs arising pursuant to Clause 24.2 (Break Costs).

"Budget" means the annual budget for a Financial Year in relation to the Borrower prepared by the management of the Borrower including, but not limited to, a detailed calculation of the DSCR in this respect to be determined as a forecast for such Financial Year, applying the principles as set out in Clause 19 (Financial Covenants) but on a forecast basis, in form and substance satisfactory to the Facility Agent as updated from time to time in accordance with this Agreement.

"Business Day" means a day (other than a Saturday or Sunday or December 31) which is not a public holiday and on which banks are open for general business in:

(a) Frankfurt am Main, Germany, Luxembourg, New York, United States of America and Kuala Lumpur, Malaysia; and

(b) (in relation to any date for the rate fixing of, or the payment or purchase of, a sum denominated

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in euro and in addition to the days set out in (a) above) any day on which the Trans-European Automated Real-time Gross settlement Express Transfer (TARGET) system is operating.

"CAFDS"has the meaning ascribed thereto in Clause 19.1 (Financial Definitions).

"Capital Expenditure" has the meaning ascribed thereto in Clause 19.1 (Financial Definitions).

"Commitment" means:

(a) in relation to an Original Lender, at any time and save as otherwise provided for herein, the amount allocated to its name in Schedule 1 (The Original Lenders) as reduced by any assignments/transfers in accordance with this Agreement or as specified in the relevant Transfer Agreement(s); and

(b) in relation to any other Lender, the amount of any Commitment assigned/transferred in accordance with this Agreement or as specified in the relevant Transfer Agreement(s),

to the extent not cancelled or reduced hereunder.

"Compliance Certificate" means a certificate substantially in the form set out in Schedule 6 (Form of Compliance Certificate).

"Conditions Precedent" means the conditions precedent set out in Schedule 3 (Conditions Precedent).

"Contract Value" means any of Contract Value Ardenne V, Contract Value Ardenne VI, Contract Value Schmid V, Contract Value Schmid VI, Contract Value Bürkle V, Contract Value Bürkle VI, Contract Value Olbricht V, Contract Value Olbricht VI.

"Contract Value Ardenne V" means EUR 28,438,607.50.

"Contract Value Ardenne VI" means EUR 34,035,467.50.

"Contract Value Bürkle V" means EUR 1,037,719.98.

"Contract Value Bürkle VI" means EUR 1,037,719.98.

"Contract Value Olbricht V" means EUR 325,000.00.

"Contract Value Olbricht VI" means EUR 325,000.00.

"Contract Value Schmid V" means EUR 2,224,914.01.

"Contract Value Schmid VI" means EUR 2,364,415.61.

"Contract Values" means the aggregate of Contract Values KLM V and the aggregate of the Contract Values KLM VI.

"Contract Values KLM V" means the aggregate of Contract Value Ardenne V, Contract Value Schmid V, Contract Value Bürkle V and Contract Value Olbricht V.

"Contract Values KLM VI" means the aggregate of Contract Value Ardenne VI, Contract Value

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Schmid VI, Contract Value Bürkle VI and Contract Value Olbricht VI.

"Debtor Relief Laws" means any liquidation, conservatorship, bankruptcy, assignment for the benefit of creditors, moratorium, rearrangement, receivership, insolvency, reorganization, or similar debtor relief laws (including, but not limited to, the Bankruptcy Code of the United States of America) of any applicable jurisdictions (including, but not limited to the United States of America and Malaysia) from time to time in effect and affecting the rights of creditors generally.

"Debt Service" has the meaning ascribed thereto in Clause 19.1 (Financial Definitions).

"Drawdown Date" means the date for which drawdown of an Advance is requested and specified in the applicable Drawdown Request or on which an Advance is being made in accordance with Clause 3.2(b).

"Drawdown Request" means a request in writing from the Borrower to the Facility Agent for the occurrence of a Utilisation under the Facilities substantially in the form set out in Schedule 4 (Form of Drawdown Request).

"DSCR" has the meaning ascribed thereto in Clause 19.1 (Financial Definitions).

"EBITDA" has the meaning ascribed thereto in Clause 19.1 (Financial Definitions).

"ECA-Fees" means the fees to be paid to the ECA-Guarantor under or in connection with the Hermes Guarantee.

"ECA-Fee Shortfall" means any shortfall of the loan amount available to meet the relevant ECA-Fees against the actual aggregate amount of the relevant ECA-Fees as invoiced by the ECA-Guarantor with its final invoice.

"ECA-Guarantor" means Euler Hermes Kreditversicherungs-AG, Hamburg, Federal Republic of Germany.

"Encumbrance" means a mortgage, pledge, lien, charge, hypothecation, security interest, title retention, preferential right or trust arrangement, obligations under leasing agreements and conditional purchase agreements, and any other collateral agreement or similar arrangement whether on existing or future assets.

"Environmental Claim" means any claim, notice, prosecution, demand, action, official warning, abatement or other order (conditional or otherwise) relating to, or any notification or order requiring compliance with, any Environmental Law or Environmental Permits.

"Environmental Law" means any law applicable to the Project and the Borrower which relates to the pollution or protection of the environment or harm to or the protection of human health or the health of animals or plants.

"Environmental Permits" means any authorisation required under any Environmental Law for the construction or operation of the Project and business of the Borrower conducted on or from the premises owned or used by the Borrower in connection with the Project.

"Equipment" means the entirety of the goods and services to be provided by the Exporters under the Supply Contracts.

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"EURIBOR" means in relation to any amount to be advanced to, or owing by, the Borrower hereunder in euro on which interest for a given period is to accrue:

(a) the percentage rate per annum equal to the offered quotation which appears on the page of the Reuters Screen which displays an average rate of the Banking Federation of the European Union for euro (being currently page EURIBOR) for such period at or about 11.00 a.m. (Brussels time) on the Quotation Date for such period or, if such page or service shall cease to be available, such other page or such other services used for the purpose of displaying an average rate of the Banking Federation of the European Union as the Facility Agent, after consultation with the Borrower, shall select; or

(b) if no quotation for the euro for the relevant period is displayed and the Facility Agent has not selected an alternative service on which a quotation is displayed, the arithmetic mean (rounded upwards to four decimal places) of the rates (as notified to the Lenders) at which each of the Reference Banks was offering to prime banks in the European interbank market deposits in the euro of an equivalent amount and for such period at or about 11.00 a.m. (Brussels time) on the Quotation Date.

"Event of Default" means any circumstance described as such in Clause 21 (Events of Default).

"Facilities" means each of Facility I, Facility II and Facility III and "Facility" means any of them.

"Facility I" means the euro term loan facility granted to the Borrower as described in Clause 2.1(a) (Grant of the Facilities).

"Facility II" means the euro term loan facility granted to the Borrower as described in Clause 2.1(b) (Grant of the Facilities).

"Facility III" means the euro term loan facility granted to the Borrower as described in Clause 2.1(c) (Grant of the Facilities).

"Facility I Loan" means, at any time, the aggregate principal amount of the outstanding Advances under Facility I.

"Facility II Loan" means, at any time, the aggregate principal amount of the outstanding Advances under Facility II.

"Facility III Loan" means, at any time, the aggregate principal amount of the outstanding Advances under Facility III.

"Facility Office" means, in relation to the Facility Agent, the office identified with its signature below or such other office as it may select by notice and, in relation to any Lender, the office(s) notified by it to the Facility Agent in writing prior to the date hereof (or, in the case of a Transferee, at the end of the Transfer Agreement to which it is a party as Transferee) or such other office(s) as it may from time to time select by notice to the Facility Agent.

"Fee Letter" means the letter between the Facility Agent and the Borrower setting out the fees referred to in Clause 22.3 (Agency Fee).

"Final Availability Date I" means in respect of Facility I the earlier of (a) the date when the Available Facility I is zero and (b) 25 November 2011.

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"Final Availability Date II" means in respect of Facility II the earlier of (a) the date when Available Facility II is zero and (b) 25 November 2011.

"Final Availability Date III" means in respect of Facility III the earlier of (a) the date when the Available Facility III is zero and (b) 25 November 2011.

"Final Availability Date" means the Final Availability Date I, the Final Availability Date II and the Final Availability Date III.

"Finance Documents" means:

(a) this Agreement;

(b) the Subordination Agreement;

(c) the Fee Letter;

(d) the Security Documents; and

(e) any other document designated as such by the Facility Agent and agreed by the Borrower.

"Finance Parties" means the Lenders, the Arrangers, the Facility Agent and the Security Agent.

"Financial Covenant" means any of the covenants set out in Clause 19 (Financial Covenants).

"Financial Indebtedness" means any indebtedness for or in respect of:

(a) moneys borrowed;

(b) any amount raised by acceptance under any acceptance credit facility or dematerialised equivalent;

(c) any amount raised pursuant to any note purchase facility or the issue of bonds, notes, debentures, loan stock or any similar instrument;

(d) the amount of any liability in respect of any lease or hire purchase contract which would, in accordance with generally accepted accounting principles applicable to a Borrower, be treated as a finance or capital lease;

(e) receivables sold or discounted (other than any receivables to the extent they are sold on a non-recourse basis);

(f) any amount raised under any other transaction (including any forward sale or purchase agreement) having the commercial effect of a borrowing;

(g) any derivative transaction entered into in connection with protection against or benefit from fluctuation in any rate or price (and, when calculating the value of any derivative transaction, only the marked to market value shall be taken into account);

(h) any counter-indemnity obligation in respect of a guarantee, indemnity, bond, standby or documentary letter of credit or any other instrument issued by a bank or financial institution; and

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(i) the amount of any liability in respect of any guarantee or indemnity for any of the items referred to in paragraphs (a) to (h) above.

"Financial Year" means the calendar year.

"First Repayment Date" means the earlier of (i) the day of the month falling six months after the Starting Point; and (ii) the Ultimate First Repayment Date, unless such day is not a Business Day, in case of which the First Repayment Date shall be the next Business Day in that calendar month (if there is one) or the preceding Business Day (if there is not).

"First Solar Group" means the Sponsor and its Subsidiaries.

"German Process Agent" means First Solar Manufacturing GmbH, Marie-Curie-Strasse 3, 15236 Frankfurt (Oder).

"Hermes Guarantee" means the guarantee, in form and substance satisfactory to the Facility Agent, issued or to be issued to the Lenders by the Federal Republic of Germany, represented by the ECA-Guarantor, in respect of the Facilities covering 95 per cent. of the commercial and political risk under this Agreement (upon the terms and conditions set forth in the final guarantee confirmation (endgültige Indeckungsnahmeerklärung) and the finance credit guarantee declaration (Finanzkreditgarantieerklärung) together with the general conditions (Allgemeine Bedingungen – Garantien für gebundene Finanzkredite (FKG)).

"Increased Costs" has the meaning ascribed thereto in Clause 14.1 (Increased costs).

"IFRS" means the International Financial Reporting Standards formulated by the International Accounting Standards Board.

"Insurance Proceeds" means any and all amounts payable in consequence of a claim under the Insurances.

"Insurances" has the meaning ascribed thereto in Clause 20.1(m) (Insurance).

"Interest Payment Date" means in relation to a Loan the last day of each Interest Period.

"Interest Period" means, in relation to a Loan, each period determined in accordance with Clause 4.1 (Interest Periods) and, in relation to any amount due and payable but unpaid by the Borrower under the Finance Documents, each period determined in accordance with Clause 4.4 (Default Interest).

"Interest Rate" means the interest rate pursuant to Clause 5.1 (Interest Rate).

"Legal Advisors" means Clifford Chance Partnerschaftsgesellschaft, Frankfurt am Main, Germany, Clifford Chance US LLP, New York, NY, USA and Chooi & Company, advocates & solicitors, Kuala Lumpur, Malaysia.

"Lender" means

(a) any Original Lender; and

(b) any financial institution (or other person) which has become a party hereto in accordance with

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Clause 28.3 (Assignments and Transfers by Lenders), and which has not ceased to be a party hereto in accordance with the terms hereof.

"Loans" means the Facility I Loan, the Facility II Loan and the Facility III Loan and "Loan" means any of them.

"Majority Lenders" means:

(a) before any Advances have been made, a Lender or Lenders whose Available Commitments amount in aggregate to more than sixty-six and two thirds per cent. of the Available Facilities; and

(b) thereafter, a Lender or Lenders to whom in aggregate more than sixty-six and two thirds per cent. of the Loans is (or, immediately prior to its final repayment, was then) owed.

"Margin" means 1.00 per cent. per annum.

"MASB" means the Malaysian Accounting Standards Board.

"Material Adverse Effect" means a material adverse effect on (a) the business, operations, assets, financial condition or results of operations of the Borrower which could be expected to impair the Borrower's ability to perform its obligations under this Agreement or (b) the validity or enforceability of or the effectiveness or ranking of any security interest granted, or purported to be granted, to the Finance Parties.

"Net Interest Expense" has the meaning ascribed thereto in Clause 19.1 (Financial Definitions).

"Original Financial Statements" means the audited financial statements of the Borrower for its Financial Year ended 31 December 2009.

"Parties" means the parties to this Agreement.

"Permitted Disposal" means:

(a) any disposal created in favour of the Lenders and/or the Security Agent pursuant to any Security Document;

(b) any disposal where the assets being disposed of are replaced by assets serving a similar purpose and having a fair market value substantially equal to or greater than the fair market value of the asset being disposed of;

(c) any disposal made in relation to the Equipment for a consideration of less than USD 15,000,000 (or its equivalent in any other currency) in aggregate per year;

(d) any disposal made in the ordinary course of the Borrower's business on a commercial arm's length basis; or

(e) any disposal created with the prior written consent of the Majority Lenders.

"Permitted Encumbrance" means:

(a) any Encumbrance created in favour of the Lenders and/or the Security Agent pursuant to any

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Security Document;

(b) retention of title clauses (i) in the Supply Contracts or (ii) in suppliers' standard terms and conditions of business in respect of contracts entered into in the ordinary course of the Borrower's day to day business;

(c) any lien arising by operation of law or in the ordinary course of the Borrower's business;

(d) any lien for Taxes not yet due or which are being contested in good faith by appropriate proceedings; or

(e) any Encumbrance created with the prior written consent of the Majority Lenders.

"PERS" means Private Entity Reporting Standards, being the official reporting standards applicable to the Borrower.

"Potential Event of Default" means any of the events referred to in Clauses 21.1(a) (Payment Obligations) and 21.1(c) (Covenants) to the extent it relates to the breach of a Financial Covenant, which with the giving of notice, passage of time or fulfilment of any condition, in each case as prescribed by the relevant aforementioned Clause (or any combination thereof) would become an Event of Default.

"Prepayment Notice" has the meaning ascribed thereto in Clause 9.2 (Prepayment).

"Project Documents" means:

(a) the Supply Contracts, including any of its (executed) schedules;

(b) any purchase order entered into pursuant to the Supply Contracts (for the avoidance of doubt, other than the Purchase Orders);

(c) any document which amends or varies any document referred to in paragraphs (a) through (b) above; and

(d) any other document designated as such by the Facility Agent and agreed by the Borrower.

"Purchase Order Bürkle V" means the purchase order agreement between Exporter C and the Borrower dated March 26, 2010 with regard to four AKLE-L700 Coating Systems, four TRDUE Dryer Ovens, four electric cabinets and four UV exposure systems and related services.

"Purchase Order Bürkle VI" means the purchase order agreement between Exporter C and the Borrower dated March 26, 2010 with regard to four AKLE-L700 Coating Systems, four TRDUE Dryer Ovens, four electric cabinets and four UV exposure systems and related services.

"Purchase Order Olbricht V" means the purchase order agreement between Exporter D and the Borrower dated April 22, 2010, with regard to four double sided glass loaders and related services.

"Purchase Order Olbricht VI" means the purchase order agreement between Exporter D and the Borrower dated April 22, 2010, with regard to four double sided glass loaders and related services.

"Purchase Orders" means the Purchase Order Bürkle V, the Purchase Order Bürkle VI, the Purchase Order Olbricht V and the Purchase Order Olbricht VI.

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"Quotation Date" means with respect to any Interest Period in relation to an Advance made or to be made in relation to a Facility, the day which is two (2) Business Days prior to the commencement of such Interest Period.

"Ratio Calculation Date" means each date in respect of which the financial covenants according to Clause 19 (Financial Covenants) are calculated and which is identical to the end of each quarter of each Financial Year.

"Reference Banks" means Commerzbank Aktiengesellschaft, Frankfurt am Main, Deutsche Bank AG, Frankfurt am Main, Société Générale S.A., Paris, and Crédit Agricole, Paris.

"Reference Rate" means the average of the percentage rates quoted by the Reference Banks as their cost of funding for the relevant amount and for the relevant period from whatever source each of them may reasonably select.

"Repayment Date" means each of the fourteen (14) semi-annual payment dates referred to in Clause 8.1 (Repayment Instalments) beginning with the First Repayment Date and in each case the Business Day falling six (6) months thereafter as well as each subsequent date which is by its numbering equal to these dates in any calendar year thereafter provided that if such date is not a Business Day, it shall be deemed to be the immediately next Business Day in the same calendar month (if there is one) or the preceding Business Day (if there is none).

"Repayment Schedule" means a repayment schedule substantially in the form set out in Schedule 9 (Form of Repayment Schedule) as updated from time to time by the Facility Agent in accordance with this Agreement.

"Repeated Representations and Warranties" means each of the representations and warranties referred to in Clause 17.2 (Repetition).

"Robert Bürkle GmbH" means Robert Bürkle GmbH a limited liability company (Gesellschaft mit beschränkter Haftung), registered in the commercial register (Handelsregister) of the local court (Amtsgericht) of Stuttgart under HRB 430840.

"Security" means a mortgage, charge, pledge, lien or other security interest securing any obligation of any person or any other agreement or arrangement having a similar effect.

"Security Documents" means:

(a) the Sponsor's Guarantee;

(b) any documents entered into pursuant to, or which amends or varies, the document referred to in paragraph (a) above; and

(c) any other document designated as such by the Facility Agent and agreed by the Borrower.

"Selection Notice" means a selection in writing from the Borrower to the Facility Agent of an Interest Period for one or more Advances substantially in the form set out in Schedule 5 (Form of Selection Notice).

"Shareholders" means the direct shareholders of the Borrower, being at the date of this Agreement First Solar FE Holdings Pte Ltd., a limited liability company formed under the laws of Singapore.

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"Shares" means the issued and voting share capital from time to time of the Borrower.

"Sponsor" means First Solar Inc., a corporation formed under the laws of the State of Delaware having a principal place of business in Tempe, Arizona, United States of America.

"Sponsor's Guarantee" means the first demand guarantee subject to New York State law dated on or about the date hereof between the Sponsor and the Lenders including, but not limited to, an undertaking to (i) pay on first written demand any amount necessary to discharge the Borrower's payment obligations outstanding under any of the Finance Documents from time to time in full, (ii) directly or indirectly own more than 50 per cent. of the entire issued share capital of the Borrower, (iii) to keep direct or indirect control over the Borrower and (iv) not to create or permit or subsist any security interest over any of its shares in the Borrower.

"Starting Point" means the date of readiness of KLM V and KLM VI for operation as confirmed by the Starting Point Confirmation.

"Starting Point Confirmation" means the confirmation in writing by the Borrower to the Facility Agent confirming the readiness of KLM V and KLM VI for operation in form and substance as provided for in Schedule 8 (Form of Starting Point Confirmation).

"Subordination Agreement" means the subordination agreement dated on or about the date hereof between the Borrower, the junior creditors referred to therein and the Facility Agent.

"Subsidiary" means in relation to any partnership, company or corporation, a partnership, company or corporation:

(a) which is controlled, directly or indirectly, by the first mentioned partnership, company or corporation;

(b) more than half of the issued share capital in which is beneficially owned, directly or indirectly by the first mentioned partnership, company or corporation; or

(c) which is a Subsidiary of another Subsidiary of the first mentioned partnership, company or corporation,

and for this purpose, a partnership, company or corporation shall be treated as being controlled by another if that other partnership, company or corporation is able to direct its affairs and/or to control the composition of its board of directors or equivalent body.

"Supply Contracts Ardenne V" means

(a) the equipment and purchase agreement entered into between Exporter A and the Borrower dated 4 February 2010 with regard to four GC 60 V – Vertical Inline Spurter Systems systems (Metalizer) and related services relating to KLM V; and

(b) the equipment and purchase agreement entered into between Exporter A and the Borrower dated 4 February 2010 with regard to four GC 60 H – CdS/CdTe Coating Systems (Semiconductor Coater) and related services relating to KLM V.

"Supply Contracts Ardenne VI" means

(a) the equipment and purchase agreement entered into between Exporter A and the Borrower

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dated 4 February 2010 with regard to four GC 60 V – Vertical Inline Spurter Systems systems (Metalizer) and related services relating to KLM VI; and

(b) the equipment and purchase agreement entered into between Exporter A and the Borrower dated 4 February 2010 with regard to four GC 60 H – CdS/CdTe Coating Systems (Semiconductor Coater) and related services relating to KLM VI.

"Supply Contract Schmid V" means the equipment and purchase agreement entered into between Exporter B and the Borrower dated 12 March 2010 with regard to two Acid Etch Line A, two Acid Etch Line B, two NPR Washer/Develop System Line A, two NPR Wascher/Develop System Line B, two CuCl Etch System Line A and two CuCl Etch System Line B relating to KLM V.

"Supply Contract Schmid VI" means the equipment and purchase agreement entered into between Exporter B and the Borrower dated 12 March 2010 with regard to two Acid Etch Line A, two Acid Etch Line B, two NPR Washer/Develop System Line A, two NPR Wascher/Develop System Line B, two CuCl Etch System Line A and two CuCl Etch System Line B relating to KLM VI.

"Supply Contracts V" means Supply Contracts Ardenne V, Supply Contract Schmid V, Purchase Order Bürkle V and Purchase Order Olbricht V and "Supply Contract V" means any of them.

"Supply Contracts VI" means Supply Contracts Ardenne VI, Supply Contract Schmid VI, Purchase Order Bürkle VI and Purchase Order Olbricht VI and "Supply Contract VI" means any of them.

"Supply Contracts" means Supply Contracts V and Supply Contracts VI and "Supply Contract" means any of them.

"Tax" means any tax, levy, impost, duty or other charge or withholding of a similar nature in any jurisdiction (including any penalty, fine or interest payable in connection with any failure to pay or any delay in paying any of the same).

"Total Debt" has the meaning ascribed thereto in Clause 19.1 (Financial Definitions).

"Total Equity" has the meaning ascribed thereto in Clause 19.1 (Financial Definitions).

"Transaction Documents" means the Finance Documents and the Project Documents.

"Transfer" has the meaning ascribed thereto in Clause 28.3(a) (Assignment and Transfers by the Lenders).

"Transfer Agreement" means the transfer agreement referred to in Schedule 2 (Form of Transfer Agreement).

"Transferee" means a person to which a Lender seeks to assign or transfer all or part of such Lender's rights, benefits and/or obligations under the Finance Documents (as more specifically referred to in Clause 28.3(a) (Assignment and Transfers by the Lenders)).

"Transferor" has the meaning ascribed thereto in Clause 28.3(a) (Assignment and Transfers by the Lenders).

"Ultimate Final Availability Date" means the date which is the later of

(a) the Final Availability Day I;

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(b) the Final Availability Day II; and

(c) the Final Availability Day III.

"Ultimate First Repayment Date" means 25 May 2012.

"US GAAP" means the generally accepted accounting principles in the United States of America consistent with those utilised in preparing the audited financial statement referred to in Clause 18.1(c) (Audited Annual Accounts).

"Utilisation" means the making of an Advance under a Facility.

1.2 Interpretation

Any reference in this Agreement to:

(a) any "Lender", the "Facility Agent", the "Arrangers", the "Security Agent", and any other person shall be construed so as to include its and any subsequent successors and permitted transferees in accordance with their respective interests;

(b) any reference to "amend" includes an alteration, variation, supplement, accession, transfer, novation, release, replacement or re-enactment and cognate expressions shall be construed accordingly;

(c) references to "assets" shall include all or any part of a person's present or future business, undertaking, property, assets, benefits, rights and revenues (and includes any right to recover or receive any of the foregoing);

(d) "continuing" in relation to an Event of Default, shall be construed as a reference to an Event of Default which has not been remedied or waived in accordance with the terms hereof, and in relation to a Potential Event of Default, one which has not been remedied within the relevant grace period or waived in accordance with the terms hereof;

(e) a "disposal" of any asset or obligation includes any sale, transfer, exchange, lease, licence, lending-out, assignment, surrender, dispossession, set-off against or release thereof and cognate expressions shall be construed accordingly;

(f) "dividend" includes any payment or transfer (whether in cash, specie, kind or otherwise) made by way of dividend, bonus, return on capital, repayment of capital contributions or similar rights of equity distribution other than pursuant to a winding-up;

(g) the "equivalent" on any date in one currency (the "first currency") of an amount denominated in another currency (the "second currency") is a reference to the amount of the first currency which could on a given date be purchased with the amount of the second currency at the spot rate of exchange quoted in the relevant currency exchange market at or about 12.00 noon on such date for the purchase of the first currency with the second currency;

(h) "indebtedness" shall be construed so as to include any obligation (whether incurred as principal or as surety) for the payment or repayment of money, whether present or future, actual or contingent;

(i) any reference to an account being "interest bearing" shall mean bearing such rate of interest

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as may be agreed from time to time between the depositor and the depositee (to be determined, where reasonably practicable, by reference to rates offered by such depositee to customers of equivalent size and financial standing to that of the relevant depositor and by reference to deposits of the same currency, of a similar size and of a similar maturity period to that of the relevant deposited amount);

(j) a "law" shall be construed as any law (including common or customary law), statute, constitution, decree, judgment, treaty, regulation, directive, by-law, order or any other legislative measure of any government, supranational, local government, statutory or regulatory body or court;

(k) a "month" is a reference to a period starting on one day in a calendar month and ending on the numerically corresponding day in the next succeeding calendar month save that:

(i) if any such numerically corresponding day is not a Business Day, such period shall end on the immediately succeeding Business Day to occur in that next succeeding calendar month or, if none, it shall end on the immediately preceding Business Day; and

(ii) if there is no numerically corresponding day in that next succeeding calendar month, that period shall end on the last Business Day in that next succeeding calendar month,

(and references to "months" shall be construed accordingly);

(l) a "person" shall be construed as a reference to any person, firm, company, corporation, government, state or agency of a state or any association or partnership (whether or not having separate legal personality) of two or more of the foregoing;

(m) "repay" (or any derivative form thereof) shall, subject to any contrary indication, be construed to include "prepay" (or, as the case may be, the corresponding derivative form thereof);

(n) a "successor" shall be construed so as to include an assignee or successor in title of such party and any person who under the laws of its jurisdiction of incorporation or domicile has assumed the rights and obligations of such party under this Agreement or to which, under such laws, such rights and obligations have been transferred;

(o) "terminates" shall be construed to include where a person avoids, cancels, repudiates, revokes, rescinds, suspends, terminates or withdraws a permission, document or contract or any material part thereof;

(p) "VAT" shall be construed as a reference to value added tax including any similar tax which may be imposed in place thereof from time to time; and

(q) the "winding-up", "dissolution" or "administration" of a company or corporation shall be construed so as to include any equivalent or analogous proceedings under the law of the jurisdiction in which such company or corporation is incorporated or any jurisdiction in which such company or corporation carries on business including the seeking of liquidation, winding-up, reorganisation, dissolution, administration, arrangement, adjustment, protection or relief of debtors.

1.3 Currency Symbols

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"€", "EUR" and "euro" denote the single currency unit of the European Union as constituted by the Treaty on European Union as referred to in EMU legislation and "USD" denotes the currency unit of the United States of America.

1.4 Agreements and Statutes

Any reference in this Agreement to:

(a) this Agreement or any other agreement or document shall be construed as a reference to this Agreement or, as the case may be, such other agreement or document as the same may have been, or may from time to time be, amended in accordance with the terms of such document and of this Agreement; and

(b) a statute or treaty shall be construed as a reference to such statute or treaty as the same may have been, or may from time to time be, amended or, in the case of a statute, re-enacted.

1.5 Headings

Clause and Schedule headings are for ease of reference only.

1.6 Time

Any reference in this Agreement to a time of day shall, unless a contrary indication appears, be a reference to German time (CET).

1.7 Plurals

Unless otherwise indicated herein, any reference to the plural includes the singular and any reference to the singular includes the plural.

1.8 German Law Principle of Reasonableness/Good Faith (Treu und Glauben)

The Parties agree that the German statutory law principle of reasonableness/good faith (Treu und Glauben) shall apply to this Agreement.

2. THE FACILITIES

2.1 Grant of the Facilities

The Lenders grant to the Borrower, upon the terms and subject to the conditions hereof:

(a) a euro denominated term loan facility in a maximum aggregate amount of up to EUR 27,119,313 (the "Facility I");

(b) a euro denominated term loan facility in a maximum aggregate amount of up to EUR 31,995,220 (the "Facility II"); and

(c) a euro denominated term loan facility in a maximum aggregate amount of up to EUR 885,467 (the "Facility III");

in aggregate, however, not exceeding EUR 60,000,000.

2.2 Purpose and Application

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(a) The Facility I is exclusively intended to finance the payment of:

(i) up to such 85% (per cent.) of Contract Value Ardenne V that remain payable to Exporter A by the Borrower after the Borrower has effected a payment of at least 15% (per cent.) of Contract Value Ardenne V;

(ii) up to such 85% (per cent.) of Contract Value Schmid V that remain payable to Exporter B by the Borrower after the Borrower has effected a payment of at least 15% (per cent.) of Contract Value Schmid V;

(iii) up to such 75,08% (per cent.) of Contract Value Bürkle V that remain payable to Exporter C by the Borrower after the Borrower has effected a payment of at least 15% (per cent.) of Contract Value Bürkle V; and

(v)    up to such 85% (per cent.) of Contract Value Olbricht V that remain payable to Exporter D by the Borrower after the Borrower has effected a payment of at least 15% (per cent.) of Contract Value Olbricht V.

(b) The Facility II is exclusively intended to finance the payment of:

(i) up to such 85% (per cent.) of Contract Value Ardenne VI that remain payable to Exporter A by the Borrower after the Borrower has effected a payment of at least 15% (per cent.) of Contract Value Ardenne VI;

(ii) up to such 85% (per cent.) of Contract Value Schmid VI that remain payable to Exporter B by the Borrower after the Borrower has effected a payment of at least 15% (per cent.) of Contract Value Schmid VI;

(iii) up to such 75,08% (per cent.) of Contract Value Bürkle VI that remain payable to Exporter C by the Borrower after the Borrower has effected a payment of at least 15% (per cent.) of Contract Value Bürkle VI; and

(iv) up to such 85% (per cent.) of Contract Value Olbricht VI that remain payable to Exporter D by the Borrower after the Borrower has effected a payment of at least 15% (per cent.) of Contract Value Olbricht VI.

(c) The Facility III is exclusively intended to finance the payment of up to 100 per cent. of the ECA-Fees.

(d) All amounts granted under Clause 2.1 shall be applied in or towards satisfaction of the Borrower's financing requirements as set out above by making Advances:

(i) under Facility I to the Borrower for reimbursement to the Borrower of amounts (other than the payment of at least 15% (per cent.) of the Contract Value of the Supply Contracts V) due under the terms of the Supply Contracts V or any of them and effected by the Borrower to the relevant Exporter out of own funds of the Borrower;

(ii) under Facility II to the Borrower for reimbursement to the Borrower of amounts (other than the payment of at least 15% (per cent.) of the Contract Value of the Supply Contracts VI) due under the terms of the Supply Contracts VI or any of them and effected by the Borrower to the relevant Exporter out of own funds of the Borrower;

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and

(iii) under Facility III to the ECA-Guarantor on behalf of the Borrower and the Borrower herewith authorises the Facility Agent, upon receipt by the Facility Agent of the relevant invoice issued by the ECA-Guarantor to pay the proceeds of any such Advance to the ECA-Guarantor.

(e) Notwithstanding that no drawdown request will be issued in respect of payments to the ECA-Guarantor, the Borrower acknowledges and agrees that payments made by the Lenders through the Facility Agent to the ECA-Guarantor pursuant to paragraph (d)(iii) above constitute an Advance under this Agreement whereby the Lenders discharge their respective obligations pursuant to Clause 2.6 (Lenders' Obligations Several) and that it is the sole obligor thereof independent of any rights or obligations it may have under the Supply Contracts or otherwise and the Borrower hereby authorises and instructs the Lenders to pay the proceeds of each such Advance through the Facility Agent into the accounts designated for such purpose by the ECA-Guarantor. The Facility Agent shall not later than at the date of an Advance made pursuant to paragraph (d)(iii) above provide the Borrower with a copy of the relevant invoice issued by the ECA-Guarantor.

2.3 Conditions Precedent

(a) Subject to subsection (b) of this Section 2.3, the Lenders shall not be obliged to make an Advance under this Agreement unless the Facility Agent has confirmed to the Borrower and the Lenders that it has received:

(i) with regard to the initial Drawdown Request under this Agreement, all Conditions Precedent listed in Part I of Schedule 3 (Conditions Precedent); and

(ii) with regard to the first Drawdown Request in relation to each of (a) Facility I and (b) Facility II, all Conditions Precedent listed in Part II of Schedule 3 (Conditions Precedent);

each in form and substance satisfactory to the Facility Agent.

(b) If, at the request of the Borrower, any Condition Precedent referred to in paragraph (a) above is waived or deferred by the Facility Agent (acting on the instructions of the Majority Lenders) the Facility Agent may attach to such waiver or deferral such requirements and further or other conditions as it may think fit (acting on the instructions of the Majority Lenders) and, to the extent not further waived or deferred by the Facility Agent (acting on the instructions of the Majority Lenders), the Borrower shall fulfil or procure fulfilment of all such requirements and further or other conditions as may be notified to the Borrower in writing in accordance with the terms of such notification as if such requirement or further or other condition was an obligation under this Agreement.

2.4 Conditions subsequent

(a) The Borrower shall procure that the Facility Agent has received each document and other items listed in Schedule 10 (Conditions Subsequent) by not later than the date specified in that Schedule opposite the relevant document or item each in form and substance satisfactory to the Lenders.

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(b) The Facility Agent shall notify the Borrower promptly upon the Lenders having informed it of being so satisfied.

2.5 Lenders' Rights Several

The rights of each Lender are several and any debt arising hereunder at any time from the Borrower to any of the other parties hereto shall be a separate and independent debt. Each such party shall be entitled to protect and enforce its individual rights arising out of the Finance Documents independently of any other party in accordance with the terms of the Finance Documents (so that it shall not be necessary for any party hereto to be joined as an additional party in any proceedings for this purpose).

2.6 Lenders' Obligations Several

The obligations of each Lender are several and the failure by a Lender to perform its obligations hereunder shall not affect the obligations of any party hereto towards any other party hereto nor shall any other party be liable for the failure by such Lender to perform its obligations hereunder.

3. UTILISATION OF THE FACILITIES

3.1 General Conditions for all Advances

Without prejudice to the additional requirements set out in Clause 3.2 (Further Conditions for Advances), it is a precondition to any Advance being made by the Lenders to the Borrower that:

(a) the proposed Drawdown Date is a Business Day which is or precedes the applicable Final Availability Date;

(b) on and as of the proposed Drawdown Date (a) no Event of Default or Potential Event of Default has occurred and is continuing (nor will any such event thereby occur as a result of the making of such Advance as requested) and (b) the Repeated Representations and Warranties are true in all respects; and

(c) no event has occurred which will or may result in the ECA-Guarantor (or any agent thereof) refusing to allow disbursements to be made under this Agreement or otherwise terminating the cover provided or to be issued by the Hermes Guarantee in whole or part.

3.2 Further Conditions for Advances

(a) Each Advance in accordance with Clauses 2.2(d)(i) and 2.2(d)(ii) will be made by the Lenders through the Facility Agent to the Borrower if:

(i) by 10.00 a.m. not less than eight (8) Business Days before the proposed Drawdown Date in respect of such Advance, the Facility Agent has received a completed Drawdown Request from the Borrower; and

(ii) the proposed amount of such Advance is either (a) (if less than the respective Available Facility) an amount equal to at least EUR 1,000,000 or (b) equal to the amount of the respective Available Facility.

(b) Each Advance in accordance with Clause 2.2(d)(iii) will be made by the Lenders through the Facility Agent to the ECA-Guarantor on behalf of the Borrower if for any Advance to be made

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to finance the ECA-Fees the Facility Agent has received an invoice from the ECA-Guarantor.

(c) If the conditions set out in this Agreement have been met, each Lender shall make its participation in each Loan available by the time specified in Clause 3.2(a) above and, in case of an Advance in accordance with Clause 2.2(d)(iii), within twenty (20) Business Days after receipt of the invoice from the ECA-Guarantor by the Facility Agent through its Facility Office.

(d) The amount of each Lender's participation in each Advance will be equal to the proportion borne by its Available Commitment to the Available Facility immediately prior to making the Loan.

3.3 Each Lender's Participation

Each Lender will participate through its Facility Office in each Advance made pursuant to Clause 3.2 (Further Conditions for Advances) in the proportion borne by its relevant Available Commitments to the relevant Available Facilities immediately prior to the making of that Advance.

3.4 Reduction of Available Commitments

If a Lender's Available Commitments are reduced in accordance with the terms hereof after the Facility Agent has received a Drawdown Request for an Advance and such reduction was not taken into account in the respective Available Facility, then the amount of that Advance shall be reduced accordingly.

3.5 Disbursement of Advances into offshore account

Each Advance shall be disbursed into an account other than an account being held in Malaysia to be agreed with the Facility Agent.

4. INTEREST

4.1 Interest Periods

Each Interest Period (other than the first of each Loan, which shall begin on the day such Loan is made) shall start on the last day of the Interest Period preceding such period.

4.2 Duration of Interest Periods

(a) Subject to this Clause 4.2, the Borrower may select an Interest Period of three (3) or six (6) months in the Drawdown Request for the relevant Advance or (if the relevant Advance has already been made) in a Selection Notice.

(b) Each Selection Notice for an Advance is irrevocable and must be delivered to the Facility Agent by the Borrower not later than three (3) Business Days prior to the commencement of the next Interest Period in relation to such Advance.

(c) If the Borrower fails to deliver a Selection Notice to the Facility Agent in accordance with paragraph (b) above, the relevant Interest Period will, subject to this Clause 4.2, be three (3) months.

(d) Any Interest Period relating to Advances made under the same Facility (other than the Interest

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Period relating to the first Advance made under such Facility) shall end on the last day of the Interest Period relating to the first Advance made under such Facility.

(e) Any Interest Period in relation to any Advance which would otherwise extend beyond a Repayment Date shall end on such Repayment Date.

(f) If an Interest Period would otherwise end on a day which is not a Business Day, that Interest Period will instead end on the next Business Day in that calendar month (if there is one) or the preceding Business Day (if there is not).

4.3 Consolidation of Advances

If two or more Interest Periods relating to Advances made under the same Facility end at the same time, then, on the last day of those Interest Periods, those Advances will be treated as a single Advance.

4.4 Default Interest

(a) If the Borrower fails to pay any amount (other than interest) payable by it hereunder on its due date or following acceleration, interest will accrue on the overdue amount from the due date up to the date of actual payment at a rate of 2 per cent. per annum above:

(i) in relation to an amount becoming due and payable before expiration of the Interest Period applicable thereto, for the period until the expiration of such Interest Period the rate applicable to such overdue amount immediately prior to the due date; and

(ii) in all other cases, the rate which would have been payable if the overdue amount had, during the period of non-payment, constituted a Loan for successive Interest Periods, each of a duration selected by the Facility Agent.

(b) If the Borrower fails to pay any interest payable by it hereunder on its due date, it will make, at the time of payment of all arrears of interest, a lump sum payment for all arrears of interest in the amount of 2 per cent. above EURIBOR applicable to the respective Interest Period of the amount due and payable. The right of the Borrower to prove a lower loss of the Lenders remains unaffected.

(c) The right of the Lenders to compensation for any loss arising from the default remains unaffected. Payments made under Clause (b) will, however, be deducted from such compensation.

(d) The Facility Agent will promptly notify the Borrower and the Lenders of the determination of any default interest. Each determination by the Facility Agent will, in the absence of a manifest error, be conclusive and binding on the Borrower and the Lenders.

5. INTEREST RATE AND PAYMENT OF INTEREST

5.1 Interest Rate

The rate of interest applicable to an Advance under the Facilities from time to time during an Interest Period is the percentage rate per annum which is the aggregate of EURIBOR on the Quotation Date therefor and the Margin.

5.2 Payment of Interest

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On each Interest Payment Date the Borrower shall pay accrued interest on the Advance to which such Interest Period relates.

6. MARKET DISRUPTION AND ALTERNATIVE INTEREST RATES

6.1 Market Disruption

If, in relation to any Advance made or to be made under a Facility:

(a) EURIBOR is to be determined by reference to Reference Banks and at or about 11 a.m. on the Quotation Date for the relevant Interest Period none or only one of the Reference Banks supplies a rate for the purpose of determining EURIBOR for the relevant Interest Period; or

(b) before the close of business in Frankfurt am Main on the Quotation Date for the relevant Interest Period the Facility Agent has been notified by one or more Lenders that the EURIBOR rate does not accurately reflect the cost of funding its/their participation in such Advance and such cost of funding exceeds the Reference Rate plus 30 basis points,

then, the Facility Agent shall notify the other parties hereto of such event and, notwithstanding anything to the contrary in this Agreement, Clause 6.2 (Substitute Interest Period and Interest Rate) shall apply to such Advance.

6.2 Substitute Interest Period and Interest Rate

If sub-Clause 6.1(a) of Clause 6.1 (Market Disruption) applies to an Advance, the duration of the relevant Interest Period shall be one (1) month or, if less, such that it shall end on the next applicable succeeding Repayment Date. If either sub-Clause 6.1(a) or 6.1(b) of Clause 6.1 (Market Disruption) applies to an Advance, the rate of interest applicable to each Lender's portion of such Advance during the relevant Interest Period shall (subject to any agreement reached pursuant to Clause 6.3 (Alternative Interest Rate)) be the rate per annum which is the sum of:

(a) the Margin; and

(b) the rate per annum notified to the Facility Agent by that Lender as soon as practicable and in any event before interest is due to be paid in respect of that Interest Period, to be that which expresses as a percentage rate per annum the cost to that Lender of funding its participation in that Advance from whatever source it may reasonably select whereby in case of Clause 6.1(b) (Market Disruption) such rate shall not exceed the Reference Rate.

6.3 Alternative Interest Rate

If (a) either of those events mentioned in sub-Clauses 6.1(a) and 6.1(b) of Clause 6.1 (Market Disruption) occurs in relation to an Advance or (b) by reason of circumstances affecting the European interbank market during any period of three (3) consecutive Business Days EURIBOR is not available to prime banks in the European interbank market, then if the Facility Agent or the Borrower so requires, the Facility Agent and the Borrower shall enter into negotiations with a view to agreeing a substitute basis (i) for determining the rates of interest from time to time applicable to such Advances and/or (ii) upon which such Advances may be maintained thereafter and any such substitute basis that is agreed shall take effect in accordance with its terms and be binding on each party hereto, provided that the Facility Agent may not agree any such substitute basis without the prior consent of each Lender.

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7. NOTIFICATION

7.1 Advances

Not less than five (5) Business Days before the proposed Drawdown Date, the Facility Agent shall notify each Lender of the proposed amount of the relevant Advance and the aggregate principal amount of the relevant Advance allocated to such Lender pursuant to Clause 3.3 (Each Lender's Participation).

7.2 Interest Rate Determination and Loan Amount

The Facility Agent shall promptly notify the Borrower and the Lenders of EURIBOR and the Margin applicable from time to time and the Loans disbursed under any Facility.

7.3 Changes to Interest Periods or Interest Rates

The Facility Agent shall promptly notify the Borrower and the Lenders of any change to the proposed length of an Interest Period or any interest rate pursuant to Clause 6 (Market Disruption and Alternative Interest Rates).

8. REPAYMENT

8.1 Repayment Instalments

(a) Upon the occurrence of the First Repayment Date, all Loans made under any of the Facilities shall be consolidated into one (1) single Loan and shall be treated as a single Advance.

(b) The Borrower shall repay the Loan which has been consolidated in accordance with paragraph (a) above, in fourteen (14) semi-annual equal consecutive instalments based on the aggregate amount of all Loans borrowed by the Borrower under the Facilities as at close of business on the Ultimate Final Availability Date divided by 14, by repaying on each relevant Repayment Date such an instalment. Without prejudice to the foregoing the Borrower shall in any event repay the Loan which has been consolidated in accordance with paragraph (a) above and all interest thereon in full on the final Repayment Date.

(c) The Facility Agent and the Borrower shall not later than the earlier of (i) ten (10) Business Days after the Starting Point and (ii) fifteen (15) Business Days prior to the Ultimate First Repayment Date agree, for information purposes, on a Repayment Schedule in relation to all Facilities setting out the amount of the repayment instalments and the Repayment Dates in relation to the Facilities in the form set out in Schedule 9 (Form of Repayment Schedule) which shall be updated from time to time by the Facility Agent in consultation with the Borrower to reflect any prepayments made in accordance with Clauses 9 (Voluntary Cancellation and Prepayments) and 10 (Mandatory Cancellation and Prepayments). Notwithstanding the foregoing, the amounts and due dates of the repayment instalments will be solely determined on the basis of paragraph (b) above, and, as any Repayment Schedule is provided for information purposes only, in case of any deviation or discrepancy between the amounts and due dates of the repayment instalments set out in the Repayment Schedule and the amounts and due dates determined on the basis of paragraph (b) above, the latter shall prevail. Accordingly, failure by the Borrower and the Facility Agent to agree on a Repayment Schedule shall in no manner release the Borrower from its repayment obligation pursuant to paragraph (b) above.

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(d) If:

(i) the Starting Point Confirmation has not been made available to the Facility Agent prior to the Ultimate First Repayment Date;

(ii) the Facility Agent consequently could not determine the Starting Point;

(iii) repayment of the Facilities consequently commenced on the relevant Ultimate First Repayment Date;

(iv) the Facility Agent subsequently received the Starting Point Confirmation or by other means and in its sole discretion has determined the Starting Point; and

(v) the Starting Point was a day that preceded the Ultimate First Repayment Date by more than six (6) months

then all remaining Repayment Dates of the Facilities (starting with the Repayment Date that prior to such adjustment would have fallen due not earlier than five (5) Business Days from the date of determination of the Starting Point by the Facility Agent) shall be adjusted so that the Repayment Date to fall due next will be the day that is six (6) months (or such smallest multiple of six (6) months that ensures that such Repayment Date falls not earlier than five (5) Business Days from the Starting Point) after the Starting Point and any further Repayment Date falls six (6) months after the previous Repayment Date so determined.

8.2 No Re-borrowing

No amount repaid under Clause 8.1 (Repayment Instalments) may be re-borrowed.

8.3 Offshore Loan

It is the understanding of the parties to this Agreement that the financing provided hereunder is provided to the Borrower solely on an offshore basis from outside Malaysia, notwithstanding that the Borrower is incorporated and resident in Malaysia and that no moneylender's license in Malaysia is required for the granting of the Loan. The Borrower hereby waives any right it may have to refuse repayment of the Loan on the basis of Malaysian banking laws.

9. VOLUNTARY CANCELLATION AND PREPAYMENTS

9.1 Voluntary Cancellation

The Borrower may, by giving to the Facility Agent not less than five (5) Business Days' prior irrevocable notice to that effect, cancel the whole or any part of the Facilities without any penalty. Any such cancellation of the Available Commitments shall reduce the Available Commitments of the Lenders rateably.

