x | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
o | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Delaware | 56-1505767 | |
(State or other jurisdiction of incorporation or organization) | (I. R. S. Employer Identification No.) | |
501 Pearl Drive (City of O’Fallon) St. Peters, Missouri | 63376 | |
(Address of principal executive offices) | (Zip Code) |
Large accelerated filer | x | Accelerated filer | o | |||
Non-accelerated filer | o (Do not check if a smaller reporting company) | Smaller reporting company | o |
Page | ||
Item 1. | Unaudited Condensed Consolidated Statements of Operations and Comprehensive (Loss) Income | |
Item 2. | ||
Item 3. | ||
Item 4. | ||
Item 1. | ||
Item 2. | ||
Item 6. | ||
Item 1. | Financial Statements. |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||
2012 | 2011 | 2012 | 2011 | ||||||||||
Net sales (see Note 14) | $ | 601.6 | $ | 516.2 | $ | 1,929.2 | $ | 1,997.7 | |||||
Cost of goods sold | 514.7 | 457.6 | 1,701.8 | 1,644.0 | |||||||||
Gross profit | 86.9 | 58.6 | 227.4 | 353.7 | |||||||||
Operating expenses: | |||||||||||||
Marketing and administration | 68.9 | 83.8 | 239.2 | 270.8 | |||||||||
Research and development | 17.4 | 22.3 | 55.8 | 65.1 | |||||||||
Goodwill impairment charge | — | 56.4 | — | 56.4 | |||||||||
Restructuring and impairment (reversals) charges (see Note 2) | (58.3 | ) | (0.1 | ) | (53.0 | ) | 13.7 | ||||||
Insurance recovery | — | — | (4.0 | ) | — | ||||||||
Operating income (loss) | 58.9 | (103.8 | ) | (10.6 | ) | (52.3 | ) | ||||||
Non-operating expense (income): | |||||||||||||
Interest expense | 28.0 | 20.7 | 100.3 | 50.9 | |||||||||
Interest income | (0.9 | ) | (1.3 | ) | (2.8 | ) | (3.1 | ) | |||||
Other, net | (2.4 | ) | 13.4 | 0.1 | (3.9 | ) | |||||||
Total non-operating expense | 24.7 | 32.8 | 97.6 | 43.9 | |||||||||
Income (loss) before income taxes and equity in (loss) earnings of joint ventures | 34.2 | (136.6 | ) | (108.2 | ) | (96.2 | ) | ||||||
Income tax expense (benefit) | (3.3 | ) | (43.2 | ) | 27.9 | (56.6 | ) | ||||||
Income (loss) before equity in earnings of joint ventures | 37.5 | (93.4 | ) | (136.1 | ) | (39.6 | ) | ||||||
Equity in earnings (loss) of joint ventures, net of tax | 0.9 | 1.2 | (0.9 | ) | 4.5 | ||||||||
Net income (loss) | 38.4 | (92.2 | ) | (137.0 | ) | (35.1 | ) | ||||||
Net income attributable to noncontrolling interests | (1.4 | ) | (2.2 | ) | (1.8 | ) | (16.5 | ) | |||||
Net income (loss) attributable to MEMC stockholders | $ | 37.0 | $ | (94.4 | ) | $ | (138.8 | ) | $ | (51.6 | ) | ||
Basic income (loss) per share (see Note 10) | $ | 0.16 | $ | (0.41 | ) | $ | (0.61 | ) | $ | (0.22 | ) | ||
Diluted income (loss) per share (see Note 10) | $ | 0.16 | $ | (0.41 | ) | $ | (0.61 | ) | $ | (0.22 | ) | ||
Comprehensive income (loss) | $ | 48.6 | $ | (139.7 | ) | $ | (145.5 | ) | $ | (37.6 | ) | ||
Less: comprehensive income (loss) attributable to noncontrolling interests | 2.5 | (1.0 | ) | 2.8 | 17.6 | ||||||||
Comprehensive income (loss) attributable to MEMC stockholders | $ | 46.1 | $ | (138.7 | ) | $ | (148.3 | ) | $ | (55.2 | ) |
September 30, 2012 | December 31, 2011 | ||||||
ASSETS | |||||||
Current assets: | |||||||
Cash and cash equivalents | $ | 609.8 | $ | 585.8 | |||