9.2 Prepayment

At any time after the occurrence of the First Repayment Date the Borrower may, after having given to the Facility Agent not less than ten (10) Business Days' prior irrevocable written notice to that effect (the "Prepayment Notice"), prepay any part of the amount outstanding under the Facilities on the last day of an Interest Period relating to the relevant Advance, subject to a minimum prepayment

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amount of EUR 1,000,000 or the total outstanding amount, whichever is smaller. Voluntary prepayments under this Clause 9.2 will be applied in inverse chronological order of maturity over the remaining repayment instalments of the Facilities (and the obligations of the Borrower under Clause 8.1 (Repayment Instalments) shall be satisfied pro tanto).

9.3 Overpayment of ECA-Fee

The Facility Agent shall upon receipt of the final invoice issued by the ECA-Guarantor in relation to the Project notify the Borrower about any overpayment of ECA-Fees made by the Borrower. The Borrower may, after having given to the Facility Agent not less than ten (10) Business Days' prior a Prepayment Notice to that effect, apply such overpayment towards pro rata prepayment of any part of the amount outstanding under the Facilities on the last day of an Interest Period or request the Facility Agent to refund such overpayment to an account, details of which are to be set out in the relevant Prepayment Notice.

9.4 Scope of Prepayment

All prepayments will be made together with accrued interest on the amount prepaid and all other amounts, if any, owing by the Borrower to the Lenders hereunder.

9.5 Notices

Any notice of cancellation or Prepayment Notice given by the Borrower pursuant to this Clause 9 is irrevocable and will specify the date upon which such cancellation or prepayment is to be made and the amount of such cancellation or prepayment. The Facility Agent will notify the Lenders promptly of receipt of any such notice.

9.6 No Other Voluntary Prepayments

To the extent legally permissible the Borrower will not voluntarily prepay all or any part of any Loans except at the times and in the manner expressly provided for in this Agreement.

9.7 Re-Borrowing

The Borrower will not be entitled to re-borrow any amount prepaid under this Clause 9.

10. MANDATORY CANCELLATION AND PREPAYMENTS

10.1 If, after the Hermes Guarantee has been issued by the ECA-Guarantor:

(a) the Hermes Guarantee is fully or partially withdrawn, suspended, terminated or cancelled or otherwise ceases to be in full force and effect; or

(b) the ECA-Guarantor repudiates the Hermes Guarantee or does or causes to be done any act or thing evidencing in writing that it unequivocally intends to repudiate the Hermes Guarantee issued by it, or any of the obligations of the ECA-Guarantor thereunder are not or ceases to be legal, valid, binding or in full force and effect or the ECA-Guarantor otherwise avoids, rescinds, or terminates in whole or in part the Hermes Guarantee other than pursuant to its terms,

the Facility Agent shall, if so directed by any of the Lenders, by notice to the Borrower, cancel the

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Available Facilities attributable to the respective Lender directing the Facility Agent to do so (whereupon it shall immediately be cancelled) and declare the Loans attributable to the respective Lender directing the Facility Agent to do so, together with accrued interest and all other amounts accrued or outstanding under the Finance Documents, to be immediately due and payable (whereupon they shall become immediately due and payable) unless the circumstances set out in paragraphs (a) and (b) above occurred by virtue of wilful misconduct of the Facility Agent.

10.2 The Borrower will not be entitled to re-borrow any amount prepaid under this Clause 10.

10.3 The undrawn Commitment of each Lender under a Facility will automatically be cancelled on the relevant Final Availability Date for that Facility.

11. TAXES

11.1 Definitions:

"Tax Credit" means a credit against, relief or remission for, or repayment of any Tax.

"Tax Deduction" means a deduction or withholding for or on account of Tax from a payment under a Finance Document.

"Tax Payment" means either the increase in a payment made by the Borrower to a Finance Party under Clause 11.2 (Tax Gross-up) or payment under Clause 11.3 (Tax Indemnity).

11.2 Tax Gross-up

(a) All payments to be made by the Borrower to any Lender, the Facility Agent or the Security Agent under the Finance Documents shall be made free and clear of and without any Tax Deduction.

(b) In the event that any Tax Deduction is required by law, the Borrower will pay such additional amounts as will result in the receipt by such Lender, the Facility Agent or the Security Agent of the net amounts after such Tax Deduction equal to the amounts it would otherwise have received had no such Tax Deduction been required to be made by law.

(c) The Borrower is not required to make an increased payment to a Lender under paragraph (b) above, if on the date on which that payment falls due the Borrower is able to demonstrate that the payment could have been made to that Lender, Facility Agent or Security Agent without the Tax Deduction had that Lender complied with its obligations under paragraph (d) below.

(d) A Lender and the Borrower shall co-operate in completing any procedural formalities necessary for the Borrower to obtain authorization to make a payment without a Tax Deduction.

11.3 Tax Indemnity

(a) Without prejudice to Clause 1.2 (Tax Gross-up), if any Finance Party is required to make any payment of or on account of Tax on or in relation to any sum received or receivable under the Finance Documents the Borrower shall, upon written demand of the Facility Agent, within three (3) Business Days of receiving such written demand, indemnify such Finance Party accordingly, together with any interest, penalties, costs and expenses payable or incurred in connection therewith.

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(b) Paragraph (a) above shall not apply:

(i) with respect to any Tax assessed on a Finance Party:

(A) under the law of the jurisdiction in which that Finance Party is incorporated or, if different, the jurisdiction (or jurisdictions) in which that Finance Party is treated as resident for tax purposes;

(B) under the law of the jurisdiction in which that Finance Party's Facility Office is located, or, if different, the jurisdiction in which that Finance Party's Facility Office is treated as resident for tax purposes, in respect of amounts received or receivable in that jurisdiction

if that Tax is imposed on or calculated by reference to the income received or receivable by that Finance Party; or

(ii) to the extent a Tax, loss, liability or cost:

(A) is compensated for by an increased payment under Clause 11.2 (Tax Gross-up); or

(B) would have been compensated for by an increased payment under clause 11.2 (Tax Gross-up) but was not so compensated solely because one of the exclusions in clause 11.2(c) (TaxGross-up) applied.

(c) Further, without prejudice to Clause 11.2 (Tax Gross-up) the Borrower shall pay and, within five (5) Business Days of demand, indemnify any Lender, the Facility Agent or the Security Agent against any cost, loss or liability any Lender, Facility Agent or Security Agent may incur in relation to stamp duty, other similar transfer tax or notary fees in connection with the Finance Documents.

11.4 Tax Credits

If the Borrower makes a Tax Payment and the relevant Finance Party (acting in accordance with the principles of good faith) determines that

(a) a Tax Credit is attributable either to an increased payment of which that Tax Payment forms part, or to that Tax Payment; and

(b) the Lender has obtained, utilized and retained that Tax Credit (directly or on an affiliated group basis),

the relevant Finance Party shall pay an amount to the Borrower which that Finance Party determines (in applying the principles of good faith) will leave it (after that payment) in the same after-Tax position as it would have been in had the Tax Payment not been required to be made by the Borrower.

The relevant Finance Party shall use its best efforts to obtain a Tax Credit taking into account the interest of both parties but without being obliged to take steps which might be prejudicial to it.

11.5 Claims by Lenders

A Lender intending to make a claim pursuant to Clause 11.3 (Tax Indemnity) shall notify the Facility

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Agent of the event giving rise to the claim within sixty (60) Business Days of the occurrence of such event, whereupon the Facility Agent shall notify the Borrower within 10 Business Days of receipt of such notification.

11.6 Change of Tax Law or Tax Regulations

Each Party shall, as soon as it becomes aware of it, inform the Facility Agent of any details of any change of tax law or tax regulations in Malaysia or the United States of America, which might have an impact on the Project.

12. VAT

12.1 All consideration expressed to be payable under a Finance Document by any Party to a Finance Party shall be deemed to be exclusive of any VAT. If VAT is chargeable on any supply made by any Finance Party to any Party in connection with a Finance Document, that Party shall pay to that Finance Party (upon provision of a proper VAT invoice at the time specified in such invoice) in addition to the consideration for that supply an amount equal to the amount of the VAT if the reverse charge mechanism is not applicable and such VAT does not result from the election for a VAT option right.

12.2 Where a Finance Document requires any Party to reimburse a Finance Party for any costs or expenses, that Party shall also at the same time pay and indemnify that Finance Party against all VAT incurred by the Finance Party in respect of the costs or expenses to the extent that the Finance Party determines that it is not entitled to credit or repayment from the relevant Tax Authority in respect of the VAT.

12.3 Where pursuant to the terms of this Agreement one Finance Party makes a supply to another Finance Party, and VAT is chargeable on such supply, each Party paying the consideration for such supply shall also pay (in addition to and at the same time as paying the consideration for that supply upon provision of a proper VAT invoice) an amount equal to the amount of VAT if the supply is not subject to the reverse charge mechanism and such VAT does not result from the election for a VAT option right.

13. TAX RECEIPTS

13.1 Notification of Requirement to Deduct Tax

If, at any time, the Borrower is required by law to make a Tax Deduction (or if thereafter there is any change in the rates at which or the manner in which such Tax Deductions are calculated), the Borrower shall promptly notify the Facility Agent within 10 Business Days after it becomes aware of such requirement or change.

13.2 Evidence of Payment of Tax

If the Borrower makes any payment under the Finance Documents in respect of which it is required to make any Tax Deduction, it shall pay the full amount required to be deducted or withheld to the relevant taxation or other authority within the time allowed for such payment under applicable law and shall deliver to the Facility Agent for each Lender, within thirty days after it has made such payment to the applicable authority, an original receipt (or a certified copy thereof) issued by such authority evidencing the payment to such authority of all amounts so required to be deducted or withheld in respect of that Lender's share of such payment.

14. INCREASED COSTS

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14.1 Increased costs

(a) Subject to Clause 14.3 (Exceptions) the Borrower shall, for any Interest Period beginning after the day on which the Facility Agent has notified the Borrower in accordance with Clause 14.2(a) (Increased cost claims), pay for the account of a Finance Party the amount of any Increased Costs incurred by that Finance Party or any of its affiliated companies as a result of (i) the introduction of or any change in (or in the interpretation, administration or application of) any law or regulation or (ii) compliance with any law or regulation made after the date of this Agreement. The amount of Increased Costs shall become due and payable within five (5) Business Days of a demand by the Facility Agent.

(b) In this Agreement "Increased Costs" means:

(i) a reduction in the rate of return from the Facilities or on a Finance Party's or its head office's overall capital;

(ii) an additional or increased cost; or

(iii) a reduction of any amount due and payable under any Finance Document,

which is incurred or suffered by a Finance Party or its head office to the extent that it is attributable to that Finance Party having entered into its Commitment or funding or performing its obligations under any Finance Document.

14.2 Increased cost claims

(a) A Finance Party intending to make a claim pursuant to Clause 14.1 (Increased costs) shall notify the Facility Agent of the event giving rise to the claim, following which the Facility Agent shall promptly notify the Borrower.

(b) Each Finance Party shall, as soon as practicable after a demand by the Facility Agent, provide a certificate confirming the amount of its Increased Costs and setting out the calculation of the amount in reasonable detail.

14.3 Exceptions

(a) Clause 14.1 (Increased costs) does not apply to the extent any Increased Cost is:

(i) attributable to a Tax Deduction required by law to be made by the Borrower;

(ii) compensated for by Clause 11.3 (Tax indemnity) (or would have been compensated for under Clause 11.3 (Tax indemnity) but was not so compensated solely because any of the exclusions in Clause 11.3(b) (Tax indemnity) applied);

(iii) attributable to the wilful or gross negligent breach by the relevant Finance Party or its affiliated companies of any law or regulation; or

(iv) attributable to the implementation or application of or compliance with the "International Convergence of Capital Measurement and Capital Standards, a Revised Framework" published by the Basel Committee on Banking Supervision in June 2004 in the form existing on the date of this Agreement ("Basel II") or any other law or

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regulation which implements Basel II (whether such implementation, application or compliance is by a government, regulator Finance Party or any of its affiliated companies).

(b) In this Clause 14.3, a reference to a "Tax Deduction" has the same meaning given to the term in Clause 11.1 (Definitions).

15. ILLEGALITY

If, at any time, after the signing of this Agreement it has become unlawful in any applicable jurisdiction for a Lender to make, fund or allow to remain outstanding all or part of its share of the Advances, then that Lender shall, promptly after becoming aware of the same, deliver to the Borrower through the Facility Agent a notice to that effect and:

(a) such Lender shall not thereafter be obliged to participate in the making of any Advances and the amount of its Available Commitments shall be immediately reduced to zero; and

(b) if the relevant law and the Facility Agent on behalf of such Lender so requires, the Borrower shall repay such Lender's share of any outstanding Advances on the last day of the Interest Period after the Facility Agent has notified the Borrower, or on such date as the Facility Agent shall have specified (which must not be earlier than the last day of any applicable grace period permitted by the relevant law) together with accrued interest thereon and all other amounts owing to such Lender under the Finance Documents and any repayment so made shall reduce rateably the remaining obligations of the Borrower under Clause 8 (Repayment).

16. MITIGATION

16.1 If, in respect of any Lender, circumstances arise which would or would upon the giving of notice result in:

(a) an increase in any sum payable to it or for its account pursuant to Clause 11.2 (Tax Gross-up);

(b) a claim for indemnification pursuant to Clause 11.3 (Tax Indemnity) or Clause 14 (Increased Costs); or

(c) the reduction of its Available Commitments to zero or any repayment to be made by the Borrower pursuant to Clause 15 (Illegality),

then, without in any way limiting, reducing or otherwise qualifying the rights of such Lender or the obligations of the Borrower under any of the Clauses referred to above, such Lender shall promptly upon becoming aware of such circumstances notify the Facility Agent thereof and, in consultation with the Facility Agent and the Borrower and to the extent that it can do so lawfully and without prejudice to its own position, take steps (including a change of location of its Facility Office or the transfer of its rights, benefits and obligations under the Finance Documents to another financial institution acceptable to the Borrower and willing to participate in the Facility) to mitigate the effects of such circumstances, provided that such Lender shall be under no obligation to take any such action if, in the bona fide opinion of such Lender, to do so might have any adverse effect upon its business or operations or banking and lending policies (other than any minor costs and expenses of an administrative nature).

16.2 In the context of Clause 16.1 above the Borrower shall also be entitled to prepay the Loan in accordance

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with Clause 9.2 (Prepayment), provided, however, that the Borrower does not need to comply with the minimum prepayment amount stipulated therein.

17. REPRESENTATIONS AND WARRANTIES

17.1 Representations and Warranties

As of the day of execution of this Agreement, the Borrower represents and warrants by way of an independent guarantee (unabhängiges Garantieversprechen) to each of the Arrangers, the Facility Agent, the Security Agent and the Lenders that:

(a) Status: it is a company limited by shares duly organised and validly existing under the laws of Malaysia, has the capacity to sue and be sued in its own name and has the corporate power and authority to own its assets and to carry on its business as currently conducted;

(b) Powers and Authority: it has the corporate power and authority to enter into and perform its obligations under the Transaction Documents and has taken all necessary corporate and other action required to authorise the execution, delivery and performance of the Transaction Documents;

(c) Non-Conflict: it complies with and the entry into and the execution and performance of the Transaction Documents by the Borrower do not and will not conflict:

(i) with any agreement, mortgage, bond or other instrument or treaty to which it is a party or which is binding upon it or any of its assets which could be expected to have a Material Adverse Effect;

(ii) with its constitutive documents; or

(iii) with any applicable law, including environmental and tax laws, in a manner which could be expected to have a Material Adverse Effect;

(d) Authorisations: all material Authorisations required to be obtained or renewed by the time this representation is made or is repeated have been so obtained or renewed and each of such Authorisations is in full force and effect, the Borrower has complied and is at all times in compliance with the terms and conditions of each material Authorisation and has not received any indication and is not aware of any facts or circumstances which might result in any material Authorisation being suspended, revoked, amended, varied, withdrawn or not renewed and so far as the Borrower is aware no material Authorisation will be suspended, revoked, amended, varied, withdrawn or not renewed as a result of the execution or performance of any of the Transaction Documents or a document to be executed pursuant thereto;

(e) Further Authorisations: having made due inquiry, it knows of no reason why any material Authorisation required for the Project or the performance of its obligations under the Transaction Documents (i) will not be granted when applied for or requested, or (ii) will be terminated, suspended, withdrawn (zurückgenommen) or revoked (widerrufen);

(f) No Material Adverse Effect: there has been no Material Adverse Effect;

(g) No Material Proceedings: no litigation, action or administrative proceeding of or before any court, arbitrator or agency (including, but not limited to, investigative proceedings) is

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commenced against the Borrower or its assets which, if adversely determined, would be expected to have a Material Adverse Effect;

(h) No labour unrest: it knows of no labour unrest pending and no labour unrest has commenced which, if so pending and commencing respectively would be expected to have a Material Adverse Effect;

(i) Project Documents: (i) all Project Documents (in relation to the KLM to be financed by the relevant Facility, where applicable) are or will be in full force and effect at the time of each drawdown under Facilities, and (ii) the Borrower is in compliance with all Project Documents in all material aspects; and

(j) Environmental Compliance: it has duly performed and observed in all respects all Environmental Law, Environmental Permits and all other covenants, conditions, restrictions or agreements including in connection with any contamination, pollution, emissions, waste, release or discharge of any toxic or hazardous substance where failure to do so could be expected to have a Material Adverse Effect.

17.2 Repetition

(a) Each of the representations and warranties pursuant to Clause 17.1 (Representations and Warranties) will be repeated by the Borrower on each Drawdown Date by reference to the facts and circumstances existing on such Drawdown Date.

(b) In addition, each of the representations and warranties pursuant to Clause 17.1(d) and 17.1(e) (Representations and Warranties) shall be deemed to be made by the Borrower by reference to the facts and circumstances then existing on each Interest Payment Date.

18. FINANCIAL INFORMATION

The Borrower makes the covenants in this Clause 18 from the date of this Agreement until the date on which all amounts of principal, interest, fees, costs, expenses, commission and all other amounts due or which may become due hereunder have been paid or repaid.

18.1 Audited Annual Accounts

(a) The Borrower shall as soon as the same becomes available, but in any event within 180 days after the end of each of its Financial Years, deliver to the Facility Agent its annual financial statements prepared in accordance with IFRS or US GAAP (commencing with such financial statements for the Financial Year ending 31 December 2010), certified by an Authorised Signatory of the Borrower as giving a true and fair view of its financial condition as at the end of such Financial Year and of the results of its operations during such Financial Year.

(b) The Borrower shall as soon as the same becomes available, but in any event within 180 days after the end of each of its Financial Years, deliver to the Facility Agent its annual financial statements prepared in accordance with MASB approved accounting standards and PERS (and audited by the Auditor) (commencing with such financial statements for the Financial Year ending 31 December 2010).

(c) The Borrower shall as soon as the same becomes available, but in any event within 180 days after the end of each Financial Year of the Sponsor, deliver to the Facility Agent the annual

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financial statements prepared in accordance with IFRS or US GAAP (and audited by the Auditor) of the Sponsor (commencing with such financial statements for the Financial Year ending 31 December 2010).

18.2 Quarterly Statements and Compliance Certificates

The Borrower shall as soon as the same become available but in any event within 60 days after the end of each quarter of its Financial Year deliver to the Facility Agent its unaudited financial statements prepared in accordance with IFRS or US GAAP for such period (commencing with such financial statements for such quarter ending 31 December 2010), certified by an Authorised Signatory of the Borrower as giving a true and fair view of its financial condition as at the end of the period to which those financial statements relate and of the results of its operations during such period, and a Compliance Certificate signed by an Authorised Signatory of the Borrower together with evidence of its accounts, financial statements and calculations as required to confirm the accuracy of the Compliance Certificate. All projections and assumptions used for the purposes of the Compliance Certificate shall be fair and reasonable.

18.3 Budget

The Borrower shall not later than sixty (60) days after the end of its Financial Year provide the Facility Agent a Budget for the new Financial Year, for the first time in respect of the Financial Year 2011.

18.4 FinancialYear

The Borrower shall inform the Facility Agent promptly about a change of the end of the Financial Year of the Borrower and/or the Sponsor.

18.5 Other Information

The Borrower shall from time to time on the request of the Facility Agent, furnish to the Lenders through the Facility Agent such information about the financial condition of the Borrower as the Lenders may reasonably request.

18.6 Accounting Policies

The Borrower shall ensure that each set of financial statements delivered pursuant to this Clause 18 is prepared in the English language using accounting policies, practices, procedures and reference periods consistent with IFRS, US GAAP or MASB approved accounting standards and PERS, as relevant, and, in relation to any such financial statement, the Borrower shall notify the Facility Agent if there have been one or more changes in any accounting policy, practice, procedure or reference period and the Borrower shall procure that in respect of the financial statements provided pursuant to Clause 18.1(b), the Borrower's Auditor provides:

(a) a description of the changes and the adjustments which would be required to be made to those financial statements in order to cause them to use the accounting policies, practices, procedures and reference period upon which the Original Financial Statements were prepared; and

(b) sufficient information, in such detail and format as may be required by the Facility Agent, to enable the Lenders to make an accurate comparison between the financial position indicated by those financial statements and the Original Financial Statements,

and any reference in this Agreement to those financial statements shall be construed as a reference

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to those financial statements as adjusted to reflect the basis upon which the Original Financial Statements were prepared.

18.7 "Know your customer" checks

(a) If:

(i) the introduction of or any change in (or in the interpretation, administration or application of) any law or regulation made after the date of this Agreement;

(ii) any change in the status of the Borrower, the Shareholders or the Sponsor after the date of this Agreement; or

(iii) a proposed assignment or assignment and transfer by way of assumption of contract (Vertragsübernahme) by a Lender of any of its rights and obligations under this Agreement to a party that is not a Lender prior to such assignment or assignment and transfer by way of assumption of contract (Vertragsübernahme),

obliges the Facility Agent or any Lender (or, in the case of paragraph (iii) above, any prospective new Lender) to comply with "know your customer" or similar identification procedures in circumstances where the necessary information is not already available to it, each of the Borrower, the Shareholders and the Sponsor shall promptly upon the request of the Facility Agent or any Lender supply, or procure the supply of, such documentation and other evidence as is reasonably requested by the Facility Agent (for itself or on behalf of any Lender) or any Lender (for itself or, in the case of the event described in paragraph (iii) above, on behalf of any prospective new Lender) in order for the Facility Agent, such Lender or, in the case of the event described in paragraph (iii) above, any prospective new Lender to carry out and be satisfied it has complied with all necessary "know your customer" or other similar checks under all applicable laws and regulations pursuant to the transactions contemplated in the Finance Documents.

(b) Each Lender shall promptly upon the request of the Facility Agent supply, or procure the supply of, such documentation and other evidence as is reasonably requested by the Facility Agent (for itself) in order for the Facility Agent to carry out and be satisfied it has complied with all necessary "know your customer" or other similar checks under all applicable laws and regulations pursuant to the transactions contemplated in the Finance Documents.

19. FINANCIAL COVENANTS

19.1 Financial Definitions

In this Clause 19:

"Annualised Debt Service" means the Debt Service during the preceding twelve months.

"Annualised DSCR" means the DSCR during the preceding twelve months.

"Annualised EBITDA" means the EBITDA during the preceding twelve months.

"Annualised Net Interest Expense" means the Net Interest Expense during the preceding twelve months.

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"CAFDS" means the EBITDA for any preceding twelve months:

(a) after deducting any amount of tax on profits, gains, income in respect of cash payments or cash payable;

(b) after taking into account all increases and decreases respectively of accruals;

(c) after taking into account all increases and decreases respectively of liabilities resulting from deliveries of goods and services;

(d) after taking into account all increases and decreases respectively of receivables resulting from deliveries of goods and services;

(e) after taking into account all increases and decreases respectively of the inventories, raw materials and supplies, work-in-process and finished product, advance payments and prepaid expenses; and

(f) after taking into account all increases and decreases respectively of the Capital Expenditures.

"Capital Expenditure" means any expenditure (including any reinvestment of disposal proceeds but excluding any replacement of assets out of insurance proceeds) or obligations in respect of expenditure (including any obligation in respect of the capital element of any finance lease, operating lease or capital lease) for the acquisition of equipment, fixed assets, real property, intangible assets and other assets of a capital nature, or for the replacements or substitutions therefore or additions or improvements thereto in each case which would be consistent with the Borrower's accounting policies and in line with US GAAP, together with costs incurred in connection therewith.

"Debt Service" means in respect of the Borrower any due and payable fees, Net Interest Expense and repayments of principal in respect of any loan granted to the Borrower excluding amounts of principal and interest on loans granted by any member of the First Solar Group.

"DSCR" means the ratio of CAFDS to Annualised Debt Service.

"EBITDA" means the Borrower's net results plus interest expenses minus interest income plus taxes plus depreciation plus amortization (excluding in each case extraordinary items) plus cash injections during any cure period/grace period of a Financial Covenant.

"Net Interest Expense" means in respect of the Borrower all interest due and payable (excluding all interest due and payable on any loans granted by another member of the First Solar Group to the Borrower) minus all interest earned.

"Total Debt" means, in respect of any Financial Year, all moneys borrowed (including debt incurred under any bill of exchange) of the Borrower plus (to the extent not already included under moneys borrowed):

(a) the amount raised pursuant to any note purchase facility or the issue of bonds, notes, debentures, loan stock or any similar instrument;

(b) the amount incurred by acceptance of any certificate of indebtedness;

(c) the amount of any mezzanine capital of the Borrower;

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(d) the amount of any liability in respect of any lease or hire purchase contract;

(e) the amount of any trade liability with a remaining period of one (1) year and more;

(f) the amount of any liability of the Borrower against another member of the First Solar Group with a remaining period of one (1) year and more; and

(g) the amount of any subordinated shareholder loan granted to the Borrower (excluding the amount of any shareholder loan granted to cure a breach of any covenant under this Clause 19).

"Total Equity" means, in respect of any Financial Year, the paid-in capital, ordinary share capital or subscribed capital of the Borrower:

(a) plus capital reserves;

(b) after taking into account any retained earnings and accumulated deficits;

(c) after taking into account any net income and net loss;

(d) minus any receivables against shareholders;

(e) plus any liabilities towards shareholders if subordinated to the claims of the Finance Parties against the Borrower under the Finance Documents; and

(f) plus any subordinated shareholder debt.

19.2 Financial Condition

The Borrower shall:

(a) Total Debt to Equity Ratio: ensure that at the end of each quarter of each Financial Year the ratio of Total Debt to Total Equity is not higher than 75 per cent., to be calculated the first time at the end of the Financial Year 2010.

(b) Total Leverage Ratio: ensure that at the end of each quarter of each Financial Year the ratio of Total Debt to Annualised EBITDA is not above 4.5 in its Financial Year 2010 and thereafter, to be calculated the first time at the end of the Financial Year 2010.

(c) Interest Coverage Ratio: ensure that at the end of each quarter of each Financial Year the ratio of Annualised EBITDA to Annualised Net Interest Expense is not less than 4.0, to be calculated the first time at the end of the Financial Year 2010.

(d) Debt Service Coverage Ratio: ensure that at the end of each quarter of each Financial Year the Annualised DSCR is not less than 2.5, to be calculated the first time at the end of the Financial Year 2010.

19.3 No Event of Default

The Borrower may cure a breach of any covenant under this Clause 19 within twenty (20) Business Days from the earlier of (i) the Borrower becoming aware of such breach and (ii) notification by the Facility Agent of such breach by procuring the provision of further equity or shareholder loans

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subordinated in accordance with the terms of the Subordination Agreement to the Borrower. Upon provision of such further equity and subordinated loans respectively the ratios set out in this Clause 19 will be recalculated taking into account such further equity and subordinated loans respectively. Where any such breach of a covenant under this Clause 19 is cured in accordance with this paragraph no Event of Default will arise as a consequence of that breach.

20. COVENANTS

20.1 Positive Covenants

The Borrower shall:

(a) Maintenance of Legal Validity and Legal Status: (i) do all things necessary to maintain its existence as a legal person and to ensure the legality, validity, enforceability or admissibility in evidence in Malaysia of the Transaction Documents including the obtaining and maintaining of all applicable Authorisations necessary for the Project and the performance of its obligations under the Transaction Documents, as and when required, and, (ii) on request of the Facility Agent, shall supply copies (certified by an Authorised Signatory of the Borrower as true, complete and up to date) of any such Authorisations and (iii) comply with all applicable laws and Authorisations, except a failure to comply with this Clause 20.1(a)(i) and (iii) would not reasonably be expected to have a Material Adverse Effect;

(b) Applicable social, health and safety guidelines: comply in all material respects with all applicable social, health and safety guidelines except where a failure to comply with this covenant would not be expected to have a Material Adverse Effect;

(c) Notification of Events of Default and Material Adverse Effect: promptly inform the Facility Agent of the occurrence of any Event of Default, Potential Event of Default or Material Adverse Effect of which it is aware and, upon receipt of a written request to that effect from the Facility Agent, confirm to the Facility Agent that, save as previously notified to the Facility Agent or as notified in such confirmation, no Event of Default, Potential Event of Default or Material Adverse Effect has occurred of which it is aware;

(d) Transaction Documents: enter into, maintain in full force and effect, perform all its obligations under, and otherwise comply in all material respects with all Transaction Documents, provided that the Borrower shall have the right to terminate a Project Document in accordance with its terms;

(e) Project Documents: promptly provide details of any cancellation, termination, change or waiver under any of the Project Documents which might have a material impact on the Project in particular, but not limited to, cancellations, terminations, changes or waivers of the terms of payment, the delivery dates and/or the specifications of the Equipment contained in any Project Document;

(f) Information to ECA-Guarantor: allow the Facility Agent to give information to the ECA-Guarantor regarding the Borrower, the Project and in connection with the Transaction Documents;

(g) ECA-Fee Shortfall: pay to the Facility Agent on its first written demand (auf erstes Anfordern) any ECA-Fee Shortfall to be forwarded by the Facility Agent to the ECA-Guarantor together with the relevant proceeds of the relevant Facility in order to meet the payment obligations

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in relation to the ECA-Fees as invoiced by the ECA-Guarantor in any invoice in relation to a Facility;

(h) Inspection: allow the Facility Agent, Security Agent (including any of their delegates appointed by either the Facility Agent or the Security Agent) and the Lenders to inspect the Project and the books and records of the Borrower at any reasonable time during normal business hours and with at least seven (7) days prior notification thereof;

(i) Claims Pari-Passu: ensure that at all times the claims of the Lenders against it under the Finance Documents rank at least pari passu with the claims of all its unsecured and unsubordinated creditors;

(j) NoImmunity: waive any immunity from suit or enforcement;

(k) Environmental Compliance: comply in all material respects with all Environmental Laws and obtain and maintain any Environmental Permits and notify the Facility Agent, promptly after a responsible officer becomes aware of the same of:

(i) any Environmental Claim made on it or to any occupier of any property owned or leased by it under any Environmental Law which may affect the compliance with this Agreement; and

(ii) any circumstances which arise whereby any material remedial action is likely to be required to be taken by, or at the expense of, it pursuant to any Environmental Law;

(l) Notification of Litigation etc.: promptly provide the details of each litigation, arbitration or administrative proceedings which are current, and, to the best of its knowledge, threatened or pending against the Borrower with an amount in dispute of more than USD 10,000,000 (or its equivalent in any other currency);

(m) Insurance: keep and maintain effective and in full force adequate insurance policies for building risk and property insurance in respect of the Project (the "Insurances") with insurers with international reputation, pay the premium in time and promptly upon reasonable request provide to the Facility Agent copies of all cover notes and policies (including endorsements) issued from time to time in relation to each insurance, and of all changes requested or effected thereto;

(n) Financial Statements: prepare its financial statements in accordance with IFRS or US GAAP;

(o) Approvals required pursuant to the Fire Services Act 1988: obtain the approvals required pursuant to the Fire Services Act 1988 in April 2012 at the latest.

20.2 Negative Covenants

The Borrower shall not (by action or omission) without the prior written consent of the Facility Agent which shall not be unreasonably withheld or delayed:

(a) Negative Pledge: create or permit to subsist any Encumbrance over the Equipment or parts thereof other than any Permitted Encumbrance;

(b) Disposals: sell, lease, transfer or otherwise dispose of the whole or any part of the Equipment

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other than by way of a Permitted Disposal;

(c) Guarantees: guarantee the satisfaction of obligations of any person other than:

(i) officers and employees if the guarantee in each case does not exceed USD 1,000,000 (or its equivalent in any other currency) per officer and employee respectively;

(ii) obligations to local utilities and/or governmental agencies if such guarantee is requested by utilities and/or governmental agencies as standard business practice; and

(iii) guarantees not falling under the above paragraphs (i) and (ii) of this covenant and which do not exceed USD 20,000,000 (or its equivalent in any other currency) in aggregate outstanding at any time.

(d) Change of Business: make any changes to the general nature of its business or carry on any other business which results in any change to the general nature of such business;

(e) Merger or Consolidation: enter into any amalgamation, merger, demerger or consolidation, or undertake any corporate or financial restructuring except for within the First Solar Group or if the Borrower is the surviving entity, provided, however, the Borrower provides the Facility Agent not later than ten (10) Business Days prior to such amalgamation, merger or consolidation with an updated Budget taking into account such amalgamation, merger or consolidation and containing a detailed calculation of forecasts in relation to all Financial Covenants for the twelve (12) months following the date of such Budget showing that such Financial Covenants will not be breached as a result of such amalgamation, merger or consolidation;

(f) Illegal Payment: offer, give, receive or solicit any illegal payment or improper advantage to any person in connection with the Project;

(g) Contracts with members of First Solar Group: enter into any contract with other members of the First Solar Group otherwise than on terms no less favourable to the Borrower than arm's length terms and in the ordinary course of business.

21. EVENTS OF DEFAULT

21.1 Each of the following circumstances constitutes an Event of Default for the purpose of this Agreement, irrespective of whether or not caused by any reason within the control of the Borrower or any other person, is voluntary or involuntary or arises or is effected by operation of applicable law. Each Event of Default may be relied upon by the Facility Agent and the Lenders severally and independently from any other Event of Default:

(a) Payment Obligations: failure by the Borrower to make:

(i) any payment of principal or interest due under and in accordance with this Agreement within five (5) Business Days from the due date thereof; and/or

(ii) any other payment due under the Finance Documents within five (5) Business Days from a notification by the Facility Agent of the Borrower’s failure to pay;

(b) Representations and Warranties etc: any representation, warranty or statement made by the

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Borrower or the Sponsor in or pursuant to any Transaction Document, the Hermes Guarantee, any certificate, statement or opinion delivered by or on behalf of the Borrower or the Sponsor hereunder or in connection herewith is or proves to have been incorrect, untrue or misleading in a material respect when made or delivered, unless the circumstances giving rise to the misrepresentation are capable of remedy and remedied within fifteen (15) Business Days from the earlier of (i) the Borrower becoming aware of the misrepresentation and (ii) notification by the Facility Agent of such misrepresentation;

(c) Covenants: subject to Clause 19.3 (No Event of Default) the Borrower or the Sponsor breaches any covenant or material obligation under any Transaction Document (other than Clause 20.1(c) (Notification of Events of Default and Material Adverse Effect) in respect of a Potential Event of Default) which, if capable of being remedied, has not been remedied to the satisfaction of the Facility Agent within fifteen (15) Business Days from the earlier of (i) the Borrower becoming aware of such breach, (ii) notification by the Facility Agent of such breach, and (iii) any such document is terminated (otherwise than by reason of full performance in accordance with its terms);

(d) Insolvency and Rescheduling: the Sponsor or the Borrower institutes or consents to the institution of any proceeding under any Debtor Relief Law, or makes an assignment for the benefit of creditors, or applies for or consents to the appointment of any receiver, trustee, custodian, conservator, liquidator, rehabilitator or similar officer for it or for all or any material part of its property, or any receiver, trustee, custodian, conservator, liquidator, rehabilitator or similar officer is appointed for the Sponsor, the Borrower or all or any material part of its property without the application or consent of the Sponsor or the Borrower and the appointment continues undischarged or unstayed for sixty (60) calendar days, or any proceeding under any Debtor Relief Law relating to the Sponsor or the Borrower or to all or any material part of its property is instituted without the consent of the Sponsor or the Borrower and continues undismissed or unstayed for sixty (60) calendar days, or an order for relief is entered in any such proceeding;

(e) Winding-up: the Borrower or the Sponsor takes any corporate action or any other steps are taken or legal proceedings are started for its winding-up, dissolution, liquidation or reorganisation or other relief with respect to it or its debts or for the appointment of a liquidator, receiver, administrator, administrative receiver, conservator, custodian, trustee or similar officer of it or of any part or all of its assets;

(f) Indebtedness:

(i) any Financial Indebtedness of the Borrower is not paid when due (nor within any originally applicable grace periods) or is declared to be or otherwise becomes due and payable prior to its specified maturity (or within any originally applicable grace periods) as a result of an event of default (however described) unless such Financial Indebtedness is contested in good faith and reserved for; or

(ii) any creditor of the Borrower has declared any Financial Indebtedness of the Borrower due and payable prior to its specified maturity (after the expiry of any originally applicable grace periods) as a result of an event of default (howsoever described); or

(iii) any security (other than under a Security Document) securing Financial Indebtedness over any asset of the Borrower become enforceable for the amount of such Financial

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Indebtedness,

provided that no Event of Default will occur under Clauses (f) (i) to (iii) as applicable unless the aggregate amount of any such Financial Indebtedness under the relevant sub-clause is USD 5,000,000 (or its equivalent in any other currency) or more;

(g) Change of Control: the Sponsor ceases to:

(i) own (directly or indirectly) more than 50 per cent. of the entire issued share capital of the Borrower; or

(ii) control (directly or indirectly) the Borrower.

(h) Invalid, Non-binding and Non-enforceable Obligations: a provision of the Finance Documents is not legal, valid, binding and enforceable subject, however, to any general principles of law and qualifications as to matters of law set out in any legal opinion to be delivered to the Facility Agent pursuant to Clause 2.3(a)(i) (Conditions Precedent);

(i) Security: any material security pursuant to the Security Documents has not been provided on the due date or ceases to be in full force and effect;

(j) Sponsor's Guarantee: any event of default under the Sponsor's Guarantee;

(k) Material Adverse Effect: any other event or circumstance (or series of events or circumstances) occurs that has a Material Adverse Effect, subject, however, to general principles of law and qualifications as to matters of law set out in any legal opinion to be delivered to the Facility Agent pursuant to Clause 2.3(a)(i) (Conditions Precedent) unless the Facility Agent is satisfied that the Sponsor will perform under the Sponsor's Guarantee and such performance is capable to remedy such Material Adverse Effect.

21.2 Acceleration and Cancellation

Upon the occurrence of an Event of Default and at any time thereafter while such Event of Default is continuing, the Facility Agent may and shall upon the direction of all Lenders and the ECA-Guarantor by notice to the Borrower:

(a) declare all or any part of the Advances to be immediately due and payable or declare all or any part of the Advances to be due and payable on its demand (whereupon the same will become so payable together with accrued interest thereon and any other sums then owed by the Borrower under the Finance Documents); and/or

(b) declare that any unutilised portion of the Facility will be cancelled, whereupon the Lenders' undrawn Commitments shall be cancelled and each Lender's undrawn Commitment will be reduced to zero, provided that, notwithstanding the foregoing, upon the occurrence of an Event of Default specified in Clauses 21.1(d) (Insolvency and Rescheduling) and 21.1(e) (Winding Up), the undrawn Commitments of each Lender will immediately be reduced to zero and all Advances and other sums then owed by the Borrower hereunder shall become immediately due and payable; and/or

(c) exercise all rights and remedies under any Finance Document or instruct the Security Agent to do so; and/or

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(d) to exercise the rights of the Lenders in relation to the Hermes Guarantee or any security in accordance with the Security Documents.

21.3 Advances Due on Demand

If, pursuant to Clause 21.2(a), the Facility Agent declares all or any part of the Advances to be due and payable on demand of the Facility Agent, then, and at any time thereafter the Facility Agent may by notice to the Borrower:

(a) require repayment of all or such part of the Facility on such date as it may specify in such notice (whereupon the same will become due and payable on the date specified together with accrued interest thereon and any other sums then owed by the Borrower under the Finance Documents); and/or

(b) select as the duration of any Interest Period which begins whilst such declaration remains in effect a period of six months or less.

21.4 Participation of the ECA-Guarantor

Upon becoming aware of the occurrence of an Event of Default in accordance with the terms of this Agreement, the Facility Agent will promptly inform the ECA-Guarantor thereof.

22. FEES

22.1 Upfront Fee for the Facilities

(a) The Borrower shall pay to the Facility Agent in form of a one time upfront payment:

(i) for the account of the Arranger 1 an arrangement fee of 0.35 per cent. and

(ii) for the account of the Lenders a participation fee of 0.65 per cent.

of the aggregate amount of, as at the date of the Facility Agreement, the Facilities.

(b) The arrangement fee for the Facilities pursuant to paragraph (a)(i) above shall be due and payable on the earlier of (i) the date of the first Utilisation and (ii) three (3) months after the date of this Agreement, into an account to be specified by the Facility Agent to the Borrower in writing.

(c) The participation fee for the Facilities pursuant to paragraph (a)(ii) above shall be due and payable on the date of the first Utilisation into an account to be specified by the Facility Agent to the Borrower in writing.

22.2 Commitment Fee

The Borrower shall pay to the Facility Agent (for the account of each Lender) a commitment fee on the amount of such Lender's Available Commitment from day to day during the relevant Availability Period, such commitment fee to be calculated at the rate of 0.35 per cent. per annum and being due and payable in EUR in arrears on the last day of each calendar quarter during the relevant Availability Period and on the relevant Final Availability Date.

22.3 Agency Fee

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The Borrower shall pay to the Facility Agent (for the account of the Facility Agent) an agency fee in the amount and at the times agreed in the Fee Letter.

22.4 Payments

All payments to be made by the Borrower to any of the Finance Parties under this Clause 22 (Fees):

(a) shall be paid in immediately available, freely transferable, cleared funds;

(b) shall be paid in Euro; and

(c) are exclusive of any VAT. If VAT is chargeable in respect of any of the fees payable under this Clause 22 (Fees), the Borrower shall, at the same time as such payment is due and payable, pay any applicable VAT.

23. COSTS AND EXPENSES

23.1 Transaction Expenses

The Borrower shall, from time to time on demand of the Facility Agent or the Security Agent, reimburse each of the Facility Agent, the Security Agent and the Arrangers for all reasonable expenses (including fees of any Advisor) together with any VAT thereon incurred by it in connection with the negotiation, preparation and execution of the Finance Documents and the completion of the transactions contemplated in each case therein provided that any such expenses are within the limits agreed in writing between the Arrangers and the Borrower prior to the making of any such expenses. The Facility Agent and the Security Agent shall consult with the Borrower in respect of any expenses expected to be paid by the Facility Agent and/or the Security Agent in excess of EUR 10,000 and for each increase of at least EUR 10,000 in the aggregate amount of expenses.

23.2 Preservation and Enforcement of Rights

The Borrower shall, from time to time on demand of the Facility Agent, reimburse the Facility Agent, the Security Agent and the Lenders for all costs and expenses (including legal fees) on a full indemnity basis together with any VAT thereon incurred in or in connection with the preservation and/or enforcement of any of the rights of such parties under the Finance Documents (including, without limitation, any costs and expenses relating to any investigation as to whether or not an Event of Default has occurred or any steps necessary or desirable in connection with any proposal for remedying or otherwise resolving an Event of Default).

23.3 Stamp Taxes

The Borrower shall pay all stamp, registration and other taxes to which the Finance Documents, any other document referred to in the Finance Documents or any judgment given in connection therewith is or at any time may be subject and shall, from time to time on demand of the Facility Agent, indemnify the Lenders against any liabilities, costs, claims and expenses resulting from any failure to pay or any delay in paying any such tax.

23.4 Amendment Costs

If the Borrower requests any amendment, waiver or consent then the Borrower shall, within ten (10) Business Days of demand by the Facility Agent, reimburse the Facility Agent, the Security Agent

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and the Lenders for all costs and expenses (including legal fees) together with any VAT thereon incurred by such person in responding to or complying with such request.

23.5 Translation Costs

The Borrower shall, within ten (10) Business Days of demand by the Facility Agent, reimburse the Facility Agent, the Security Agent and the Lenders for all reasonable costs and expenses (including such costs and expenses of a legal adviser) together with any VAT thereon incurred by the Facility Agent, the Security Agent or any Lender by reason of such person having to have translated into English, Malay or German, as the case may be, any notice or other communication made or delivered under this Agreement or any other documents required to be delivered under or in connection with this Agreement or any other Transaction Document unless already accompanied by a relevant certified translation into English, Malay or German, as the case may be and except for a translation from the German language into the English language and vice versa.

23.6 Reimbursement of VAT

The Borrower shall only be obliged to reimburse any VAT payable in accordance with Clauses 23.1 (Transaction Expenses) to 23.5 (Translation Costs) if the respective Party entitled to reimbursement thereunder confirms that it is not legally entitled to deduct input tax (Vorsteuerabzugsberechtigung) in respect of the amounts to be reimbursed.

23.7 Lenders' Liabilities for Costs

If the Borrower fails to perform any of its obligations under this Clause 23 (Costs and Expenses), each Lender shall, in the proportion borne by its share of the Loans (or, if no Advances have been made, its Available Commitments) to the amount of the Loans (or, if no Advances have been made, the Available Facilities) for the time being (or, if the Loans have been repaid in full, immediately prior to the final repayment thereof), indemnify each of the Facility Agent and the Security Agent against any loss incurred by any of them as a result of such failure.

24. INDEMNITY AND BREAK COSTS

24.1 Indemnities

The Borrower undertakes to indemnify each of the Lenders, the Facility Agent and the Security Agent, except where any such costs, loss, expense or liability results from a Lender's, the Facility Agent's or the Security Agent's gross negligence or wilful misconduct, against any cost, claim, loss, expense (including legal fees) or liability together with any VAT thereon, which it may sustain or incur as a consequence of the occurrence of any Event of Default or any default by the Borrower and/or the Sponsor in the performance of any of the obligations expressed to be assumed by it in any of the Transaction Documents.

24.2 Break Costs

If:

(a) in relation to any Facility any payment or (voluntary or mandatory) prepayment is made otherwise than on the last day of an Interest Period applicable thereto; or

(b) in relation to all Facilities any other payment is made otherwise than on the due date therefore;

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or

(c) in relation to all Facilities any Advance requested is not made (other than by reason of default or negligence by a Finance Party);

then the Borrower will, except such payment or prepayment results from the application of Clause 15 (Illegality) pay to the Facility Agent for the account of each Lender to which such payment is made or who participated in the Advance requested its Break Costs.

"Break Costs" means the amount (if any) by which:

(a) the amount of interest which a Lender would have received (excluding Margin) for the period from the date of receipt of any part of the Loan or an overdue amount to the last day of the applicable Interest Period for the Loan or overdue amount if the principal or overdue amount received had been paid on the last day of that Interest Period;

exceeds

(b) the amount of interest which the Lender would be able to obtain by placing an amount equal to the amount received by it on deposit with a bank operating in the European Union (selected by that Lender) which has short term unsecured debt instruments in issue with a rating of F1(+) (or better) by Fitch, P-1 (or better) by Moody's or A-1(+) (or better) by S&P for period starting on the Business Day following receipt and ending on the last day of the current Interest Period.

25. PAYMENTS

25.1 Notification of Payments

Without prejudice to the liability of each party hereto promptly to pay each amount owing by it hereunder on the due date therefore, whenever a payment is expected to be made by any of the parties hereto, the Facility Agent shall, at least two (2) Business Days prior to the expected date for such payment, notify all the parties hereto of the amount, currency and timing of such payment and the identity of the party liable to make such payment and issue invoices in relation to such payments if requested, for example, for VAT purposes.

25.2 Payments to the Facility Agent

(a) On each date on which this Agreement requires an amount to be paid by the Borrower or a Lender and the Borrower or, as the case may be, such Lender shall make the same available to the Facility Agent for value on the due date at such time and in such funds and to such account with such bank as the Facility Agent shall specify from time to time.

(b) Unless otherwise permitted, all payments required to be made by the Borrower to the Lenders under any Finance Document will be made in euro to the Facility Agent on the due date therefore not later than 10:00 a.m.. If a payment is due on a day which is not a Business Day, the due date for that payment will instead be the immediately next Business Day in the same calendar month (if there is one) or the preceding Business Day (if there is none).

25.3 Distributions by the Facility Agent

(a) Save as otherwise provided herein, each payment received by the Facility Agent pursuant to

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Clause 25.2 (Payments to the Facility Agent) shall be made available by the Facility Agent to the person entitled to receive such payment in accordance with this Agreement (in the case of a Lender, for the account of its Facility Office) for value the same day by transfer to such account of such person with such bank as such person shall have previously notified to the Facility Agent.

(b) A payment will be deemed to have been made by the Facility Agent on the date on which it is required to be made under this Agreement if the Facility Agent can demonstrate that it has, on or before that date, taken steps to make that payment in accordance with the regulations or operating procedures of the clearing or settlement system used by the Facility Agent in order to make the payment. For the avoidance, the Borrower shall not have any liability towards the Lenders for any failure by the Facility Agent in respect of any distribution by the Facility Agent to the Lenders.

25.4 No Set-off

All payments required to be made by the Borrower hereunder shall be calculated without reference to any set-off or counterclaim and shall be made free and clear of and without any deduction for or on account of any set-off or counterclaim.

25.5 Clawback

Where a sum is to be paid hereunder to the Facility Agent for account of another person, the Facility Agent shall not be obliged to make the same available to that other person until the Facility Agent has been able to establish to its satisfaction that the Facility Agent has actually received such sum, but if it does so and it proves to be the case that it had not actually received such sum, then the person to whom such sum was so made available shall on request refund the same to the Facility Agent together with an amount sufficient to indemnify the Facility Agent against any cost or loss it may have suffered or incurred by reason of its having paid out such sum prior to its having received such sum.

25.6 Partial Payments

(a) If the Facility Agent receives a payment that is insufficient to discharge all the amounts then due and payable by the Borrower under the Finance Documents, the Facility Agent shall apply that payment towards the obligation of the Borrower under the Finance Documents in the following order:

(i) firstly, in or towards payment pro rata according to the respective amount thereof, of any unpaid fees, costs and expenses due to the Finance Parties under the Finance Documents;

(ii) secondly, in or towards payment pro rata according to the respective amount thereof, of any accrued interest due and payable under this Agreement;

(iii) thirdly, in or towards payment pro rata according to the respective amount thereof, of any principal due but unpaid under this Agreement; and

(iv) fourthly, in or towards payment pro rata according to the respective amount thereof, of any other sum due but unpaid under this Agreement,

unless and to the extent a deviating application of such payments received is prescribed by

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the ECA Guarantor.

(b) Paragraph (a) above will override any appropriation made by the Borrower.

26. Sharing

26.1 Payments to Lenders

If a Lender (a "Recovering Bank") applies any receipt or recovery from the Borrower to a payment due under this Agreement and such amount is received or recovered other than in accordance with Clause 25 (Payments), then such Recovering Bank shall:

(a) notify the Facility Agent of such receipt or recovery;

(b) at the request of the Facility Agent, promptly pay to the Facility Agent an amount (the "Sharing Payment") equal to such receipt or recovery less any amount which the Facility Agent determines may be retained by such Recovering Bank as its share of any payment to be made under this Agreement.

26.2 Redistribution of Payments

The Facility Agent shall treat the Sharing Payment as if it had been paid by the Borrower and distribute it rateably between the Lenders (other than the Recovering Bank).

26.3 Recovering Bank's Rights

The Lenders (other than the Recovering Bank) will assign to the Recovering Bank the claims (or the proof thereof) to which the Sharing Payment is allocated and if and to the extent the Recovering Bank is not able to rely on the assignment the Borrower shall be liable to the Recovering Bank in an amount equal to that assigned claim.

26.4 Repayable Recoveries

If any part of the Sharing Payment received or recovered by a Recovering Bank becomes repayable and is repaid by such Recovering Bank, then:

(a) each party which has received a share of such Sharing Payment pursuant to Clause 26.2 (Redistribution of Payments) shall, upon request of the Facility Agent, pay to the Facility Agent for account of such Recovering Bank an amount equal to its share of such Sharing Payment; and

(b) such Recovering Bank's rights of assignment shall be cancelled and the Borrower will be liable to the reimbursing of the party for the amount so reimbursed and the Recovering Bank shall re-assign any claims assigned to it pursuant to Clause 26.3 (Recovering Bank's Rights).

26.5 Exception

This Clause 26 shall not apply if the Recovering Bank would not, after making any payment pursuant hereto, have a valid and enforceable claim against the Borrower.

26.6 Recoveries Through Legal Proceedings

If any Lender intends to commence any action in any court it shall give prior notice to the Facility

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Agent and the other Lenders. If any Lender shall commence any action in any court to enforce its rights hereunder and, as a result thereof or in connection therewith, receives any amount, then such Lender shall not be required to share any portion of such amount with any Lender which has the legal right to, but does not, join in such action or commence and diligently prosecute a separate action to enforce its rights in another court.

27. THE FACILITY AGENT, THE SECURITY AGENT, THE ARRANGERS AND THE LENDERS

27.1 Appointment of the Agents

Each of the Lenders appoints the Facility Agent and the Security Agent, in each case to act as its agent in connection with the Finance Documents and the Hermes Guarantee and authorises the Facility Agent and the Security Agent to exercise such rights, powers, authorities and discretions as are specifically delegated to such agent by the terms hereof and thereof together with all such rights, powers, authorities and discretions as are incidental thereto.

27.2 Agent's Discretions

Each of the Facility Agent and the Security Agent may:

(a) assume, unless it has, in its capacity as agent for the Lenders, received notice to the contrary from any other party hereto or upon it becoming aware in the case of any default by the Borrower in the payment of principal or contractual interest hereunder, that (i) any representation made by the Borrower in connection with the Finance Documents is true, (ii) no Event of Default or Potential Event of Default has occurred, (iii) no party is in breach of or default under its obligations under the Transaction Documents and (iv) any right, power, authority or discretion vested herein upon the Majority Lenders, the Lenders or any other person or group of persons has not been exercised;

(b) assume that (i) the Facility Office of each Lender is that notified to it by such Lender in writing and (ii) the information provided by each Lender pursuant to Clause 31 (Notices) is true and correct in all respects until it has received from such Lender notice of a change to its Facility Office or any such information and act upon any such notice until the same is superseded by a further such notice;

(c) engage and pay for the advice or services of any lawyers, accountants, surveyors or other experts whose advice or services may to it seem necessary, expedient or desirable and rely upon any advice so obtained;

(d) rely as to any matters of fact upon a certificate signed by or on behalf of the Borrower or any Shareholder or Sponsor;

(e) rely upon any communication or document believed by it to be genuine;

(f) (other than in respect of, and in connection with, Clause 10.1, where each Lender may instruct the Facility Agent and/or the Security Agent to enforce such Lender's rights contained in Clause 10.1)) refrain from exercising any right, power or discretion vested in it as agent hereunder unless and until instructed by the Majority Lenders as to whether or not such right, power or discretion is to be exercised and, if it is to be exercised, as to the manner in which it should be exercised; and

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(g) refrain from acting in accordance with any instructions of the Majority Lenders or the Lenders to begin any legal action or proceeding arising out of or in connection with the Finance Documents and the Hermes Guarantee until it shall have received such Security as it may require (whether by way of payment in advance or otherwise) for all costs, claims, losses, expenses (including legal fees) and liabilities which it will or may expend or incur in complying with such instructions.

27.3 Facility Agent's Obligations

The Facility Agent shall:

(a) promptly inform each Lender of the contents of any notice or document received by it in its capacity as Facility Agent from the Borrower under the Finance Documents;

(b) promptly notify each Lender of the occurrence of any Event of Default or any default by the Borrower in the due performance of or compliance with its obligations under the Finance Documents of which the Facility Agent has notice from any other party hereto (or, in the case of the Facility Agent, any default by the Borrower in the payment of principal or contractual interest hereunder of which it is aware);

(c) (save as otherwise provided herein, and other than in respect of, and in connection with, Clause 10.1, where each Lender may instruct the Facility Agent to enforce such Lender's rights contained in Clause 10.1), act as agent hereunder in accordance with any instructions given to it by the Majority Lenders, which instructions shall be binding on the Arrangers, the Security Agent and the Lenders; 

(d) if so instructed by the Majority Lenders, refrain from exercising any right, power or discretion vested in it as agent hereunder; and

(e) use its reasonable efforts to obtain the Hermes Guarantee and to comply with any conditions contained therein, whereas each Lender will, upon request by the Facility Agent, support, and provide requested information to, the Facility Agent in order to enable the Facility Agent to comply with its obligations contained in this paragraph (e).

The Facility Agent's duties under the Finance Documents are solely mechanical and administrative in nature unless otherwise provided for therein.

27.4 Excluded Obligations

Notwithstanding anything to the contrary expressed or implied in the Finance Documents, neither the Facility Agent, the Security Agent nor the Arrangers shall:

(a) be bound to enquire as to (i) whether or not any representation made or deemed to be made by the Borrower in connection with the Finance Documents is true, (ii) the occurrence or otherwise of any Event of Default or Potential Event of Default (other than, in the case of the Facility Agent, any default by the Borrower in the payment of principal or contractual interest hereunder), (iii) the performance by the Borrower of its obligations under the Finance Documents or (iv) any breach of or default by the Borrower of or under its obligations under the Finance Documents;

(b) be bound to account to any Lender or any other party for any sum or the profit element of any

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sum received by it for its own account;

(c) be under any obligations other than those for which express provision is made herein; or

(d) be or be deemed to be a fiduciary for any other party hereto.

27.5 Indemnification

Each Lender shall, from time to time on demand by the Facility Agent or the Security Agent, indemnify the Facility Agent and the Security Agent, in the proportion of its share of the Loan (or, if no Advances have been made, its Available Commitments) bears to the amount of the Loan (or, if no Advances have been made, the Available Facilities) at the time of such demand (or, if the Loan has then been repaid in full, immediately prior to the final repayment thereof), against any and all costs, claims, losses, expenses (including legal fees) and liabilities together with any VAT thereon which the Facility Agent or Security Agent may incur, otherwise than by reason of its own gross negligence or wilful misconduct, in acting in its capacity as agent hereunder or under the other Finance Documents.

27.6 Security Agent as trustee

(a) The Security Agent declares that it holds all rights, title and interests in, to and under those Finance Documents to which it is a party and expressed to be a trustee (acting as trustee for the Finance Parties), and all proceeds of the enforcement of such Finance Documents, on trust for the Finance Parties from time to time. This trust shall remain in force even if the Security Agent (in whatever capacity) is at any time the sole Finance Party.

(b) The Security Agent, in its capacity as trustee or otherwise under any Finance Document or the Hermes Guarantee is not liable for any failure:

(i) to require the deposit with it of any Finance Document or the Hermes Guarantee or any other documents in connection with any Finance Document or the Hermes Guarantee;

(ii) in it holding any Finance Document or the Hermes Guarantee or any other documents in connection with any Finance Document or the Hermes Guarantee in its own possession or to take any steps to protect or preserve the same including permitting the Borrower to retain any such title deeds, any Finance Documents, the Hermes Guarantee or any other documents;

(iii) to obtain any licence, consent or other authority for the execution, delivery, validity, legality, adequacy, performance, enforceability or admissibility in evidence of any such Finance Document or the Hermes Guarantee;

(iv) to take or require the Borrower to take any step to render the Security created or purported to be created by or pursuant to any such Finance Document or the Hermes Guarantee effective or to secure the creation of any ancillary Security under the laws of any jurisdiction;

(v) to require any further assurances in relation to any such Finance Document or the Hermes Guarantee; or

(vi) to insure any asset or require any other person to maintain any such insurance or be

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responsible for any loss which may be suffered by any person as a result of the lack, or inadequacy or insufficiency, of any such insurance.

(c) The Security Agent may accept, without enquiry, any right or title the Borrower may (or may purport to) have to any asset which is the subject of any such Finance Document or the Hermes Guarantee and shall not be bound or concerned to investigate or make any enquiry into the right or title of the Borrower to any such asset or to require the Borrower to remedy any defect in its right or title to the same.

(d) Save as otherwise provided in the Finance Documents, all moneys, which under the trusts contained in any Finance Document are received by the Security Agent in its capacity as trustee or otherwise, may be invested in the name of, or under the control of, the Security Agent in any investment which may be selected by the Security Agent with the consent of the Majority Lenders. Additionally, the same may be placed on deposit in the name of, or under the control of, the Security Agent at such bank or institution (including the Security Agent) and upon such terms as the Security Agent may think fit.

27.7 Resignation of the Facility Agent or Security Agent

(a) The Facility Agent or Security Agent may resign and appoint one of its affiliates acting through an office in Germany as successor by giving notice to the other parties or, in the case of the Security Agent, to the Facility Agent on behalf of the Lenders, and to the Borrower.

(b) Alternatively the Facility Agent or Security Agent may resign by giving notice to the other Finance Parties or, in the case of the Security Agent, to the Facility Agent on behalf of the Lenders, and to the Borrowers, in which case the Lenders (after consultation with the Borrower) may appoint a successor Facility Agent or Security Agent, as appropriate.

(c) If the Lenders have not appointed a successor Facility Agent or Security Agent in accordance with paragraph (b) above within 30 days after notice of resignation was given, the Facility Agent or Security Agent (after consultation with the Borrower) may appoint a successor Facility Agent or Security Agent (acting through an office in Germany).

(d) The retiring Facility Agent or, as the case may be, Security Agent shall, at its own cost, make available to the successor Facility Agent or Security Agent such documents and records and provide such assistance as the successor Facility Agent or Security Agent may reasonably request for the purposes of performing its functions as Facility Agent or, as the case may be, Security Agent under the Finance Documents and the Hermes Guarantee.

(e) The Facility Agent's or, as the case may be, the Security Agent's resignation notice shall only take effect upon the appointment of a successor and, in the case of the Security Agent, the transfer of all of the Security for the Loans held by the incumbent to that successor.

(f) Upon the appointment of a successor:

(i) the retiring Facility Agent or, as the case may be, Security Agent shall be discharged from any further obligation in respect of the Finance Documents and the Hermes Guarantee but shall remain entitled to the benefit of this Clause 27; and

(ii) the successor Facility Agent or, as the case may be, Security Agent and each of the other parties shall have the same rights and obligations amongst themselves as they

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would have had if such successor had been an original party.

(g) With the prior written consent of the Borrower (such consent not to be unreasonably withheld), the Lenders may, by notice to the Facility Agent or to the Security Agent, as appropriate, require it to resign in accordance with paragraph (b) above. In this event, the Facility Agent or Security Agent shall resign in accordance with paragraph (b) above.

27.8 Exclusion of Liabilities

Except in the case of gross negligence (grobe Fahrlässigkeit) or wilful misconduct (Vorsatz), none of the Facility Agent, the Security Agent or the Arrangers accept any responsibility to any other Finance Party:

(a) for the adequacy, accuracy and/or completeness or any information supplied by the Facility Agent, the Security Agent, the Arrangers, by the Borrower or by any other person in connection with the Finance Documents or the Hermes Guarantee, the transactions therein contemplated or any other agreement, arrangement or document entered into, made or executed in anticipation of, pursuant to or in connection with the Finance Documents;

(b) for the adequacy, accuracy and/or completeness of any translation;

(c) for the legality, validity, effectiveness, adequacy or enforceability of the Finance Documents, the Hermes Guarantee or any other agreement, arrangement or document entered into, made or executed in anticipation of, pursuant to or in connection with the Finance Documents; or

(d) for the exercise of, or the failure to exercise, any judgment, discretion or power given to any of them by or in connection with the Finance Documents, the Hermes Guarantee or any other agreement, arrangement or document entered into, made or executed in anticipation of, pursuant to or in connection with the Finance Documents or the Hermes Guarantee.

Accordingly, none of the Facility Agent, the Security Agent or the Arrangers shall be under any liability in respect of such matters, save in the case of gross negligence or wilful misconduct.

27.9 No Actions

Each of the Lenders agrees that it will not assert or seek to assert against any director, officer or employee of the Facility Agent, the Security Agent or the Arrangers any claim it might have against any of them in respect of the matters referred to in Clause 27.8 (Exclusion of Liabilities).

27.10 Business with the Group

The Facility Agent and the Security Agent may accept deposits from, lend money to and generally engage in any kind of banking or other business with any member of the First Solar Group.

27.11 Own Responsibility

It is understood and agreed by each Lender that at all times it has itself been, and will continue to be, solely responsible for making its own independent appraisal of and investigation into all risks arising under or in connection with the Finance Documents and the Hermes Guarantee including, but not limited to:

(a) the financial condition, creditworthiness, condition, affairs, status and nature of the Borrower,

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any Shareholder, Sponsor;

(b) the legality, validity, effectiveness, adequacy and enforceability of the Finance Documents, the Hermes Guarantee and any other agreement, arrangement or document entered into, made or executed in anticipation of, pursuant to or in connection with the Finance Documents or the Hermes Guarantee;

(c) whether such Lender has recourse, and the nature and extent of that recourse, against the Borrower or any other person or any of their respective assets under or in connection with the Finance Documents or the Hermes Guarantee, the transactions therein contemplated or any other agreement, arrangement or document entered into, made or executed in anticipation of, pursuant to or in connection with the Finance Documents or the Hermes Guarantee; and

(d) the adequacy, accuracy and/or completeness of information provided by the Facility Agent, the Security Agent, each of the Arrangers, the Borrower, or by any other person in connection with the Finance Documents or the Hermes Guarantee, the transactions contemplated therein or any other agreement, arrangement or document entered into, made or executed in anticipation of, pursuant to or in connection with the Finance Documents or the Hermes Guarantee.

Accordingly, each Lender acknowledges to the Facility Agent, the Security Agent and the Arrangers that it has not relied on and will not hereafter rely on the Facility Agent, the Security Agent or the Arrangers or any of them in respect of any of these matters.

27.12 Agency and Trustee Division Separate

In acting as agent or trustee under the Finance Documents for the Lenders, the Facility Agent and the Security Agent shall be regarded as acting through its agency division or, as the case may be, trustee division which shall be treated as a separate entity from any other of its divisions or departments and, notwithstanding the foregoing provisions of this Clause 27 (The Facility Agent, the Security Agent, the Arrangers and the Lenders) any information received by some other division or department of the Facility Agent or Security Agent may be treated as confidential and shall not be regarded as having been given to the Facility Agent's or Security Agent's agency or trustee division.

28. ASSIGNMENTS AND TRANSFERS

28.1 Binding Agreement

This Agreement shall be binding upon and enure to the benefit of each party hereto and its or any subsequent successors and Transferees.

28.2 No Assignments and Transfers by the Borrower

The Borrower shall not be entitled to assign, transfer or otherwise dispose of all or any of its rights, benefits and obligations under the Finance Documents.

28.3 Assignments and Transfers by the Lenders

(a) Each of the Lenders (a "Transferor") may at any time:

(i) assign any of its rights and benefits (an "Assignment"); or

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(ii) transfer any of its rights and obligations (a "Transfer"); or

(iii) otherwise dispose of any of its rights and obligations (including, but not limited to, by way of sub-participation)

under this Agreement, the Hermes Guarantee and/or any Security Document in whole or in part to third parties (each a "Transferee") subject to Clause (b) and will subsequently inform the Borrower.

(b) Any Assignment or Transfer (save for sub-participations) will only be permissible

(i) upon prior written consent of the Borrower (such consent not to be unreasonably withheld; an increase in the Tax Deduction obligations of the Borrower shall be a reason where consent may be withheld by the Borrower. However, the Borrower– as the case may be – together with the relevant existing and/or future Lender shall use their best efforts to obtain any potentially available exemptions to reduce or mitigate such potentially increased Tax Deduction. If and when such measures result in a situation where after the Transfer the Tax Deduction obligations of the Borrower would be comparable to those of the transferring/assigning Lender prior to the Transfer, the consent may no longer be withheld on such grounds.);

(ii) if such Assignment and/or Transfer is permitted under the general conditions of the Hermes Guarantee (Allgemeine Bedingungen – Garantien für gebundene Finanzkredite (FKG)) and the supplementary provisions relating to the assignment of guaranteed amounts (Allgemeine Bedingungen – Ergänzende Bestimmungen für Forderungsabtretungen (AB-FAB)); and

(iii) if it refers to a minimum of EUR 5,000,000

unless such Assignment and/or Transfer is intended to be made to another existing Lender, an affiliate of an existing Lender, the ECA-Guarantor or the Federal Republic of Germany or an Event of Default has occurred and is continuing and provided that such Assignment and/or Transfer is permitted under the general conditions of the Hermes Guarantee (Allgemeine Bedingungen – Garantien für gebundene Finanzkredite (FKG)) and the supplementary provisions relating to the assignment of guaranteed amounts (Allgemeine Bedingungen – Ergänzende Bestimmungen für Forderungsabtretungen (AB-FAB)).

If a generally permitted Assignment and/or Transfer is intended to be made to an affiliate of an existing Lender, the Borrower may object to such Assignment and/or Transfer, if this would result in an increased Tax Deduction obligation of the Borrower. However, the Borrower– as the case may be – together with the relevant existing and/or future Lender or its affiliate shall use their best efforts to obtain any potentially available exemptions to reduce or mitigate such potentially increased Tax Deduction. If and when such measures result in a situation where after the Transfer the Tax Deduction obligations of the Borrower would be comparable to those of the transferring/assigning Lender prior to the Transfer, an objection of the Borrower shall no longer be effective. The Borrower may not object to an Assignment and/or Transfer pursuant to this paragraph in cases where an Event of Default has occurred and is continuing.

(c) A Transfer will only become effective upon execution by the Transferor and the Transferee and countersignature by the Facility Agent of a transfer agreement substantially in the form

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of Schedule 2 (Form of Transfer Agreement) (the "Transfer Agreement"). Upon the Transfer becoming effective, and for such part of the Transferor’s rights and obligations, as is transferred, the Transferor shall be released from its obligations under the Finance Documents and all other related documentation, and its rights and obligations under such documents shall transfer to and vest in the Transferee provided that it will be the sole responsibility of the Transferee to ensure that any additional action which may be required for securing the valid transfer to it of any rights in respect of the Hermes Guarantee and/or the security under the applicable Security Documents is taken.

(d) The Facility Agent shall consult the Borrower of a proposed Assignment and/or Transfer at least 10 days in advance. Any Transferor shall give timely notice of any proposed Transfer to the Facility Agent in order to enable the Facility Agent to inform the Borrower of such Transfer with a notice period of at least 10 days.

28.4 Assignment and Transfer Fees

On the date upon which an Assignment or a Transfer (save for sub-participation) takes effect the relevant assignee or Transferee shall pay to the Facility Agent for its own account a fee of EUR 3,000.

28.5 Disclosure of Information

Any Lender may disclose to any person:

(a) to (or through) whom such Lender assigns or transfers (or may potentially assign or transfer) all or any of its rights, benefits and obligations under the Finance Documents;

(b) with (or through) whom such Lender enters into (or may potentially enter into) any sub-participation in relation to, or any other transaction under which payments are to be made by reference to, this Agreement or the Borrower;

(c) to the ECA-Guarantor and the Federal Republic of Germany, or

(d) to whom information may be required to be disclosed by any applicable law:

such information about the Borrower, the Shareholders, the Sponsor, the Project and the Transaction Documents as such Lender shall consider appropriate provided that in relation to sub-Clauses (a) and (b) the person to whom such information is to be given has first entered into a confidentiality agreement or is otherwise bound by duties of bank secrecy. The confidentiality restrictions in this Clause shall not apply to:

(e) information already known to a recipient otherwise than in breach of this Clause or any other confidentiality obligation binding upon the disclosing party;

(f) information also received from another source on terms not requiring it to be kept confidential; and

(g) information which is or becomes publicly available otherwise than in breach of this Clause or any other confidentiality obligation binding upon the disclosing party.

29. CALCULATIONS AND EVIDENCE OF DEBT

29.1 Basis of Accrual

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Interest, commitment fee and default interest shall accrue from day to day and shall be calculated in relation to each Advance made or to be made under a Facility on the basis of a year of 360 days for amounts denominated in EUR (or, in any case where market practice differs, in accordance with market practice) and the actual number of days elapsed. The same shall apply mutatis mutandis in respect of the agency fee pursuant to Clause 22.3 (Agency Fee).

29.2 Evidence of Debt

Each Lender shall maintain in accordance with its usual practice accounts evidencing the amounts from time to time lent by and owing to it hereunder.

29.3 Control Accounts

The Facility Agent shall maintain on its books a control account or accounts in which shall be recorded (a) the amount of any Advance and each Lender's share therein, (b) the amount of all principal, interest and other sums due or to become due from the Borrower and each Lender's share therein and (c) the amount of any sum received or recovered by the Facility Agent hereunder and each Lender's share therein.

29.4 Prima Facie Evidence

In any legal action or proceeding arising out of or in connection with any Finance Document, the entries made in the accounts maintained pursuant to Clause 29.2 (Evidence of Debt) and Clause 29.3 (Control Accounts) shall be prima facie evidence of the existence and amounts of the specified obligations of the Borrower.

30. REMEDIES AND WAIVERS, PARTIAL INVALIDITY

30.1 Remedies and Waivers

No failure to exercise, nor any delay in exercising any right or remedy under the Finance Documents shall operate as a waiver thereof, nor shall any single or partial exercise of any right or remedy prevent any further or other exercise thereof or the exercise of any other right or remedy. The rights and remedies herein provided are cumulative and not exclusive of any rights or remedies provided by law.

30.2 Partial Invalidity

If, at any time, any provision hereof is or becomes illegal, invalid or unenforceable in any respect under the law of any jurisdiction, neither the legality, validity or enforceability of the remaining provisions hereof nor the legality, validity or enforceability of such provision under the law of any other jurisdiction shall in any way be affected or impaired thereby.

31. NOTICES

31.1 Communications in Writing

Each communication to be made under the Finance Documents shall be made in writing and, unless otherwise stated, shall be made by fax or letter.

31.2 Addressees

Any communication or document to be made or delivered pursuant to the Finance Documents shall

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(unless the recipient of such communication or document has, by fifteen days' written notice to the Facility Agent, specified another address or fax number) be made or delivered to the address or fax number:

(a) in the case of the Facility Agent and the Security Agent, identified with its name on the signature page;

(b) in the case of the Borrower, identified with its name on the signature page; and

(c) in the case of each Lender, notified in writing to the Facility Agent prior to the date hereof (or, in the case of a Transferee, at the end of the Transfer Agreement to which it is a party as Transferee);

provided that not more than one address may be specified by each party pursuant to this Clause 31.2 (Addressees) at any time.

31.3 Delivery

Any communication or document to be made or delivered by one person to another pursuant to the Finance Documents shall:

(a) if by way of fax, be deemed to have been received when transmission has been completed; and

(b) if by way of letter, be deemed to have been delivered when left at the relevant address or, as the case may be, ten days after being deposited in the post postage prepaid in an envelope addressed to it at such address,

provided that any communication or document to be made or delivered to the Facility Agent or the Security Agent shall be effective only when received by its agency division and then only if the same is expressly marked for the attention of the department or officer identified with the Facility Agent's or, as the case may be, Security Agent's signature below (or such other department or officer as the Facility Agent or, as the case may be, Security Agent shall from time to time specify for this purpose).

31.4 Notification of Changes

Promptly upon receipt of notification of a change of address or fax number of the Borrower or upon changing its own address or fax number the Facility Agent shall notify the other parties hereto of such change. The Facility Agent shall only notify the other parties hereto of a change of address or fax number of a Lender upon request.

31.5 Electronic communication

(a) Any communication to be made between the Facility Agent and a Lender under or in connection with the Finance Documents may be made by electronic mail or other electronic means, if the Facility Agent and the relevant Lender:

(i) agree that, unless and until notified to the contrary, this is to be an accepted form of communication;

(ii) notify each other in writing of their electronic mail address and/or any other

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information required to enable the sending and receipt of information by that means; and

(iii) notify each other of any change to their address or any other such information supplied by them.

(b) Any electronic communication made between the Facility Agent and a Lender will be effective only when actually received in readable form and in the case of any electronic communication made by a Lender to the Facility Agent only if it is addressed in such a manner as the Facility Agent shall specify for this purpose.

31.6 Use of websites

(a) The Facility Agent may satisfy its obligation under this Agreement to deliver any information in relation to those Lenders (the "Website Lenders") who accept this method of communication by posting this information onto an electronic website designated by the Facility Agent (the "Designated Website") if:

(i) the Facility Agent expressly agrees (after consultation with each of the Lenders) that it will accept communication of the information by this method;

(ii) the Facility Agent is aware of the address of and any relevant password specifications for the Designated Website; and

(iii) the information is in a format previously agreed between the Borrower and the Facility Agent.

(b) If any Lender (a "Paper Form Lender") does not agree to the delivery of information electronically then the Facility Agent shall notify the Borrower accordingly and the Borrower shall at its own cost supply the information to the Facility Agent (in sufficient copies for each Paper Form Lender) in paper form. In any event the Borrower shall at its own cost supply the Facility Agent with at least one copy in paper form of any information required to be provided by it.

(c) The Facility Agent shall supply each Website Lender with the address of and any relevant password specifications for the Designated Website following designation of that website by the Borrower and the Facility Agent.

(d) The Borrower shall promptly upon becoming aware of its occurrence notify the Facility Agent if:

(i) the Designated Website cannot be accessed due to technical failure;

(ii) the password specifications for the Designated Website change;

(iii) any new information which is required to be provided under this Agreement is posted onto the Designated Website;

(iv) any existing information which has been provided under this Agreement and posted onto the Designated Website is amended; or

(v) the Borrower becomes aware that the Designated Website or any information posted

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onto the Designated Website is or has been infected by any electronic virus or similar software.

(e) If the Borrower notifies the Facility Agent under paragraph (d)(i) or paragraph (d)(v) above, all information to be provided by the Borrower under this Agreement after the date of that notice shall be supplied in paper form unless and until the Facility Agent and each Website Lender is satisfied that the circumstances giving rise to the notification are no longer continuing.

(f) Any Website Lender may request, through the Facility Agent, one paper copy of any information required to be provided under this Agreement which is posted onto the Designated Website. The Borrower shall at its own cost comply with any such request within ten Business Days.

31.7 Language

Each notice or other communication made or delivered under this Agreement shall be in English (or in German if so required by the ECA-Guarantor). Any other documents required to be delivered under or in connection with this Agreement shall be either in English or be accompanied by a certified translation into English (or in German if so required by the ECA-Guarantor).

32. COUNTERPARTS

This Agreement may be executed in any number of counterparts, all of which taken together shall constitute one and the same instrument.

33. AMENDMENTS

33.1 Amendments

The Facility Agent, if it has the prior consent of, or an instruction from, the Majority Lenders and the Borrower, may from time to time agree in writing to amend this Agreement or to waive, prospectively or retrospectively, any of the requirements of this Agreement. Any amendments or waivers so agreed shall be binding on all parties hereto provided that no such waiver or amendment shall impose any new or additional obligations upon any party hereto without the consent of such party.

33.2 Amendments Requiring the Consent of all the Lenders

An amendment or waiver which relates to:

(a) Clause 26 (Sharing) or this Clause 33;

(b) a change in the principal amount of or currency of any Advance or deferral of any Repayment Date;

(c) a change in the Margin, the amount or currency of any payment of interest, fees or any other amount payable hereunder to any party or deferral of the date for payment thereof;

(d) Clause 19 (Financial Covenants);

(e) the conditions set out in Clause 3.1 (General Conditions for all Advances);

(f) Clause 28.2 (No Assignments and Transfers by the Borrower); or

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(g) any provision which contemplates the need for the consent or approval of all the Lenders,

shall not be made without the prior written consent of all the Lenders unless the contrary is expressly indicated.

33.3 Exceptions

Notwithstanding any other provisions hereof, neither the Facility Agent nor the Security Agent shall be obliged to agree to any such amendment or waiver if the same would:

(a) amend or waive this Clause 33, Clause 23 (Costs and Expenses) or Clause 27 (The Facility Agent, the Security Agent, the Arrangers and the Lenders); or

(b) otherwise amend or waive any of the Facility Agent's or Security Agent's rights hereunder.

34. HERMES GUARANTEE

34.1 Compliance with Hermes Guarantee

To the best of its knowledge, each of the Original Lenders and the Facility Agent has taken all steps necessary to align this Agreement with the provisions of the Hermes Guarantee.

34.2 Procedure in case of conflicts with Hermes Guarantee

If, in the opinion of the Facility Agent, there are any provisions in this Agreement that contradict or conflict with any provision of the Hermes Guarantee to an extent that has or may have the effect of rendering all or any part of the Hermes Guarantee void, voidable or otherwise not in full force and effect, the Finance Parties and the Borrower shall enter into good faith negotiations and use all reasonable efforts to agree on amendments to this Agreement necessary to ensure compliance with the terms of the Hermes Guarantee. The negotiation period for this purpose shall be four weeks unless a period set by the ECA-Guarantor is shorter, in which case the negotiation period shall be as long as the period set by the ECA-Guarantor. The four weeks negotiation period shall start upon the Facility Agent requesting such negotiation period or upon receipt of a notification from the ECA-Guarantor, as the case may be.

34.3 No changes

The Facility Agent agrees that it shall not agree to any changes to the Hermes Guarantee which (in its sole opinion) will or are reasonably likely to have the effect of or require (whether pursuant to an amendment under Clause 34.2 above or otherwise) an amendment to any of the material financial terms of this Agreement.

35. NON APPLICABILITY OF SECTION 181 BGB

Section 181 BGB does not apply to any authorisation the Borrower gives to the Arrangers, the Facility Agent, the Security Agent and the Lenders.

36. GOVERNING LAW

This Agreement is governed by German law.

37. JURISDICTION

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37.1 Arbitration

Subject to Clause 37.2 (Courts of Law) hereof, any dispute (a "Dispute") arising out of or in connection with this Agreement (including a dispute regarding the existence, validity or termination of this Agreement or the consequences of its nullity) shall be finally settled under the Rules of Arbitration of the International Chamber of Commerce (the "Rules") by three arbitrators appointed in accordance with the Rules. The arbitral tribunal shall consist of three arbitrators. The place of arbitration shall be Zurich, Switzerland and the language of the arbitration shall be English. Save as provided in Clause 37.2 (Courts of Law) hereof, the parties exclude the jurisdiction of the courts of law.

37.2 Courts of Law

In the case of any Dispute each claimant may prior to having initiated arbitral proceedings, by notice in writing to the relevant defendant require that such Dispute be heard by a court of law. If a claimant gives such notice, the Dispute to which such notice refers shall be determined in accordance with Clause 37.3 (Exclusive Jurisdiction) hereof.

37.3 Exclusive Jurisdiction

The Borrower, the Facility Agent, the Security Agent and the Lenders irrevocably agree that place of performance and place of exclusive jurisdiction for any obligations under this Agreement is Frankfurt am Main, Federal Republic of Germany. The Borrower irrevocably submits to the exclusive jurisdiction of the competent courts in Frankfurt am Main, Federal Republic of Germany, in the case of any proceedings or legal action regarding this Agreement waiving any other jurisdiction to which the Borrower may be entitled by law.

37.4 Appointment of German Process Agent

The Borrower agrees that the process by which any suit, action or proceedings in the Federal Republic of Germany in connection with this Agreement is begun may be served on it by being delivered to the German Process Agent and the Borrower agrees that failure by the German Process Agent to give notice of such service of process shall not impair or affect the validity of such service or of any judgment based thereon.

If the appointment of such German Process Agent ceases to be effective, the Borrower shall immediately notify the Facility Agent thereof and appoint a further person in the Federal Republic of Germany to accept service of process on its behalf in the Federal Republic of Germany and, failing such appointment within fifteen (15) days, the Facility Agent shall be entitled to appoint such a person by notice to the Borrower. Nothing contained herein shall affect the right to serve process in any other manner permitted by relevant law.

37.5 Obligations of Borrower several

The Borrower agrees that the Supply Contracts and the obligations resulting therefrom shall not have any legal influence on this Agreement. With regard to the obligations of the Borrower under this Agreement the Borrower may not raise any objection or defence based upon the Supply Contracts or emanating from the commercial relationship between the Borrower and any of the Exporters.

38. LANGUAGE

This Agreement is made in the English language. However, where a German translation of a word

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or phrase appears in the text of this Agreement, the German translation of such word or phrase shall prevail.

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SCHEDULE 1
THE ORIGINAL LENDERS

Original Lenders	Commerzbank Aktiengesellschaft	Natixis Zweigniederlassung Deutschland	Total
Commitment in respect of	Total EUR 40.000.000,00	Total EUR 20.000.000,00	EUR 60.000.000,00
Facility I	EUR 18.079.542,00	EUR 9.039.771,00	EUR 27.119.313,00
Facility II	EUR 21.330.146,67	EUR 10.665.073,33	EUR 31.995.220,00
Facility III	EUR 590.311,33	EUR 295.155,67	EUR 885.467,00

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SCHEDULE 2
FORM OF TRANSFER AGREEMENT

Transfer Agreement

Between

[•]

(the "Assigning Bank")

and

[•]

(the "Assignee")

Preamble

Whereas, by the agreement dated __________ 2011 (the "Facility Agreement") the Assigning Bank together with the other Lenders has provided to the Borrower a facility for an aggregate principal amount of up to EUR [•]. The Assigning Bank has assumed a Lender's Commitment in the amount of EUR [•].

Whereas, the Assigning Bank has pursuant to Clause 28.3 (Assignments and Transfers by the Lenders) of the Facility Agreement the right to assign its legal position as Lender including all its rights, benefits and obligations under the Facility Agreement.

Whereas, the Assigning Bank is desirous to transfer its rights, benefits and obligations related to an amount of EUR [•] of the Commitment under the Facility Agreement to the Assignee and the Assignee is desirous of assuming the legal position of the Assigning Bank related thereto including all rights, benefits and obligations.

Now therefore, the parties to this Transfer Agreement hereby agree as follows:

1. Definitions

Terms used but not otherwise defined herein shall have the meaning given to them in the Facility Agreement.

2. Transfer of Assigning Bank’s Participation in Advances

Subject to the payment to the Facility Agent of a fee in the amount of EUR 3,000 and to the condition precedent that the Assignee pays the transfer price on the date of payment as defined in Clause 6.2 of this Transfer Agreement, the Assigning Bank herewith assigns and transfers and the Assignee herewith assumes, the Assigning Bank’s legal position related to such Lender's portion of its participation in each relevant outstanding Advance and/or the Commitments (applied rateably between the Assigning Bank's share in each relevant outstanding Advance thereunder and its undrawn Commitment in relation thereto and allocated between the Advances pro rata) in the amount set out in Clause 6.1 of this Transfer Agreement, including but not limited to all rights, benefits and obligations of the Assigning Bank under the Facility Agreement, as against the Borrower (if

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transferable) and the other parties thereto (the "Transferred Position") effective as of the date of payment as defined in Clause 6.2 of this Transfer Agreement. Upon the transfer as set forth above becoming effective, the Assigning Bank shall be released from the obligations related to the Transferred Position to the Borrower on the one hand and to the Lenders on the other hand.

3. Confirmations

3.1 The Assignee confirms that it has received a copy of the Facility Agreement and all other documentation and information required by it in connection with the transaction contemplated by this Transfer Agreement.

3.2 The Assignee confirms that it has made and will continue to make its own assessment of the validity, enforceability and sufficiency of the Facility Agreement and the Transfer Agreement and has not relied and will not rely on the Assigning Bank, the Lenders and the Facility Agent or any statements made by any of them in this respect.

3.3 The Assigning Bank hereby confirms that it has fulfilled its obligations arising out of the Facility Agreement with respect to the Transferred Position until the date hereof. The Assigning Bank gives no representation or warranty and assumes no responsibility with respect to the validity or enforceability of the Facility Agreement, the Hermes Guarantee, any Security Document or any other related document and assumes no responsibility for the financial conditions of the Borrower or any other party to the Facility Agreement or for the performance and observance by the Borrower or any other party of any of its obligations under the Facility Agreement, the Hermes Guarantee, any Security Document or any other related document and all such representations and warranties, whether expressed or implied by law or otherwise, are hereby excluded.

4. Miscellaneous

4.1 The Assigning Bank shall inform the Facility Agent without undue delay of the transfer of the Transferred Position pursuant to Clause 2 of this Transfer Agreement.

4.2 The transfer of the Transferred Position pursuant to Clause 2 of this Transfer Agreement shall be effected by the Facility Agent countersigning and returning to each of the Assigning Bank and the Assignee one counterpart of this Transfer Agreement.

4.3 The Assignee herewith empowers the Facility Agent to exercise such rights, powers of attorney and discretions as set forth in the provisions of the Finance Documents.

4.4 Without prejudice to any future change of address, all correspondence to the Assignee shall be sent to the following address:

[•]

Attn.:

Fax:

Email:

5. Legal Provisions

5.1 Any alteration or amendment to this Transfer Agreement shall be in writing.

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5.2 The form and content of this Transfer Agreement shall be subject to and construed in accordance with the laws of the Federal Republic of Germany in every respect. Non-exclusive place of jurisdiction for all disputes arising out of or in connection with this Transfer Agreement shall be Frankfurt am Main.

5.3 Should any provision of this Transfer Agreement be or become wholly or partly invalid, then the remaining provisions shall remain valid. Invalid provisions shall be construed in accordance with the intent of the parties and the purpose of this Transfer Agreement.

5.4 This Transfer Agreement has been executed in the English language and may be executed in three counterparts and this has the same effect as if the signatures on the counterparts were on a single copy of this Transfer Agreement. One executed copy shall be provided to the Assigning Bank, the Assignee and the Facility Agent. Each executed copy shall have the effect of an original.

6. Commitments and Advances subject to Transfer

6.1 Assigning Bank’s Commitment prior to transfer:    EUR [•]

Assigning Bank’s participation in Advances prior to transfer:    EUR [•]

Position transferred to Assignee:    EUR [•]

6.2 Date of payment by Assignee to Assigning Bank:    [•]

6.3 Account of Assigning Bank to which payment shall be effected:    [•]

____________________________

[Assigning Bank]

____________________________

[Assignee]

We hereby agree to the above Transfer Agreement.

[place], [date]

______________________________

[Facility Agent]

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SCHEDULE 3 CONDITIONS PRECEDENT

PART ICONDITIONS PRECEDENT TO INITIAL UTILISATION

Corporate Documents

1. An up to date copy certified as true by a director or company secretary of the Borrower of its memorandum & articles of association, and its certificate of incorporation.

2. A copy certified as true by a director or company secretary of the Borrower of its most recent Forms 24, 44 and 49 and Form of Annual Return, in the form prescribed under the Companies Regulations 1965 of Malaysia.

3. An up to date copy certified as true by a director or company secretary of the Borrower of its register of members.

4. An up to date copy of the Sponsor's (i) articles of incorporation certified as true by the secretary of State of its formation; and (ii) bylaws certified as true by its corporate secretary.

5. An up to date certificate of good standing in relation to the Sponsor from the secretary of State of Delaware and Arizona.

6. A copy of the corporate authorisations and/or board resolutions of each party to the Finance Documents (other than the Finance Parties) relating to the execution, delivery and performance of all Transaction Documents to which it is a party.

7. A certified and up to date copy of specimen signatures of the persons authorised to sign the relevant Transaction Documents and Drawdown Requests on behalf of each party to the Finance Documents (other than the Finance Parties) and the Drawdown Requests.

Finance Documents and Security

8. An original executed copy of each relevant Finance Document being in full force and effect.

9. Originals of the following documents in relation to each of the Exporters/producers (as applicable): (a) exporter declaration, including Annex A (Exporteurerklärung, inkl. Annex A), (b) statement on the prevention of corruption (Korruptionspräventionserklärung), (c) undertaking by Exporter/producer (Exporteur/Hersteller-Verpflichtungserklärung) and (d) a confirmation with respect to the origin of the goods to be provided under the Supply Contracts.

10. A written confirmation by Robert Bürkle GmbH that any payment claims it may have against the Borrower under or in connection with the Purchaser Order Bürkle V and the Purchase Order Bürkle VI may be fulfilled by way of payment of the respective amount to the Exporter C and that it will accept any such payments to the Exporter C as if they were paid directly to itself.

Hermes Guarantee

11. An executed copy of the Hermes Guarantee being in full force and effect.

Financial Information

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12. An original or a copy of an original of the latest audited financial statements of the Borrower or its opening balance sheets, in each case, however, bearing an original signature.

13. An original or a copy of an original of the most recent quarterly financial statements of the Borrower, in each case, however, bearing an original signature.

14. Evidence required by the Facility Agent for the purpose of enabling the Finance Parties to obtain compliance clearance in respect of:

• any applicable regulations and statutes from time to time in force applicable to any Finance Party for the prevention of money laundering and financial crime including, without limitation, any requirement of the Financial Services Authority for the identification of the Borrower, its officers, shareholders and ultimate beneficiaries; and

• "know your customer" regulations and other similar requirements.

Legal Opinions

15. A legal opinion from Clifford Chance Partnerschaftsgesellschaft, Frankfurt am Main regarding the German law Finance Documents in form and substance satisfactory to the Original Lenders.

16. A legal opinion from Chooi & Company regarding the Borrower's obligations under the Finance Documents, the due execution by the Borrower of the relevant German law governed Transaction Documents and Malaysian law aspects of the transaction including, but not limited to, a confirmation in respect of compliance with environmental standards and a confirmation that all Authorisations are in full force and effect in form and substance satisfactory to the Original Lenders.

17. A legal opinion of Clifford Chance LLP, New York regarding the Sponsor's obligations under the New York law Sponsor's Guarantee in form and substance satisfactory to the Original Lenders including a capacity opinion on the Sponsor with regard to the Sponsor's Guarantee and the Subordination Agreement.

Miscellaneous

18. Confirmation by the German Process Agent to the Facility Agent to act as process agent for the Borrower.

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PART II
CONDITIONS PRECEDENT TO EACH FIRST UTILISATIONS UNDER EACH OF (A) FACILITY 1 AND (B) FACILITY II, TO THE EXTENT APPLICABLE

Project Documents

1. An executed copy of each Project Document relating to the KLM to be financed by the relevant Facility being in full force and effect.

Authorisations and Regulatory requirements

2. Evidence that all Authorisations relating to the KLM to be financed by the relevant Facility as set out in Schedule 7 (Authorisations) are in place in accordance with the relevant point in time determined in Schedule 7 (Authorisations).

Payments

3. Receipt of all fees (including legal fees), costs and expenses required to be paid by the Borrower in relation to the relevant Facility to the extent such fees are due and payable on the relevant date of Utilisation.

4. A confirmation from the relevant Exporter addressed to the Facility Agent confirming receipt of a payment of at least 15 per cent. of the Contract Value of the relevant Supply Contract together with the relevant account statement of the relevant Exporter evidencing such receipt.

Project Documents

5. A confirmation of the Borrower and the relevant Exporter that the respective Supply Contract to be financed by the relevant Utilisation is in full force and effect [or, as the case may be, has been discharged in full by the relevant parties] and the Borrower has complied in all material respects with the terms thereof.

6. A photocopy of the relevant bills of lading (Konnossements) to the extent such shipping documents form a condition precedent to the relevant payment obligation under the relevant Supply Contract the satisfaction of which shall be financed by the relevant Drawdown.

7. A copy of the relevant invoice issued by the relevant Exporter in relation to the payment obligation under the relevant Supply Contract the satisfaction of which shall be financed or refinanced by the relevant drawdown.

8. A copy of the account statement of the relevant Exporter evidencing that the Borrower has made the relevant payment to be financed or refinanced by the relevant drawdown.

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SCHEDULE 4
FORM OF DRAWDOWN REQUEST

From:    First Solar Malaysia Sdn. Bhd.

To:     Commerzbank Aktiengesellschaft, Luxembourg Branch as Facility Agent

Dated:

Dear Sir or Madam

Facility Agreement dated __________ 2011between, inter alios, Commerzbank Aktiengesellschaft, Luxembourg Branch as Facility Agent, the Lenders and First Solar Malaysia Sdn. Bhd. as Borrower (the "Facility Agreement")

1. We refer to the Facility Agreement. This is a Drawdown Request. This Drawdown Request is issued for the making of an Advance under Facility [I/II/III] as contemplated under Clause 2.2 (Purpose and Application) of the Facility Agreement.

2. Terms defined in the Facility Agreement have the same meaning when used in this Drawdown Request unless given a different meaning in this Drawdown Request.

3. This notice is irrevocable.

4. This is to confirm that payments have been effected to the [Exporter A/B/C/D] out of own funds of the Borrower for payment of amounts due under the terms of the Supply Contract ___ in respect of all deliveries/services made/rendered

(a) on _______________ in the value of     EUR _______________________

(b) on _______________ in the value of     EUR _______________________

(c) on _______________ in the value of     EUR _______________________

Total    EUR _______________________

on the condition always, that such payments shall be reimbursed to the Borrower under the terms of the Facility Agreement.

5. Therefore we ask you to disburse the aggregate amount of EUR _______________________ to the account of the Borrower specified below, being an account held outside of Malaysia and agreed with the Facility Agent:

Account holder: _______________________

Account number: _______________________

Account bank: _______________________

S.W.I.F.T. code: _______________________

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IBAN: _______________________

BIC: _______________________

6. We request that the Interest Periods for the above Advance under Facility [I/II/III] shall be __ months.

7. We confirm that, at the date hereof,

(a) the Repeated Representations and Warranties are true in all respects; and

(b) no Event of Default or Potential Event of Default has occurred and is continuing (nor will any such event thereby occur as a result of the making of such Advances).

Place/Date: _______________________

For and on behalf of the Borrower

[signature]

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SCHEDULE 5

FORM OF SELECTION NOTICE

From:    First Solar Malaysia Sdn. Bhd.

To:     Commerzbank Aktiengesellschaft, Luxembourg Branch as Facility Agent

Dated:

Dear Sir or Madam

Facility Agreement dated __________ 2011between, inter alios, Commerzbank Aktiengesellschaft, Luxembourg Branch as Facility Agent, the Lenders and First Solar Malaysia Sdn. Bhd. as Borrower (the "Facility Agreement")

1. We refer to the Facility Agreement. This is a Selection Notice. Terms defined in the Facility Agreement have the same meaning when used in this Selection Notice unless given a different meaning in this Selection Notice.

2. We refer to the Advance[s] made under [Facility [I/II/III]]/[the Facilities] with an Interest Period ending on ______________.

3. This notice is irrevocable.

4. We request that the Interest Period for the above Advance[s] shall be __ months.

Place/Date: _______________________

For and on behalf of the Borrower

[signature]

________________________

¹ To be inserted upon occurence of the First Repayment Date.

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SCHEDULE 6

FORM OF COMPLIANCE CERTIFICATE

To:    Commerzbank Aktiengesellschaft, Luxembourg Branchas Facility Agent

From:     First Solar Malaysia Sdn. Bhd. as Borrower

Dated:

Dear Sir or Madam

Facility Agreement dated __________ 2011between, inter alios, Commerzbank Aktiengesellschaft, Luxembourg Branch as Facility Agent, the Lenders and First Solar Malaysia Sdn. Bhd. as Borrower (the "Facility Agreement")

1. We refer to the Facility Agreement. This is a Compliance Certificate. Terms defined in the Facility Agreement have the same meaning when used in this Compliance Certificate unless given a different meaning in this Compliance Certificate.

2. We confirm that the relevant ratios described under clause 19.2 (Financial Condition) of the Facility Agreement on the most recent Ratio Calculation Date were:

Total Debt to Equity Ratio:     [    ]

Total Leverage Ratio:     [    ]

Interest Coverage Ratio:     [    ]

Debt Service Coverage Ratio:    [    ]

3. We confirm that no Event of Default is continuing.

This certificate is made in the individual's official capacity as a director or officer to the Borrower and no personal liability is intended to attach in the giving of this certificate.

Signed:    __________________________        Director

of

[Borrower]

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SCHEDULE 7

AUTHORISATIONS

Type of Authorisation (in relation to Malaysian law)
1.	Manufacturing licence for the manufacture of solar modules pursuant to the Industrial Co-ordination Act 1975 expected to be obtained in December 2010
2.	Approvals required pursuant to the Environmental Quality Act 1974 and the regulations issued thereunder expected to be obtained in December 2010
3.	Approvals required in respect of the equipment and machinery for the Project and use thereof, pursuant to the Factories and Machinery Act 1967 expected to be obtained in April 2011
4.	Approvals required pursuant to the Occupational Safety and Health Act 1994 expected to be obtained in December 2010
5.	Approvals from local authorities to carry out manufacturing activities and of manufacturing premises expected to be obtained in April 2011
6.	Approvals for foreign employees pursuant to the Immigration Act 1959/63 expected to be obtained in December 2010
7.	Approvals required pursuant to the Customs Act 1967 expected to be obtained in December 2010
9.	Approvals for installation and operation of generators pursuant to the Electricity Supply Act 1990 expected to be obtained in July 2011

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SCHEDULE 8
Form of Starting Point Confirmation

[Letterhead of Borrower]

Commerzbank Aktiengesellschaft, Luxembourg Branch

Starting Point Confirmation

Dear Sir or Madam

Facility Agreement dated __________ 2011between, inter alios, Commerzbank Aktiengesellschaft, Luxembourg Branch as Facility Agent, the Lenders and First Solar Malaysia Sdn. Bhd. as Borrower (the "Facility Agreement")

We refer to the Facility Agreement. This is the Starting Point Confirmation. Terms defined in the Facility Agreement have the same meaning in this Starting Point Confirmation unless given a different meaning herein.

We hereby confirm that the date of readiness for operation of the Project in respect of KLM V and KLM VI has been set on ......................…… .

Place/Date ......................

For and on behalf of the Borrower

By

Name:

Title:

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SCHEDULE 9

FORM OF REPAYMENT SCHEDULE

Facility Agreement dated __________ 2011 between, inter alios, Commerzbank Aktiengesellschaft, Luxembourg Branchas Facility Agent, the Lenders and First Solar Malaysia Sdn. Bhd. as Borrower (the "Facility Agreement")

This is a repayment schedule in relation to Facility [I/II/III] of the Facility Agreement.

Repayment Dates	Repayment Instalments (in EUR)
[●]	[●]
[●]	[●]
[●]	[●]
[●]	[●]
[●]	[●]
[●]	[●]
[●]	[●]
[●]	[●]
[●]	[●]
[●]	[●]
[●]	[●]
[●]	[●]
[●]	[●]
[●]	[●]

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SCHEDULE 10
CONDITIONS SUBSEQUENT

No.	Condition subsequent	Time Line
1.	Approvals required pursuant to the Fire Services Act 1988	To be obtained in April 2012

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EXECUTION PAGE

FACILITY AGREEMENT

FIRST SOLAR MALAYSIA SDN. BHD

as Borrower

/s/ David Brady
Name:	David Brady	Name:
Address:	350 West Washington Street
	Suite 600
	Tempe, Arizona 85281-1244
	USA
Attn:	David Brady
Fax:	+ 1 602 414 9462

COMMERZBANK AKTIENGESELLSCHAFTas Arranger and Original Lender

/s/ Hans-Ulrich Betzoldt		/s/ Klaus-Dieter Schmedding
Name:	Hans-Ulrich Betzoldt	Name:     Klaus-Dieter Schmedding
Address:	Kaiserplatz 60311 Frankfurt am Main
Attn:	Klaus-Dieter Schmedding
Fax:	+ 49 (0)69 136 23742

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COMMERZBANK AKTIENGESELLSCHAFT, LUXEMBOURG BRANCH

as Facility Agent

/s/ Authorized Signatory		/s/ Joern Tschentscher
Name:	Authorized Signatory	Name:     Joern Tschentscher
Address:	25, Rue Edward Steichen L-2540 Luxembourg
Attn:	Agency-Department Jörn Tschentscher
Fax:	+ 352 477 911 3905

COMMERZBANK AKTIENGESELLSCHAFT, LUXEMBOURG BRANCH

as Security Agent

/s/ Authorized Signatory		/s/ Joern Tschentscher
Name:	Authorized Signatory	Name:     Joern Tschentscher
Address:	25, Rue Edward Steichen L-2540 Luxembourg
Attn:	Security Agencies Luxembourg Eva Gottschalk-Schmitt
Fax:	+ 352 477 911 3903

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NATIXIS ZWEIGNEIDERLASSUNG DEUTSCHLAND

as Arranger and Original Lender

/s/ Brueggemann		/s/ Reichmann
Name:	Brueggemann	Name:     Reichmann
Address:	Im Trutz Frankfurt 55 60322 Frankfurt
Attn:	Michael Brüggemann
Fax:	+ 49 (0) 69 97153 173

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EX-10.2

Exhibit 10.2

FIRST DEMAND GUARANTY

DATED AS OF 3 August, 2011

by

FIRST SOLAR, INC.

GUARANTY

This GUARANTY dated as of 3 August, 2011 is made by First Solar, Inc., a Delaware corporation (the “Guarantor”), in favor of each of the Agents (as defined below) and the Lenders (as defined in the Facility Agreement dated the date hereof, among First Solar Malaysia Sdn. Bhd. (Company No. 758827-T) (the “Borrower”), Commerzbank Aktiengesellschaft and Natixis Zweigniederlassung Deutschland as Arrangers, Commerzbank Aktiengesellschaft, Luxembourg Branch as Facility Agent and Security Agent (each of the Facility Agent and the Security Agent, an “Agent” and, collectively, the “Agents”) and the Original Lenders listed on Schedule 1 thereto (as amended, modified or supplemented from time to time in accordance with its terms, the “Facility Agreement”)). Capitalized terms used herein and not otherwise defined herein shall have the meanings attributed thereto in the Facility Agreement.

The Lenders have agreed to extend Loans to the Borrower pursuant to, and subject to the terms and conditions of, the Facility Agreement. The obligation of the Lenders to extend such Loans under the Facility Agreement is conditioned on the execution and delivery by the Guarantor of a first demand guaranty in the form hereof of the obligations of the Borrower under any of the Finance Documents, which such obligations are the due and punctual payment and performance of (a) the principal of and interest on the Loans, when and as due, whether at maturity, by acceleration, upon one or more dates set for prepayment or otherwise, including interest and fees that accrue after the commencement of proceedings by or against the Borrower under any bankruptcy, insolvency, or other debtor relief laws, and (b) all other obligations of the Borrower at any time and from time to time under the Facility Agreement and the other Finance Documents (the foregoing being collectively referred to herein as the “Obligations”).

Accordingly, in consideration of the premises and in order to induce the Lenders to make Loans and extend other financial accommodations under the Facility Agreement, the Guarantor hereby agrees as follows:

1. Guaranty

The Guarantor hereby irrevocably and unconditionally guarantees the punctual payment when due, whether at stated maturity, by acceleration or otherwise, and the punctual performance, of all present and future Obligations of the Borrower under any of the Finance Documents (the foregoing being referred to herein as the “Guaranteed Obligations”).

2. Waiver

The Guarantor hereby absolutely, unconditionally and irrevocably waives, to the fullest extent permitted by law, (i) promptness, diligence, notice of acceptance and any other notice with respect to this Guaranty, (ii) presentment, demand of payment, protest, notice of dishonor or nonpayment and any other notice with respect to the Guaranteed Obligations, (iii) any requirement that any Lender or Agent protect, secure, perfect or insure any security interest or lien or any property subject thereto or exhaust any right or take any action against the Borrower or any other person or any collateral securing the Guaranteed Obligations, and (iv) except as may be required in order to trigger a direct obligation of the Borrower, any other action, event or precondition to the enforcement of this Guaranty or the performance by the Guarantor of the obligations hereunder.

3. Guaranty Absolute

(a) The Guarantor guarantees that, to the fullest extent permitted by law, the Guaranteed Obligations will be paid or performed strictly in accordance with their terms, regardless of any law, regulation or order now or hereafter in effect in any jurisdiction affecting any of such terms or the rights of any Agent or Lender with respect thereto.

(b) No invalidity, irregularity, voidability, voidness or unenforceability of the Facility Agreement or any other Finance Document or any other agreement or instrument relating thereto, or of all or any part of the Guaranteed Obligations or of any security therefor shall affect, impair or be a defense to this Guaranty.

(c) This Guaranty is one of payment and performance, not collection, and the obligations of the Guarantor

- 1 -

under this Guaranty are independent of the Guaranteed Obligations, and a separate action or actions may be brought and prosecuted against the Guarantor to enforce this Guaranty, irrespective of whether any action is brought against the Borrower or whether the Borrower is joined in any such action or actions.

(d) Until the indefeasible payment in full of the Guaranteed Obligations, the liability of the Guarantor under this Guaranty shall be absolute and unconditional irrespective of:

(i) any change in the manner, place or terms of payment or performance, and/or any change or extension of the time of payment or performance of, renewal or alteration of, any Guaranteed Obligation, any security therefor, or any liability incurred directly or indirectly in respect thereof, or any other amendment or waiver of or any consent to departure from the Facility Agreement or any other Finance Document, including any increase in the Guaranteed Obligations resulting from the extension of additional credit to the Borrower or any of its subsidiaries or otherwise;

(ii) any sale, exchange, release, surrender, realization upon any property by whomsoever at any time pledged or mortgaged to secure, or howsoever securing, all or any of the Guaranteed Obligations, and/or any offset thereagainst, or failure to perfect, or continue the perfection of, any lien in any such property, or delay in the perfection of any such lien, or any amendment or waiver of or consent to departure from any other guaranty for all or any of the Guaranteed Obligations;

(iii) any exercise or failure to exercise any rights against the Borrower or others (including the Guarantor);

(iv) any settlement or compromise (in each case, other than the indefeasible payment in full of all of the Guaranteed Obligations) of any Guaranteed Obligation, any security therefor or any liability (including any of those hereunder) incurred directly or indirectly in respect thereof or hereof, and any subordination of the payment of all or any part thereof to the payment of any Guaranteed Obligation (whether due or not) of the Borrower to creditors of the Borrower other than the Guarantor;

(v) any manner of application of any collateral securing the Guaranteed Obligations, or proceeds thereof, to all or any of the Guaranteed Obligations, or any manner of sale or other disposition of any such collateral or any other assets of the Borrower or any of its subsidiaries;

(vi) any change, restructuring or termination of the existence of the Borrower or any of its subsidiaries; or

(vii) any other agreements or circumstance of any nature whatsoever which might otherwise constitute a defense available to, or a discharge of, this Guaranty and/or obligations of the Guarantor hereunder, or a defense to, or discharge of, the Borrower or any other person or party relating to this Guaranty or the obligations of the Guarantor hereunder or otherwise with respect to the Loans or other financial accommodations to the Borrower.

(e) Any Agent may at any time and from time to time (whether or not after revocation or termination of this Guaranty) without the consent of, or notice (except as shall be required by applicable statute and cannot be waived) to, the Guarantor, and without incurring responsibility to the Guarantor or impairing or releasing the obligations of the Guarantor hereunder, apply any sums by whomsoever paid or howsoever realized to any Guaranteed Obligation regardless of what Guaranteed Obligations remain unpaid.

(f) This Guaranty shall continue to be effective or be reinstated, as the case may be, if at any time payment,

- 2 -

or any part thereof, of any Obligation is rescinded or must otherwise be restored by the Agents or Lenders, upon the bankruptcy or reorganization of the Borrower.

4. Continuing Guaranty

This Guaranty is a continuing one and shall (i) remain in full force and effect until the indefeasible payment in full of the Guaranteed Obligations (and, upon such payment, this Guaranty shall automatically terminate), (ii) be binding upon the Guarantor, its successors and assigns, and (iii) inure to the benefit of, and be enforceable by, any Lender or Agent, and their respective permitted successors, permitted transferees and permitted assigns. All obligations to which this Guaranty applies or may apply under the terms hereof shall be conclusively presumed to have been created in reliance hereon.

5. Representations, Warranties and Covenants

(a) The Guarantor hereby represents and warrants, as of the date hereof, to and with the Lenders and the Agents that:

(i) The Guarantor has the corporate power to execute and deliver this Guaranty and to incur and perform its obligations hereunder;

(ii) The Guarantor has duly taken all necessary corporate action to authorize the execution, delivery and performance of this Guaranty and to incur and perform its obligations hereunder;

(iii) No consent, approval, authorization or other action by, and no notice to or of, or declaration or filing with, any governmental or other public body, or any other person, is required for the due authorization, execution, delivery and performance by the Guarantor of this Guaranty or the consummation of the transactions contemplated hereby;

(iv) The execution, delivery and performance by the Guarantor of this Guaranty do not and will not violate or otherwise conflict with any term or provision of any material agreement, instrument, judgment, decree, order or any statute, rule or governmental regulation applicable to the Guarantor or result in the creation of any lien upon any of its properties or assets pursuant thereto, in each case in a manner which could reasonably be expected to have a material adverse effect on the Guarantor;

(v) This Guaranty is enforceable against the Guarantor in accordance with its terms, except as enforcement thereof may be subject to the effect of any applicable bankruptcy, insolvency, reorganization, moratorium or similar law affecting creditors’ rights generally, and general principles of equity (regardless of whether such enforcement is sought in a proceeding in equity or at law);

(vi) No proceeding referred to in Section 21.1(d) of the Facility Agreement is pending against the Guarantor and no other event referred to in Section 21.1 of the Facility Agreement has occurred and is continuing; and

(vii) The capital stock of the Borrower directly or indirectly owned by the Guarantor on the date hereof consists of 330,000,002 shares of common stock, with par value 1 MYR (Malaysian ringgit) per share, constituting 100% of the authorized, issued and outstanding capital stock of the Borrower on the date hereof.

(b) The Guarantor hereby undertakes:

(i) To (x) own of record or beneficially, directly or indirectly, more than 50% of the issued share capital of the Borrower and (y) maintain direct or indirect control over the Borrower, including,

- 3 -

without limitation, the right to elect a majority of the members of the board of directors of the Borrower; and

(ii) Not to create or permit to subsist any mortgage, pledge, security interest, conditional sale or other title retention document, charge, encumbrance, or other lien (whether such interest is based on common law, statute, other law or contract) upon any shares in the Borrower.

6. Expenses

The Guarantor will upon demand reimburse any Lender or Agent for any sums, costs, and expenses which such Lender or Agent may pay or incur pursuant to the provisions of this Guaranty or in negotiating, executing, perfecting, defending, protecting or enforcing this Guaranty or in enforcing payment of the Guaranteed Obligations or otherwise in connection with the provisions hereof (other than any such sums, costs and expenses paid or incurred as a result of such Lender’s or Agent’s gross negligence or willful misconduct), including court costs, collection charges, travel expenses, and reasonable attorneys’ fees, together with interest thereon. Any payment made by the Guarantor pursuant to this Section 6 shall cause a corresponding reduction in the payment of such costs under the Facility Agreement.

7. Terms

(a) All terms defined in the Uniform Commercial Code of the State of New York (the “UCC”) and used herein shall have the meanings as defined in the UCC, unless the context otherwise requires.

(b) The words “include,” “includes” and “including” shall be deemed to be followed by the phrase “without limitation”.

(c) All references herein to sections and subsections shall be deemed to be references to sections and subsections of this Guaranty unless the context shall otherwise require.

8. Amendments and Modification

Neither this Guaranty nor any provision hereof may be amended or modified except pursuant to an agreement or agreements in writing entered into by the Facility Agent and the Guarantor.

9. Subrogation Rights

(a) In addition to all such rights of indemnity and subrogation as the Guarantor may have under applicable law (but subject to Section 9(b)), the Borrower agrees that in the event a payment shall be made by the Guarantor under this Guaranty, the Borrower shall indemnify the Guarantor for the full amount of such payment and the Guarantor shall be subrogated to the rights of the person to whom such payment shall have been made to the extent of such payment.

(b) The Guarantor hereby agrees that all rights and claims of subrogation, indemnification, contribution and reimbursement from the Borrower and its property, regardless of whether such rights arise in connection with this Guaranty, by operation of law or pursuant to Section 9(a), it may now or hereafter have or acquire against the Borrower that would constitute it a “creditor” of the Borrower for purposes of the United States Federal Bankruptcy Code, shall be fully subordinated to the payment in full of the Guaranteed Obligations.

10. Remedies Upon Default; Right of Set-Off

(a) In furtherance of the foregoing, upon the occurrence and during the continuance of any Event of Default, the Facility Agent may, without notice to or demand upon the Borrower, declare the amount of the unpaid Guaranteed Obligations immediately due and payable, and shall be entitled to enforce the obligations of the Guarantor hereunder.

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(b) Upon such declaration by the Facility Agent, any Agent or Lender are hereby authorized at any time and from time to time, to the fullest extent permitted by law, to set off and apply any and all deposits (general or special, time or demand, provisional or final) at any time held and other indebtedness at any time owing by such Agent or Lender to or for the credit or the account of the Guarantor against any and all of the obligations of the Guarantor now or hereafter existing under this Guaranty, whether or not such Agent or Lender shall have made any demand under this Guaranty; provided that at such time such obligations are due or payable. The Facility Agent agrees promptly to notify the Guarantor after any such set-off and application, provided that the failure to give such notice shall not affect the validity of such set-off and application. The rights of each Agent and Lender under this Section 10 are in addition to other rights and remedies (including other rights of set-off) which such Agents and Lenders may have.

11. Statute of Limitations

Any acknowledgment or new promise, whether by payment of principal or interest or otherwise and whether by the Borrower or others (including the Guarantor), with respect to any of the Guaranteed Obligations shall, if the statute of limitations in favor of the Guarantor against any Agent or Lender shall have commenced to run, toll the running of such statute of limitations and, if the period of such statute of limitations shall have expired, prevent the operation of such statute of limitations.

12. Rights and Remedies Not Waived

No act, omission or delay by any Agent or Lender shall constitute a waiver of its rights and remedies hereunder or otherwise. No single or partial waiver by any Agent or Lender of any default hereunder or right or remedy which it may have shall operate as a waiver of any other default, right or remedy or of the same default, right or remedy on a future occasion.

13. Admissibility of Guaranty

The Guarantor agrees that any copy of this Guaranty signed by the Guarantor and transmitted by telecopier for delivery to any Agent or Lender, or their respective legal counsel, shall be admissible in evidence as the original itself in any judicial or administrative proceeding, whether or not the original is in existence.

14. Notices

All notices, requests and demands to or upon any Agent or Lender under this Agreement shall be in writing and given as provided in the Facility Agreement. All notices, requests and demands to or upon the Guarantor shall be in writing and shall be delivered to the following address:

First Solar, Inc.

350 West Washington Street

Suite 600

Tempe, Arizona 85281

15. Counterparts

This Guaranty may be executed in any number of counterparts and by the different parties hereto on separate counterparts, each of which when so executed and delivered shall be an original and all of which shall together constitute one and the same agreement.

16. USA Patriot Act

Each Lender that is subject to the Act (as hereinafter defined) and each Agent that is subject to the Act (for itself and not on behalf of any Lender) hereby notifies the Guarantor that pursuant to the requirements of the

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USA Patriot Act (Title III of Pub. L. 107-56 (signed into law October 26, 2001)) (the “Act”), it is required to obtain, verify and record information that identifies the Guarantor, which information includes the name and address of the Guarantor and other information that will allow such Lender or the Agent, as applicable, to identify the Guarantor in accordance with the Act.

17. CONSENT TO JURISDICTION; WAIVER OF JURY TRIAL; ETC.

(a) Each of the parties hereto hereby irrevocably and unconditionally submits, for itself and its property, to the exclusive jurisdiction of any New York State court or Federal court of the United States of America, sitting in New York City, and any appellate court from any thereof, in any action or proceeding arising out of or relating to this Guaranty, or for recognition or enforcement of any judgment, and each of the parties hereto hereby irrevocably and unconditionally agrees that all claims in respect of any such action or proceeding may be heard and determined in such New York State or, to the extent permitted by law, in such Federal court. Each of the parties hereto agrees that a final judgment in any such action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law.

(b) Each of the parties hereto hereby irrevocably and unconditionally waives, to the fullest extent it may legally and effectively do so, any objection which it may now or hereafter have to the laying of venue of any suit, action or proceeding arising out of or relating to this Guaranty in any court referred to in paragraph (a) of this Section 17. Each of the parties hereto hereby irrevocably waives, to the fullest extent permitted by law, the defense of an inconvenient forum to the maintenance of such action or proceeding in any such court.

(c) Nothing herein shall affect the right of any party hereto to serve process in any manner permitted by law.

(d) EACH PARTY HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS GUARANTY. EACH PARTY HERETO HEREBY (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 17(D).

18. GOVERNING LAW

THIS GUARANTY SHALL BE GOVERNED IN ALL RESPECTS BY THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS EXECUTED AND TO BE PERFORMED IN SUCH STATE, WITHOUT GIVING EFFECT TO THE CONFLICT OF LAW PRINCIPLES THEREOF.

19. Captions; Severability

(a) The captions of the sections and subsections of this Guaranty have been inserted for convenience only and shall not in any way affect the meaning or construction of any provision of this Guaranty.

(b) If any term of this Guaranty shall be held to be invalid, illegal or unenforceable, the validity of all other terms hereof shall in no way be affected thereby.

20. Acknowledgment of Receipt

The Guarantor acknowledges receipt of a copy of this Guaranty and each of the Finance Documents.

- 6 -

IN WITNESS WHEREOF, the parties hereto have duly executed this Guaranty as of the date first set forth above.

FIRST SOLAR, INC.
By:	/s/ David Brady
	Name:	David Brady
	Title:	VP, Treasurer
By:
	Name:
	Title:
FIRST SOLAR MALAYSIA SDN. BHD.
By:	/s/ David Brady
	Name:	David Brady
	Title:	Director
By:
	Name:
	Title:
COMMERZBANK AKTIENGESELLSCHAFT, LUXEMBOURG BRANCH as Facility Agent and Security Agent
By:	/s/ Joern Tschentscher
	Name:	Joern Tschentscher
	Title:	Assistant Vice President
By:	/s/ Authorized Signatory
	Name:	Authorized Signatory
	Title:

Signature Page to Sponsor Guaranty

- 7 -

EX-31.01

EXHIBIT 31.01

CERTIFICATION OF CHIEF EXECUTIVE OFFICER

PURSUANT TO 15 U.S.C. SECTION 7241, AS

ADOPTED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Robert J. Gillette, certify that:

1 I have reviewed the Quarterly Report on Form 10-Q of First Solar, Inc., a Delaware corporation, for the period ended June 30, 2011, as filed with the Securities and Exchange Commission;

2 Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3 Based on my knowledge, the financial statements and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of and for, the periods presented in this report;

4 The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an Annual Report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5 The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date:	August 5, 2011	/s/ ROBERT J. GILLETTE
		Robert J.Gillette
		Chief Executive Officer

EX-31.02

EXHIBIT 31.02

CERTIFICATION OF CHIEF FINANCIAL OFFICER

PURSUANT TO 15 U.S.C. SECTION 7241, AS

ADOPTED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Mark Widmar, certify that:

1 I have reviewed the Quarterly Report on Form 10-Q of First Solar, Inc., a Delaware corporation, for the period ended June 30, 2011, as filed with the Securities and Exchange Commission;

2 Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3 Based on my knowledge, the financial statements and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of and for, the periods presented in this report;

4 The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an Annual Report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5 The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date:	August 5, 2011	/s/ MARK WIDMAR
		Mark Widmar
		Chief Financial Officer

EX-32.01

EXHIBIT 32.01

CERTIFICATION OF

 CHIEF EXECUTIVE OFFICER AND CHIEF FINANCIAL OFFICER

 PURSUANT TO 18 U.S.C. SECTION 1350,

 AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report on Form 10-Q of First Solar, Inc., a Delaware corporation, for the period ended June 30, 2011, as filed with the Securities and Exchange Commission, each of the undersigned officers of First Solar, Inc. certifies pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to his respective knowledge:

	(1	)	the quarterly report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and
	(2	)	the information contained in the quarterly report fairly presents, in all material respects, the financial condition and results of operations of First Solar, Inc. for the periods presented therein.
Date:			August 5, 2011	/s/ ROBERT  J. GILLETTE
				Robert J. Gillette
				Chief Executive Officer
Date:			August 5, 2011	/s/ MARK WIDMAR
				Mark Widmar
				Chief Financial Officer

XML



Note 9. Derivative Financial Instruments (Details) - Hedging Relationship (USD $) In Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2011	Jun. 26, 2010	Jun. 30, 2011	Jun. 26, 2010
Foreign Exchange Contract [Member] | Other Expense [Member] | Nondesignated [Member]
Amount of gain (loss) on derivatives recognized in income:
Derivative instruments, gain (loss) recognized in income, net	$ (741)	$ (4,958)	$ 468	$ (10,521)
Foreign Exchange Contract [Member] | Net Sales [Member] | Cash Flow Hedging [Member]
Amount of gain (loss) reclassified from accumulated other comprehensive income into income:
Derivative instruments, gain (loss) reclassified from accumulated OCI into income, effective portion, net	(26,154)	27,938	(38,534)	29,233
Amount of gain (loss) on derivatives recognized in income:
Derivative instruments, gain (loss) recognized in income, net	(26,154)	27,938	(38,534)	29,233
Foreign Exchange Contract [Member] | Net Sales [Member] | Nondesignated [Member]
Amount of gain (loss) on derivatives recognized in income:
Derivative instruments, gain (loss) recognized in income, net		340		0
Foreign Exchange Contract [Member] | Cost of Sales [Member] | Nondesignated [Member]
Amount of gain (loss) on derivatives recognized in income:
Derivative instruments, gain (loss) recognized in income, net	820	(2,714)	3,902	(7,228)
Foreign Exchange Contract [Member] | Cash Flow Hedging [Member]
Amount of gain (loss) recognized in other comprehensive income on derivatives:
Derivative instruments, gain (loss) recognized in other comprehensive income, effective portion, net	(16,890)	18,055	(70,642)	54,954
Interest Rate Swap [Member] | Interest Income (Expense) [Member] | Cash Flow Hedging [Member]
Amount of gain (loss) reclassified from accumulated other comprehensive income into income:
Derivative instruments, gain (loss) reclassified from accumulated OCI into income, effective portion, net	(200)	(314)	(405)	(633)
Amount of gain (loss) on derivatives recognized in income:
Derivative instruments, gain (loss) recognized in income, net	(200)	(314)	(405)	(633)
Interest Rate Swap [Member] | Cash Flow Hedging [Member]
Amount of gain (loss) recognized in other comprehensive income on derivatives:
Derivative instruments, gain (loss) recognized in other comprehensive income, effective portion, net	(533)	(366)	184	(821)
Cash Flow Hedging [Member]
Amount of gain (loss) recognized in other comprehensive income on derivatives:
Derivative instruments, gain (loss) recognized in other comprehensive income, effective portion, net	(17,423)	17,689	(70,458)	54,133
Amount of gain (loss) reclassified from accumulated other comprehensive income into income:
Derivative instruments, gain (loss) reclassified from accumulated OCI into income, effective portion, net	$ (26,354)	$ 27,624	$ (38,939)	$ 28,600

XML



Condensed Consolidated Balance Sheets (USD $) In Thousands	Jun. 30, 2011		Dec. 31, 2010
Current assets:
Cash and cash equivalents	$ 357,477		$ 765,689
Marketable securities and investments	106,966		167,889
Accounts receivable trade, net	541,977		305,537
Accounts receivable, unbilled	63,677		1,482
Inventories	322,995		195,863
Balance of systems parts	33,656		4,579
Project assets	145,379		0
Deferred tax asset, net	3,590		388
Prepaid expense and other assets	260,514		143,033
Total current assets	1,836,231		1,584,460
Property, plant and equipment, net	1,727,993		1,430,789
Project assets	309,688		320,140
Deferred tax asset, net	268,243		259,236
Marketable securities	50,996		180,271
Restricted cash and investments	174,698		86,003
Goodwill	458,808		433,288
Inventories	42,713	[1]	42,728	[1]
Other assets	69,862		43,488
Total assets	4,939,232		4,380,403
Current liabilities:
Accounts payable	189,875		82,312
Income taxes payable	36,493		16,831
Accrued expenses	242,250		244,271
Current portion of long-term debt	28,334		26,587
Other current liabilities	94,917		99,676
Total current liabilities	591,869		469,677
Accrued solar module collection and recycling liability	176,644		132,951
Long-term debt	332,492		210,804
Other liabilities	156,689		112,026
Total liabilities	1,257,694		925,458
Stockholders equity:
Common stock, $0.001 par value per share; 500,000,000 shares authorized; 86,290,962 and 85,843,511 shares issued and outstanding at June 30, 2011 and December 31, 2010, respectively	86		86
Additional paid-in capital	1,878,429		1,815,420
Contingent consideration	0		1,118
Accumulated earnings	1,842,670		1,665,564
Accumulated other comprehensive loss	(39,647)		(27,243)
Total stockholders equity	3,681,538		3,454,945
Total liabilities and stockholders equity	$ 4,939,232		$ 4,380,403

[1] We purchase a critical raw material that is heavily used in our core production process in quantities that anticipate confident, but long-term future demand. We classify the raw materials that we do not expect to be consumed within our operating cycle (which is 12 months) as noncurrent.

XML



Condensed Consolidated Balance Sheets (Parenthetical) (USD $)	Jun. 30, 2011	Dec. 31, 2010
Common stock, par value	$ 0.001	$ 0.001
Common stock, shares authorized	500,000,000	500,000,000
Common stock, shares issued	86,290,962	85,843,511
Common stock, shares outstanding	86,290,962	85,843,511

XML



Note 10. Fair Value Measurement (Details) (USD $) In Thousands	Jun. 30, 2011	Dec. 31, 2010
Marketable securities:
Fair Value, assets measured on recurring basis, derivative financial instruments, assets	$ 21,174	$ 21,866
Fair value assets measured on recurring basis	344,584	479,499
Liabilities:
Fair Value, liabilities measured on recurring basis, derivative financial instruments, liabilities	55,346	24,034
Commercial Paper [Member] | Fair Value, Inputs, Level 1 [Member]
Cash equivalents:
Cash equivalents	0	0
Money Market Funds [Member] | Fair Value, Inputs, Level 1 [Member]
Cash equivalents:
Cash equivalents	10,059	22,289
Foreign Government Obligations [Member] | Fair Value, Inputs, Level 1 [Member]
Marketable securities:
Fair value assets measured on recurring basis available-for-sale securities	0	0
US Government Debt Securities [Member] | Fair Value, Inputs, Level 1 [Member]
Marketable securities:
Fair value assets measured on recurring basis available-for-sale securities	0
Fair Value, Inputs, Level 1 [Member]
Marketable securities:
Fair Value, assets measured on recurring basis, derivative financial instruments, assets	0	0
Fair value assets measured on recurring basis	10,059	22,289
Liabilities:
Fair Value, liabilities measured on recurring basis, derivative financial instruments, liabilities	0	0
Fair Value, Inputs, Level 1 [Member] | Commercial Paper, Not Included with Cash and Cash Equivalents [Member]
Marketable securities:
Fair value assets measured on recurring basis available-for-sale securities	0	0
Fair Value, Inputs, Level 1 [Member] | Corporate Debt Securities [Member]
Marketable securities:
Fair value assets measured on recurring basis available-for-sale securities	0	0
Fair Value, Inputs, Level 1 [Member] | Federal Agency Debt [Member]
Marketable securities:
Fair value assets measured on recurring basis available-for-sale securities	0	0
Fair Value, Inputs, Level 1 [Member] | Foreign Agency Debt [Member]
Marketable securities:
Fair value assets measured on recurring basis available-for-sale securities	0	0
Fair Value, Inputs, Level 1 [Member] | Supranational Debt [Member]
Marketable securities:
Fair value assets measured on recurring basis available-for-sale securities	0	0
Fair Value, Inputs, Level 1 [Member] | Certificates of Deposit [Member]
Marketable securities:
Fair value assets measured on recurring basis available-for-sale securities	0
Fair Value, Inputs, Level 1 [Member] | Restricted Investments [Member]
Marketable securities:
Fair value assets measured on recurring basis available-for-sale securities	0	0
Commercial Paper [Member] | Fair Value, Inputs, Level 2 [Member]
Cash equivalents:
Cash equivalents	4,600	1,200
Money Market Funds [Member] | Fair Value, Inputs, Level 2 [Member]
Cash equivalents:
Cash equivalents	0	0
Foreign Government Obligations [Member] | Fair Value, Inputs, Level 2 [Member]
Marketable securities:
Fair value assets measured on recurring basis available-for-sale securities	5,608	9,143
US Government Debt Securities [Member] | Fair Value, Inputs, Level 2 [Member]
Marketable securities:
Fair value assets measured on recurring basis available-for-sale securities	2,012
Fair Value, Inputs, Level 2 [Member]
Marketable securities:
Fair Value, assets measured on recurring basis, derivative financial instruments, assets	21,174	21,866
Fair value assets measured on recurring basis	334,525	457,210
Liabilities:
Fair Value, liabilities measured on recurring basis, derivative financial instruments, liabilities	55,346	24,034
Fair Value, Inputs, Level 2 [Member] | Commercial Paper, Not Included with Cash and Cash Equivalents [Member]
Marketable securities:
Fair value assets measured on recurring basis available-for-sale securities	6,846	13,343
Fair Value, Inputs, Level 2 [Member] | Corporate Debt Securities [Member]
Marketable securities:
Fair value assets measured on recurring basis available-for-sale securities	29,886	98,602
Fair Value, Inputs, Level 2 [Member] | Federal Agency Debt [Member]
Marketable securities:
Fair value assets measured on recurring basis available-for-sale securities	49,697	45,875
Fair Value, Inputs, Level 2 [Member] | Foreign Agency Debt [Member]
Marketable securities:
Fair value assets measured on recurring basis available-for-sale securities	22,085	133,165
Fair Value, Inputs, Level 2 [Member] | Supranational Debt [Member]
Marketable securities:
Fair value assets measured on recurring basis available-for-sale securities	39,226	48,032
Fair Value, Inputs, Level 2 [Member] | Certificates of Deposit [Member]
Marketable securities:
Fair value assets measured on recurring basis available-for-sale securities	2,602
Fair Value, Inputs, Level 2 [Member] | Restricted Investments [Member]
Marketable securities:
Fair value assets measured on recurring basis available-for-sale securities	150,789	85,984
Commercial Paper [Member] | Fair Value, Inputs, Level 3 [Member]
Cash equivalents:
Cash equivalents	0	0
Money Market Funds [Member] | Fair Value, Inputs, Level 3 [Member]
Cash equivalents:
Cash equivalents	0	0
Foreign Government Obligations [Member] | Fair Value, Inputs, Level 3 [Member]
Marketable securities:
Fair value assets measured on recurring basis available-for-sale securities	0	0
US Government Debt Securities [Member] | Fair Value, Inputs, Level 3 [Member]
Marketable securities:
Fair value assets measured on recurring basis available-for-sale securities	0
Fair Value, Inputs, Level 3 [Member]
Marketable securities:
Fair Value, assets measured on recurring basis, derivative financial instruments, assets	0	0
Fair value assets measured on recurring basis	0	0
Liabilities:
Fair Value, liabilities measured on recurring basis, derivative financial instruments, liabilities	0	0
Fair Value, Inputs, Level 3 [Member] | Commercial Paper, Not Included with Cash and Cash Equivalents [Member]
Marketable securities:
Fair value assets measured on recurring basis available-for-sale securities	0	0
Fair Value, Inputs, Level 3 [Member] | Corporate Debt Securities [Member]
Marketable securities:
Fair value assets measured on recurring basis available-for-sale securities	0	0
Fair Value, Inputs, Level 3 [Member] | Federal Agency Debt [Member]
Marketable securities:
Fair value assets measured on recurring basis available-for-sale securities	0	0
Fair Value, Inputs, Level 3 [Member] | Foreign Agency Debt [Member]
Marketable securities:
Fair value assets measured on recurring basis available-for-sale securities	0	0
Fair Value, Inputs, Level 3 [Member] | Supranational Debt [Member]
Marketable securities:
Fair value assets measured on recurring basis available-for-sale securities	0	0
Fair Value, Inputs, Level 3 [Member] | Certificates of Deposit [Member]
Marketable securities:
Fair value assets measured on recurring basis available-for-sale securities	0
Fair Value, Inputs, Level 3 [Member] | Restricted Investments [Member]
Marketable securities:
Fair value assets measured on recurring basis available-for-sale securities	0	0
Commercial Paper [Member]
Cash equivalents:
Cash equivalents	4,600	1,200
Money Market Funds [Member]
Cash equivalents:
Cash equivalents	10,059	22,289
Commercial Paper, Not Included with Cash and Cash Equivalents [Member]
Marketable securities:
Fair value assets measured on recurring basis available-for-sale securities	6,846	13,343
Corporate Debt Securities [Member]
Marketable securities:
Fair value assets measured on recurring basis available-for-sale securities	29,886	98,602
Federal Agency Debt [Member]
Marketable securities:
Fair value assets measured on recurring basis available-for-sale securities	49,697	45,875
Foreign Agency Debt [Member]
Marketable securities:
Fair value assets measured on recurring basis available-for-sale securities	22,085	133,165
Foreign Government Obligations [Member]
Marketable securities:
Fair value assets measured on recurring basis available-for-sale securities	5,608	9,143
Supranational Debt [Member]
Marketable securities:
Fair value assets measured on recurring basis available-for-sale securities	39,226	48,032
US Government Debt Securities [Member]
Marketable securities:
Fair value assets measured on recurring basis available-for-sale securities	2,012
Certificates of Deposit [Member]
Marketable securities:
Fair value assets measured on recurring basis available-for-sale securities	2,602
Restricted Investments [Member]
Marketable securities:
Fair value assets measured on recurring basis available-for-sale securities	$ 150,789	$ 85,984

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Note 18. Comprehensive Income

6 Months Ended

Jun. 30, 2011

Comprehensive Income (Loss) Note [Abstract]

Comprehensive Income Disclosure [Text Block]

18. Comprehensive Income

Comprehensive income, which includes foreign currency translation adjustments, unrealized gains and losses on available-for-sale securities, and unrealized gains and losses on derivative instruments designated and qualifying as cash flow hedges, the impact of which, has been excluded from net income and reflected as components of stockholders’ equity, was as follows for the three and six months ended June 30, 2011 and June 26, 2010 (in thousands):

	Three Months Ended						Six Months Ended
	June 30, 2011			June 26, 2010			June 30, 2011			June 26, 2010
Net income	$	61,138		$	159,043		$	177,106		$	331,388
Foreign currency translation adjustments	6,794			(35,884		)	30,589			(68,118		)
Change in unrealized (loss) gain on marketable securities, net of tax	(3,971		)	5,680			(11,474		)	6,777
Change in unrealized gain (loss) on derivative instruments, net of tax	8,931			17,689			(31,519		)	54,133
Comprehensive income	$	72,892		$	146,528		$	164,702		$	324,180

Components of accumulated other comprehensive loss at June 30, 2011 and December 31, 2010 were as follows (in thousands):

	June 30, 2011			December 31, 2010
Foreign currency translation adjustments	$	242		$	(30,347	)
Unrealized (loss) gain on marketable securities, net of tax	(5,703		)	5,771
Unrealized loss on derivative instruments, net of tax	(34,186		)	(2,667		)
Accumulated other comprehensive loss	$	(39,647	)	$	(27,243	)

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Document and Entity Information	3 Months Ended
	Jun. 30, 2011	Jul. 29, 2011
Document Information [Line Items]
Entity Registrant Name	FIRST SOLAR, INC.
Entity Central Index Key	0001274494
Document Type	10-Q
Document Period End Date	Jun. 30, 2011
Amendment Flag	false
Document Fiscal Year Focus	2011
Document Fiscal Period Focus	Q2
Current Fiscal Year End Date	--12-31
Entity Current Reporting Status	Yes
Entity Well Known Seasoned Issuer	Yes
Entity Voluntary Filers	No
Entity Filer Category	Large Accelerated Filer
Entity Common Stock Shares Outstanding		86,304,748

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Note 8. Consolidated Balance Sheet Details (Details) - Valuation and Qualifying Accounts (USD $) In Thousands	Jun. 30, 2011		Dec. 31, 2010
Valuation and Qualifying Accounts Disclosure [Line Items]
Product Warranty Accrual in Excess of Normal Product Warranty Liability, Nonrecurring	$ 17,237	[1]	$ 28,921	[1]
Module Replacement [Member]
Valuation and Qualifying Accounts Disclosure [Line Items]
Product Warranty Accrual in Excess of Normal Product Warranty Liability, Nonrecurring	14,400
Post-sale Expenses [Member]
Valuation and Qualifying Accounts Disclosure [Line Items]
Product Warranty Accrual in Excess of Normal Product Warranty Liability, Nonrecurring	$ 2,800

[1] The above-referenced $17.2 million of accrued nonrecurring expenses in excess of normal product warranty liability and related expenses as of June 30, 2011 consisted of the following, each related to the manufacturing excursion described below: (i) $14.4 million in estimated expenses for certain module replacement efforts voluntarily undertaken by us beyond the normal product warranty; and (ii) $2.8 million in estimated nonrecurring post-sale expenses. During the period from June 2008 to June 2009, a manufacturing excursion occurred affecting less than 4% of the total product manufactured within the period. The excursion could result in possible premature power loss in affected modules. The root cause was identified and subsequently mitigated in June 2009. On-going testing confirms that the corrective actions have been effective. We have been working directly with impacted customers to replace the affected modules and these efforts are well underway and, in some cases, complete. Some of these efforts go beyond our normal warranty coverage

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Note 21. Subsequent Events (Notes)

6 Months Ended

Jun. 30, 2011

Subsequent Events [Abstract]

Subsequent Events [Text Block]

Subsequent Events

We entered into an amendment and waiver dated as of June 30, 2011 to the credit agreement governing our revolving credit facility. The amendment became effective as of June 30, 2011 upon receipt of approval thereof from the Required Lenders (as defined in the Credit Agreement) on July 11, 2011. The amendment provides for, among other things, the ability of Restricted Subsidiaries (as defined in the amended and restated credit agreement) to incur indebtedness and guarantee obligations pursuant to letters of credit, bank guarantees or similar instruments issued in the ordinary course of business; provided that the aggregate stated or face amount of all such letters of credit, bank guarantees, and similar instruments shall not exceed $50.0 million for all Restricted Subsidiaries outstanding at any time.

On August 3, 2011, First Solar Malaysia Sdn. Bhd. entered into a €60.0 million Facility Agreement with a consortium of banks. The obligations of First Solar Malayisa Sdn. Bhd. under the Facility Agreement are guaranteed by First Solar, Inc. In addition, certain obligations in respect of the Facility Agreement will be guaranteed (the “Euler Hermes Guarantee”) by the Federal Republic of Germany, represented by Euler Hermes Kreditversicherungs-AG (“Euler Hermes”).

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Note 8. Consolidated Balance Sheet Details (Details)	3 Months Ended			6 Months Ended			13 Months Ended						3 Months Ended				6 Months Ended				3 Months Ended		6 Months Ended															3 Months Ended		6 Months Ended		3 Months Ended		6 Months Ended
	Jun. 30, 2011 USD ($)		Jun. 26, 2010 USD ($)	Jun. 30, 2011 USD ($)		Jun. 26, 2010 USD ($)	Jun. 30, 2009	May 30, 2011	Dec. 31, 2010 USD ($)		Jun. 30, 2011 Module Replacement [Member] USD ($)	Jun. 30, 2011 Post-sale Expenses [Member] USD ($)	Jun. 30, 2011 Solar Modules [Member] USD ($)	Jun. 30, 2011 Solar Modules [Member] EUR (€)	Jun. 26, 2010 Solar Modules [Member] USD ($)	Jun. 26, 2010 Solar Modules [Member] EUR (€)	Jun. 30, 2011 Solar Modules [Member] USD ($)	Jun. 30, 2011 Solar Modules [Member] EUR (€)	Jun. 26, 2010 Solar Modules [Member] USD ($)	Jun. 26, 2010 Solar Modules [Member] EUR (€)	Jun. 30, 2011 Depreciable Assets [Member] USD ($)	Jun. 26, 2010 Depreciable Assets [Member] USD ($)	Jun. 30, 2011 Depreciable Assets [Member] USD ($)	Jun. 26, 2010 Depreciable Assets [Member] USD ($)	Dec. 31, 2010 Depreciable Assets [Member] USD ($)	Jun. 30, 2011 Building and Building Improvements [Member] USD ($)	Dec. 31, 2010 Building and Building Improvements [Member] USD ($)	Jun. 30, 2011 Machinery and Equipment [Member] USD ($)	Dec. 31, 2010 Machinery and Equipment [Member] USD ($)	Jun. 30, 2011 Office equipment and furniture [Member] USD ($)	Dec. 31, 2010 Office equipment and furniture [Member] USD ($)	Jun. 30, 2011 Leasehold Improvements [Member] USD ($)	Dec. 31, 2010 Leasehold Improvements [Member] USD ($)	Jun. 30, 2011 Land [Member] USD ($)	Dec. 31, 2010 Land [Member] USD ($)	Jun. 30, 2011 Construction in Progress [Member] USD ($)	Dec. 31, 2010 Construction in Progress [Member] USD ($)	Jun. 30, 2011 Property, Plant And Equipment [Member] USD ($)	Jun. 26, 2010 Property, Plant And Equipment [Member] USD ($)	Jun. 30, 2011 Property, Plant And Equipment [Member] USD ($)	Jun. 26, 2010 Property, Plant And Equipment [Member] USD ($)	Jun. 30, 2011 Project Assets And Deferred Project Costs [Member] USD ($)	Jun. 26, 2010 Project Assets And Deferred Project Costs [Member] USD ($)	Jun. 30, 2011 Project Assets And Deferred Project Costs [Member] USD ($)	Jun. 26, 2010 Project Assets And Deferred Project Costs [Member] USD ($)
Accounts receivable trade, net:
Accounts receivable trade, gross	$ 541,977,000			$ 541,977,000					$ 305,537,000
Allowance for doubtful account	0			0					0
Accounts receivable trade, net	541,977,000			541,977,000					305,537,000
Unbilled contracts receivable	63,677,000			63,677,000					1,482,000
Solar Module Rebates [Abstract]
Revenue rebate participation rate																	92.00%	92.00%
Sales product revenue rebates issued													24,900,000	17,300,000	20,600,000	15,600,000	39,800,000	28,000,000	48,400,000	35,600,000
Average exchange rate ratio													1.44	1.44	1.32	1.32	1.42	1.42	1.36	1.36
Sales product revenue rebates accrued													32,100,000	22,300,000			32,100,000	22,300,000
Exchange rate ratio	1.44			1.44				1.42					1.44	1.44			1.44	1.44
Inventories:
Raw materials	197,961,000			197,961,000					162,190,000
Work in process	30,499,000			30,499,000					21,528,000
Finished goods	137,248,000			137,248,000					54,873,000
Total inventories	365,708,000			365,708,000					238,591,000
Inventory - current	322,995,000			322,995,000					195,863,000
Inventories - noncurrent	42,713,000	[1]		42,713,000	[1]				42,728,000	[1]
Prepaid expenses and other current assets:
Prepaid expenses	64,792,000			64,792,000					46,016,000
Deferred project costs	47,390,000	[2]		47,390,000	[2]				14,446,000	[2]
Derivative instruments	21,174,000			21,174,000					20,986,000
Other current assets	127,158,000			127,158,000					61,585,000
Total prepaid expenses and other current assets	260,514,000			260,514,000					143,033,000
Project Assets - Current and Noncurrent:
Project assets acquired through OptiSolar and NextLight	217,417,000			217,417,000					217,417,000
Project assets - land	15,899,000			15,899,000					13,781,000
Project assets - other	221,751,000			221,751,000					88,942,000
Total project assets	455,067,000			455,067,000					320,140,000
Total project assets - current	145,379,000			145,379,000					0
Total project assets - noncurrent	309,688,000			309,688,000					320,140,000
Property, plant and equipment, net:
Property, plant and equipment, gross																					1,907,311,000		1,907,311,000		1,380,070,000	398,115,000	286,637,000	1,378,961,000	997,510,000	92,024,000	70,569,000	38,211,000	25,354,000	11,758,000	10,355,000	271,865,000	403,669,000
Accumulated depreciation	(462,941,000)			(462,941,000)					(363,305,000)
Property, plant and equipment, net	1,727,993,000			1,727,993,000					1,430,789,000												1,444,370,000		1,444,370,000		1,016,765,000
Investment tax credit				16,300,000
Depreciation																					54,400,000	36,200,000	101,500,000	72,800,000
Interest Costs Incurred [Abstract]
Interest cost incurred	(1,954,000)		(1,923,000)	(3,791,000)		(4,198,000)
Interest costs, capitalized during period																																						1,352,000	1,283,000	3,111,000	1,701,000	602,000	634,000	680,000	2,491,000
Interest expense, net	0		(6,000)	0		(6,000)
Accued Expenses [Abstract]
Accrued compensation and benefits	35,222,000			35,222,000					69,353,000
Accrued property, plant, and equipment	49,836,000			49,836,000					53,741,000
Accrued inventory	54,835,000			54,835,000					25,686,000
Product warranty liability - current	10,706,000			10,706,000					11,226,000
Nonrecurring expenses in excess of normal product warranty liability and realted expenses	17,237,000	[3]		17,237,000	[3]				28,921,000	[3]	14,400,000	2,800,000
Other accrued expenses	74,414,000			74,414,000					55,344,000
Total accrued expenses	242,250,000			242,250,000					244,271,000
Percentage of Total Product Manufactured Affected by Manufacturing Excursion							4.00%
Other current liabilities
Deferred revenue	31,010,000	[4]		31,010,000	[4]				14,718,000	[4]
Derivative instruments	53,428,000			53,428,000					22,996,000
Deferred tax liabilities	0			0					34,601,000
Other current liabilities	10,479,000			10,479,000					27,361,000
Total other current liabilities	94,917,000			94,917,000					99,676,000
Other liabilities:
Other taxes payable	73,461,000			73,461,000					59,148,000
Total Other Noncurrent Liabilities	83,228,000			83,228,000					52,878,000
Total other liabilities	$ 156,689,000			$ 156,689,000					$ 112,026,000

[1] We purchase a critical raw material that is heavily used in our core production process in quantities that anticipate confident, but long-term future demand. We classify the raw materials that we do not expect to be consumed within our operating cycle (which is 12 months) as noncurrent.

[2] Deferred project costs represent (i) costs that we capitalize for arrangements that we account for as real estate transactions after we have entered into a definitive sales arrangement, but before we have met the criteria to recognize the sale as revenue, (ii) recoverable pre-contract costs that we capitalize for arrangements accounted for as long-term construction contracts prior to entering into a definitive sales agreement, or (iii) costs that we capitalize for arrangements accounted for as long-term construction contracts after we have signed a definitive sales agreement, but before the revenue recognition criteria have been met.

[3] The above-referenced $17.2 million of accrued nonrecurring expenses in excess of normal product warranty liability and related expenses as of June 30, 2011 consisted of the following, each related to the manufacturing excursion described below: (i) $14.4 million in estimated expenses for certain module replacement efforts voluntarily undertaken by us beyond the normal product warranty; and (ii) $2.8 million in estimated nonrecurring post-sale expenses. During the period from June 2008 to June 2009, a manufacturing excursion occurred affecting less than 4% of the total product manufactured within the period. The excursion could result in possible premature power loss in affected modules. The root cause was identified and subsequently mitigated in June 2009. On-going testing confirms that the corrective actions have been effective. We have been working directly with impacted customers to replace the affected modules and these efforts are well underway and, in some cases, complete. Some of these efforts go beyond our normal warranty coverage

[4] Deferred revenue will be recognized in net sales once all revenue recognition criteria are met.

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Note 7. Restricted Cash and Investments

6 Months Ended

Jun. 30, 2011

Restricted Cash And Investments Note [Abstract]

Restricted Cash and Investments Disclosure [Text Block]

7. Restricted Cash and Investments

Restricted cash and investments consisted of the following at June 30, 2011 and December 31, 2010 (in thousands):

	June 30, 2011		December 31, 2010
Restricted cash	$	23,909	$	19
Restricted investments	150,789		85,984
Total restricted cash and investments — noncurrent	$	174,698	$	86,003

On May 18, 2011, in connection with the plant expansion at our German manufacturing center, First Solar Manufacturing GmbH, our indirect wholly owned subsidiary, entered into a credit facility agreement (German Facility Agreement), as disclosed in Note 13. "Debt," to these condensed consolidated financial statements. Pursuant to the German Facility Agreement, First Solar Manufacturing GmbH is required to maintain a euro-denominated debt service reserve account in the amount of €16.6 million pledged in favor of the lenders. The account is available solely to pay any outstanding interest and principal payments. As of June 30, 2011, the balance of this reserve account was €16.6 million ($23.9 million at the balance sheet close rate on June 30, 2011 of $1.44/€1.00).

At June 30, 2011 and December 31, 2010, our restricted investments consisted of long-term marketable securities that we hold through a custodial account to fund future costs of our solar module collection and recycling program.

We pre-fund our estimated solar module collection and recycling costs at the time of module sale through a custodial account with a large bank as the investment advisor in the name of a trust, for which First Solar Inc., First Solar Malaysia Sdn. Bhd., and First Solar Manufacturing GmbH are grantors. We fund this custodial account within 60 days after the beginning of a fiscal year for the prior year's module sales, assuming for this purpose a minimum service life of 25 years for our solar modules. To ensure that our collection and recycling program is available at all times and the pre-funded amounts are accessible regardless of our financial status in the future (even in the case of our own insolvency), we have established a trust structure under which funds are put into custodial accounts in the name of a trustee. Only the trustee can distribute funds from the custodial accounts and these funds cannot be accessed for any purpose other than for administering module collection and recycling, either by us or a third party executing the collection and recycling services. To provide further assurance that sufficient funds will be available, our module collection and recycling program, including the financing arrangement, is audited periodically by an independent third party auditor. Cash invested in this custodial account must meet the criteria of the highest quality investments, such as AAA rated government or agency bonds.

The following table summarizes unrealized gains and losses related to our restricted investments in marketable securities designated as available-for-sale by major security type as of June 30, 2011 and December 31, 2010 (in thousands):

	As of June 30, 2011
Security Type	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value
Foreign government obligations	$	141,903	$	447	$	6,937	$	135,413
U.S. government obligations	15,022		448		94		15,376
Total	$	156,925	$	895	$	7,031	$	150,789

	As of December 31, 2010
Security Type	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value
Foreign government obligations	$	73,729	$	6,529	$	72	$	80,186
U.S. government obligations	5,659		139		—		5,798
Total	$	79,388	$	6,668	$	72	$	85,984

Gross unrealized losses as of June 30, 2011 were primarily the result of changes in interest rates. We evaluated these losses and determined these unrealized losses to be temporary, because we do not intend to sell the securities, and it is not more likely than not that we will be required to sell these securities before recovery of their amortized cost basis. As of June 30, 2011 and December 31, 2010, the contractual maturities of these available-for-sale marketable securities were between 17 years and 25 years.

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Note 2. Summary of Significant Accounting Policies (Policies)

6 Months Ended

Jun. 30, 2011

Accounting Policies [Abstract]

Inventory for Long-term Contracts Policy

Balance of Systems Parts. Balance of systems partsrepresent mounting, DC and AC electrical and other construction parts purchased for solar power plants under construction, which we hold title of and are not yet installed in a solar power plant. These parts include posts, tilt brackets, tables, harnesses, combiner boxes, inverters, cables and any other parts we purchase or assemble for the solar power plants we construct. Balance of systems parts do not include solar modules. We report these parts at the lower of cost or market, with market being based on either recoverability through installation in a solar power plant under construction or through a sale. 

Revenue Recognition Policy

Revenue recognition — Systems Business. Our systems business provides a complete solar power system solution, which includes project development, engineering, procurement, and construction (EPC) services, operating and maintenance (O&M) services, when applicable, and project finance, when required.

We recognize revenue for arrangements entered into by the systems business generally using two revenue recognition models, following the guidance in ASC 605, Accounting for Long-term Construction Contracts or, for arrangements which include land, ASC 360, Accounting for Sales of Real Estate.

For construction contracts that do not involve land or land rights and thus are accounted for under ASC 605, we use the percentage-of-completion method using actual costs incurred over total estimated costs to complete a project (including module costs) as our basic accounting policy, unless we cannot make reasonably dependable estimates of the costs to complete the contract, in which case we would use the completed contract method. We periodically revise our contract cost and profit estimates and we immediately recognize any losses that we identify on contracts. Incurred costs include all direct materials, costs for solar modules, labor, subcontractor costs, and those indirect costs related to contract performance, such as indirect labor, supplies, and tools. We recognize direct material costs and costs for solar modules as incurred costs when the direct materials and solar modules have been installed. When contracts specify that title to direct materials and solar modules transfers to the customer before installation has been performed, we defer revenue and associated costs and recognize revenue once those materials are installed and have met all other revenue recognition requirements. We consider direct materials to be installed when they are permanently attached or fitted to the solar power systems as required by engineering designs.

Revenue Recognition, Completed-Contract Method [Policy Text Block]

For arrangements recognized under ASC 360, typically when we have gained control of land or land rights, we record the sale as revenue after construction of a project is complete, we have transferred the usual risks and rewards of ownership to the buyer, and we have received payment from the buyer. We apply the percentage-of-completion method to certain contracts covered under ASC 360, when the sale has been consummated, the initial or continuing investment criteria have been met, we have the ability to estimate our costs and progress toward completion, and other revenue recognition criteria have been met. Depending on the value of the initial and continuing payment commitment by the buyer, we may align our revenue recognition and release of project assets to cost of sales with the receipt of payment from the buyer for contracts accounted for under ASC 360.

Adoption of ASU 2010-28 And Its Impact

In June 2011, the FASB issued ASU 2011-05, Comprehensive Income (Topic 220): Presentation of Comprehensive Income. ASU 2011-05 allows an entity to present components of net income and other comprehensive income in one continuous statement, referred to as the statement of comprehensive income, or in two separate, but consecutive statements. ASU 2011-05 eliminates the option to present the components of other comprehensive income as part of the statement of changes in stockholders' equity. While the new guidance changes the presentation of comprehensive income, there are no changes to the components that are recognized in net income or other comprehensive income under current accounting guidance. ASU 2011-05 is effective for fiscal years and interim periods beginning after December 15, 2011 and must be applied retrospectively. We do not believe that the adoption of ASU 2011-05 will have an impact on our financial position, results of operations, or cash flows.

Adoption of ASU 2010-29 And Its Impact

In April 2011, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2011-04, Fair Value Measurement (Topic 820): Amendments to Achieve Common Fair Value Measurement and Disclosure Requirements in U.S. GAAP and IFRS. This ASU amends current fair value measurement and disclosure guidance to include increased transparency around valuation input and investment categorization. ASU 2011-04 is effective for fiscal years and interim periods beginning after December 15, 2011, with early adoption not permitted. We do not believe that the adoption of ASU 2011-04 in the first quarter of 2012 will have an impact on our financial position, results of operations, or cash flows.

Goodwill Policy

ASC 350, Intangibles — Goodwill and Other, requires us to test goodwill for impairment at least annually, or sooner, if facts or circumstances between scheduled annual tests indicate that it is more likely than not that the fair value of a reporting unit that has goodwill might be less than its carrying value. Currently our operating segments and reporting units are identical. We estimate the fair value of our reporting units by referring to the price that would be received to sell the unit as whole in an orderly transaction between market participants at the measurement date. For the goodwill assessment of our systems business, we believe that a typical market participant for the sale of our systems reporting unit would be a solar module manufacturer seeking to acquire a systems business with a large pipeline of utility-scale solar power plant projects, with the intent that these projects would provide a captive outlet for additional future solar module production. Therefore, we model the systems reporting unit's future performance for purposes of applying the income method of fair value measurement to include some of the profitability associated with the solar module element of the solar power plants that it builds and sells.

Project Assets Policy

We review project assets for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. We consider a project commercially viable if it is anticipated to be sellable for a profit once it is either fully developed or fully constructed. We consider a partially developed or partially constructed project commercially viable if the anticipated selling price is higher than the carrying value of the related project assets. We examine a number of factors to determine if the project will be profitable, the most notable of which is whether there are any changes in environmental, ecological, permitting, or regulatory conditions that impact the project. Such changes could cause the cost of the project to increase or the selling price of the project to decrease.

Project assets consist primarily of costs relating to solar power projects in various stages of development that we capitalize prior to the sale of the solar power project to a third party for further project development or the signing of a project construction contract. These costs include costs for land and costs for developing and constructing a solar power plant. Development costs can include legal, consulting, permitting, interconnect and other similar costs. Once we enter into a definitive sales agreement, we reclassify project assets to deferred project costs on our balance sheet until we have met the criteria to recognize the sale of the project assets as revenue. We classify project assets generally as noncurrent due to the time required to complete all activities to sell a specific project, which is typically longer than 12 months.

Fair Value Policy

ASC 820, Fair Value Measurements and Disclosures, defines fair value, establishes a framework for measuring fair value in accordance with generally accepted accounting principles, and provides financial statement disclosure requirements for fair value measurements. ASC 820 defines fair value as the price that would be received from the sale of an asset or paid to transfer a liability (an exit price) on the measurement date in an orderly transaction between market participants in the principal or most advantageous market for the asset or liability. ASC 820 specifies a hierarchy of valuation techniques, which is based on whether the inputs into the valuation technique are observable or unobservable. The hierarchy is as follows:

• Level 1 — Valuation techniques in which all significant inputs are unadjusted quoted prices from active markets for assets or liabilities that are identical to the assets or liabilities being measured.

• Level 2 — Valuation techniques in which significant inputs include quoted prices from active markets for assets or liabilities that are similar to the assets or liabilities being measured and/or quoted prices for assets or liabilities that are identical or similar to the assets or liabilities being measured from markets that are not active. Also, model-derived valuations in which all significant inputs and significant value drivers are observable in active markets are Level 2 valuation techniques.

• Level 3 — Valuation techniques in which one or more significant inputs or significant value drivers are unobservable. Unobservable inputs are valuation technique inputs that reflect our own assumptions about the assumptions that market participants would use to price an asset or liability.

When available, we use quoted market prices to determine the fair value of an asset or liability. If quoted market prices are not available, we measure fair value using valuation techniques that use, when possible, current market-based or independently-sourced market parameters, such as interest rates and currency rates. The following is a description of the valuation techniques that we use to measure the fair value of assets and liabilities that we measure and report at fair value on a recurring or one-time basis:

• Cash equivalents. At June 30, 2011 and December 31, 2010, our cash equivalents consisted of commercial paper and money market mutual funds. We value our commercial paper cash equivalents using quoted prices for securities with similar characteristics and other observable inputs (such as interest rates that are observable at commonly quoted intervals), and accordingly, we classify the valuation techniques that use these inputs as Level 2. We value our money market cash equivalents using observable inputs that reflect quoted prices for securities with identical characteristics, and accordingly, we classify the valuation techniques that use these inputs as Level 1.

• Marketable securities, investments, and restricted investments. At June 30, 2011, our marketable securities and investments consisted of certificates of deposit, commercial paper, corporate debt securities, federal and foreign agency debt, foreign government obligations, supranational debt, and U.S. government obligations, and our restricted investments consisted of foreign and U.S. government obligations. At December 31, 2010, our marketable securities consisted of commercial paper, corporate debt securities, federal and foreign agency debt, foreign government obligations, and supranational debt, and our restricted investments consisted of foreign and U.S. government obligations. We value our marketable securities, investments, and restricted investments using quoted prices for securities with similar characteristics and other observable inputs (such as interest rates that are observable at commonly quoted intervals), and accordingly, we classify the valuation techniques that use these inputs as Level 2. We also consider the effect of our counterparties' credit standings in these fair value measurements.

• Derivative assets and liabilities. At June 30, 2011 and December 31, 2010, our derivative assets and liabilities consisted of foreign exchange forward contracts involving major currencies and interest rate swap contracts involving benchmark interest rates. Since our derivative assets and liabilities are not traded on an exchange, we value them using industry standard valuation models. Where applicable, these models project future cash flows and discount the future amounts to a present value using market-based observable inputs including interest rate curves, credit risk, foreign exchange rates, and forward and spot prices for currencies. These inputs are observable in active markets over the terms of the instruments we hold, and accordingly, we classify these valuation techniques as Level 2. We consider the effect of our own credit standing and that of our counterparties in our valuations of our derivative assets and liabilities.

• Solar module collection and recycling liability. We account for our obligation to collect and recycle the solar modules that we sell in a similar manner to the accounting for asset retirement obligations that is prescribed by ASC 410, Asset Retirement and Environmental Obligations. When we sell solar modules, we initially record our liability for collecting and recycling those particular solar modules at the fair value of this liability, and then in subsequent periods, we accrete this fair value to the estimated future cost of collecting and recycling the solar modules. Therefore, this is a one-time nonrecurring fair value measurement of the collection and recycling liability associated with each particular solar module sold.

Since there is not an established market for collecting and recycling our solar modules, we value our liability using a valuation model (an income approach). This fair value measurement requires us to use significant unobservable inputs, which are primarily estimates of collection and recycling process costs and estimates of future changes in costs due to inflation and future currency exchange rates. Accordingly, we classify these valuation techniques as Level 3. We estimate collection and recycling process costs based on analyses of the collection and recycling technologies that we are currently developing; we estimate future inflation costs based on analysis of historical trends; and we estimate future currency exchange rates based on current rate information. We consider the effect of our own credit standing in our measurement of the fair value of this liability.

Share-Based Compensation Policy

We measure share-based compensation cost at the grant date based on the fair value of the award and recognize this cost as an expense over the grant recipients’ requisite service periods, in accordance with ASC 718, Compensation - Stock Compensation.

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Note 6. Cash, Cash Equivalents, Marketable Securities, and Investments (Details) (USD $)	3 Months Ended		6 Months Ended
	Jun. 30, 2011	Jun. 26, 2010	Jun. 30, 2011	Jun. 26, 2010	Dec. 31, 2010	Dec. 26, 2009
Investment [Line Items]
Cash and cash equivalents	$ 357,477,000	$ 510,482,000	$ 357,477,000	$ 510,482,000	$ 765,689,000	$ 664,499,000
Marketable securities and investments	157,962,000		157,962,000		348,160,000
Total cash, cash equivalents, marketable securities, and investments	515,439,000		515,439,000		1,113,849,000
Available-for-sale securities, gross realized gains	800,000	400,000	900,000	700,000
Available-for-sale securities, gross realized losses		400,000		500,000
Cash [Member]
Investment [Line Items]
Cash and cash equivalents	342,818,000		342,818,000		742,200,000
Commercial Paper [Member]
Investment [Line Items]
Cash and cash equivalents	4,600,000		4,600,000		1,200,000
Money Market Funds [Member]
Investment [Line Items]
Cash and cash equivalents	10,059,000		10,059,000		22,289,000
Certificates of Deposit [Member]
Investment [Line Items]
Marketable securities and investments	2,602,000		2,602,000		0
Commercial Paper, Not Included with Cash and Cash Equivalents [Member]
Investment [Line Items]
Marketable securities and investments	6,846,000		6,846,000		13,343,000
Corporate Debt Securities [Member]
Investment [Line Items]
Marketable securities and investments	29,886,000		29,886,000		98,602,000
Federal Agency Debt [Member]
Investment [Line Items]
Marketable securities and investments	49,697,000		49,697,000		45,875,000
Foreign Agency Debt [Member]
Investment [Line Items]
Marketable securities and investments	22,085,000		22,085,000		133,165,000
Foreign Government Obligations [Member]
Investment [Line Items]
Marketable securities and investments	5,608,000		5,608,000		9,143,000
Supranational Debt [Member]
Investment [Line Items]
Marketable securities and investments	39,226,000		39,226,000		48,032,000
US Government Debt Securities [Member]
Investment [Line Items]
Marketable securities and investments	$ 2,012,000		$ 2,012,000		$ 0

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Note 18. Comprehensive Income (Tables)

6 Months Ended

Jun. 30, 2011

Comprehensive Income (Loss) Note [Abstract]

Comprehensive Income Loss And Accumulated Other Comprehensive Gain Loss [Text Block]

Comprehensive income, which includes foreign currency translation adjustments, unrealized gains and losses on available-for-sale securities, and unrealized gains and losses on derivative instruments designated and qualifying as cash flow hedges, the impact of which, has been excluded from net income and reflected as components of stockholders’ equity, was as follows for the three and six months ended June 30, 2011 and June 26, 2010 (in thousands):

	Three Months Ended						Six Months Ended
	June 30, 2011			June 26, 2010			June 30, 2011			June 26, 2010
Net income	$	61,138		$	159,043		$	177,106		$	331,388
Foreign currency translation adjustments	6,794			(35,884		)	30,589			(68,118		)
Change in unrealized (loss) gain on marketable securities, net of tax	(3,971		)	5,680			(11,474		)	6,777
Change in unrealized gain (loss) on derivative instruments, net of tax	8,931			17,689			(31,519		)	54,133
Comprehensive income	$	72,892		$	146,528		$	164,702		$	324,180

Components of accumulated other comprehensive loss at June 30, 2011 and December 31, 2010 were as follows (in thousands):

	June 30, 2011			December 31, 2010
Foreign currency translation adjustments	$	242		$	(30,347	)
Unrealized (loss) gain on marketable securities, net of tax	(5,703		)	5,771
Unrealized loss on derivative instruments, net of tax	(34,186		)	(2,667		)
Accumulated other comprehensive loss	$	(39,647	)	$	(27,243	)

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Note 20. Segment Reporting

6 Months Ended

Jun. 30, 2011

Segment Reporting Information, Profit (Loss) [Abstract]

Segment Reporting Disclosure [Text Block]

20. Segment Reporting

ASC 280, Segment Reporting, establishes standards for companies to report in their financial statements information about operating segments, products, services, geographic areas, and major customers. The method of determining what information to report is generally based on the way that management organizes the operating segments within the company for making operating decisions and assessing financial performance.

We operate our business in two segments. Our components segment is our principal business and involves the design, manufacture, and sale of solar modules which convert sunlight into electricity. Customers of our components segment include project developers, system integrators, and operators of renewable energy projects.

Our second segment is our fully integrated systems business, through which we provide a complete PV solar power system, which includes project development, EPC services, O&M services, when applicable, and project finance, when required. Our systems segment sells solar power systems, all of which use our solar modules, directly to investor owned utilities, independent power developers and producers, commercial and industrial companies, and other system owners who purchase completed solar power plants, EPC services, and/or O&M services from us.

Our Chief Operating Decision Maker (CODM), consisting of senior executive staff, views the sale of solar modules from the components segment as the core driver of our profitability, return on net assets, and cash throughput; and as a result, we view our systems segment as an enabler to drive module throughput. Therefore, we operate our systems segment with the objective to achieve break-even results before income taxes. In our operating segment financial disclosures, we include the sale of our solar modules manufactured by our components segment and installed in projects sold by our systems segment in “Net sales” of our components business.

After we have determined the amount of revenue earned for each transaction following the applicable guidance for the underlying arrangement, we allocate revenue between the components and systems segments based on how our CODM strategically views these segments. We determine the amount of revenue to be allocated between the systems business and the components business based on the principle that the systems business is an enabler operating at break-even results to drive module throughput for the components business. The amount of revenue allocated to the components segment for modules used in the systems business arrangement is equal to the cost of the solar module plus the earned margin (or estimated margin in the case of percentage-of-completion accounting) for a particular project for the period.

We also allocate the cost of sales value recognized for the solar modules in the systems business arrangements to the components business. The cost of solar modules is composed of inventory cost without any inter-company profit.

Our systems business has certain of its own dedicated administrative key functions, such as accounting, legal, finance, project finance, human resources, procurement, and marketing. Costs for these functions are recorded and included within selling, general and administrative costs for our systems segment. Our corporate key functions consist primarily of company-wide corporate tax, corporate treasury, corporate accounting/finance, corporate legal, investor relations, corporate communications, and executive management functions. We allocate corporate costs to the components segment as part of selling, general and administrative costs, since this segment currently benefits the most from the corporate functions.

In the event segment gross profit from our systems segment (after allocating the revenue from solar modules and the related cost of sales to the components segment) is less than operating expenses in a given quarter, then the components business will compensate the systems segment for the temporary shortfall. A typical shortfall can result from (i) the timing and amount of revenue recognition in comparison to the amount of fixed costs incurred in a given quarter, or (ii) a larger amount of other-than-temporary project asset impairment in any given quarter. The systems segment repays these cumulative temporary shortfalls in fiscal quarters in which its segment gross profit exceeds operating expenses. Any surplus segment income before income taxes for any given quarter after such repayment would then trigger an additional allocation of revenue from the systems segment to the components segment to achieve break-even results based on how our CODM views these segments.

Compensation by the components segment to the systems segment during the three and six months ended June 30, 2011 and June 26, 2010 was as follows (in millions):

	Three Months Ended				Six Months Ended
	June 30, 2011		June 26, 2010		June 30, 2011		June 26, 2010
Compensation by the Components Segment to the Systems Segment	$	19.7	$	—	$	45.9	$	8.9

Repayment of prior period compensation by the systems segment to the components segment during the three and six months ended June 30, 2011 and June 26, 2010 was as follows (in millions):

	Three Months Ended				Six Months Ended
	June 30, 2011		June 26, 2010		June 30, 2011		June 26, 2010
Repayment of Prior Period Compensation by the Systems Segment to the Components Segment	$	—	$	11.4	$	—	$	11.4

Financial information about our segments during the three and six months ended June 30, 2011 and June 26, 2010 was as follows (in thousands):

	Three Months Ended						Three Months Ended
	June 30, 2011						June 26, 2010
	Components		Systems		Total		Components		Systems		Total
Net sales	$	471,947	$	60,827	$	532,774	$	500,940	$	86,914	$	587,854
Gross profit	$	189,875	$	4,923	$	194,798	$	261,656	$	22,538	$	284,194
Income before income taxes	$	71,957	$	—	$	71,957	$	180,438	$	—	$	180,438
Goodwill	$	393,365	$	65,443	$	458,808	$	251,275	$	35,240	$	286,515
Total assets	$	4,206,755	$	732,477	$	4,939,232	$	3,172,912	$	458,403	$	3,631,315

	Six Months Ended						Six Months Ended
	June 30, 2011						June 26, 2010
	Components		Systems		Total		Components		Systems		Total
Net sales	$	991,466	$	108,601	$	1,100,067	$	1,030,208	$	125,607	$	1,155,815
Gross profit	$	448,133	$	6,330	$	454,463	$	539,307	$	26,923	$	566,230
Income before income taxes	$	204,964	$	—	$	204,964	$	375,797	$	—	$	375,797
Goodwill	$	393,365	$	65,443	$	458,808	$	251,275	$	35,240	$	286,515
Total assets	$	4,206,755	$	732,477	$	4,939,232	$	3,172,912	$	458,403	$	3,631,315

Product Revenue

The following table sets forth the total amounts of solar modules and solar power systems revenue recognized for the three and six months ended June 30, 2011 and June 26, 2010. For the purposes of the following table, (i) "Solar module revenue" is composed of total revenues from the sale of solar modules to third parties, and (ii) "Solar power system revenue" is composed of total revenues from the sale of complete solar power systems and related services including the solar modules installed in the solar power system.

	Three Months Ended				Six Months Ended
(Dollars in thousands)	June 30, 2011		June 26, 2010		June 30, 2011		June 26, 2010
Solar module revenue	$	427,350	$	476,061	$	933,092	$	1,004,939
Solar power system revenue	105,424		111,793		166,975		150,876
Total net sales	$	532,774	$	587,854	$	1,100,067	$	1,155,815

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Note 12. Notes Receivable

6 Months Ended

Jun. 30, 2011

Notes Receivable Note [Abstract]

Notes Receivable Disclosure [Text Block]

12. Notes Receivable

On April 8, 2009, we entered into a credit facility agreement with a solar project entity of one of our customers for an available amount of €17.5 million ($25.2 million at the balance sheet close rate on June 30, 2011 of $1.44/€1.00) to provide financing for a PV power generation facility. The credit facility replaced a bridge loan that we had made to this entity. The credit facility bears interest at 8% per annum and is due on December 31, 2026. As of June 30, 2011 and December 31, 2010, the balance on this credit facility was €7.0 million ($10.1 million at the balance sheet close rate on June 30, 2011 of $1.44/€1.00). The outstanding amount of this credit facility is included within “Other assets” on our consolidated balance sheets.

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Note 3 Recent Accounting Pronouncements

6 Months Ended

Jun. 30, 2011

New Accounting Pronouncements and Changes in Accounting Principles [Abstract]

Recent Accounting Pronouncements Disclosure [Text Block]

3. Recent Accounting Pronouncements

In April 2011, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2011-04, Fair Value Measurement (Topic 820): Amendments to Achieve Common Fair Value Measurement and Disclosure Requirements in U.S. GAAP and IFRS. This ASU amends current fair value measurement and disclosure guidance to include increased transparency around valuation input and investment categorization. ASU 2011-04 is effective for fiscal years and interim periods beginning after December 15, 2011, with early adoption not permitted. We do not believe that the adoption of ASU 2011-04 in the first quarter of 2012 will have an impact on our financial position, results of operations, or cash flows.

In June 2011, the FASB issued ASU 2011-05, Comprehensive Income (Topic 220): Presentation of Comprehensive Income. ASU 2011-05 allows an entity to present components of net income and other comprehensive income in one continuous statement, referred to as the statement of comprehensive income, or in two separate, but consecutive statements. ASU 2011-05 eliminates the option to present the components of other comprehensive income as part of the statement of changes in stockholders' equity. While the new guidance changes the presentation of comprehensive income, there are no changes to the components that are recognized in net income or other comprehensive income under current accounting guidance. ASU 2011-05 is effective for fiscal years and interim periods beginning after December 15, 2011 and must be applied retrospectively. We do not believe that the adoption of ASU 2011-05 will have an impact on our financial position, results of operations, or cash flows.

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Note 14. Commitments and Contingencies (Tables)

6 Months Ended

Jun. 30, 2011

Commitments and Contingencies Disclosure [Abstract]

Product Warranty Disclosure [Text Block]

Product warranty activity during the three and six months ended June 30, 2011 and June 26, 2010 was as follows (in thousands):

	Three Months Ended						Six Months Ended
	June 30, 2011			June 26, 2010			June 30, 2011			June 26, 2010
Product warranty liability, beginning of period	$	32,141		$	23,375		$	27,894		$	22,583
Accruals for new warranties issued (warranty expense)	5,293			3,865			10,562			7,672
Settlements	(2,869		)	(3,123		)	(6,455		)	(8,973		)
Change in estimate of warranty liability	1,791			(255		)	4,355			2,580
Product warranty liability, end of period	$	36,356		$	23,862		$	36,356		$	23,862
Current portion of warranty liability							$	10,706		$	8,546
Noncurrent portion of warranty liability							$	25,650		$	15,316

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Note 9. Derivative Financial Instruments

6 Months Ended

Jun. 30, 2011

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Derivative Financial Instruments Disclosure [Text Block]

9. Derivative Financial Instruments

As a global company, we are exposed in the normal course of business to interest rate and foreign currency risks that could affect our net assets, financial position, results of operations, and cash flows. We use derivative instruments to hedge against certain risks such as these, and we only hold derivative instruments for hedging purposes, not for speculative or trading purposes. Our use of derivative instruments is subject to strict internal controls based on centrally defined, performed, and controlled policies and procedures.

Depending on the terms of the specific derivative instruments and market conditions, some of our derivative instruments may be assets and others liabilities at any particular point in time. As required by ASC 815, Derivatives and Hedging, we report all of our derivative instruments that are within the scope of that accounting standard at fair value on our balance sheet. Depending on the substance of the hedging purpose for our derivative instruments, we account for changes in the fair value of some of them using cash flow hedge accounting pursuant to ASC 815 and of others by recording the changes in fair value directly to current earnings (so-called “economic hedges”). These accounting approaches, the various risk classes that we are exposed to in our business, and the risk management systems using derivative instruments that we apply to these risks are described below. See Note 10. "Fair Value Measurements," to our condensed consolidated financial statements for information about the techniques we use to measure the fair value of our derivative instruments.

The following tables present the fair values of derivative instruments included in our consolidated balance sheets as of June 30, 2011 and December 31, 2010 (in thousands):

	June 30, 2011
	Other Assets – Current		Other Assets – Noncurrent		Other Liabilities – Current		Other Liabilities – Noncurrent
Derivatives designated as hedging instruments under ASC 815:
Foreign exchange forward contracts	$	8,787	$	—	$	39,438	$	1,425
Interest rate swap contracts	—		—		137		493
Total derivatives designated as hedging instruments	$	8,787	$	—	$	39,575	$	1,918
Derivatives not designated as hedging instruments under ASC 815:
Foreign exchange forward contracts	$	12,387	$	—	$	13,853	$	—
Total derivatives not designated as hedging instruments	$	12,387	$	—	$	13,853	$	—
Total derivative instruments	$	21,174	$	—	$	53,428	$	1,918

	December 31, 2010
	Other Assets – Current		Other Assets – Noncurrent		Other Liabilities – Current		Other Liabilities – Noncurrent
Derivatives designated as hedging instruments under ASC 815:
Foreign exchange forward contracts	$	10,115	$	880	$	12,384	$	58
Interest rate swap contracts	—		—		239		980
Total derivatives designated as hedging instruments	$	10,115	$	880	$	12,623	$	1,038
Derivatives not designated as hedging instruments under ASC 815:
Foreign exchange forward contracts	$	10,871	$	—	$	10,373	$	—
Total derivatives not designated as hedging instruments	$	10,871	$	—	$	10,373	$	—
Total derivative instruments	$	20,986	$	880	$	22,996	$	1,038

The following tables present the amounts related to derivative instruments affecting accumulated other comprehensive income (loss) and our condensed consolidated statements of operations for the three and six months ended June 30, 2011 and June 26, 2010 (in thousands):

	Amount of Gain (Loss) Recognized in Other Comprehensive Income on Derivatives							Amount of Gain (Loss) Reclassified from Accumulated Other Comprehensive Income into Income
	Three Months Ended			Six Months Ended			Location of Gain (Loss) Reclassified from Accumulated Other Comprehensive Income into Income	Three Months Ended			Six Months Ended
Derivative Type	June 30, 2011			June 30, 2011				June 30, 2011			June 30, 2011
Derivatives designated as cash flow hedges under ASC 815:
Foreign exchange forward contracts	$	(16,890	)	$	(70,642	)	Net sales	$	(26,154	)	$	(38,534	)
Interest rate swaps	(533		)	184			Interest income (expense)	(200		)	(405		)
Total derivatives designated as cash flow hedges	$	(17,423	)	$	(70,458	)		$	(26,354	)	$	(38,939	)

	Amount of Gain (Loss) Recognized in Income on Derivatives
	Three Months Ended			Six Months Ended
Derivative Type	June 30, 2011			June 30, 2011			Location of Gain (Loss) Recognized in Income on Derivatives
Derivatives designated as cash flow hedges under ASC 815:
Foreign exchange forward contracts	$	(26,154	)	$	(38,534	)	Net sales
Interest rate swaps	$	(200	)	$	(405	)	Interest income (expense)
Derivatives not designated as hedging instruments under ASC 815:
Foreign exchange forward contracts	$	(741	)	$	468		Other income (expense)
Foreign exchange forward contracts	$	820		$	3,902		Cost of sales

	Amount of Gain (Loss) Recognized in Other Comprehensive Income on Derivatives							Amount of Gain (Loss) Reclassified from Accumulated Other Comprehensive Income into Income
	Three Months Ended			Six Months Ended			Location of Gain (Loss) Reclassified from Accumulated Other Comprehensive Income into Income	Three Months Ended			Six Months Ended
Derivative Type	June 26, 2010			June 26, 2010				June 26, 2010			June 26, 2010
Derivatives designated as cash flow hedges under ASC 815:
Foreign exchange forward contracts	$	18,055		$	54,954		Net sales	$	27,938		$	29,233
Interest rate swaps	(366		)	(821		)	Interest income (expense)	(314		)	(633		)
Total derivatives designated as cash flow hedges	$	17,689		$	54,133			$	27,624		$	28,600

	Amount of Gain (Loss) Recognized in Income on Derivatives
	Three Months Ended			Six Months Ended
Derivative Type	June 26, 2010			June 26, 2010			Location of Gain (Loss) Recognized in Income on Derivatives
Derivatives designated as cash flow hedges under ASC 815:
Foreign exchange forward contracts	$	27,938		$	29,233		Net sales
Interest rate swaps	$	(314	)	$	(633	)	Interest income (expense)
Derivatives not designated as hedging instruments under ASC 815:
Foreign exchange forward contracts	$	(4,958	)	$	(10,521	)	Other income (expense)
Foreign exchange forward contracts	$	(2,714	)	$	(7,228	)	Cost of sales
Foreign exchange forward contracts	$	340		$	—		Net sales

Interest Rate Risk

We use interest rate swap agreements to mitigate our exposure to interest rate fluctuations associated with certain of our debt instruments; we do not use such swap agreements for speculative or trading purposes. On May 29, 2009, we entered into an interest rate swap contract to hedge a portion of the floating rate loans under our Malaysian credit facility, which became effective on September 30, 2009 with a notional value of €57.3 million ($82.5 million at the balance sheet close rate on June 30, 2011 of $1.44/€1.00) and pursuant to which we are entitled to receive a six-month floating interest rate, the Euro Interbank Offered Rate (Euribor), and are required to pay a fixed rate of 2.80%. The notional amount of the interest rate swap contract is scheduled to decline in correspondence to our scheduled principal payments on the underlying hedged debt. As of June 30, 2011, the notional value of this interest rate swap contract was €43.2 million ($62.2 million at the balance sheet close rate on June 30, 2011 of $1.44/€1.00). This derivative instrument qualifies for accounting as a cash flow hedge in accordance with ASC 815 and we designated it as such. We determined that our interest rate swap contract was highly effective as a cash flow hedge at June 30, 2011 and December 31, 2010. For the six months ended June 30, 2011, there was no ineffectiveness from this cash flow hedge.

Foreign Currency Exchange Risk

Cash Flow Exposure

We expect many of the components of our business to have material future cash flows, including revenues and expenses, that will be denominated in currencies other than the component's functional currency. Our primary cash flow exposures are customer collections and vendor payments. Changes in the exchange rates between our components' functional currencies and the other currencies in which they transact will cause fluctuations in the cash flows we expect to receive when these cash flows are realized or settled. Accordingly, we enter into foreign exchange forward contracts to hedge a portion of these forecasted cash flows. As of June 30, 2011 and December 31, 2010, these foreign exchange contracts hedged our forecasted future cash flows for up to 18 months. These foreign exchange contracts qualified for accounting as cash flow hedges in accordance with ASC 815, and we designated them as such. We initially report the effective portion of the derivative's gain or loss in “Accumulated other comprehensive income (loss)” and subsequently reclassify amounts into earnings when the hedged transaction is settled. For cash flow hedges, ineffectiveness in the hedging relationship and changes in fair value that are not included in the measurement of effectiveness are both included in other operating income (expense). We determined that these derivative financial instruments were highly effective as cash flow hedges at June 30, 2011 and December 31, 2010. During the six months ended June 30, 2011, there were immaterial amounts of ineffectiveness and amounts excluded from effectiveness testing for these cash flow hedges. In addition, during the six months ended June 30, 2011, we did not discontinue any cash flow hedges because a hedging relationship was no longer highly effective.

During the six months ended June 30, 2011, we purchased foreign exchange forward contracts to hedge the exchange risk on forecasted cash flows denominated in euro and Canadian dollars. As of June 30, 2011, the unrealized loss on these contracts was $31.1 million. The total notional value of the contracts denominated in euro and Canadian dollars were €559.0 million and CAD340.0 million, respectively ($805.0 million and $350.2 million, respectively at the balance sheet close rates on June 30, 2011 of $1.44/€1.00 and $1.03/CAD1.00). The weighted average forward exchange rates for these contracts were $1.36/€1.00 and $1.05/CAD1.00, respectively, at June 30, 2011. As of December 31, 2010, the unrealized loss on these types of contracts was $1.4 million and the total notional value of the contracts was €742.0 million ($1.1 billion at the balance sheet close rate on June 30, 2011 of $1.44/€1.00). The weighted average forward exchange rate for these contracts was $1.33/€1.00 at December 31, 2010. During the six months ended June 30, 2011, we recognized insignificant losses related to hedged forecasted transactions that did not occur by the end of the originally specified period.

In the following 12 months, we expect to reclassify to earnings $29.6 million of net unrealized losses related to these forward contracts that are included in "Accumulated other comprehensive loss" at June 30, 2011 as we realize the earnings effect of the related forecasted transactions. The amount we ultimately record to earnings will depend on the actual exchange rate when we realize the related forecasted transactions. During the three and six months ended June 30, 2011, we realized losses of $26.4 million and $38.9 million, respectively, related to our cash flow hedges.

Transaction Exposure

Many components of our business have assets and liabilities (primarily receivables, investments, accounts payable, debt, solar module collection and recycling liabilities, and inter-company transactions) that are denominated in currencies other than the component's functional currency. Changes in the exchange rates between our components' functional currencies and the other currencies in which these assets and liabilities are denominated can create fluctuations in our reported consolidated financial position, results of operations, and cash flows. We may enter into foreign exchange forward contracts or other financial instruments to economically hedge assets and liabilities against the short-term effects of currency exchange rate fluctuations. The gains and losses on the foreign exchange forward contracts will offset all or part of the transaction gains and losses that we recognize in earnings on the related foreign currency assets and liabilities.

During the six months ended June 30, 2011, we purchased foreign exchange forward contracts to hedge balance sheet exposures related to transactions with third parties. We recognize gains or losses from the fluctuation in foreign exchange rates and the valuation of these derivative contracts in "Cost of sales" and "Foreign currency gain (loss)" on our consolidated statements of operations, depending on where the gain or loss from the economically hedged item is classified on our consolidated statements of operations. As of June 30, 2011, the total unrealized loss on our foreign exchange forward contracts was $1.5 million. These contracts have maturities of less than three months.

As of June 30, 2011, the notional values of our foreign exchange forward contracts were as follows (notional amounts and U.S. dollar equivalents in millions):

				Balance sheet close rate on
Transaction	Currency	Notional Amount	U.S. Equivalent	June 30, 2011
Purchase	Euro	€360.0	$518.4	$1.44/€1.00
Sell	Euro	€425.6	$612.9	$1.44/€1.00
Purchase	Australian dollar	AUD 1.5	$1.6	$1.06/AUD1.00
Sell	Australian dollar	AUD 1.5	$1.6	$1.06/AUD1.00
Purchase	Malaysian ringgit	MYR 162.6	$53.7	$0.33/MYR1.00
Sell	Malaysian ringgit	MYR 20.5	$6.8	$0.33/MYR1.00
Purchase	Japanese yen	JPY 3,416.0	$34.2	$0.01/JPY1.00
Sell	Japanese yen	JPY 2,512.4	$25.1	$0.01/JPY1.00
Purchase	Canadian dollar	CAD 5.5	$5.7	$1.03/CAD1.00
Sell	Canadian dollar	CAD 8.6	$8.9	$1.03/CAD1.00

Credit Risk

We have certain financial and derivative instruments that subject us to credit risk. These consist primarily of cash, cash equivalents, investments, trade accounts receivable, interest rate swap contracts, and foreign exchange forward contracts. We are exposed to credit losses in the event of nonperformance by the counterparties to our financial and derivative instruments. We place cash, cash equivalents, investments, interest rate swap contracts, and foreign exchange forward contracts with various high-quality financial institutions and limit the amount of credit risk from any one counterparty. We continuously evaluate the credit standing of our counterparty financial institutions.

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Note 14. Commitments and Contingencies

6 Months Ended

Jun. 30, 2011

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies Disclosure [Text Block]

14. Commitments and Contingencies

Financial Guarantees

In the normal course of business, we occasionally enter into agreements with third parties under which we guarantee the performance of our subsidiaries related to certain service contracts, which may include services such as development, engineering, procurement of permits and equipment, construction management, and monitoring and maintenance related to solar power plants. These agreements meet the definition of a guarantee according to ASC 460, Guarantees. As of June 30, 2011 and December 31, 2010, none of these guarantees were material to our financial position.

Loan Guarantees

At June 30, 2011 and December 31, 2010, our only loan guarantees were guarantees of our own debt, as disclosed in Note 13. "Debt," to these condensed consolidated financial statements.

Commercial Commitments

During the normal course of business, we enter into commercial commitments in the form of letters of credit and bank guarantees to provide financial and performance assurance to third parties. Our revolving credit facility provides us the capacity to issue up to $600.0 million in letters of credit at a fee equal to the applicable margin for eurocurrency revolving loans and a fronting fee. As of June 30, 2011, we had $143.4 million in letters of credit issued under the revolving credit facility with a remaining availability of $356.6 million, all of which can be used for the issuance of letters of credit. The majority of these letters of credit were supporting our systems business. In addition, as of June 30, 2011 we had $22.0 million in bank guarantees issued by certain of our foreign subsidiaries to guarantee continuous operating obligations.

Product Warranties

We offer warranties on our products and record an estimate of the associated liability based on the number of solar modules under warranty, our historical experience with warranty claims, our monitoring of field installation sites, our in-house testing of our solar modules, and our estimated per-module replacement cost.

Product warranty activity during the three and six months ended June 30, 2011 and June 26, 2010 was as follows (in thousands):

	Three Months Ended						Six Months Ended
	June 30, 2011			June 26, 2010			June 30, 2011			June 26, 2010
Product warranty liability, beginning of period	$	32,141		$	23,375		$	27,894		$	22,583
Accruals for new warranties issued (warranty expense)	5,293			3,865			10,562			7,672
Settlements	(2,869		)	(3,123		)	(6,455		)	(8,973		)
Change in estimate of warranty liability	1,791			(255		)	4,355			2,580
Product warranty liability, end of period	$	36,356		$	23,862		$	36,356		$	23,862
Current portion of warranty liability							$	10,706		$	8,546
Noncurrent portion of warranty liability							$	25,650		$	15,316

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Note 10. Fair Value Measurement

6 Months Ended

Jun. 30, 2011

Fair Value Disclosures [Abstract]

Fair Value Measurement Disclosure [Text Block]

10. Fair Value Measurements

ASC 820, Fair Value Measurements and Disclosures, defines fair value, establishes a framework for measuring fair value in accordance with generally accepted accounting principles, and provides financial statement disclosure requirements for fair value measurements. ASC 820 defines fair value as the price that would be received from the sale of an asset or paid to transfer a liability (an exit price) on the measurement date in an orderly transaction between market participants in the principal or most advantageous market for the asset or liability. ASC 820 specifies a hierarchy of valuation techniques, which is based on whether the inputs into the valuation technique are observable or unobservable. The hierarchy is as follows:

• Level 1 — Valuation techniques in which all significant inputs are unadjusted quoted prices from active markets for assets or liabilities that are identical to the assets or liabilities being measured.

• Level 2 — Valuation techniques in which significant inputs include quoted prices from active markets for assets or liabilities that are similar to the assets or liabilities being measured and/or quoted prices for assets or liabilities that are identical or similar to the assets or liabilities being measured from markets that are not active. Also, model-derived valuations in which all significant inputs and significant value drivers are observable in active markets are Level 2 valuation techniques.

• Level 3 — Valuation techniques in which one or more significant inputs or significant value drivers are unobservable. Unobservable inputs are valuation technique inputs that reflect our own assumptions about the assumptions that market participants would use to price an asset or liability.

When available, we use quoted market prices to determine the fair value of an asset or liability. If quoted market prices are not available, we measure fair value using valuation techniques that use, when possible, current market-based or independently-sourced market parameters, such as interest rates and currency rates. The following is a description of the valuation techniques that we use to measure the fair value of assets and liabilities that we measure and report at fair value on a recurring or one-time basis:

• Cash equivalents. At June 30, 2011 and December 31, 2010, our cash equivalents consisted of commercial paper and money market mutual funds. We value our commercial paper cash equivalents using quoted prices for securities with similar characteristics and other observable inputs (such as interest rates that are observable at commonly quoted intervals), and accordingly, we classify the valuation techniques that use these inputs as Level 2. We value our money market cash equivalents using observable inputs that reflect quoted prices for securities with identical characteristics, and accordingly, we classify the valuation techniques that use these inputs as Level 1.

• Marketable securities, investments, and restricted investments. At June 30, 2011, our marketable securities and investments consisted of certificates of deposit, commercial paper, corporate debt securities, federal and foreign agency debt, foreign government obligations, supranational debt, and U.S. government obligations, and our restricted investments consisted of foreign and U.S. government obligations. At December 31, 2010, our marketable securities consisted of commercial paper, corporate debt securities, federal and foreign agency debt, foreign government obligations, and supranational debt, and our restricted investments consisted of foreign and U.S. government obligations. We value our marketable securities, investments, and restricted investments using quoted prices for securities with similar characteristics and other observable inputs (such as interest rates that are observable at commonly quoted intervals), and accordingly, we classify the valuation techniques that use these inputs as Level 2. We also consider the effect of our counterparties' credit standings in these fair value measurements.

• Derivative assets and liabilities. At June 30, 2011 and December 31, 2010, our derivative assets and liabilities consisted of foreign exchange forward contracts involving major currencies and interest rate swap contracts involving benchmark interest rates. Since our derivative assets and liabilities are not traded on an exchange, we value them using industry standard valuation models. Where applicable, these models project future cash flows and discount the future amounts to a present value using market-based observable inputs including interest rate curves, credit risk, foreign exchange rates, and forward and spot prices for currencies. These inputs are observable in active markets over the terms of the instruments we hold, and accordingly, we classify these valuation techniques as Level 2. We consider the effect of our own credit standing and that of our counterparties in our valuations of our derivative assets and liabilities.

• Solar module collection and recycling liability. We account for our obligation to collect and recycle the solar modules that we sell in a similar manner to the accounting for asset retirement obligations that is prescribed by ASC 410, Asset Retirement and Environmental Obligations. When we sell solar modules, we initially record our liability for collecting and recycling those particular solar modules at the fair value of this liability, and then in subsequent periods, we accrete this fair value to the estimated future cost of collecting and recycling the solar modules. Therefore, this is a one-time nonrecurring fair value measurement of the collection and recycling liability associated with each particular solar module sold.

Since there is not an established market for collecting and recycling our solar modules, we value our liability using a valuation model (an income approach). This fair value measurement requires us to use significant unobservable inputs, which are primarily estimates of collection and recycling process costs and estimates of future changes in costs due to inflation and future currency exchange rates. Accordingly, we classify these valuation techniques as Level 3. We estimate collection and recycling process costs based on analyses of the collection and recycling technologies that we are currently developing; we estimate future inflation costs based on analysis of historical trends; and we estimate future currency exchange rates based on current rate information. We consider the effect of our own credit standing in our measurement of the fair value of this liability.

At June 30, 2011 and December 31, 2010, information about inputs into the fair value measurements of our assets and liabilities that we make on a recurring basis was as follows (in thousands):

	As of June 30, 2011
			Fair Value Measurements at Reporting Date Using
	Total Fair Value and Carrying Value on Our Balance Sheet		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets:
Cash equivalents:
Commercial paper	$	4,600	$	—	$	4,600	$	—
Money market mutual funds	10,059		10,059		—		—
Marketable securities and investments:
Certificates of deposit	2,602		—		2,602		—
Commercial paper	6,846		—		6,846		—
Corporate debt securities	29,886		—		29,886		—
Federal agency debt	49,697		—		49,697		—
Foreign agency debt	22,085		—		22,085		—
Foreign government obligations	5,608		—		5,608		—
Supranational debt	39,226		—		39,226		—
U.S. government obligations	2,012		—		2,012		—
Restricted investments (excluding restricted cash)	150,789		—		150,789		—
Derivative assets	21,174		—		21,174		—
Total assets	$	344,584	$	10,059	$	334,525	$	—
Liabilities:
Derivative liabilities	$	55,346	$	—	$	55,346	$	—

	As of December 31, 2010
			Fair Value Measurements at Reporting Date Using
	Total Fair Value and Carrying Value on Our Balance Sheet		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets:
Cash equivalents:
Commercial paper	$	1,200	$	—	$	1,200	$	—
Money market mutual funds	22,289		22,289		—		—
Marketable securities:
Commercial paper	13,343		—		13,343		—
Corporate debt securities	98,602		—		98,602		—
Federal agency debt	45,875		—		45,875		—
Foreign agency debt	133,165		—		133,165		—
Foreign government obligations	9,143		—		9,143		—
Supranational debt	48,032		—		48,032		—
Restricted investments (excluding restricted cash)	85,984		—		85,984		—
Derivative assets	21,866		—		21,866		—
Total assets	$	479,499	$	22,289	$	457,210	$	—
Liabilities:
Derivative liabilities	$	24,034	$	—	$	24,034	$	—

Fair Value of Financial Instruments

The carrying values and fair values of our financial instruments at June 30, 2011 and December 31, 2010 were as follows (in thousands):

	June 30, 2011				December 31, 2010
	Carrying Value		Fair Value		Carrying Value		Fair Value
Assets:
Marketable securities — current and noncurrent	$	155,360	$	155,360	$	348,160	$	348,160
Investments — current	$	2,602	$	2,602	$	—	$	—
Foreign exchange forward contract assets	$	21,174	$	21,174	$	21,866	$	21,866
Restricted investments (excluding restricted cash)	$	150,789	$	150,789	$	85,984	$	85,984
Notes receivable — noncurrent	$	10,057	$	9,441	$	9,314	$	8,836
Liabilities:
Long-term debt, including current maturities	$	360,826	$	364,825	$	237,391	$	240,176
Interest rate swap contract liabilities	$	630	$	630	$	1,219	$	1,219
Foreign exchange forward contract liabilities	$	54,716	$	54,716	$	22,815	$	22,815

The carrying values on our balance sheet of our cash and cash equivalents, accounts receivable, restricted cash, accounts payable, income taxes payable, and accrued expenses approximate their fair values due to their short maturities; therefore, we exclude them from the foregoing table.

We estimated the fair value of our long-term debt in accordance with ASC 820 using a discounted cash flows approach (an income approach). We incorporated the credit risk of our counterparty for all asset fair value measurements and our credit risk for all liability fair value measurements.

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Note 9. Derivative Financial Instruments (Tables)

6 Months Ended

Jun. 30, 2011

Derivative Financial Instruments Note [Abstract]

Schedule of Derivative Instruments in Statement of Financial Position, Fair Value [Text Block]

The following tables present the fair values of derivative instruments included in our consolidated balance sheets as of June 30, 2011 and December 31, 2010 (in thousands):

	June 30, 2011
	Other Assets – Current		Other Assets – Noncurrent		Other Liabilities – Current		Other Liabilities – Noncurrent
Derivatives designated as hedging instruments under ASC 815:
Foreign exchange forward contracts	$	8,787	$	—	$	39,438	$	1,425
Interest rate swap contracts	—		—		137		493
Total derivatives designated as hedging instruments	$	8,787	$	—	$	39,575	$	1,918
Derivatives not designated as hedging instruments under ASC 815:
Foreign exchange forward contracts	$	12,387	$	—	$	13,853	$	—
Total derivatives not designated as hedging instruments	$	12,387	$	—	$	13,853	$	—
Total derivative instruments	$	21,174	$	—	$	53,428	$	1,918

	December 31, 2010
	Other Assets – Current		Other Assets – Noncurrent		Other Liabilities – Current		Other Liabilities – Noncurrent
Derivatives designated as hedging instruments under ASC 815:
Foreign exchange forward contracts	$	10,115	$	880	$	12,384	$	58
Interest rate swap contracts	—		—		239		980
Total derivatives designated as hedging instruments	$	10,115	$	880	$	12,623	$	1,038
Derivatives not designated as hedging instruments under ASC 815:
Foreign exchange forward contracts	$	10,871	$	—	$	10,373	$	—
Total derivatives not designated as hedging instruments	$	10,871	$	—	$	10,373	$	—
Total derivative instruments	$	20,986	$	880	$	22,996	$	1,038

Schedule of Derivative Instruments, Gain (Loss) in Statement of Financial Performance [Text Block]

The following tables present the amounts related to derivative instruments affecting accumulated other comprehensive income (loss) and our condensed consolidated statements of operations for the three and six months ended June 30, 2011 and June 26, 2010 (in thousands):

	Amount of Gain (Loss) Recognized in Other Comprehensive Income on Derivatives							Amount of Gain (Loss) Reclassified from Accumulated Other Comprehensive Income into Income
	Three Months Ended			Six Months Ended			Location of Gain (Loss) Reclassified from Accumulated Other Comprehensive Income into Income	Three Months Ended			Six Months Ended
Derivative Type	June 30, 2011			June 30, 2011				June 30, 2011			June 30, 2011
Derivatives designated as cash flow hedges under ASC 815:
Foreign exchange forward contracts	$	(16,890	)	$	(70,642	)	Net sales	$	(26,154	)	$	(38,534	)
Interest rate swaps	(533		)	184			Interest income (expense)	(200		)	(405		)
Total derivatives designated as cash flow hedges	$	(17,423	)	$	(70,458	)		$	(26,354	)	$	(38,939	)

	Amount of Gain (Loss) Recognized in Income on Derivatives
	Three Months Ended			Six Months Ended
Derivative Type	June 30, 2011			June 30, 2011			Location of Gain (Loss) Recognized in Income on Derivatives
Derivatives designated as cash flow hedges under ASC 815:
Foreign exchange forward contracts	$	(26,154	)	$	(38,534	)	Net sales
Interest rate swaps	$	(200	)	$	(405	)	Interest income (expense)
Derivatives not designated as hedging instruments under ASC 815:
Foreign exchange forward contracts	$	(741	)	$	468		Other income (expense)
Foreign exchange forward contracts	$	820		$	3,902		Cost of sales

	Amount of Gain (Loss) Recognized in Other Comprehensive Income on Derivatives							Amount of Gain (Loss) Reclassified from Accumulated Other Comprehensive Income into Income
	Three Months Ended			Six Months Ended			Location of Gain (Loss) Reclassified from Accumulated Other Comprehensive Income into Income	Three Months Ended			Six Months Ended
Derivative Type	June 26, 2010			June 26, 2010				June 26, 2010			June 26, 2010
Derivatives designated as cash flow hedges under ASC 815:
Foreign exchange forward contracts	$	18,055		$	54,954		Net sales	$	27,938		$	29,233
Interest rate swaps	(366		)	(821		)	Interest income (expense)	(314		)	(633		)
Total derivatives designated as cash flow hedges	$	17,689		$	54,133			$	27,624		$	28,600

	Amount of Gain (Loss) Recognized in Income on Derivatives
	Three Months Ended			Six Months Ended
Derivative Type	June 26, 2010			June 26, 2010			Location of Gain (Loss) Recognized in Income on Derivatives
Derivatives designated as cash flow hedges under ASC 815:
Foreign exchange forward contracts	$	27,938		$	29,233		Net sales
Interest rate swaps	$	(314	)	$	(633	)	Interest income (expense)
Derivatives not designated as hedging instruments under ASC 815:
Foreign exchange forward contracts	$	(4,958	)	$	(10,521	)	Other income (expense)
Foreign exchange forward contracts	$	(2,714	)	$	(7,228	)	Cost of sales
Foreign exchange forward contracts	$	340		$	—		Net sales

Schedule Of Notional Value Of Foreign Exchange Forward Derivatives [Text Block]

As of June 30, 2011, the notional values of our foreign exchange forward contracts were as follows (notional amounts and U.S. dollar equivalents in millions):

				Balance sheet close rate on
Transaction	Currency	Notional Amount	U.S. Equivalent	June 30, 2011
Purchase	Euro	€360.0	$518.4	$1.44/€1.00
Sell	Euro	€425.6	$612.9	$1.44/€1.00
Purchase	Australian dollar	AUD 1.5	$1.6	$1.06/AUD1.00
Sell	Australian dollar	AUD 1.5	$1.6	$1.06/AUD1.00
Purchase	Malaysian ringgit	MYR 162.6	$53.7	$0.33/MYR1.00
Sell	Malaysian ringgit	MYR 20.5	$6.8	$0.33/MYR1.00
Purchase	Japanese yen	JPY 3,416.0	$34.2	$0.01/JPY1.00
Sell	Japanese yen	JPY 2,512.4	$25.1	$0.01/JPY1.00
Purchase	Canadian dollar	CAD 5.5	$5.7	$1.03/CAD1.00
Sell	Canadian dollar	CAD 8.6	$8.9	$1.03/CAD1.00

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Note 8. Consolidated Balance Sheet Details

6 Months Ended

Jun. 30, 2011

Consolidated Balance Sheet Details [Abstract]

Supplemental Balance Sheet Disclosures [Text Block]

8. Consolidated Balance Sheet Details

Accounts receivable trade, net

Accounts receivable trade, net consisted of the following at June 30, 2011 and December 31, 2010 (in thousands):

	June 30, 2011		December 31, 2010
Accounts receivable trade, gross	$	541,977	$	305,537
Allowance for doubtful accounts	—		—
Accounts receivable trade, net	$	541,977	$	305,537

During the third quarter of 2009, we amended our Supply Contracts with certain of our customers to implement a program which provided a price rebate to these customers for solar modules purchased from us. The initial intent of this program was to enable our customers to successfully compete in our core German market and to adjust, for eligible customers, the sales price (which was documented in framework agreements entered into several years ago) in light of market conditions.

The rebate program is offered for a defined period, during which customers may apply and claim such rebate. The most recent rebate offering, for solar modules sold on or after December 1, 2010, includes certain European geographic areas in addition to Germany.

As was the case in 2009, the rebate amounts are established so as to enable the sell-through of our products at competitive prices. The amount of rebate earned during a fiscal quarter is based on (i) the volume of solar modules shipped to a customer (measured in watts), (ii) the volume of solar modules registered for eligible projects (measured in watts), provided that those solar modules were invoiced by the buyer to an end-user, and (iii) the rebate rate. The rebate program applies a specified rebate rate to solar modules sold for solar power projects in certain geographic areas. Customers need to meet certain requirements in order to be eligible for and benefit from this program. During the six months ended June 30, 2011, we experienced approximately 92% participation in this program by eligible customers.

We account for these rebates as a reduction to the selling price of our solar modules and, therefore, as a reduction in revenue at the time of sale and recognize a contra-asset within accounts receivable trade, net. No rebates granted under this program can be claimed for cash; instead, rebates may only be applied to reduce outstanding accounts receivable balances. During the three and six months ended June 30, 2011, we extended rebates to customers in the amount of €17.3 million and €28.0 million, respectively ($24.9 million and $39.8 million at the average exchange rates of $1.44/€1.00 and $1.42/€1.00, respectively). At June 30, 2011, we had €22.3 million ($32.1 million at the balance sheet close rate on June 30, 2011 of $1.44/€1.00) of rebate claims accrued, which reduced our accounts receivable accordingly. During the three and six months ended June 26, 2010, we extended rebates to customers in the amount of €15.6 million and €35.6 million, respectively ($20.6 million and $48.4 million at the average exchange rates of $1.32/€1.00 and $1.36/€1.00, respectively).

Accounts receivable, unbilled

Accounts receivable, unbilled represents revenue that has been recognized in advance of billing the customer. This is common for construction contracts. For example, we recognize revenue from contracts for the construction and sale of solar power systems which include the sale of project assets over the contractual period using applicable accounting methods. One applicable accounting method is the percentage-of-completion method of accounting, under which sales and gross profit are recognized as work is performed based on the relationship between actual costs incurred compared to the total estimated costs for completing the entire contract. Under this accounting method, revenue could be recognized under applicable revenue recognition criteria in advance of billing the customer, resulting in an amount recorded to "Accounts receivable, unbilled." Once we meet the billing criteria under a contract, we bill our customer accordingly and reclassify the “Accounts receivable, unbilled” to “Accounts receivable trade, net.” Billing requirements vary by contract, but are generally structured around completion of certain construction milestones.

Accounts receivable, unbilled were $63.7 million and $1.5 million at June 30, 2011 and December 31, 2010, respectively. We expect to bill and collect these amounts within the next 12 months.

Inventories

Inventories consisted of the following at June 30, 2011 and December 31, 2010 (in thousands):

	June 30, 2011		December 31, 2010
Raw materials	$	197,961	$	162,190
Work in process	30,499		21,528
Finished goods	137,248		54,873
Total inventories	$	365,708	$	238,591
Inventories — current	$	322,995	$	195,863
Inventories — noncurrent (1)	$	42,713	$	42,728

(1) We purchase a critical raw material that is heavily used in our core production process in quantities that anticipate confident, but long-term future demand. We classify the raw materials that we do not expect to be consumed within our operating cycle (which is 12 months) as noncurrent.

Prepaid expenses and other current assets

Prepaid expenses and other current assets consisted of the following at June 30, 2011 and December 31, 2010 (in thousands):

	June 30, 2011		December 31, 2010
Prepaid expenses	$	64,792	$	46,016
Deferred project costs (1)	47,390		14,446
Derivative instruments	21,174		20,986
Other current assets	127,158		61,585
Total prepaid expenses and other current assets	$	260,514	$	143,033

(1) Deferred project costs represent (i) costs that we capitalize for arrangements that we account for as real estate transactions after we have entered into a definitive sales arrangement, but before we have met the criteria to recognize the sale as revenue, (ii) recoverable pre-contract costs that we capitalize for arrangements accounted for as long-term construction contracts prior to entering into a definitive sales agreement, or (iii) costs that we capitalize for arrangements accounted for as long-term construction contracts after we have signed a definitive sales agreement, but before the revenue recognition criteria have been met.

Project assets — current and noncurrent

Project assets consist primarily of costs relating to solar power projects in various stages of development that we capitalize prior to the sale of the solar power project to a third party for further project development or the signing of a project construction contract. These costs include costs for land and costs for developing and constructing a solar power plant. Development costs can include legal, consulting, permitting, interconnect and other similar costs. Once we enter into a definitive sales agreement, we reclassify project assets to deferred project costs on our balance sheet until we have met the criteria to recognize the sale of the project assets as revenue. We classify project assets generally as noncurrent due to the time required to complete all activities to sell a specific project, which is typically longer than 12 months.

Project assets — current and noncurrent consisted of the following at June 30, 2011 and December 31, 2010 (in thousands):

	June 30, 2011		December 31, 2010
Project assets acquired through OptiSolar and NextLight	$	217,417	$	217,417
Project assets — land	15,899		13,781
Project assets — other	221,751		88,942
Total project assets	$	455,067	$	320,140
Total project assets — current	$	145,379	$	—
Total project assets — noncurrent	$	309,688	$	320,140

In connection with the acquisition of the solar power project development businesses of OptiSolar and NextLight, we measured at fair value certain acquired project assets based on the varying development stages of each project asset on the acquisition date. Subsequent to the acquisitions of OptiSolar and NextLight, we incurred additional costs to further develop these projects. Once we enter into a definitive sales agreement, we reclassify project assets to deferred project costs on our balance sheet. We expense these project assets to cost of sales as each respective project asset or solar power system is sold to a customer, since the project is constructed for a customer (matching the underlying revenue recognition method). If a project is considered not commercially viable, we impair the respective project asset and adjust it to fair value, with the resulting impairment recorded within operations.

We review project assets for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. We consider a project commercially viable if it is anticipated to be sellable for a profit once it is either fully developed or fully constructed. We consider a partially developed or partially constructed project commercially viable if the anticipated selling price is higher than the carrying value of the related project assets. We examine a number of factors to determine if the project will be profitable, the most notable of which is whether there are any changes in environmental, ecological, permitting, or regulatory conditions that impact the project. Such changes could cause the cost of the project to increase or the selling price of the project to decrease.

Property, plant and equipment, net

Property, plant and equipment, net consisted of the following at June 30, 2011 and December 31, 2010 (in thousands):

	June 30, 2011			December 31, 2010
Buildings and improvements	$	398,115		$	286,637
Machinery and equipment	1,378,961			997,510
Office equipment and furniture	92,024			70,569
Leasehold improvements	38,211			25,354
Depreciable property, plant and equipment, gross	1,907,311			1,380,070
Accumulated depreciation	(462,941		)	(363,305		)
Depreciable property, plant and equipment, net	1,444,370			1,016,765
Land	11,758			10,355
Construction in progress	271,865			403,669
Property, plant and equipment, net	$	1,727,993		$	1,430,789

During 2010, we were granted a $16.3 million tax credit under the Advanced Energy Tax Credit program enacted by the American Reinvestment and Recovery Act of 2009 for the expansion of our Perrysburg, Ohio manufacturing facility, and we reduced the acquisition cost for the expansion of this facility accordingly.

Further, we are eligible to receive certain investment incentives related to building the expansion of our manufacturing plant in Frankfurt/Oder, Germany, including costs for the construction of buildings and the purchase of machinery and equipment. We account for these grants as a deduction to the carrying value of the fixed assets they fund when there is reasonable assurance that we comply with the conditions attached to the grants and the grants will be received. See Note 11. "Economic Development Funding," for further information about these grants.

Depreciation of property, plant and equipment was $54.4 million and $36.2 million for the three months ended June 30, 2011 and June 26, 2010, respectively, and was $101.5 million and $72.8 million for the six months ended June 30, 2011 and June 26, 2010, respectively.

Capitalized interest

We capitalized interest costs incurred into property, plant and equipment or project assets/deferred project costs as follows during the three and six months ended June 30, 2011 and June 26, 2010 (in thousands):

	Three Months Ended						Six Months Ended
	June 30, 2011			June 26, 2010			June 30, 2011			June 26, 2010
Interest cost incurred	$	(1,954	)	$	(1,923	)	$	(3,791	)	$	(4,198	)
Interest cost capitalized – property, plant and equipment	1,352			1,283			3,111			1,701
Interest cost capitalized – project assets and deferred project costs	602			634			680			2,491
Interest expense, net	$	—		$	(6	)	$	—		$	(6	)

Accrued expenses

Accrued expenses consisted of the following at June 30, 2011 and December 31, 2010 (in thousands):

	June 30, 2011		December 31, 2010
Accrued compensation and benefits	$	35,222	$	69,353
Accrued property, plant and equipment	49,836		53,741
Accrued inventory	54,835		25,686
Product warranty liability – current	10,706		11,226
Nonrecurring expenses in excess of normal product warranty liability and related expenses (1)	17,237		28,921
Other accrued expenses	74,414		55,344
Total accrued expenses	$	242,250	$	244,271

(1) The above-referenced $17.2 million of accrued nonrecurring expenses in excess of normal product warranty liability and related expenses as of June 30, 2011 consisted of the following, each related to the manufacturing excursion described below: (i) $14.4 million in estimated expenses for certain module replacement efforts voluntarily undertaken by us beyond the normal product warranty; and (ii) $2.8 million in estimated nonrecurring post-sale expenses. During the period from June 2008 to June 2009, a manufacturing excursion occurred affecting less than 4% of the total product manufactured within the period. The excursion could result in possible premature power loss in affected modules. The root cause was identified and subsequently mitigated in June 2009. On-going testing confirms that the corrective actions have been effective. We have been working directly with impacted customers to replace the affected modules and these efforts are well underway and, in some cases, complete. Some of these efforts go beyond our normal warranty coverage.

Other current liabilities

Other current liabilities consisted of the following at June 30, 2011 and December 31, 2010 (in thousands):

	June 30, 2011		December 31, 2010
Deferred revenue (1)	$	31,010	$	14,718
Derivative instruments	53,428		22,996
Deferred tax liabilities	—		34,601
Other current liabilities	10,479		27,361
Total other current liabilities	$	94,917	$	99,676

(1) Deferred revenue will be recognized in net sales once all revenue recognition criteria are met.

Other liabilities

Other liabilities consisted of the following at June 30, 2011 and December 31, 2010 (in thousands):

	June 30, 2011		December 31, 2010
Other taxes payable	$	73,461	$	59,148
Other noncurrent liabilities	83,228		52,878
Total other liabilities	$	156,689	$	112,026

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Note 9. Derivative Financial Instruments (Details) - Transaction Exposure In Millions			6 Months Ended
	Jun. 30, 2011 USD ($)	May 30, 2011	Jun. 30, 2011 Euro Member Countries, Euro Forward Contracts [Member] USD ($)	Jun. 30, 2011 Euro Member Countries, Euro Forward Contracts [Member] EUR (€)	Jun. 30, 2011 Australia, Dollars Forward Contracts [Member] USD ($)	Jun. 30, 2011 Australia, Dollars Forward Contracts [Member] AUD	Jun. 30, 2011 Malaysia, Ringgits Forward Contracts [Member] USD ($)	Jun. 30, 2011 Malaysia, Ringgits Forward Contracts [Member] MYR	Jun. 30, 2011 Japan, Yen Forward Contracts [Member] USD ($)	Jun. 30, 2011 Japan, Yen Forward Contracts [Member] JPY (¥)	Jun. 30, 2011 Canada, Dollars Forward Contracts [Member] USD ($)	Jun. 30, 2011 Canada, Dollars Forward Contracts [Member] CAD
Derivative [Line Items]
Exchange rate ratio	1.44	1.42	1.44	1.44	1.06	1.06	0.33	0.33	0.01	0.01	1.03	1.03
Derivative, currency bought			Euro	Euro	Australian dollar	Australian dollar	Malaysian ringgit	Malaysian ringgit	Japanese yen	Japanese yen	Canadian dollar	Canadian dollar
Notional amount of foreign currency derivative purchase contracts			$ 518.4	€ 360.0	$ 1.6	1.5	$ 53.7	162.6	$ 34.2	¥ 3,416.0	$ 5.7	5.5
Derivative, currency sold			Euro	Euro	Australian dollar	Australian dollar	Malaysian ringgit	Malaysian ringgit	Japanese yen	Japanese yen	Canadian dollar	Canadian dollar
Notional amount of foreign currency derivative sale contracts			$ 612.9	€ 425.6	$ 1.6	1.5	$ 6.8	20.5	$ 25.1	¥ 2,512.4	$ 8.9	8.6

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Note 1. Basis of Presentation

6 Months Ended

Jun. 30, 2011

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Basis of Presentation Disclosure [Text Block]

1. Basis of Presentation

The accompanying unaudited condensed consolidated financial statements of First Solar, Inc. and its subsidiaries have been prepared in accordance with accounting principles generally accepted in the United States of America (U.S. GAAP) for interim financial information and pursuant to the instructions to Form 10-Q and Article 10 of Regulation S-X of the Securities and Exchange Commission (SEC). Accordingly, these interim financial statements do not include all of the information and footnotes required by U.S. GAAP for annual financial statements. In the opinion of management, all adjustments (consisting only of normal recurring adjustments) considered necessary for a fair statement have been included. Operating results for the three months and six months ended June 30, 2011 are not necessarily indicative of the results that may be expected for the year ending December 31, 2011, or for any other period. The balance sheet at December 31, 2010 has been derived from the audited consolidated financial statements at that date, but does not include all of the information and footnotes required by U.S. GAAP for complete financial statements. These financial statements and notes should be read in conjunction with the financial statements and notes thereto for the fiscal year ended December 31, 2010 included in our Annual Report on Form 10-K filed with the SEC.

We report our quarterly results of operations using a calendar convention. Prior to December 31, 2010, our fiscal periods ended on the Saturday closest to the end of the applicable calendar quarter. Fiscal 2011 will end on December 31, 2011.

Certain prior year balances have been reclassified to conform to the current year's presentation. Such reclassifications did not affect total net sales, operating income, or net income.

Unless expressly stated or the context otherwise requires, the terms "the Company," "we," "our," "us," and "First Solar" refer to First Solar, Inc. and its subsidiaries.

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Note 4. Acquisitions

6 Months Ended

Jun. 30, 2011

Acquisitions Note [Abstract]

Acquisitions Disclosure [Text Block]

4. Acquisitions

Fiscal 2011 Acquisition

Ray Tracker

On January 4, 2011, we acquired 100% of the ownership interest of Ray Tracker, Inc., a tracking technology and photovoltaic (PV) balance of systems business in an all-cash transaction, which was not material to our consolidated balance sheets and results of operations. We have included the financial results of Ray Tracker in our condensed consolidated financial statements from the date of acquisition. During the first six months of 2011, Ray Tracker did not contribute a material amount to our net sales and net income.

Fiscal 2010 Acquisition

NextLight Renewable Power

On July 12, 2010, we completed the acquisition of NextLight Renewable Power, LLC (NextLight), a leading developer of utility-scale solar power projects in the southwestern United States. NextLight was formed by a private equity firm focused on investing in North America's energy infrastructure. This transaction expanded our pipeline of solar power projects in the southwestern United States and supports our expansion in the U.S. utility-scale power market. We have integrated NextLight into our systems business, which provides a complete PV solar power solution, including project development, EPC services, O&M services, when applicable, and project finance, when required.

The total consideration for this acquisition was $296.7 million in an all-cash transaction. In allocating the purchase price based on estimated fair values, we recorded approximately $146.8 million of goodwill, $2.5 million of net tangible assets, and $147.4 million of project assets. We have included the financial results of NextLight in our condensed consolidated financial statements beginning on the acquisition date. For the period from January 1, 2010 to June 26, 2010, NextLight did not recognize any revenue and did not incur a material net loss. Therefore, had the acquisition of NextLight occurred on December 27, 2009 (the first day of our fiscal year 2010), our reported net sales would not have changed and our reported net income would not have materially changed from the amounts previously reported.

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Note 20. Segment Reporting (Tables)

6 Months Ended

Jun. 30, 2011

Segment Reporting Information, Profit (Loss) [Abstract]

Schedule of Segment Reporting Information, by Segment [Table Text Block]

Financial information about our segments during the three and six months ended June 30, 2011 and June 26, 2010 was as follows (in thousands):

	Three Months Ended						Three Months Ended
	June 30, 2011						June 26, 2010
	Components		Systems		Total		Components		Systems		Total
Net sales	$	471,947	$	60,827	$	532,774	$	500,940	$	86,914	$	587,854
Gross profit	$	189,875	$	4,923	$	194,798	$	261,656	$	22,538	$	284,194
Income before income taxes	$	71,957	$	—	$	71,957	$	180,438	$	—	$	180,438
Goodwill	$	393,365	$	65,443	$	458,808	$	251,275	$	35,240	$	286,515
Total assets	$	4,206,755	$	732,477	$	4,939,232	$	3,172,912	$	458,403	$	3,631,315

	Six Months Ended						Six Months Ended
	June 30, 2011						June 26, 2010
	Components		Systems		Total		Components		Systems		Total
Net sales	$	991,466	$	108,601	$	1,100,067	$	1,030,208	$	125,607	$	1,155,815
Gross profit	$	448,133	$	6,330	$	454,463	$	539,307	$	26,923	$	566,230
Income before income taxes	$	204,964	$	—	$	204,964	$	375,797	$	—	$	375,797
Goodwill	$	393,365	$	65,443	$	458,808	$	251,275	$	35,240	$	286,515
Total assets	$	4,206,755	$	732,477	$	4,939,232	$	3,172,912	$	458,403	$	3,631,315

Schedule Of Segment Reporting Information By Alternate Segment [Text Block]

The following table sets forth the total amounts of solar modules and solar power systems revenue recognized for the three and six months ended June 30, 2011 and June 26, 2010. For the purposes of the following table, (i) "Solar module revenue" is composed of total revenues from the sale of solar modules to third parties, and (ii) "Solar power system revenue" is composed of total revenues from the sale of complete solar power systems and related services including the solar modules installed in the solar power system.

	Three Months Ended				Six Months Ended
(Dollars in thousands)	June 30, 2011		June 26, 2010		June 30, 2011		June 26, 2010
Solar module revenue	$	427,350	$	476,061	$	933,092	$	1,004,939
Solar power system revenue	105,424		111,793		166,975		150,876
Total net sales	$	532,774	$	587,854	$	1,100,067	$	1,155,815

Inter Segment Transfers [Table Text Block]

Compensation by the components segment to the systems segment during the three and six months ended June 30, 2011 and June 26, 2010 was as follows (in millions):

	Three Months Ended				Six Months Ended
	June 30, 2011		June 26, 2010		June 30, 2011		June 26, 2010
Compensation by the Components Segment to the Systems Segment	$	19.7	$	—	$	45.9	$	8.9

Repayment of prior period compensation by the systems segment to the components segment during the three and six months ended June 30, 2011 and June 26, 2010 was as follows (in millions):

	Three Months Ended				Six Months Ended
	June 30, 2011		June 26, 2010		June 30, 2011		June 26, 2010
Repayment of Prior Period Compensation by the Systems Segment to the Components Segment	$	—	$	11.4	$	—	$	11.4

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Note 8. Consolidated Balance Sheet Details (Tables)

6 Months Ended

Jun. 30, 2011

Consolidated Balance Sheet Details [Abstract]

Financing Receivables [Text Block]

Accounts receivable trade, net consisted of the following at June 30, 2011 and December 31, 2010 (in thousands):

	June 30, 2011		December 31, 2010
Accounts receivable trade, gross	$	541,977	$	305,537
Allowance for doubtful accounts	—		—
Accounts receivable trade, net	$	541,977	$	305,537

Inventories [Text Block]

Inventories consisted of the following at June 30, 2011 and December 31, 2010 (in thousands):

	June 30, 2011		December 31, 2010
Raw materials	$	197,961	$	162,190
Work in process	30,499		21,528
Finished goods	137,248		54,873
Total inventories	$	365,708	$	238,591
Inventories — current	$	322,995	$	195,863
Inventories — noncurrent (1)	$	42,713	$	42,728

(1) We purchase a critical raw material that is heavily used in our core production process in quantities that anticipate confident, but long-term future demand. We classify the raw materials that we do not expect to be consumed within our operating cycle (which is 12 months) as noncurrent.

Prepaid expenses and other current assets [Text Block]

Prepaid expenses and other current assets consisted of the following at June 30, 2011 and December 31, 2010 (in thousands):

	June 30, 2011		December 31, 2010
Prepaid expenses	$	64,792	$	46,016
Deferred project costs (1)	47,390		14,446
Derivative instruments	21,174		20,986
Other current assets	127,158		61,585
Total prepaid expenses and other current assets	$	260,514	$	143,033

(1) Deferred project costs represent (i) costs that we capitalize for arrangements that we account for as real estate transactions after we have entered into a definitive sales arrangement, but before we have met the criteria to recognize the sale as revenue, (ii) recoverable pre-contract costs that we capitalize for arrangements accounted for as long-term construction contracts prior to entering into a definitive sales agreement, or (iii) costs that we capitalize for arrangements accounted for as long-term construction contracts after we have signed a definitive sales agreement, but before the revenue recognition criteria have been met.

Project Assets Current and Noncurrent [Text Block]

Project assets — current and noncurrent consisted of the following at June 30, 2011 and December 31, 2010 (in thousands):

	June 30, 2011		December 31, 2010
Project assets acquired through OptiSolar and NextLight	$	217,417	$	217,417
Project assets — land	15,899		13,781
Project assets — other	221,751		88,942
Total project assets	$	455,067	$	320,140
Total project assets — current	$	145,379	$	—
Total project assets — noncurrent	$	309,688	$	320,140

Property, plant and equipment, net [Text Block]

Property, plant and equipment, net consisted of the following at June 30, 2011 and December 31, 2010 (in thousands):

	June 30, 2011			December 31, 2010
Buildings and improvements	$	398,115		$	286,637
Machinery and equipment	1,378,961			997,510
Office equipment and furniture	92,024			70,569
Leasehold improvements	38,211			25,354
Depreciable property, plant and equipment, gross	1,907,311			1,380,070
Accumulated depreciation	(462,941		)	(363,305		)
Depreciable property, plant and equipment, net	1,444,370			1,016,765
Land	11,758			10,355
Construction in progress	271,865			403,669
Property, plant and equipment, net	$	1,727,993		$	1,430,789

Capitalized interest [Text Block]

We capitalized interest costs incurred into property, plant and equipment or project assets/deferred project costs as follows during the three and six months ended June 30, 2011 and June 26, 2010 (in thousands):

	Three Months Ended						Six Months Ended
	June 30, 2011			June 26, 2010			June 30, 2011			June 26, 2010
Interest cost incurred	$	(1,954	)	$	(1,923	)	$	(3,791	)	$	(4,198	)
Interest cost capitalized – property, plant and equipment	1,352			1,283			3,111			1,701
Interest cost capitalized – project assets and deferred project costs	602			634			680			2,491
Interest expense, net	$	—		$	(6	)	$	—		$	(6	)

Accrued expenses [Text Block]

Accrued expenses consisted of the following at June 30, 2011 and December 31, 2010 (in thousands):

	June 30, 2011		December 31, 2010
Accrued compensation and benefits	$	35,222	$	69,353
Accrued property, plant and equipment	49,836		53,741
Accrued inventory	54,835		25,686
Product warranty liability – current	10,706		11,226
Nonrecurring expenses in excess of normal product warranty liability and related expenses (1)	17,237		28,921
Other accrued expenses	74,414		55,344
Total accrued expenses	$	242,250	$	244,271

(1) The above-referenced $17.2 million of accrued nonrecurring expenses in excess of normal product warranty liability and related expenses as of June 30, 2011 consisted of the following, each related to the manufacturing excursion described below: (i) $14.4 million in estimated expenses for certain module replacement efforts voluntarily undertaken by us beyond the normal product warranty; and (ii) $2.8 million in estimated nonrecurring post-sale expenses. During the period from June 2008 to June 2009, a manufacturing excursion occurred affecting less than 4% of the total product manufactured within the period. The excursion could result in possible premature power loss in affected modules. The root cause was identified and subsequently mitigated in June 2009. On-going testing confirms that the corrective actions have been effective. We have been working directly with impacted customers to replace the affected modules and these efforts are well underway and, in some cases, complete. Some of these efforts go beyond our normal warranty coverage.

Other current and noncurrent liabilities [Text Block]

Other current liabilities consisted of the following at June 30, 2011 and December 31, 2010 (in thousands):

	June 30, 2011		December 31, 2010
Deferred revenue (1)	$	31,010	$	14,718
Derivative instruments	53,428		22,996
Deferred tax liabilities	—		34,601
Other current liabilities	10,479		27,361
Total other current liabilities	$	94,917	$	99,676

(1) Deferred revenue will be recognized in net sales once all revenue recognition criteria are met.

Other liabilities

Other liabilities consisted of the following at June 30, 2011 and December 31, 2010 (in thousands):

	June 30, 2011		December 31, 2010
Other taxes payable	$	73,461	$	59,148
Other noncurrent liabilities	83,228		52,878
Total other liabilities	$	156,689	$	112,026

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Note 13. Debt (Details) - Facility Agreements						6 Months Ended									6 Months Ended				6 Months Ended				6 Months Ended								6 Months Ended
	Jun. 30, 2011 USD ($)	May 30, 2011	Dec. 31, 2010 USD ($)	Jun. 30, 2011 JP Morgan Chase Bank NA And Bank Of America [Member] Line Of Credit - Revolving Letter Of Credit [Member] USD ($)	Dec. 31, 2010 JP Morgan Chase Bank NA And Bank Of America [Member] Line Of Credit - Revolving Letter Of Credit [Member] USD ($)	Jun. 30, 2011 German Facility Agreement [Member] USD ($)	Jun. 30, 2011 German Facility Agreement [Member] EUR (€)	Dec. 31, 2010 German Facility Agreement [Member] USD ($)	Jun. 30, 2011 Malaysian Facility Agreement [Member] USD ($)		Jun. 30, 2011 Malaysian Facility Agreement [Member] EUR (€)		Dec. 31, 2010 Malaysian Facility Agreement [Member] USD ($)		Jun. 30, 2011 Malaysian Facility Agreement Floating Rate Term Loan [Member] USD ($)		Dec. 31, 2010 Malaysian Facility Agreement Floating Rate Term Loan [Member] USD ($)		Jun. 30, 2011 Malaysian Facility Agreement, Fixed Rate Term Loan [Member] USD ($)	Dec. 31, 2010 Malaysian Facility Agreement, Fixed Rate Term Loan [Member] USD ($)	Jun. 30, 2011 Director of Development of the State of Ohio [Member] USD ($)	Dec. 31, 2010 Director of Development of the State of Ohio [Member] USD ($)	Jun. 30, 2011 Director of Development of the State of Ohio 2015 maturity [Member] USD ($)	Dec. 31, 2010 Director of Development of the State of Ohio 2015 maturity [Member] USD ($)	Jun. 30, 2011 Capital Lease Obligations [Member] USD ($)	Dec. 31, 2010 Capital Lease Obligations [Member] USD ($)	Jun. 30, 2011 France Facility Agreement [Member] USD ($)	Jun. 30, 2011 France Facility Agreement [Member] EUR (€)	Dec. 31, 2010 France Facility Agreement [Member] USD ($)	Jun. 30, 2011 Malaysian Ringgit Facility Agreement [Member] USD ($)	Jun. 30, 2011 JP Morgan Chase Bank NA And Bank Of America [Member] USD ($)	Dec. 31, 2010 JP Morgan Chase Bank NA And Bank Of America [Member] USD ($)	Sep. 04, 2009 JP Morgan Chase Bank NA And Bank Of America [Member] USD ($)
Debt Instrument [Line Items]
Line of credit facility, current borrowing capacity																															$ 600,000,000		$ 300,000,000
Line of credit facility, maximum borrowing capacity						179,300,000	124,500,000		193,000,000		134,000,000																72,000,000	50,000,000		150,000,000	750,000,000
Interest Rate Stated Percentage - Variable Rate Description						Euribor plus 1.35%	Euribor plus 1.35%								Euribor plus 0.55%																Borrowings under the amended and restated credit agreement currently bear interest at (i) London Interbank Offered Rate (LIBOR) (adjusted for eurocurrency reserve requirements) plus a margin of 2.25% or (ii) a base rate as defined in the credit agreement plus a margin of 1.25%, depending on the type of borrowing requested
Line of credit commitment fee, annual percentage rate						35.00%	35.00%																								0.375%
Line of credit facility, interest rate at period end																															2.66%
Line of credit facility, amount outstanding				100,000,000	100,000,000																						5,400,000	3,800,000	0	0	143,400,000	126,400,000
Line of credit facility, remaining borrowing capacity																															356,600,000
Debt Instrument, Face Amount																					15,000,000		15,000,000
Debt Instrument, Currency						EUR	EUR								EUR				EUR				USD
Debt Instrument, Interest Rate, Stated Percentage																			4.54%				2.25%				4.00%	4.00%
Long-term Debt, Gross	$ 365,619,000		$ 239,866,000			$ 123,734,000	€ 85,900,000	$ 0	$ 126,648,000	[1]	€ 87,900,000	[1]	$ 130,018,000	[1]	$ 63,324,000	[2]	$ 65,009,000	[2]	$ 63,324,000	$ 65,009,000	$ 7,229,000	$ 8,112,000	$ 7,229,000	$ 8,112,000	$ 2,658,000	$ 1,736,000	$ 5,350,000		$ 0
Debt instrument, maturity date, description						2019	2019								2016				2016				2015
Exchange rate ratio	1.44	1.42
Long-term Debt, Percentage Bearing Fixed Interest, Percentage Rate						1.35%	1.35%

[1] 1) €87.9 million outstanding at June 30, 2011 ($126.6 million at the balance sheet close rate on June 30, 2011 of $1.44/€1

[2] We entered into an interest rate swap contract related to this loan. See Note 9. "Derivative Financial Instruments," to our condensed consolidated financial statements.

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Note 14. Commitments and Contingencies (Details) - Product Warranties (USD $) In Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2011	Jun. 26, 2010	Jun. 30, 2011	Jun. 26, 2010
Movement in Standard Product Warranty Accrual [Roll Forward]
Product warranty liability, beginning of period	$ 32,141	$ 23,375	$ 27,894	$ 22,583
Accruals for new warranties issued (warranty expense)	5,293	3,865	10,562	7,672
Settlements	(2,869)	(3,123)	(6,455)	(8,973)
Change in estimate of warranty liability	1,791	(255)	4,355	2,580
Product warranty liability, end of period	36,356	23,862	36,356	23,862
Current portion of warranty liability	10,706	8,546	10,706	8,546
Noncurrent portion of warranty liability	$ 25,650	$ 15,316	$ 25,650	$ 15,316

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Note 9. Derivative Financial Instruments (Details) - Risk Management	3 Months Ended		6 Months Ended		12 Months Ended				3 Months Ended	6 Months Ended	12 Months Ended				6 Months Ended
	Jun. 30, 2011 USD ($)	Jun. 26, 2010 USD ($)	Jun. 30, 2011 USD ($)	Jun. 26, 2010 USD ($)	Dec. 31, 2010	May 30, 2011	Jun. 30, 2011 Foreign Exchange Contract [Member] Euro Member Countries, Euro USD ($)	Jun. 30, 2011 Foreign Exchange Contract [Member] Canada, Dollars USD ($)	Jun. 30, 2011 Foreign Exchange Contract [Member] USD ($)	Jun. 30, 2011 Foreign Exchange Contract [Member] USD ($)	Dec. 31, 2010 Foreign Exchange Contract [Member] USD ($)	Jun. 30, 2011 Foreign Exchange Contract [Member] EUR (€)	Jun. 30, 2011 Foreign Exchange Contract [Member] CAD	Dec. 31, 2010 Foreign Exchange Contract [Member] EUR (€)	Jun. 30, 2011 Interest Rate Swap [Member] USD ($)	Jun. 30, 2011 Interest Rate Swap [Member] EUR (€)	Sep. 30, 2009 Interest Rate Swap [Member] USD ($)	Sep. 30, 2009 Interest Rate Swap [Member] EUR (€)
Interest Rate Derivatives:
Derivative, inception date															May 29, 2009	May 29, 2009
Exchange rate ratio	1.44		1.44			1.42			1.44	1.44					1.44	1.44
Interest expense, net	$ 0	$ 6,000	$ 0	$ 6,000
Derivative, type of interest rate paid on swap															fixed rate	fixed rate
Derivative fixed interest rate paid on swap															2.80%	2.80%
Notional amount of interest rate cash flow hedge derivatives															62,200,000	43,200,000	82,500,000	57,300,000
Foreign Currency Derivatives:
Maximum length of time hedged in foreign currency cash flow hedge					18 months					18 months
Unrealized gain (loss) on cash flow hedging instruments										(31,100,000)	(1,400,000)
Notional amount of foreign currency derivatives							805,000,000	350,200,000			1,068,480,000	559,000,000	340,000,000	742,000,000
Derivative, average forward exchange rate									1.05	1.05	1.33
Foreign currency cash flow hedge gain (loss) to be reclassified during next 12 months									(29,600,000)	(29,600,000)
Foreign currency cash flow hedge gain (loss) reclassified to earnings, net									(26,400,000)	(38,900,000)
Maximum remaining maturity of foreign currency derivatives									less than three months	less than three months
Unrealized gain (loss) on derivatives not designated as hedging instruments										$ (1,500,000)

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Note 17. Net Income Per Share (Details) (USD $) In Thousands, except Per Share data	3 Months Ended		6 Months Ended
	Jun. 30, 2011	Jun. 26, 2010	Jun. 30, 2011	Jun. 26, 2010
Numerator:
Net income	$ 61,138	$ 159,043	$ 177,106	$ 331,388
Denominator, basic:
Weighted-average common stock outstanding	86,164	84,852	85,746	84,679
Net income per share, basic	$ 0.71	$ 1.87	$ 2.07	$ 3.91
Denominator, diluted:
Weighted-average common stock outstanding	86,164	84,852	85,746	84,679
Effect of stock options, restricted stock units outstanding and contingent issuable shares	962	1,549	1,346	1,568
Weighted-average shares used in computing diluted net income per share	87,126	86,401	87,092	86,247
Net income per share, diluted	$ 0.7	$ 1.84	$ 2.03	$ 3.84
Restricted stock units and options to purchase common stock, anti-dilutive shares excluded	939	75	515	157

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Note 5. Goodwill

6 Months Ended

Jun. 30, 2011

Goodwill And Intangible Assets [Abstract]

Goodwill [Text Block]

5. Goodwill

The changes in the carrying amount of goodwill, which is generally deductible for tax purposes, for our components segment and systems segment for the six months ended June 30, 2011 were as follows (in thousands):

	Components		Systems		Consolidated
Ending balance, December 31, 2010	$	393,365	$	39,923	$	433,288
Goodwill from acquisition	—		25,520		25,520
Ending balance, June 30, 2011	$	393,365	$	65,443	$	458,808

ASC 350, Intangibles — Goodwill and Other, requires us to test goodwill for impairment at least annually, or sooner, if facts or circumstances between scheduled annual tests indicate that it is more likely than not that the fair value of a reporting unit that has goodwill might be less than its carrying value. Currently our operating segments and reporting units are identical. We estimate the fair value of our reporting units by referring to the price that would be received to sell the unit as whole in an orderly transaction between market participants at the measurement date. For the goodwill assessment of our systems business, we believe that a typical market participant for the sale of our systems reporting unit would be a solar module manufacturer seeking to acquire a systems business with a large pipeline of utility-scale solar power plant projects, with the intent that these projects would provide a captive outlet for additional future solar module production. Therefore, we model the systems reporting unit's future performance for purposes of applying the income method of fair value measurement to include some of the profitability associated with the solar module element of the solar power plants that it builds and sells.

We performed our goodwill impairment test in the fourth fiscal quarter of the year ended December 31, 2010 and determined that the fair value of our goodwill substantially exceeded the carrying value for each individual reporting unit. Therefore, we concluded that our goodwill was not impaired. We have also concluded that there have been no changes in facts and circumstances since the date of that test that would trigger an interim goodwill impairment test.

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Note 5. Goodwill (Details) - Goodwill (USD $) In Thousands				6 Months Ended
	Jun. 30, 2011	Dec. 31, 2010	Jun. 26, 2010	Jun. 30, 2011 Components Segment [Member] Ray Tracker [Member]	Jun. 30, 2011 Systems Segment [Member] Ray Tracker [Member]	Jun. 30, 2011 Ray Tracker [Member]	Jun. 30, 2011 Systems Segment [Member]	Dec. 31, 2010 Systems Segment [Member]	Jun. 26, 2010 Systems Segment [Member]	Jun. 30, 2011 Components Segment [Member]	Dec. 31, 2010 Components Segment [Member]	Jun. 26, 2010 Components Segment [Member]
Goodwill [Roll Forward]
Goodwill, beginning balance	$ 458,808	$ 433,288	$ 286,515				$ 65,443	$ 39,923	$ 35,240	$ 393,365	$ 393,365	$ 251,275
Goodwill, acquired during period				0	25,520	25,520
Goodwill, ending balance	$ 458,808	$ 433,288	$ 286,515				$ 65,443	$ 39,923	$ 35,240	$ 393,365	$ 393,365	$ 251,275

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Note 5. Goodwill (Tables)

6 Months Ended

Jun. 30, 2011

Goodwill And Intangible Assets [Abstract]

Schedule of Goodwill [Text Block]

	Components		Systems		Consolidated
Ending balance, December 31, 2010	$	393,365	$	39,923	$	433,288
Goodwill from acquisition	—		25,520		25,520
Ending balance, June 30, 2011	$	393,365	$	65,443	$	458,808

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Note 19. Statement of Cash Flows (Details) (USD $) In Thousands	6 Months Ended
	Jun. 30, 2011	Jun. 26, 2010
Net income	$ 177,106	$ 331,388
Adjustments to reconcile net income to cash provided by operating activities:
Depreciation and amortization	104,287	77,747
Impairment of assets and liabilities	1,486	3,480
Impairment of project assets	3,411	638
Share-based compensation	56,838	44,516
Remeasurement of monetary assets and liabilities	6,635	3,510
Deferred income taxes	(42,048)	(6,877)
Excess tax benefit from share-based compensation arrangements	(16,497)	0
Provision for doubtful accounts receivable	0	(990)
Gain on sales of marketable securities, investments, and restricted investments, net	(3,298)	(203)
Other operating activities	(624)	(736)
Changes in operating assets and liabilities:
Accounts receivable, trade	(230,540)	(54,211)
Accounts receivable, unbilled	(62,195)	(105,657)
Prepaid expenses and other current assets	(80,795)	(126,313)
Other assets	(27,941)	(4,558)
Inventories and balance of systems parts	(153,323)	(49,921)
Project assets	(133,216)	(11,126)
Accounts payable	79,102	2,351
Income Taxes Payable	47,048	19,433
Accrued expenses and other liabilities	(13,391)	(27,665)
Accrued solar module collection and recycling liability	41,120	12,794
Total adjustments	(423,941)	(223,788)
Net cash (used in) provided by operating activities	$ (246,835)	$ 107,600

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Note 15. Share-Based Compensation (Details) - By Share-Based Payment (USD $) In Thousands	6 Months Ended
	Jun. 30, 2011	Jun. 26, 2010
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Proceeds from stock options exercised	$ 7,651	$ 3,709

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Note 10. Fair Value Measurement (Tables)

6 Months Ended

Jun. 30, 2011

Fair Value Measurment Note [Abstract]

Fair Value Assets And Liabilities Measured On Recurring Basis [Text Block]

At June 30, 2011 and December 31, 2010, information about inputs into the fair value measurements of our assets and liabilities that we make on a recurring basis was as follows (in thousands):

	As of June 30, 2011
			Fair Value Measurements at Reporting Date Using
	Total Fair Value and Carrying Value on Our Balance Sheet		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets:
Cash equivalents:
Commercial paper	$	4,600	$	—	$	4,600	$	—
Money market mutual funds	10,059		10,059		—		—
Marketable securities and investments:
Certificates of deposit	2,602		—		2,602		—
Commercial paper	6,846		—		6,846		—
Corporate debt securities	29,886		—		29,886		—
Federal agency debt	49,697		—		49,697		—
Foreign agency debt	22,085		—		22,085		—
Foreign government obligations	5,608		—		5,608		—
Supranational debt	39,226		—		39,226		—
U.S. government obligations	2,012		—		2,012		—
Restricted investments (excluding restricted cash)	150,789		—		150,789		—
Derivative assets	21,174		—		21,174		—
Total assets	$	344,584	$	10,059	$	334,525	$	—
Liabilities:
Derivative liabilities	$	55,346	$	—	$	55,346	$	—

	As of December 31, 2010
			Fair Value Measurements at Reporting Date Using
	Total Fair Value and Carrying Value on Our Balance Sheet		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets:
Cash equivalents:
Commercial paper	$	1,200	$	—	$	1,200	$	—
Money market mutual funds	22,289		22,289		—		—
Marketable securities:
Commercial paper	13,343		—		13,343		—
Corporate debt securities	98,602		—		98,602		—
Federal agency debt	45,875		—		45,875		—
Foreign agency debt	133,165		—		133,165		—
Foreign government obligations	9,143		—		9,143		—
Supranational debt	48,032		—		48,032		—
Restricted investments (excluding restricted cash)	85,984		—		85,984		—
Derivative assets	21,866		—		21,866		—
Total assets	$	479,499	$	22,289	$	457,210	$	—
Liabilities:
Derivative liabilities	$	24,034	$	—	$	24,034	$	—

Fair value by balance sheet grouping [Text Block]

The carrying values and fair values of our financial instruments at June 30, 2011 and December 31, 2010 were as follows (in thousands):

	June 30, 2011				December 31, 2010
	Carrying Value		Fair Value		Carrying Value		Fair Value
Assets:
Marketable securities — current and noncurrent	$	155,360	$	155,360	$	348,160	$	348,160
Investments — current	$	2,602	$	2,602	$	—	$	—
Foreign exchange forward contract assets	$	21,174	$	21,174	$	21,866	$	21,866
Restricted investments (excluding restricted cash)	$	150,789	$	150,789	$	85,984	$	85,984
Notes receivable — noncurrent	$	10,057	$	9,441	$	9,314	$	8,836
Liabilities:
Long-term debt, including current maturities	$	360,826	$	364,825	$	237,391	$	240,176
Interest rate swap contract liabilities	$	630	$	630	$	1,219	$	1,219
Foreign exchange forward contract liabilities	$	54,716	$	54,716	$	22,815	$	22,815

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Note 4. Acquisitions (Details) (USD $) In Thousands, unless otherwise specified			6 Months Ended		12 Months Ended
	Jun. 30, 2011	Dec. 31, 2010	Jun. 30, 2011 Ray Tracker [Member]	Mar. 31, 2011 Ray Tracker [Member]	Dec. 31, 2010 NextLight [Member]
Business Acquisition [Line Items]
Business acquisition, effective date of acquisition			1/4/2011		7/12/2010
Outstanding membership interests acquired (percentage)				100.00%
Business Acquisition, Purchase Price Allocation, Net Tangible Assets					$ 2,513
Business Acquisition, Purchase Price Allocation, Project Assets	217,417	217,417			147,370
Business Acquisition, Purchase Price Allocation, Goodwill					146,773
Business Acquisition, Total Purchase Consideration					$ 296,740

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Note 7. Restricted Cash and Investments (Tables)

6 Months Ended

Jun. 30, 2011

Restricted Cash And Investments Note [Abstract]

Restricted Cash And Investments [Text Block]

Restricted cash and investments consisted of the following at June 30, 2011 and December 31, 2010 (in thousands):

	June 30, 2011		December 31, 2010
Restricted cash	$	23,909	$	19
Restricted investments	150,789		85,984
Total restricted cash and investments — noncurrent	$	174,698	$	86,003

Restricted Available For Sale Securities [Text Block]

The following table summarizes unrealized gains and losses related to our restricted investments in marketable securities designated as available-for-sale by major security type as of June 30, 2011 and December 31, 2010 (in thousands):

	As of June 30, 2011
Security Type	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value
Foreign government obligations	$	141,903	$	447	$	6,937	$	135,413
U.S. government obligations	15,022		448		94		15,376
Total	$	156,925	$	895	$	7,031	$	150,789

	As of December 31, 2010
Security Type	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value
Foreign government obligations	$	73,729	$	6,529	$	72	$	80,186
U.S. government obligations	5,659		139		—		5,798
Total	$	79,388	$	6,668	$	72	$	85,984

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Note 13. Debt

6 Months Ended

Jun. 30, 2011

Debt Instruments [Abstract]

Debt Disclosure [Text Block]

13. Debt

Our long-term debt at June 30, 2011 and December 31, 2010 consisted of the following (in thousands):

Type	June 30, 2011			December 31, 2010
Revolving Credit Facility	$	100,000		$	100,000
German Facility Agreement	123,734			—
France Facility Agreement	5,350			—
Malaysian Facility Agreement — Fixed rate term loan	63,324			65,009
Malaysian Facility Agreement — Floating rate term loan (1)	63,324			65,009
Director of Development of the State of Ohio	7,229			8,112
Capital lease obligations	2,658			1,736
	365,619			239,866
Less unamortized discount	(4,793		)	(2,475		)
Total long-term debt	360,826			237,391
Less current portion	(28,334		)	(26,587		)
Noncurrent portion	$	332,492		$	210,804

(1) We entered into an interest rate swap contract related to this loan. See Note 9. "Derivative Financial Instruments," to our condensed consolidated financial statements.

We did not have any short-term debt at June 30, 2011 and December 31, 2010.

Revolving Credit Facility

On September 4, 2009, we entered into a revolving credit facility with several financial institutions as lenders. JPMorgan Securities LLC and Banc of America Securities LLC served as Joint-Lead Arrangers and Bookrunners, with JPMorgan Chase Bank, N.A. also acting as Administrative Agent. The credit agreement provided First Solar, Inc. and certain of its subsidiaries with a senior secured three-year revolving credit facility in an aggregate available amount of $300.0 million, a portion of which was available for letters of credit. Proceeds from the credit facility could be used for working capital and other general corporate purposes.

On October 15, 2010, we entered into an amended and restated credit agreement governing our revolving credit facility which provides First Solar, Inc. and certain of its subsidiaries with a senior secured five-year revolving credit facility in an aggregate available amount of $600.0 million, all of which is available for letters of credit. Subject to certain conditions, we have the right to request an increase in the aggregate commitments under the credit facility up to $750.0 million.

Borrowings under the amended and restated credit agreement currently bear interest at (i) London Interbank Offered Rate (LIBOR) (adjusted for eurocurrency reserve requirements) plus a margin of 2.25% or (ii) a base rate as defined in the credit agreement plus a margin of 1.25%, depending on the type of borrowing requested by us. These margins are subject to adjustments depending on our consolidated leverage ratio. The amended and restated credit agreement contains various financial condition covenants with which we must comply, including a debt to EBITDA ratio covenant, a minimum EBITDA covenant, and a minimum liquidity covenant. Under the amended and restated credit agreement we are also subject to customary non-financial covenants. We were in compliance with these covenants through June 30, 2011.

At June 30, 2011, we had $100.0 million in borrowings outstanding and $143.4 million in letters of credit issued under the revolving credit facility, leaving a total remaining availability of $356.6 million, all of which can be used for the issuance of letters of credit. As of June 30, 2011, based on the outstanding borrowings, the all-in effective three month LIBOR borrowing rate was 2.66%. At December 31, 2010, we had $100.0 million in borrowings outstanding and $126.4 million in letters of credit issued under the revolving credit facility. 

In addition to paying interest on outstanding principal under the credit agreement, we are required to pay a commitment fee, currently at the rate of 0.375% per annum, to the lenders based on the average daily unused commitments under the facility. The commitment fee may also be adjusted due to changes in our consolidated leverage ratio. We also pay a letter of credit fee equal to the applicable margin for eurocurrency revolving loans on the face amount of each letter of credit and a fronting fee. 

In connection with our revolving credit facility, we entered into a guarantee and collateral agreement and various foreign security agreements. Loans made to First Solar Manufacturing GmbH (a borrowing subsidiary under the credit facility) were (i) guaranteed by First Solar, Inc. pursuant to the guarantee and collateral agreement, (ii) guaranteed by certain of First Solar, Inc.'s direct and indirect subsidiaries organized under the laws of Germany, pursuant to a German guarantee agreement, (iii) secured by share pledge agreements, (iv) secured by a security interest in inter-company receivables held by First Solar Holdings GmbH, First Solar GmbH, and First Solar Manufacturing GmbH, pursuant to assignment agreements, and (v) subject to a security trust agreement, which sets forth additional terms regarding the foregoing German security documents and arrangements.

On May 6, 2011, we entered into the First Amendment to the amended and restated credit agreement which provides for, among other things, the termination of First Solar Manufacturing GmbH as a borrowing subsidiary under the credit agreement and the release of the guarantees of, and the liens securing, its obligations thereunder. The amendment also effects certain changes to the restrictions set forth in the credit agreement with respect to the incurrence of indebtedness to finance the construction or acquisition of new manufacturing facilities and assets relating thereto.  In addition, the amendment effects certain technical and clarifying amendments to the credit agreement.

German Facility Agreement

On May 18, 2011, in connection with the plant expansion at our German manufacturing center, First Solar Manufacturing GmbH, our indirect wholly owned subsidiary, entered into a credit facility agreement (German Facility Agreement) with Commerzbank Aktiengesellschaft as arranger and Commerzbank Aktiengesellschaft, Luxembourg Branch, as facility agent and security agent. The total available loan amount is €124.5 million ($179.3 million at the balance sheet close rate on June 30, 2011 of $1.44/€1.00). Pursuant to the German Facility Agreement, we will begin making semi-annual repayments of the principal balance during 2012. Amounts repaid under this credit facility cannot be re-borrowed. This credit facility consisted of the following (in thousands):

				Outstanding		Outstanding
German Borrowings	Denomination	Interest Rate	Maturity	June 30, 2011		December 31, 2010
German Facility Agreement	EUR	Euribor plus 1.35%	2019	$	123,734	$	—
Total (1)				$	123,734	$	—

(1) €85.9 million outstanding at June 30, 2011 ($123.7 million at the balance sheet close rate on June 30, 2011 of $1.44/€1.00).

The German Facility Agreement will be used by First Solar Manufacturing GmbH to, among other things, finance and/or refinance the acquisition of certain land parcels located in Frankfurt/Oder, Germany and the construction of the plant expansion at our German manufacturing center.

Borrowings under the German Facility Agreement bear interest at a rate per annum equal to 1.35% (the “Margin”) plus mandatory costs plus a Euribor rate for the interest period selected by First Solar Manufacturing GmbH. During the period from the date of the credit agreement until the date 17 months thereafter, unutilized commitments under the German Facility Agreement are subject to a commitment fee equal to 35% of the margin.

In connection with the German Facility Agreement, First Solar Inc. entered into a guarantee agreement dated May 18, 2011 in favor of the lenders. Under this guarantor agreement, First Solar Manufacturing GmbH's obligations related to the German credit facility are guaranteed, on an unsecured basis, by First Solar, Inc. In connection with the German Facility Agreement, all of First Solar Manufacturing GmbH's obligations are (i) secured by a first-ranking abstract land charge over the parcels of land on which the new production facility will be constructed and a pledge of a debt service reserve account, and (ii) guaranteed by the German Federal Government and the Federal State of Brandenburg.

The German Facility Agreement contains various financial covenants with which we must comply, including minimum liquidity, maximum permitted leverage ratio, and minimum EBITDA. The German Facility Agreement also contains negative covenants that, among other things, restrict, subject to certain exceptions, the ability of First Solar Manufacturing GmbH to incur indebtedness, create liens, effect asset sales, make dividends, other distributions and share buybacks, engage in reorganizations, make acquisitions and create joint ventures, and make loans. We were in compliance with these covenants through June 30, 2011.

France Facility Agreement

On March 30, 2010, in connection with the construction of our planned manufacturing facility in Blanquefort, France, First Solar France Manufacturing SAS, our indirect wholly owned subsidiary, entered into a facility agreement with EDF Energies Nouvelles SA (EDF-EN) for the purpose of partially financing the construction of the manufacturing facility. The total available loan amount under this non-revolving credit facility is a maximum principal amount of €50.0 million ($72.0 million at the balance sheet close rate on June 30, 2011 of $1.44/€1.00). Pursuant to the terms and conditions set forth in the facility agreement, advances will be made available commencing on the start of construction of the French plant and ending June 15, 2012. Advances must be repaid in quarterly installments through the tenth anniversary of the first commercial shipments from the French plant, subject to accelerated mandatory prepayment in the event of a default under the facility or the termination of the related venture agreement or off-take agreement with EDF-EN and affiliated entities. Amounts repaid under this credit facility cannot be re-borrowed. The borrowings will bear interest at a rate of 4%. Any advances drawn under this facility will be unsecured. As of June 30, 2011, borrowings under this facility were €3.8 million ($5.4 million at the balance sheet close rate on June 30, 2011 of $1.44/€1.00). As of December 31, 2010 there were no borrowings under this facility.

Malaysian Facility Agreement

On May 6, 2008, in connection with the plant expansion at our Malaysian manufacturing center, First Solar Malaysia Sdn. Bhd. (FS Malaysia), our indirect wholly owned subsidiary, entered into an export financing facility agreement (Malaysian Facility Agreement) with a consortium of banks. The total available loan amount was €134.0 million ($193.0 million at the balance sheet close rate on June 30, 2011 of $1.44/€1.00). Pursuant to the Malaysian Facility Agreement, we began semi-annual repayments of the principal balances of these credit facilities during 2008. Amounts repaid under these credit facilities cannot be re-borrowed. These credit facilities consist of the following (in thousands):

				Outstanding		Outstanding
Malaysian Borrowings	Denomination	Interest Rate	Maturity	June 30, 2011		December 31, 2010
Fixed-rate euro-denominated term loan	EUR	4.54%	2016	$	63,324	$	65,009
Floating-rate euro-denominated term loan	EUR	Euribor plus 0.55%	2016	63,324		65,009
Total (1)				$	126,648	$	130,018

(1) €87.9 million outstanding at June 30, 2011 ($126.6 million at the balance sheet close rate on June 30, 2011 of $1.44/€1.00).

These credit facilities were used by FS Malaysia for the purpose of (i) partially financing the purchase of certain equipment used at our Malaysian manufacturing center, and (ii) financing fees paid to Euler-Hermes Kreditversicherungs-AG, the German Export Credit Agency of Hamburg, Federal Republic of Germany, which guarantees 95% of FS Malaysia's obligations related to these Malaysian credit facilities.

In addition to paying interest on outstanding principal under the facilities, FS Malaysia is obligated to pay annual agency fees and security agency fees. 

In connection with the Malaysian credit facilities, First Solar, Inc. entered into a first demand guaranty agreement dated May 6, 2008 in favor of the lenders. Thereby FS Malaysia's obligations related to the Malaysian Facility Agreement are guaranteed, on an unsecured basis, by First Solar, Inc. In connection with the Malaysian credit facilities, all of FS Malaysia's obligations are secured by a first party, first legal charge over the equipment financed by the Malaysian credit facilities, and the other documents, contracts, and agreements related to that equipment. Also in connection with the Malaysian credit facilities, any payment claims of First Solar, Inc. against FS Malaysia are subordinated to the claims of the lenders.

The Malaysian Facility Agreement contains various financial covenants with which we must comply, including debt-to-equity ratios, total leverage ratios, interest coverage ratios, and debt service coverage ratios. The Malaysian Facility Agreement also contains various customary non-financial covenants with which FS Malaysia must comply, including submitting various financial reports and business forecasts to the lenders, maintaining adequate insurance, complying with applicable laws and regulations, and restrictions on FS Malaysia's ability to sell or encumber assets, or make loan guarantees to third parties. We were in compliance with these covenants through June 30, 2011.

State of Ohio Loan

During the year ended December 31, 2005, we received the following loan from the Director of Development of the State of Ohio (in thousands):

	Original					Outstanding		Outstanding
Ohio Borrowing	Loan Amount		Denomination	Interest Rate	Maturity	June 30, 2011		December 31, 2010
Director of Development of the State of Ohio	$	15,000	USD	2.25%	2015	$	7,229	$	8,112
Total	$	15,000				$	7,229	$	8,112

Malaysian Ringgit Facility Agreement

On June 30, 2011, First Solar Malaysia Sdn. Bhd. (FS Malaysia), our indirect wholly owned subsidiary, entered into a Malaysian-Ringgit denominated $150.0 million equivalent facility agreement (Malaysian Ringgit Facility Agreement), among FS Malaysia, First Solar, Inc., as guarantor, CIMB Investment Bank Berhad, Maybank Investment Bank Berhad, and RHB Investment Bank Berhad, as arrangers, CIMB Investment Bank Berhad as facility agent and security agent, and the original lenders party thereto.

The proceeds of the Malaysian Ringgit Facility Agreement will be used by FS Malaysia to finance, in part, the design, construction, and commission of the FS Malaysia’s fifth and sixth manufacturing plants in Malaysia (Plants 5 and 6) and the acquisition of certain plant, equipment, and machinery to be utilized in Plants 5 and 6.

Borrowings under the Malaysian Ringgit Facility Agreement bear interest at an expected rate per annum equal to a Kuala Lumpur Interbank Offered Rate (KLIBOR) rate plus any mandatory costs. As of June 30, 2011, we had no borrowings outstanding under this facility.

FS Malaysia may voluntarily prepay outstanding loans under the Malaysian Ringgit Facility Agreement at any time without premium or penalty, subject to compensation for customary “break costs” and certain other requirements. FS Malaysia is required to prepay loans with certain insurance proceeds, and the loans are subject to mandatory prepayment upon the occurrence of a change of control, material asset disposal, or termination of the construction of Plants 5 and 6, each as described in the Malaysian Ringgit Facility Agreement.

The loans made to FS Malaysia are secured by, among other things, a first fixed legal charge over FS Malaysia’s leases over the leased lots on which Plants 5 and 6 are located and a first fixed legal charge over all plant, equipment, and machinery purchased by FS Malaysia with the proceeds of the facility or otherwise installed in or utilized in Plants 5 and 6, to the extent not financed, encumbered, charged to secure, or subject to a negative pledge under a separate financing facility relating to Plants 5 and 6. In addition, FS Malaysia’s obligations under the Malaysian Ringgit Facility Agreement are guaranteed, on an unsecured basis, by First Solar, Inc. pursuant to the Malaysian Ringgit Facility Agreement.

The Malaysian Ringgit Facility Agreement contains negative covenants that, among other things, restrict, subject to certain exceptions, the ability of FS Malaysia to incur indebtedness, create liens, effect asset sales, engage in reorganizations, issue guarantees and make loans. In addition, the Malaysian Ringgit Facility Agreement includes financial covenants relating to net total leverage ratio, interest coverage ratio, total debt to equity ratio, debt service coverage ratio, and tangible net worth. The Malaysian Ringgit Facility Agreement also contains certain representations and warranties, affirmative covenants, and events of default.

Certain of our debt-financing agreements bear interest at Euribor, LIBOR or KLIBOR. A disruption of the credit environment, as previously experienced, could negatively impact interbank lending and, therefore, negatively impact these floating rates. An increase in the LIBOR rate would increase our cost of borrowing under our revolving credit facility. An increase in the Euribor rate would impact our cost of borrowing under our German Facility Agreement, but would not impact our cost of borrowing under our Malaysian Facility Agreement as we entered into an interest rate swap agreement to mitigate such risk. An increase in the KLIBOR would increase our cost of borrowing under our Malaysian Ringgit Facility Agreement.

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Note 12. Notes Receivable (Details) In Millions, unless otherwise specified	6 Months Ended
	Jun. 30, 2011 USD ($)	May 30, 2011	Jun. 30, 2011 Credit Facility Agreement [Member] USD ($)	Jun. 30, 2011 Credit Facility Agreement [Member] EUR (€)
Accounts, Notes, Loans and Financing Receivable [Line Items]
Notes receivable initial available amount			$ 25.2	€ 17.5
Note receivable, percentage bearing fixed interest rate			8.00%	8.00%
Debt instrument, maturity date	Dec. 31, 2026
Notes receivable balance included in other assets			$ 10.1	€ 7.0
Exchange rate ratio	1.44	1.42

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Note 15. Share-Based Compensation (Details) (USD $)	3 Months Ended		6 Months Ended
	Jun. 30, 2011	Jun. 26, 2010	Jun. 30, 2011	Jun. 26, 2010	Dec. 31, 2010
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Share based compensation expense	$ 31,271,000	$ 25,042,000	$ 56,838,000	$ 44,516,000
Employee service share-based compensation, capitalized in inventory	2,200,000		2,200,000		900,000
Stock Option [Member]
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Employee service share-based compensation, nonvested awards, total compensation cost not yet recognized	300,000		300,000
Employee service share-based compensation, unrecognized compensation costs on nonvested awards, weighted average period of recognition (in years)			0.5
Stock Options [Member]
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Share based compensation expense	378,000	577,000	760,000	1,555,000
Restricted Stock Units (RSUs) [Member]
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Share based compensation expense	31,471,000	26,646,000	56,913,000	44,872,000
Employee service share-based compensation, nonvested awards, total compensation cost not yet recognized	210,000,000		210,000,000
Employee service share-based compensation, unrecognized compensation costs on nonvested awards, weighted average period of recognition (in years)			1.9
Unrestricted Stock [Member]
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Share based compensation expense	226,000	157,000	452,000	307,000
Unallocated Share-based Compensation Absorbed Into Inventory [Member]
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Share based compensation expense	(804,000)	(2,338,000)	(1,287,000)	(2,218,000)
Cost of Sales [Member]
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Share based compensation expense	9,592,000	5,566,000	16,445,000	10,724,000
Research and Development Expense [Member]
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Share based compensation expense	4,013,000	2,957,000	7,300,000	5,038,000
Selling, General And Administrative [Member]
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Share based compensation expense	16,710,000	16,029,000	31,394,000	27,930,000
Production Startup [Member]
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Share based compensation expense	$ 956,000	$ 490,000	$ 1,699,000	$ 824,000

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Note 6. Cash, Cash Equivalents, Marketable Securities, and Investments

6 Months Ended

Jun. 30, 2011

Cash, Marketable Securities And Investments Note [Abstract]

Cash, Cash Equivalents, Marketable Securities, and Investments Disclosure [Text Block]

6. Cash, Cash Equivalents, Marketable Securities, and Investments

Cash, cash equivalents, marketable securities, and investments consisted of the following at June 30, 2011 and December 31, 2010 (in thousands):

	June 30, 2011		December 31, 2010
Cash and cash equivalents:
Cash	$	342,818	$	742,200
Cash equivalents:
Commercial paper	4,600		1,200
Money market mutual funds	10,059		22,289
Total cash and cash equivalents	357,477		765,689
Marketable securities and investments:
Certificates of deposit	2,602		—
Commercial paper	6,846		13,343
Corporate debt securities	29,886		98,602
Federal agency debt	49,697		45,875
Foreign agency debt	22,085		133,165
Foreign government obligations	5,608		9,143
Supranational debt	39,226		48,032
U.S. government obligations	2,012		—
Total marketable securities and investments	157,962		348,160
Total cash, cash equivalents, marketable securities, and investments	$	515,439	$	1,113,849

We have classified our marketable securities and investments as "available-for-sale." Accordingly, we record them at fair value and account for net unrealized gains and losses as a part of accumulated other comprehensive income. We report realized gains and losses on the sale of our marketable securities and investments in earnings, computed using the specific identification method. During the three and six months ended June 30, 2011 we realized $0.8 million and $0.9 million, respectively, in gains and an immaterial amount in losses on our marketable securities and investments. During the three and six months ended June 26, 2010, we realized $0.4 million and $0.7 million, respectively, in gains and $0.4 million and $0.5 million, respectively, in losses on our marketable securities and investments. See Note 10. "Fair Value Measurements," to our condensed consolidated financial statements for information about the fair value of our marketable securities and investments.

All of our available-for-sale marketable securities and investments are subject to a periodic impairment review. We consider a marketable security or investment to be impaired when its fair value is less than its carrying cost, in which case we would further review the investment to determine whether it is other-than-temporarily impaired. When we evaluate an investment for other-than-temporary impairment, we review factors such as the length of time and extent to which its fair value has been below its cost basis, the financial condition of the issuer and any changes thereto, our intent to sell, and whether it is more likely than not that we will be required to sell the investment before we have recovered its cost basis. If an investment were other-than-temporarily impaired, we would write it down through earnings to its impaired value and establish that as a new cost basis for the investment. We did not identify any of our marketable securities and investments as other-than-temporarily impaired at June 30, 2011 and December 31, 2010.

The following tables summarize the unrealized gains and losses related to our available-for-sale marketable securities and investments, by major security type, as of June 30, 2011 and December 31, 2010 (in thousands):

	As of June 30, 2011
Security Type	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value
Certificates of deposit	$	2,601	$	1	$	—	$	2,602
Commercial paper	6,845		1		—		6,846
Corporate debt securities	29,856		37		7		29,886
Federal agency debt	49,645		55		3		49,697
Foreign agency debt	22,064		24		3		22,085
Foreign government obligations	5,602		6		—		5,608
Supranational debt	39,195		34		3		39,226
U.S. government obligations	1,998		14		—		2,012
Total	$	157,806	$	172	$	16	$	157,962

	As of December 31, 2010
Security Type	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value
Commercial paper	$	13,340	$	3	$	—	$	13,343
Corporate debt securities	98,148		592		138		98,602
Federal agency debt	45,858		21		4		45,875
Foreign agency debt	132,860		425		120		133,165
Foreign government obligations	9,137		8		2		9,143
Supranational debt	47,917		115		—		48,032
Total	$	347,260	$	1,164	$	264	$	348,160

Contractual maturities of our available-for-sale marketable securities and investments as of June 30, 2011 and December 31, 2010 were as follows (in thousands):

	As of June 30, 2011
Maturity	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value
One year or less	$	106,881	$	91	$	6	$	106,966
One year to two years	44,063		75		8		44,130
Two years to three years	6,862		6		2		6,866
Total	$	157,806	$	172	$	16	$	157,962

	As of December 31, 2010
Maturity	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value
One year or less	$	167,499	$	398	$	8	$	167,889
One year to two years	177,268		759		256		177,771
Two years to three years	2,493		7		—		2,500
Total	$	347,260	$	1,164	$	264	$	348,160

The net unrealized gain of $0.2 million and $0.9 million as of June 30, 2011 and December 31, 2010, respectively, on our available-for-sale marketable securities and investments was primarily the result of changes in interest rates. We typically invest in highly-rated securities with low probabilities of default. Our investment policy requires investments to be rated single A or higher and limits the security types, issuer concentration, and duration to maturity of our investments.

The following table shows gross unrealized losses and estimated fair values for those marketable securities that were in an unrealized loss position as of June 30, 2011 and December 31, 2010, aggregated by major security type and the length of time that individual securities have been in a continuous loss position (in thousands):

	As of June 30, 2011
	In Loss Position for Less Than 12 Months				In Loss Position for 12 Months or Greater				Total
Security Type	Estimated Fair Value		Gross Unrealized Losses		Estimated Fair Value		Gross Unrealized Losses		Estimated Fair Value		Gross Unrealized Losses
Corporate debt securities	$	8,164	$	7	$	—	$	—	$	8,164	$	7
Federal agency debt	3,331		3		—		—		3,331		3
Foreign agency debt	4,870		3		—		—		4,870		3
Supranational debt	3,298		3		—		—		3,298		3
Total	$	19,663	$	16	$	—	$	—	$	19,663	$	16

	As of December 31, 2010
	In Loss Position for Less Than 12 Months				In Loss Position for 12 Months or Greater				Total
Security Type	Estimated Fair Value		Gross Unrealized Losses		Estimated Fair Value		Gross Unrealized Losses		Estimated Fair Value		Gross Unrealized Losses
Corporate debt securities	$	33,018	$	138	$	—	$	—	$	33,018	$	138
Federal agency debt	11,721		4		—		—		11,721		4
Foreign agency debt	46,134		120		—		—		46,134		120
Foreign government obligations	4,515		2		—		—		4,515		2
Total	$	95,388	$	264	$	—	$	—	$	95,388	$	264

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Note 16. Income Taxes

6 Months Ended

Jun. 30, 2011

Income Tax Disclosure [Abstract]

Income Taxes Disclosure [Text Block]

16. Income Taxes

Our effective tax rates were 15.0% and 13.6% for the three and six months ended June 30, 2011, respectively, and were 11.9% and 11.8% for the three and six months ended June 26, 2010, respectively. Our estimated annual effective tax rate was higher during the six months ended June 30, 2011 compared with the six months ended June 26, 2010 mainly due to a $170.8 million decrease in pre-tax income and a greater percentage of profits earned in jurisdictions with higher tax rates. The provision for income taxes differs from the amount computed by applying the statutory U.S. federal rate primarily due to the benefit associated with foreign income taxed at lower rates and the beneficial impact of the Malaysian tax holiday.

Our Malaysian subsidiary has been granted a long-term tax holiday that expires in 2027. The tax holiday, which generally provides for a 100% exemption from Malaysian income tax, is conditional upon our continued compliance in meeting certain employment and investment thresholds. During 2010, in connection with the expansion of our Malaysian manufacturing operations, we were granted an extension of the previously approved tax holiday by three years, contingent upon meeting additional investment requirements.

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Note 18. Comprehensive Income (Details) (USD $) In Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2011	Jun. 26, 2010	Jun. 30, 2011	Jun. 26, 2010	Dec. 31, 2010
Other Comprehensive Income (Loss), Net of Tax [Abstract]
Net income	$ 61,138	$ 159,043	$ 177,106	$ 331,388
Foreign currency translation adjustments	6,794	(35,884)	30,589	(68,118)
Change in unrealized (loss) gain on marketable securities, net of tax	(3,971)	5,680	(11,474)	6,777
Change in unrealized (loss) gain on derivative instruments, net of tax	8,931	17,689	(31,519)	54,133
Comprehensive income	72,892	146,528	164,702	324,180
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract]
Foreign currency translation adjustments	242		242		(30,347)
Unrealized (loss) gain on marketable securities, net of tax	(5,703)		(5,703)		5,771
Unrealized loss on derivative instruments, net of tax	(34,186)		(34,186)		(2,667)
Accumulated other comprehensive loss	$ (39,647)		$ (39,647)		$ (27,243)

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Note 16. Income Taxes (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2011	Jun. 26, 2010	Jun. 30, 2011	Jun. 26, 2010
Income Tax Holiday [Line Items]
Effective Income Tax Rate, Continuing Operations	15.00%	11.90%	13.60%	11.80%
Change in Pre-tax Income Affecting Effective Income Tax Rate			$ 170.8
MALAYSIA
Income Tax Holiday [Line Items]
Income Tax Holiday, Termination Date			2027
Income Tax Holiday, Description			100% exemption from Malaysian income tax

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Note 19. Statement of Cash Flows (Tables)

6 Months Ended

Jun. 30, 2011

Statement of Cash Flows [Abstract]

Reconciliation of Net Income to Cash Provided By Net Operating Activities [Text Block]

The following table presents a reconciliation of net income to net cash (used in) provided by operating activities for the six months ended June 30, 2011 and June 26, 2010 (in thousands):

	Six Months Ended
	June 30, 2011			June 26, 2010
Net income	$	177,106		$	331,388
Adjustments to reconcile net income to net cash (used in) provided by operating activities:
Depreciation and amortization	104,287			77,747
Impairment of assets and liabilities	1,486			3,480
Impairment of project assets	3,411			638
Share-based compensation	56,838			44,516
Remeasurement of monetary assets and liabilities	6,635			3,510
Deferred income taxes	(42,048		)	(6,877		)
Excess tax benefits from share-based compensation arrangements	(16,497		)	—
Provision for doubtful accounts receivable	—			(990		)
Gain on sales of marketable securities, investments, and restricted investments, net	(3,298		)	(203		)
Other operating activities	(624		)	(736		)
Changes in operating assets and liabilities:
Accounts receivable, trade	(230,540		)	(54,211		)
Accounts receivable, unbilled	(62,195		)	(105,657		)
Prepaid expenses and other current assets	(80,795		)	(126,313		)
Other assets	(27,941		)	(4,558		)
Inventories and balance of systems parts	(153,323		)	(49,921		)
Project assets	(133,216		)	(11,126		)
Accounts payable	79,102			2,351
Income taxes payable	47,048			19,433
Accrued expenses and other liabilities	(13,391		)	(27,665		)
Accrued solar module collection and recycling liability	41,120			12,794
Total adjustments	(423,941		)	(223,788		)
Net cash (used in) provided by operating activities	$	(246,835	)	$	107,600

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Note 6. Cash, Cash Equivalents, Marketable Securities, and Investments (Tables)

6 Months Ended

Jun. 30, 2011

Cash, Marketable Securities And Investments Note [Abstract]

Cash, Marketable Securities and Investment [Text Block]

Cash, cash equivalents, marketable securities, and investments consisted of the following at June 30, 2011 and December 31, 2010 (in thousands):

	June 30, 2011		December 31, 2010
Cash and cash equivalents:
Cash	$	342,818	$	742,200
Cash equivalents:
Commercial paper	4,600		1,200
Money market mutual funds	10,059		22,289
Total cash and cash equivalents	357,477		765,689
Marketable securities and investments:
Certificates of deposit	2,602		—
Commercial paper	6,846		13,343
Corporate debt securities	29,886		98,602
Federal agency debt	49,697		45,875
Foreign agency debt	22,085		133,165
Foreign government obligations	5,608		9,143
Supranational debt	39,226		48,032
U.S. government obligations	2,012		—
Total marketable securities and investments	157,962		348,160
Total cash, cash equivalents, marketable securities, and investments	$	515,439	$	1,113,849

Available-for-sale Securities [Text Block]

The following tables summarize the unrealized gains and losses related to our available-for-sale marketable securities and investments, by major security type, as of June 30, 2011 and December 31, 2010 (in thousands):

	As of June 30, 2011
Security Type	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value
Certificates of deposit	$	2,601	$	1	$	—	$	2,602
Commercial paper	6,845		1		—		6,846
Corporate debt securities	29,856		37		7		29,886
Federal agency debt	49,645		55		3		49,697
Foreign agency debt	22,064		24		3		22,085
Foreign government obligations	5,602		6		—		5,608
Supranational debt	39,195		34		3		39,226
U.S. government obligations	1,998		14		—		2,012
Total	$	157,806	$	172	$	16	$	157,962

	As of December 31, 2010
Security Type	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value
Commercial paper	$	13,340	$	3	$	—	$	13,343
Corporate debt securities	98,148		592		138		98,602
Federal agency debt	45,858		21		4		45,875
Foreign agency debt	132,860		425		120		133,165
Foreign government obligations	9,137		8		2		9,143
Supranational debt	47,917		115		—		48,032
Total	$	347,260	$	1,164	$	264	$	348,160

Available-for-sale Securities by Maturity [Text Block]

Contractual maturities of our available-for-sale marketable securities and investments as of June 30, 2011 and December 31, 2010 were as follows (in thousands):

	As of June 30, 2011
Maturity	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value
One year or less	$	106,881	$	91	$	6	$	106,966
One year to two years	44,063		75		8		44,130
Two years to three years	6,862		6		2		6,866
Total	$	157,806	$	172	$	16	$	157,962

	As of December 31, 2010
Maturity	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value
One year or less	$	167,499	$	398	$	8	$	167,889
One year to two years	177,268		759		256		177,771
Two years to three years	2,493		7		—		2,500
Total	$	347,260	$	1,164	$	264	$	348,160

Available-for-sale Securities Continuous Unrealized Loss Position [Text Block]

The following table shows gross unrealized losses and estimated fair values for those marketable securities that were in an unrealized loss position as of June 30, 2011 and December 31, 2010, aggregated by major security type and the length of time that individual securities have been in a continuous loss position (in thousands):

	As of June 30, 2011
	In Loss Position for Less Than 12 Months				In Loss Position for 12 Months or Greater				Total
Security Type	Estimated Fair Value		Gross Unrealized Losses		Estimated Fair Value		Gross Unrealized Losses		Estimated Fair Value		Gross Unrealized Losses
Corporate debt securities	$	8,164	$	7	$	—	$	—	$	8,164	$	7
Federal agency debt	3,331		3		—		—		3,331		3
Foreign agency debt	4,870		3		—		—		4,870		3
Supranational debt	3,298		3		—		—		3,298		3
Total	$	19,663	$	16	$	—	$	—	$	19,663	$	16

	As of December 31, 2010
	In Loss Position for Less Than 12 Months				In Loss Position for 12 Months or Greater				Total
Security Type	Estimated Fair Value		Gross Unrealized Losses		Estimated Fair Value		Gross Unrealized Losses		Estimated Fair Value		Gross Unrealized Losses
Corporate debt securities	$	33,018	$	138	$	—	$	—	$	33,018	$	138
Federal agency debt	11,721		4		—		—		11,721		4
Foreign agency debt	46,134		120		—		—		46,134		120
Foreign government obligations	4,515		2		—		—		4,515		2
Total	$	95,388	$	264	$	—	$	—	$	95,388	$	264

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Condensed Consolidated Statements of Cash Flows (USD $) In Thousands	6 Months Ended
	Jun. 30, 2011	Jun. 26, 2010
Cash flows from operating activities:
Cash received from customers	$ 798,159	$ 955,086
Cash paid to suppliers and associates	(1,005,181)	(824,407)
Interest received	6,742	12,560
Interest paid	(3,119)	(2,551)
Income taxes paid, net of refunds	(25,643)	(31,712)
Excess tax benefit from share-based compensation arrangements	(16,497)	0
Other operating activities	(1,296)	(1,376)
Net cash (used in) provided by operating activities	(246,835)	107,600
Cash flows from investing activities:
Purchases of property, plant and equipment	(389,966)	(239,506)
Purchases of marketable securities and investments	(189,735)	(267,304)
Proceeds from maturities of marketable securities	87,748	59,256
Proceeds from sales of marketable securities and investments	289,943	203,903
Payments received on notes receivables	0	61,658
Increase in restricted investments	(62,748)	(43,064)
Increase in restricted cash	23,328	0
Acquisitions, net of cash acquired	(21,105)	0
Other investing activities	214	1,308
Net cash used in investing activities	(308,977)	(223,749)
Cash flows from financing activities:
Proceeds from stock options exercises	7,651	3,709
Repayment of long-term debt	(114,342)	(14,004)
Proceeds from borrowings under credit facilities, net of discount and issuance costs	224,442	0
Excess tax benefit from share-based compensation arrangements	16,497	0
Proceeds from economic development funding	3,112	0
Other financing activities	(236)	(2)
Net cash (used in) provided by financing activities	137,124	(10,297)
Effect of exchange rate changes on cash and cash equivalents	10,476	(27,571)
Net decrease in cash and cash equivalents	(408,212)	(154,017)
Cash and cash equivalents, beginning of the period	765,689	664,499
Cash and cash equivalents, end of the period	357,477	510,482
Supplemental disclosure of noncash investing and financing activities:
Property, plant and equipment acquisitions funded by liabilities	$ 109,685	$ 30,457

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Note 17. Net Income Per Share

6 Months Ended

Jun. 30, 2011

Earnings Per Share [Abstract]

Net Income per Share Disclosure [Text Block]

17. Net Income per Share

Basic net income per share is computed by dividing net income by the weighted-average number of common shares outstanding for the period. Diluted net income per share is computed giving effect to all potential dilutive common stock, including employee stock options, restricted stock units, and contingently issuable shares.

The calculation of basic and diluted net income per share for the three and six months ended June 30, 2011 and June 26, 2010 was as follows (in thousands, except per share amounts):

	Three Months Ended				Six Months Ended
	June 30, 2011		June 26, 2010		June 30, 2011		June 26, 2010
Basic net income per share
Numerator:
Net income	$	61,138	$	159,043	$	177,106	$	331,388
Denominator:
Weighted-average common stock outstanding	86,164		84,852		85,746		84,679
Diluted net income per share
Denominator:
Weighted-average common stock outstanding	86,164		84,852		85,746		84,679
Effect of stock options, restricted stock units outstanding, and contingent issuable shares	962		1,549		1,346		1,568
Weighted-average shares used in computing diluted net income per share	87,126		86,401		87,092		86,247

	Three Months Ended				Six Months Ended
	June 30, 2011		June 26, 2010		June 30, 2011		June 26, 2010
Per share information — basic:
Net income per share	$	0.71	$	1.87	$	2.07	$	3.91
Per share information — diluted:
Net income per share	$	0.70	$	1.84	$	2.03	$	3.84

The following number of outstanding employee stock options and restricted stock units were excluded from the computation of diluted net income per share for the three and six months ended June 30, 2011 and June 26, 2010 as they would have had an antidilutive effect (in thousands):

	Three Months Ended		Six Months Ended
	June 30, 2011	June 26, 2010	June 30, 2011	June 26, 2010
Restricted stock units and options to purchase common stock	939	75	515	157

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Note 6. Cash, Cash Equivalents, Marketable Securities, and Investments (Details) - Available For Sale (USD $)	Jun. 30, 2011	Dec. 31, 2010
Schedule of Available-for-sale Securities [Line Items]
Available-for-sale Securities, Gross Unrealized Gain (Loss)	$ 200,000	$ 900,000
Marketable securities, continuous unrealized loss position:
Marketable securities, in loss position for less than 12 months, estimated fair value	19,663,000	95,388,000
Marketable securities, in loss position for less than 12 months, gross unrealized losses	16,000	264,000
Marketable securities, in loss position for 12 months or greater, estimated fair value	0	0
Marketable securities, in loss position for 12 months or greater, gross unrealized losses	0	0
Marketable securities, in loss position, estimated fair value	19,663,000	95,388,000
Marketable securities, in loss position, gross unrealized losses	16,000	264,000
Certificates of Deposit [Member] | Unrestricted Investments [Member]
Schedule of Available-for-sale Securities [Line Items]
Available-for-sale securities, amortized cost	2,601,000
Available-for-sale securities, gross unrealized gains	1,000
Available-for-sale securities, gross unrealized losses	0
Available-for-sale Securities, estimated fair value	2,602,000
Commercial Paper, Not Included with Cash and Cash Equivalents [Member] | Unrestricted Investments [Member]
Schedule of Available-for-sale Securities [Line Items]
Available-for-sale securities, amortized cost	6,845,000	13,340,000
Available-for-sale securities, gross unrealized gains	1,000	3,000
Available-for-sale securities, gross unrealized losses	0	0
Available-for-sale Securities, estimated fair value	6,846,000	13,343,000
Corporate Debt Securities [Member] | Unrestricted Investments [Member]
Schedule of Available-for-sale Securities [Line Items]
Available-for-sale securities, amortized cost	29,856,000	98,148,000
Available-for-sale securities, gross unrealized gains	37,000	592,000
Available-for-sale securities, gross unrealized losses	7,000	138,000
Available-for-sale Securities, estimated fair value	29,886,000	98,602,000
Federal Agency Debt [Member] | Unrestricted Investments [Member]
Schedule of Available-for-sale Securities [Line Items]
Available-for-sale securities, amortized cost	49,645,000	45,858,000
Available-for-sale securities, gross unrealized gains	55,000	21,000
Available-for-sale securities, gross unrealized losses	3,000	4,000
Available-for-sale Securities, estimated fair value	49,697,000	45,875,000
Foreign Agency Debt [Member] | Unrestricted Investments [Member]
Schedule of Available-for-sale Securities [Line Items]
Available-for-sale securities, amortized cost	22,064,000	132,860,000
Available-for-sale securities, gross unrealized gains	24,000	425,000
Available-for-sale securities, gross unrealized losses	3,000	120,000
Available-for-sale Securities, estimated fair value	22,085,000	133,165,000
Foreign Government Obligations [Member] | Unrestricted Investments [Member]
Schedule of Available-for-sale Securities [Line Items]
Available-for-sale securities, amortized cost	5,602,000	9,137,000
Available-for-sale securities, gross unrealized gains	6,000	8,000
Available-for-sale securities, gross unrealized losses	0	2,000
Available-for-sale Securities, estimated fair value	5,608,000	9,143,000
Supranational Debt [Member] | Unrestricted Investments [Member]
Schedule of Available-for-sale Securities [Line Items]
Available-for-sale securities, amortized cost	39,195,000	47,917,000
Available-for-sale securities, gross unrealized gains	34,000	115,000
Available-for-sale securities, gross unrealized losses	3,000	0
Available-for-sale Securities, estimated fair value	39,226,000	48,032,000
US Government Debt Securities [Member] | Unrestricted Investments [Member]
Schedule of Available-for-sale Securities [Line Items]
Available-for-sale securities, amortized cost	1,998,000
Available-for-sale securities, gross unrealized gains	14,000
Available-for-sale securities, gross unrealized losses	0
Available-for-sale Securities, estimated fair value	2,012,000
Unrestricted Investments [Member]
Schedule of Available-for-sale Securities [Line Items]
Available-for-sale securities, amortized cost	157,806,000	347,260,000
Available-for-sale securities, gross unrealized gains	172,000	1,164,000
Available-for-sale securities, gross unrealized losses	16,000	264,000
Available-for-sale Securities, estimated fair value	157,962,000	348,160,000
Unrestricted Investments [Member] | Available For Sale Securities Debt Maturities Within One Year [Member]
Schedule of Available-for-sale Securities [Line Items]
Available-for-sale securities, amortized cost	106,881,000	167,499,000
Available-for-sale securities, gross unrealized gains	91,000	398,000
Available-for-sale securities, gross unrealized losses	6,000	8,000
Available-for-sale Securities, estimated fair value	106,966,000	167,889,000
Unrestricted Investments [Member] | Available For Sale Securities Debt Maturities Over One Year To Two Years [Member]
Schedule of Available-for-sale Securities [Line Items]
Available-for-sale securities, amortized cost	44,063,000	177,268,000
Available-for-sale securities, gross unrealized gains	75,000	759,000
Available-for-sale securities, gross unrealized losses	8,000	256,000
Available-for-sale Securities, estimated fair value	44,130,000	177,771,000
Unrestricted Investments [Member] | Available For Sale Securities Debt Maturities Over Two Years To Three Years [Member]
Schedule of Available-for-sale Securities [Line Items]
Available-for-sale securities, amortized cost	6,862,000	2,493,000
Available-for-sale securities, gross unrealized gains	6,000	7,000
Available-for-sale securities, gross unrealized losses	2,000	0
Available-for-sale Securities, estimated fair value	6,866,000	2,500,000
Restricted Investments [Member]
Schedule of Available-for-sale Securities [Line Items]
Available-for-sale securities, amortized cost	156,925,000	79,388,000
Available-for-sale securities, gross unrealized gains	895,000	6,668,000
Available-for-sale securities, gross unrealized losses	7,031,000	72,000
Available-for-sale Securities, estimated fair value	150,789,000	85,984,000
Corporate Debt Securities [Member]
Marketable securities, continuous unrealized loss position:
Marketable securities, in loss position for less than 12 months, estimated fair value	8,164,000	33,018,000
Marketable securities, in loss position for less than 12 months, gross unrealized losses	7,000	138,000
Marketable securities, in loss position for 12 months or greater, estimated fair value	0	0
Marketable securities, in loss position for 12 months or greater, gross unrealized losses	0	0
Marketable securities, in loss position, estimated fair value	8,164,000	33,018,000
Marketable securities, in loss position, gross unrealized losses	7,000	138,000
Federal Agency Debt [Member]
Marketable securities, continuous unrealized loss position:
Marketable securities, in loss position for less than 12 months, estimated fair value	3,331,000	11,721,000
Marketable securities, in loss position for less than 12 months, gross unrealized losses	3,000	4,000
Marketable securities, in loss position for 12 months or greater, estimated fair value	0	0
Marketable securities, in loss position for 12 months or greater, gross unrealized losses	0	0
Marketable securities, in loss position, estimated fair value	3,331,000	11,721,000
Marketable securities, in loss position, gross unrealized losses	3,000	4,000
Foreign Agency Debt [Member]
Marketable securities, continuous unrealized loss position:
Marketable securities, in loss position for less than 12 months, estimated fair value	4,870,000	46,134,000
Marketable securities, in loss position for less than 12 months, gross unrealized losses	3,000	120,000
Marketable securities, in loss position for 12 months or greater, estimated fair value	0	0
Marketable securities, in loss position for 12 months or greater, gross unrealized losses	0	0
Marketable securities, in loss position, estimated fair value	4,870,000	46,134,000
Marketable securities, in loss position, gross unrealized losses	3,000	120,000
Foreign Government Obligations [Member]
Marketable securities, continuous unrealized loss position:
Marketable securities, in loss position for less than 12 months, estimated fair value		4,515,000
Marketable securities, in loss position for less than 12 months, gross unrealized losses		2,000
Marketable securities, in loss position for 12 months or greater, estimated fair value		0
Marketable securities, in loss position for 12 months or greater, gross unrealized losses		0
Marketable securities, in loss position, estimated fair value		4,515,000
Marketable securities, in loss position, gross unrealized losses		2,000
Supranational Debt [Member]
Marketable securities, continuous unrealized loss position:
Marketable securities, in loss position for less than 12 months, estimated fair value	3,298,000
Marketable securities, in loss position for less than 12 months, gross unrealized losses	3,000
Marketable securities, in loss position for 12 months or greater, estimated fair value	0
Marketable securities, in loss position for 12 months or greater, gross unrealized losses	0
Marketable securities, in loss position, estimated fair value	3,298,000
Marketable securities, in loss position, gross unrealized losses	$ 3,000

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Note 19. Statement of Cash Flows

6 Months Ended

Jun. 30, 2011

Statement of Cash Flows [Abstract]

Statement of Cash Flows Disclosure [Text Block]

19. Statement of Cash Flows

The following table presents a reconciliation of net income to net cash (used in) provided by operating activities for the six months ended June 30, 2011 and June 26, 2010 (in thousands):

	Six Months Ended
	June 30, 2011			June 26, 2010
Net income	$	177,106		$	331,388
Adjustments to reconcile net income to net cash (used in) provided by operating activities:
Depreciation and amortization	104,287			77,747
Impairment of assets and liabilities	1,486			3,480
Impairment of project assets	3,411			638
Share-based compensation	56,838			44,516
Remeasurement of monetary assets and liabilities	6,635			3,510
Deferred income taxes	(42,048		)	(6,877		)
Excess tax benefits from share-based compensation arrangements	(16,497		)	—
Provision for doubtful accounts receivable	—			(990		)
Gain on sales of marketable securities, investments, and restricted investments, net	(3,298		)	(203		)
Other operating activities	(624		)	(736		)
Changes in operating assets and liabilities:
Accounts receivable, trade	(230,540		)	(54,211		)
Accounts receivable, unbilled	(62,195		)	(105,657		)
Prepaid expenses and other current assets	(80,795		)	(126,313		)
Other assets	(27,941		)	(4,558		)
Inventories and balance of systems parts	(153,323		)	(49,921		)
Project assets	(133,216		)	(11,126		)
Accounts payable	79,102			2,351
Income taxes payable	47,048			19,433
Accrued expenses and other liabilities	(13,391		)	(27,665		)
Accrued solar module collection and recycling liability	41,120			12,794
Total adjustments	(423,941		)	(223,788		)
Net cash (used in) provided by operating activities	$	(246,835	)	$	107,600

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Note 21. Subsequent Events (Details) In Millions	3 Months Ended
	Jun. 30, 2011 Indebtness Restricted Subsidiaries [Member] USD ($)	Jun. 30, 2011 FS Malaysia Euler Hermes Facility Agreement [Member] EUR (€)
Subsequent Event [Line Items]
Subsequent Event, Amount	$ 50.0	€ 60.0

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Note 2. Summary of Significant Accounting Policies

6 Months Ended

Jun. 30, 2011

Accounting Policies [Abstract]

Summary of Significant Accounting Policies Disclosure [Text Block]

2. Summary of Significant Accounting Policies

Revenue recognition — Systems Business. Our systems business provides a complete solar power system solution, which includes project development, engineering, procurement, and construction (EPC) services, operating and maintenance (O&M) services, when applicable, and project finance, when required.

We recognize revenue for arrangements entered into by the systems business generally using two revenue recognition models, following the guidance in ASC 605, Accounting for Long-term Construction Contracts or, for arrangements which include land, ASC 360, Accounting for Sales of Real Estate.

For construction contracts that do not involve land or land rights and thus are accounted for under ASC 605, we use the percentage-of-completion method using actual costs incurred over total estimated costs to complete a project (including module costs) as our basic accounting policy, unless we cannot make reasonably dependable estimates of the costs to complete the contract, in which case we would use the completed contract method. We periodically revise our contract cost and profit estimates and we immediately recognize any losses that we identify on contracts. Incurred costs include all direct materials, costs for solar modules, labor, subcontractor costs, and those indirect costs related to contract performance, such as indirect labor, supplies, and tools. We recognize direct material costs and costs for solar modules as incurred costs when the direct materials and solar modules have been installed. When contracts specify that title to direct materials and solar modules transfers to the customer before installation has been performed, we defer revenue and associated costs and recognize revenue once those materials are installed and have met all other revenue recognition requirements. We consider direct materials to be installed when they are permanently attached or fitted to the solar power systems as required by engineering designs.

For arrangements recognized under ASC 360, typically when we have gained control of land or land rights, we record the sale as revenue after construction of a project is complete, we have transferred the usual risks and rewards of ownership to the buyer, and we have received payment from the buyer. We apply the percentage-of-completion method to certain contracts covered under ASC 360, when the sale has been consummated, the initial or continuing investment criteria have been met, we have the ability to estimate our costs and progress toward completion, and other revenue recognition criteria have been met. Depending on the value of the initial and continuing payment commitment by the buyer, we may align our revenue recognition and release of project assets to cost of sales with the receipt of payment from the buyer for contracts accounted for under ASC 360.

Balance of Systems Parts. Balance of systems partsrepresent mounting, DC and AC electrical and other construction parts purchased for solar power plants under construction, which we hold title of and are not yet installed in a solar power plant. These parts include posts, tilt brackets, tables, harnesses, combiner boxes, inverters, cables and any other parts we purchase or assemble for the solar power plants we construct. Balance of systems parts do not include solar modules. We report these parts at the lower of cost or market, with market being based on either recoverability through installation in a solar power plant under construction or through a sale. 

Please also refer to Note 2. "Summary of Significant Accounting Policies," to our consolidated financial statements included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2010 for a more complete discussion of our significant accounting policies.

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Note 11. Economic Development Funding

6 Months Ended

Jun. 30, 2011

Economic Development Funding [Abstract]

Economic development funding [Text Block]

11. Economic Development Funding

On February 11, 2011 we were approved to receive taxable investment incentives (Investitionszuschüsse) of approximately €6.3 million ($9.1 million at the balance sheet close rate on June 30, 2011 of $1.44/€1.00) from the State of Brandenburg, Germany. These funds will reimburse us for certain costs incurred related to the expansion of our manufacturing plant in Frankfurt/Oder, Germany, including costs for the construction of buildings and the purchase of machinery and equipment. Receipt of these incentives is conditional upon the State of Brandenburg having sufficient funds allocated to this program to pay the reimbursements we claim. Based on several factors, including the fiscal budget and credit rating of the State of Brandenburg among others, we believe that there is reasonable assurance that we will receive these grants. In addition, we are required to operate our facility for a minimum of five years and employ a specified number of associates during this period. We expect to meet these conditions based on our operating plans and current commitments. Our incentive approval expires on December 31, 2012. As of June 30, 2011, we had received cash payments of €2.2 million ($3.1 million at the transaction rate of $1.42/€1.00) under this program, and we had accrued €3.3 million ($4.8 million at the balance sheet close rate on June 30, 2011 of $1.44/€1.00) that we are eligible to receive under this program based on qualifying expenditures that we had incurred through that date.

We are also eligible to recover up to approximately €17.2 million ($24.8 million at the balance sheet close rate on June 30, 2011 of $1.44/€1.00) of expenditures related to the construction of our plant in Frankfurt/Oder, Germany under the German Investment Grant Act of 2010 (Investitionszulagen). This Act permits us to claim tax-exempt reimbursements for certain costs that we will incur related to the expansion of our manufacturing plant in Frankfurt/Oder, Germany, including costs for the construction of buildings and the purchase of machinery and equipment. Tangible assets subsidized under this program have to remain in the region for at least five years. We expect to meet these conditions based on our operating plans and current commitments. As of June 30, 2011, we had accrued €14.6 million ($21.0 million at the balance sheet close rate on June 30, 2011 of $1.44/€1.00) that we are eligible to receive under this program based on qualifying expenditures that we had incurred through that date.

We account for these grants as a deduction to the carrying value of the fixed assets they fund when there is reasonable assurance that we comply with the conditions attached to the grants and the grants will be received.

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Note 11. Economic Development Funding (Details)	6 Months Ended			3 Months Ended
	Jun. 30, 2011 USD ($)	Jun. 26, 2010 USD ($)	May 30, 2011	Jun. 30, 2011 Taxable Investment Incentives [Member] USD ($)	Jun. 30, 2011 Taxable Investment Incentives [Member] EUR (€)	Jun. 30, 2011 German Investment Grant Act [Member] USD ($)	Jun. 30, 2011 German Investment Grant Act [Member] EUR (€)
Accounts, Notes, Loans and Financing Receivable [Line Items]
Grants Receivable, Current				$ 4,800,000	€ 3,300,000	$ 21,000,000	€ 14,600,000
Exchange Rate Ratio	1.44		1.42
Proceeds from economic development funding	3,112,000	0		3,100,000	2,200,000
Total German Government Grant Amount				$ 9,100,000	€ 6,300,000	$ 24,800,000	€ 17,200,000

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Note 14. Commitments and Contingencies (Details) (USD $)	Jun. 30, 2011	Dec. 31, 2010	Sep. 04, 2009
JP Morgan Chase Bank NA And Bank Of America [Member]
Line of Credit Facility [Line Items]
Line of credit facility, amount outstanding	$ 143,400,000	$ 126,400,000
Line of credit facility, remaining borrowing capacity	356,600,000
Line of credit facility, current borrowing capacity	600,000,000		300,000,000
Foreign Subsidiaries [Member]
Line of Credit Facility [Line Items]
Line of credit facility, amount outstanding	$ 22,000,000

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Note 13. Debt (Tables)

6 Months Ended

Jun. 30, 2011

Debt Instrument [Line Items]

Long-term Debt [Text Block]

Our long-term debt at June 30, 2011 and December 31, 2010 consisted of the following (in thousands):

Type	June 30, 2011			December 31, 2010
Revolving Credit Facility	$	100,000		$	100,000
German Facility Agreement	123,734			—
France Facility Agreement	5,350			—
Malaysian Facility Agreement — Fixed rate term loan	63,324			65,009
Malaysian Facility Agreement — Floating rate term loan (1)	63,324			65,009
Director of Development of the State of Ohio	7,229			8,112
Capital lease obligations	2,658			1,736
	365,619			239,866
Less unamortized discount	(4,793		)	(2,475		)
Total long-term debt	360,826			237,391
Less current portion	(28,334		)	(26,587		)
Noncurrent portion	$	332,492		$	210,804

(1) We entered into an interest rate swap contract related to this loan. See Note 9. "Derivative Financial Instruments," to our condensed consolidated financial statements.

Malaysian Facility Agreement [Member]

Debt Instrument [Line Items]

Schedule of Long-term Debt Instruments [Text Block]

These credit facilities consist of the following (in thousands):

				Outstanding		Outstanding
Malaysian Borrowings	Denomination	Interest Rate	Maturity	June 30, 2011		December 31, 2010
Fixed-rate euro-denominated term loan	EUR	4.54%	2016	$	63,324	$	65,009
Floating-rate euro-denominated term loan	EUR	Euribor plus 0.55%	2016	63,324		65,009
Total (1)				$	126,648	$	130,018

(1) €87.9 million outstanding at June 30, 2011 ($126.6 million at the balance sheet close rate on June 30, 2011 of $1.44/€1.00).

German Facility Agreement [Member]

Debt Instrument [Line Items]

Schedule of Long-term Debt Instruments [Text Block]

Amounts repaid under this credit facility cannot be re-borrowed. This credit facility consisted of the following (in thousands):

				Outstanding		Outstanding
German Borrowings	Denomination	Interest Rate	Maturity	June 30, 2011		December 31, 2010
German Facility Agreement	EUR	Euribor plus 1.35%	2019	$	123,734	$	—
Total (1)				$	123,734	$	—

(1) €85.9 million outstanding at June 30, 2011 ($123.7 million at the balance sheet close rate on June 30, 2011 of $1.44/€1.00).

Director of Development of the State of Ohio 2015 maturity [Member]

Debt Instrument [Line Items]

Schedule of Long-term Debt Instruments [Text Block]

During the year ended December 31, 2005, we received the following loan from the Director of Development of the State of Ohio (in thousands):

	Original					Outstanding		Outstanding
Ohio Borrowing	Loan Amount		Denomination	Interest Rate	Maturity	June 30, 2011		December 31, 2010
Director of Development of the State of Ohio	$	15,000	USD	2.25%	2015	$	7,229	$	8,112
Total	$	15,000				$	7,229	$	8,112

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Note 15. Share-Based Compensation

6 Months Ended

Jun. 30, 2011

Share-based Compensation, Allocation and Classification in Financial Statements [Abstract]

Share-Based Compensation Disclosure [Text Block]

15. Share-Based Compensation

We measure share-based compensation cost at the grant date based on the fair value of the award and recognize this cost as an expense over the grant recipients’ requisite service periods, in accordance with ASC 718, Compensation - Stock Compensation. The share-based compensation expense that we recognized in our consolidated statements of operations for the three and six months ended June 30, 2011 and June 26, 2010 was as follows (in thousands):

	Three Months Ended				Six Months Ended
	June 30, 2011		June 26, 2010		June 30, 2011		June 26, 2010
Share-based compensation expense included in:
Cost of sales	$	9,592	$	5,566	$	16,445	$	10,724
Research and development	4,013		2,957		7,300		5,038
Selling, general and administrative	16,710		16,029		31,394		27,930
Production start-up	956		490		1,699		824
Total share-based compensation expense	$	31,271	$	25,042	$	56,838	$	44,516

The increase in share-based compensation expense was primarily the result of new awards.

The following table presents our share-based compensation expense by type of award for the three and six months ended June 30, 2011 and June 26, 2010 (in thousands):

	Three Months Ended						Six Months Ended
	June 30, 2011			June 26, 2010			June 30, 2011			June 26, 2010
Stock options	$	378		$	577		$	760		$	1,555
Restricted stock units	31,471			26,646			56,913			44,872
Unrestricted stock	226			157			452			307
Net amount absorbed into inventory	(804		)	(2,338		)	(1,287		)	(2,218		)
Total share-based compensation expense	$	31,271		$	25,042		$	56,838		$	44,516

Share-based compensation cost capitalized in our inventory was $2.2 million and $0.9 million at June 30, 2011 and December 31, 2010, respectively. As of June 30, 2011, we had $0.3 million of unrecognized share-based compensation cost related to unvested stock option awards, which we expect to recognize as an expense over a weighted-average period of approximately 0.5 years, and $210.0 million of unrecognized share-based compensation cost related to unvested restricted stock units, which we expect to recognize as an expense over a weighted-average period of approximately 1.9 years.

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Condensed Consolidated Statements of Operations (USD $) In Thousands, except Per Share data	3 Months Ended		6 Months Ended
	Jun. 30, 2011	Jun. 26, 2010	Jun. 30, 2011	Jun. 26, 2010
Net sales	$ 532,774	$ 587,854	$ 1,100,067	$ 1,155,815
Cost of sales	337,976	303,660	645,604	589,585
Gross profit	194,798	284,194	454,463	566,230
Operating expenses:
Research and development	33,102	22,836	64,453	45,724
Selling, general and administrative	86,872	78,597	173,872	145,461
Production start-up	10,294	2,288	22,225	3,431
Total operating expenses	130,268	103,721	260,550	194,616
Operating income	64,530	180,473	193,913	371,614
Foreign currency gain (loss)	1,659	(2,625)	2,609	(3,321)
Interest income	3,417	3,035	6,440	8,683
Interest expense, net	0	(6)	0	(6)
Other income (expense), net	2,351	(439)	2,002	(1,173)
Income before income taxes	71,957	180,438	204,964	375,797
Income tax expense	10,819	21,395	27,858	44,409
Net Income	$ 61,138	$ 159,043	$ 177,106	$ 331,388
Net income per share:
Basic	$ 0.71	$ 1.87	$ 2.07	$ 3.91
Diluted	$ 0.7	$ 1.84	$ 2.03	$ 3.84
Weighted-average number of shares used in per share calculations:
Basic	86,164	84,852	85,746	84,679
Diluted	87,126	86,401	87,092	86,247

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Note 15. Share-Based Compensation (Tables)

6 Months Ended

Jun. 30, 2011

Share-based Compensation, Allocation and Classification in Financial Statements [Abstract]

Schedule of Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Text Block]

The share-based compensation expense that we recognized in our consolidated statements of operations for the three and six months ended June 30, 2011 and June 26, 2010 was as follows (in thousands):

	Three Months Ended				Six Months Ended
	June 30, 2011		June 26, 2010		June 30, 2011		June 26, 2010
Share-based compensation expense included in:
Cost of sales	$	9,592	$	5,566	$	16,445	$	10,724
Research and development	4,013		2,957		7,300		5,038
Selling, general and administrative	16,710		16,029		31,394		27,930
Production start-up	956		490		1,699		824
Total share-based compensation expense	$	31,271	$	25,042	$	56,838	$	44,516

The following table presents our share-based compensation expense by type of award for the three and six months ended June 30, 2011 and June 26, 2010 (in thousands):

	Three Months Ended						Six Months Ended
	June 30, 2011			June 26, 2010			June 30, 2011			June 26, 2010
Stock options	$	378		$	577		$	760		$	1,555
Restricted stock units	31,471			26,646			56,913			44,872
Unrestricted stock	226			157			452			307
Net amount absorbed into inventory	(804		)	(2,338		)	(1,287		)	(2,218		)
Total share-based compensation expense	$	31,271		$	25,042		$	56,838		$	44,516

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Note 9. Derivative Financial Instruments (Details) (USD $) In Thousands	Jun. 30, 2011	Dec. 31, 2010
Foreign Exchange Contract [Member] | Designated as Hedging Instrument [Member] | Other Assets Current [Member]
Derivatives, Fair Value [Line Items]
Derivative asset designated as hedging instrument, fair value	$ 8,787	$ 10,115
Foreign Exchange Contract [Member] | Designated as Hedging Instrument [Member] | Other Assets Noncurrent [Member]
Derivatives, Fair Value [Line Items]
Derivative asset designated as hedging instrument, fair value	0	880
Foreign Exchange Contract [Member] | Designated as Hedging Instrument [Member] | Other Liabilities Current [Member]
Derivatives, Fair Value [Line Items]
Derivative liability designated as hedging instrument, fair value	39,438	12,384
Foreign Exchange Contract [Member] | Designated as Hedging Instrument [Member] | Other Liabilities Noncurrent [Member]
Derivatives, Fair Value [Line Items]
Derivative liability designated as hedging instrument, fair value	1,425	58
Foreign Exchange Contract [Member] | Not Designated as Hedging Instrument [Member] | Other Assets Current [Member]
Derivatives, Fair Value [Line Items]
Derivative asset designated as hedging instrument, fair value	12,387	10,871
Foreign Exchange Contract [Member] | Not Designated as Hedging Instrument [Member] | Other Assets Noncurrent [Member]
Derivatives, Fair Value [Line Items]
Derivative asset designated as hedging instrument, fair value	0	0
Foreign Exchange Contract [Member] | Not Designated as Hedging Instrument [Member] | Other Liabilities Current [Member]
Derivatives, Fair Value [Line Items]
Derivative liability designated as hedging instrument, fair value	13,853	10,373
Foreign Exchange Contract [Member] | Not Designated as Hedging Instrument [Member] | Other Liabilities Noncurrent [Member]
Derivatives, Fair Value [Line Items]
Derivative liability designated as hedging instrument, fair value	0	0
Interest Rate Swap [Member] | Designated as Hedging Instrument [Member] | Other Assets Current [Member]
Derivatives, Fair Value [Line Items]
Derivative asset designated as hedging instrument, fair value	0	0
Interest Rate Swap [Member] | Designated as Hedging Instrument [Member] | Other Assets Noncurrent [Member]
Derivatives, Fair Value [Line Items]
Derivative asset designated as hedging instrument, fair value	0	0
Interest Rate Swap [Member] | Designated as Hedging Instrument [Member] | Other Liabilities Current [Member]
Derivatives, Fair Value [Line Items]
Derivative liability designated as hedging instrument, fair value	137	239
Interest Rate Swap [Member] | Designated as Hedging Instrument [Member] | Other Liabilities Noncurrent [Member]
Derivatives, Fair Value [Line Items]
Derivative liability designated as hedging instrument, fair value	493	980
Designated as Hedging Instrument [Member] | Other Assets Current [Member]
Derivatives, Fair Value [Line Items]
Derivative asset designated as hedging instrument, fair value	8,787	10,115
Designated as Hedging Instrument [Member] | Other Assets Noncurrent [Member]
Derivatives, Fair Value [Line Items]
Derivative asset designated as hedging instrument, fair value	0	880
Designated as Hedging Instrument [Member] | Other Liabilities Current [Member]
Derivatives, Fair Value [Line Items]
Derivative liability designated as hedging instrument, fair value	39,575	12,623
Designated as Hedging Instrument [Member] | Other Liabilities Noncurrent [Member]
Derivatives, Fair Value [Line Items]
Derivative liability designated as hedging instrument, fair value	1,918	1,038
Not Designated as Hedging Instrument [Member] | Other Assets Current [Member]
Derivatives, Fair Value [Line Items]
Derivative asset designated as hedging instrument, fair value	12,387	10,871
Not Designated as Hedging Instrument [Member] | Other Assets Noncurrent [Member]
Derivatives, Fair Value [Line Items]
Derivative asset designated as hedging instrument, fair value	0	0
Not Designated as Hedging Instrument [Member] | Other Liabilities Current [Member]
Derivatives, Fair Value [Line Items]
Derivative liability designated as hedging instrument, fair value	13,853	10,373
Not Designated as Hedging Instrument [Member] | Other Liabilities Noncurrent [Member]
Derivatives, Fair Value [Line Items]
Derivative liability designated as hedging instrument, fair value	0	0
Other Assets Current [Member]
Derivatives, Fair Value [Line Items]
Derivative assets (liabilities), at fair value, net	21,174	20,986
Other Assets Noncurrent [Member]
Derivatives, Fair Value [Line Items]
Derivative assets (liabilities), at fair value, net	0	880
Other Liabilities Current [Member]
Derivatives, Fair Value [Line Items]
Derivative assets (liabilities), at fair value, net	(53,428)	(22,996)
Other Liabilities Noncurrent [Member]
Derivatives, Fair Value [Line Items]
Derivative assets (liabilities), at fair value, net	$ (1,918)	$ (1,038)

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Note 13. Debt (Details)							6 Months Ended									6 Months Ended		6 Months Ended						6 Months Ended
	Jun. 30, 2011 USD ($)	Dec. 31, 2010 USD ($)	Jun. 30, 2011 JP Morgan Chase Bank NA And Bank Of America [Member] USD ($)	Dec. 31, 2010 JP Morgan Chase Bank NA And Bank Of America [Member] USD ($)	Jun. 30, 2011 JP Morgan Chase Bank NA And Bank Of America [Member] Line Of Credit - Revolving Letter Of Credit [Member] USD ($)	Dec. 31, 2010 JP Morgan Chase Bank NA And Bank Of America [Member] Line Of Credit - Revolving Letter Of Credit [Member] USD ($)	Jun. 30, 2011 German Facility Agreement [Member] USD ($)	Jun. 30, 2011 German Facility Agreement [Member] EUR (€)	Dec. 31, 2010 German Facility Agreement [Member] USD ($)	Jun. 30, 2011 Malaysian Facility Agreement [Member] USD ($)		Jun. 30, 2011 Malaysian Facility Agreement [Member] EUR (€)		Dec. 31, 2010 Malaysian Facility Agreement [Member] USD ($)		Jun. 30, 2011 Malaysian Facility Agreement, Fixed Rate Term Loan [Member] USD ($)	Dec. 31, 2010 Malaysian Facility Agreement, Fixed Rate Term Loan [Member] USD ($)	Jun. 30, 2011 Malaysian Facility Agreement Floating Rate Term Loan [Member] USD ($)		Dec. 31, 2010 Malaysian Facility Agreement Floating Rate Term Loan [Member] USD ($)		Jun. 30, 2011 Director of Development of the State of Ohio [Member] USD ($)	Dec. 31, 2010 Director of Development of the State of Ohio [Member] USD ($)	Jun. 30, 2011 Director of Development of the State of Ohio 2015 maturity [Member] USD ($)	Dec. 31, 2010 Director of Development of the State of Ohio 2015 maturity [Member] USD ($)	Jun. 30, 2011 Capital Lease Obligations [Member] USD ($)	Dec. 31, 2010 Capital Lease Obligations [Member] USD ($)	Jun. 30, 2011 France Facility Agreement [Member] USD ($)	Jun. 30, 2011 France Facility Agreement [Member] EUR (€)	Dec. 31, 2010 France Facility Agreement [Member] USD ($)
Long-term Debt [Abstract]
Debt Instrument, Face Amount																						$ 15,000,000		$ 15,000,000
Debt Instrument, Currency							EUR	EUR								EUR		EUR						USD
Interest Rate Stated Percentage - Variable Rate Description			Borrowings under the amended and restated credit agreement currently bear interest at (i) London Interbank Offered Rate (LIBOR) (adjusted for eurocurrency reserve requirements) plus a margin of 2.25% or (ii) a base rate as defined in the credit agreement plus a margin of 1.25%, depending on the type of borrowing requested				Euribor plus 1.35%	Euribor plus 1.35%										Euribor plus 0.55%
Debt Instrument, Interest Rate, Stated Percentage																4.54%								2.25%				4.00%	4.00%
Debt Instrument, Maturity Date, Description							2019	2019								2016		2016						2015
Line of credit facility, amount outstanding			143,400,000	126,400,000	100,000,000	100,000,000																						5,400,000	3,800,000	0
Debt instrument, principal outstanding	365,619,000	239,866,000					123,734,000	85,900,000	0	126,648,000	[1]	87,900,000	[1]	130,018,000	[1]	63,324,000	65,009,000	63,324,000	[2]	65,009,000	[2]	7,229,000	8,112,000	7,229,000	8,112,000	2,658,000	1,736,000	5,350,000		0
Long-term Debt, Gross	365,619,000	239,866,000					123,734,000	85,900,000	0	126,648,000	[1]	87,900,000	[1]	130,018,000	[1]	63,324,000	65,009,000	63,324,000	[2]	65,009,000	[2]	7,229,000	8,112,000	7,229,000	8,112,000	2,658,000	1,736,000	5,350,000		0
Less unamortized discount	(4,793,000)	(2,475,000)
Total long-term debt	360,826,000	237,391,000
Current portion of long-term debt	(28,334,000)	(26,587,000)
Noncurrent portion	332,492,000	210,804,000
Short-term debt	$ 0	$ 0

[1] 1) €87.9 million outstanding at June 30, 2011 ($126.6 million at the balance sheet close rate on June 30, 2011 of $1.44/€1

[2] We entered into an interest rate swap contract related to this loan. See Note 9. "Derivative Financial Instruments," to our condensed consolidated financial statements.

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Note 20. Segment Reporting (Details) (USD $)	3 Months Ended		6 Months Ended
	Jun. 30, 2011	Jun. 26, 2010	Jun. 30, 2011	Jun. 26, 2010	Dec. 31, 2010
Segment Reporting Information [Line Items]
Net sales	$ 532,774,000	$ 587,854,000	$ 1,100,067,000	$ 1,155,815,000
Gross profit (loss)	194,798,000	284,194,000	454,463,000	566,230,000
Income before income taxes	71,957,000	180,438,000	204,964,000	375,797,000
Goodwill	458,808,000	286,515,000	458,808,000	286,515,000	433,288,000
Total assets	4,939,232,000	3,631,315,000	4,939,232,000	3,631,315,000	4,380,403,000
Solar Module [Member]
Segment Reporting Information [Line Items]
Net sales	427,350,000	476,061,000	933,092,000	1,004,939,000
Solar Power System [Member]
Segment Reporting Information [Line Items]
Net sales	105,424,000	111,793,000	166,975,000	150,876,000
Components Segment [Member]
Segment Reporting Information [Line Items]
Net sales	471,947,000	500,940,000	991,466,000	1,030,208,000
Gross profit (loss)	189,875,000	261,656,000	448,133,000	539,307,000
Income before income taxes	71,957,000	180,438,000	204,964,000	375,797,000
Goodwill	393,365,000	251,275,000	393,365,000	251,275,000	393,365,000
Total assets	4,206,755,000	3,172,912,000	4,206,755,000	3,172,912,000
Systems Segment [Member]
Segment Reporting Information [Line Items]
Net sales	60,827,000	86,914,000	108,601,000	125,607,000
Gross profit (loss)	4,923,000	22,538,000	6,330,000	26,923,000
Income before income taxes	0	0	0	0
Goodwill	65,443,000	35,240,000	65,443,000	35,240,000	39,923,000
Total assets	732,477,000	458,403,000	732,477,000	458,403,000
To Components Segment [Member]
Segment Reporting Information [Line Items]
Inter-segment transfer from	0	11,400,000	0	11,400,000
To Systems Segment [Member]
Segment Reporting Information [Line Items]
Inter-segment transfer from	$ 19,700,000	$ 0	$ 45,900,000	$ 8,900,000

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Note 7. Restricted Cash and Investments (Details) In Thousands	6 Months Ended
	Jun. 30, 2011 USD ($)	Jun. 30, 2011 EUR (€)	May 30, 2011	Dec. 31, 2010 USD ($)
Restricted Cash And Investments [Line Items]
Solar Module Collection And Recycling Custodial Account Funding Timing	60 days
Restricted cash	$ 23,909	€ 16,600		$ 19
Restricted investments	150,789			85,984
Total restricted cash and investments - noncurrent	$ 174,698			$ 86,003
Solar module minimum service life for purposes of collection and recycling custodial account	25 years
Exchange rate ratio	1.44		1.42

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Note 7. Restricted Cash and Investments (Details) - Available For Sale (USD $) In Thousands	6 Months Ended	12 Months Ended
	Jun. 30, 2011	Dec. 31, 2010
Restricted Investments [Member]
Schedule of Available-for-sale Securities [Line Items]
Available-for-sale securities, amortized cost	$ 156,925	$ 79,388
Available-for-sale securities, gross unrealized gains	895	6,668
Available-for-sale securities, gross unrealized losses	7,031	72
Available-for-sale Securities, estimated fair value	150,789	85,984
Contractural maturities of available-for-sale marketable securities, range start	17 years	17 years
Contractural maturities of available-for-sale marketable securities, range end	25 years	25 years
Restricted Investments [Member] | Foreign Government Obligations [Member]
Schedule of Available-for-sale Securities [Line Items]
Available-for-sale securities, amortized cost	141,903	73,729
Available-for-sale securities, gross unrealized gains	447	6,529
Available-for-sale securities, gross unrealized losses	6,937	72
Available-for-sale Securities, estimated fair value	135,413	80,186
Restricted Investments [Member] | US Government Debt Securities [Member]
Schedule of Available-for-sale Securities [Line Items]
Available-for-sale securities, amortized cost	15,022	5,659
Available-for-sale securities, gross unrealized gains	448	139
Available-for-sale securities, gross unrealized losses	94	0
Available-for-sale Securities, estimated fair value	15,376	5,798
Unrestricted Investments [Member]
Schedule of Available-for-sale Securities [Line Items]
Available-for-sale securities, amortized cost	157,806	347,260
Available-for-sale securities, gross unrealized gains	172	1,164
Available-for-sale securities, gross unrealized losses	16	264
Available-for-sale Securities, estimated fair value	$ 157,962	$ 348,160

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Note 10. Fair Value Measurement (Details) - Balance Sheet Grouping (USD $) In Thousands	Jun. 30, 2011	Dec. 31, 2010
Carrying (Reported) Amount, Fair Value Disclosure [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Marketable securities, current and noncurrent	$ 155,360	$ 348,160
Investments, Fair Value Disclosure	2,602	0
Foreign exchange forward contract assets	21,174	21,866
Restricted investments (excluding restricted cash)	150,789	85,984
Notes receivable - noncurrent	10,057	9,314
Long-term debt, including current maturities	360,826	237,391
Interest rate swap contract liabilities	630	1,219
Foreign exchange forward contract liabilities	54,716	22,815
Estimate of Fair Value, Fair Value Disclosure [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Marketable securities, current and noncurrent	155,360	348,160
Investments, Fair Value Disclosure	2,602	0
Foreign exchange forward contract assets	21,174	21,866
Restricted investments (excluding restricted cash)	150,789	85,984
Notes receivable - noncurrent	9,441	8,836
Long-term debt, including current maturities	364,825	240,176
Interest rate swap contract liabilities	630	1,219
Foreign exchange forward contract liabilities	$ 54,716	$ 22,815

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Note 17. Net Income Per Share (Tables)

6 Months Ended

Jun. 30, 2011

Earnings Per Share [Abstract]

Schedule of Earnings Per Share, Basic and Diluted [Table Text Block]

The calculation of basic and diluted net income per share for the three and six months ended June 30, 2011 and June 26, 2010 was as follows (in thousands, except per share amounts):

	Three Months Ended				Six Months Ended
	June 30, 2011		June 26, 2010		June 30, 2011		June 26, 2010
Basic net income per share
Numerator:
Net income	$	61,138	$	159,043	$	177,106	$	331,388
Denominator:
Weighted-average common stock outstanding	86,164		84,852		85,746		84,679
Diluted net income per share
Denominator:
Weighted-average common stock outstanding	86,164		84,852		85,746		84,679
Effect of stock options, restricted stock units outstanding, and contingent issuable shares	962		1,549		1,346		1,568
Weighted-average shares used in computing diluted net income per share	87,126		86,401		87,092		86,247

	Three Months Ended				Six Months Ended
	June 30, 2011		June 26, 2010		June 30, 2011		June 26, 2010
Per share information — basic:
Net income per share	$	0.71	$	1.87	$	2.07	$	3.91
Per share information — diluted:
Net income per share	$	0.70	$	1.84	$	2.03	$	3.84

Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share [Table Text Block]

The following number of outstanding employee stock options and restricted stock units were excluded from the computation of diluted net income per share for the three and six months ended June 30, 2011 and June 26, 2010 as they would have had an antidilutive effect (in thousands):

	Three Months Ended		Six Months Ended
	June 30, 2011	June 26, 2010	June 30, 2011	June 26, 2010
Restricted stock units and options to purchase common stock	939	75	515	157