Restricted cash | 84.2 | 125.2 | |||||
Accounts receivable, less allowance for doubtful accounts of $4.3 and $4.9 in 2012 and 2011, respectively | 252.0 | 202.9 | |||||
Inventories | 246.1 | 321.8 | |||||
Solar energy systems held for development and sale | 246.0 | 373.0 | |||||
Prepaid and other current assets | 201.2 | 277.2 | |||||
Total current assets | 1,639.3 | 1,885.9 | |||||
Investments | 48.4 | 54.5 | |||||
Property, plant and equipment, net: | |||||||
Non-solar energy systems, net of accumulated depreciation of $887.4 and $817.6 in 2012 and 2011, respectively | 1,180.6 | 1,253.7 | |||||
Solar energy systems, including consolidated variable interest entities of $53.7 and $55.3 in 2012 and 2011, respectively, net of accumulated depreciation of $62.4 and $34.2 in 2012 and 2011, respectively | 1,264.9 | 1,139.4 | |||||
Deferred tax assets, net | 30.9 | 44.8 | |||||
Restricted cash | 46.5 | 37.5 | |||||
Other assets | 344.1 | 316.6 | |||||
Intangible assets, net | 138.3 | 149.2 | |||||
Total assets | $ | 4,693.0 | $ | 4,881.6 |
September 30, 2012 | December 31, 2011 | ||||||
LIABILITIES AND STOCKHOLDERS’ EQUITY | |||||||
Current liabilities: | |||||||
Current portion of long-term debt | $ | 3.7 | $ | 3.7 | |||
Short-term solar energy system financing, current portion of solar energy system financing and capital lease obligations, including consolidated variable interest entities of $2.9 and $5.6 in 2012 and 2011, respectively | 143.3 | 144.2 | |||||
Accounts payable | 463.9 | 694.6 | |||||
Accrued liabilities | 365.8 | 409.0 | |||||
Contingent consideration related to acquisitions | 31.8 | 71.6 | |||||
Deferred revenue for solar energy systems | 142.0 | 41.4 | |||||
Customer and other deposits | 57.5 | 72.4 | |||||
Total current liabilities | 1,208.0 | 1,436.9 | |||||
Long-term debt, less current portion | 761.8 | 567.7 | |||||
Long-term solar energy system financing and capital lease obligations, less current portion, including consolidated variable interest entities of $71.2 and $57.0 in 2012 and 2011, respectively | 1,404.6 | 1,211.2 | |||||
Pension and post-employment liabilities | 72.4 | 69.4 | |||||
Customer and other deposits | 208.2 | 276.8 | |||||
Deferred revenue for solar energy systems | 147.2 | 157.4 | |||||
Non-solar energy system deferred revenue | 30.7 | 51.2 | |||||
Other liabilities | 206.6 | 326.1 | |||||
Total liabilities | 4,039.5 | 4,096.7 | |||||
Redeemable noncontrolling interest | 11.4 | — | |||||
Stockholders’ equity: | |||||||
Preferred stock, $.01 par value, 50.0 shares authorized, none issued and outstanding in 2012 and 2011 | — | — | |||||
Common stock, $.01 par value, 300.0 shares authorized, 241.4 and 241.3 shares issued, 230.9 and 230.8 shares outstanding, in 2012 and 2011, respectively | 2.4 | 2.4 | |||||
Additional paid-in capital | 620.2 | 621.7 | |||||
Retained earnings | 437.8 | 577.5 | |||||
Accumulated other comprehensive loss | (13.4 | ) | (3.9 | ) | |||
Treasury stock, 10.5 shares in 2012 and 2011, respectively | (459.8 | ) | (459.8 | ) | |||
Total MEMC stockholders’ equity | 587.2 | 737.9 | |||||
Noncontrolling interests | 54.9 | 47.0 | |||||
Total stockholders’ equity | 642.1 | 784.9 | |||||
Total liabilities and stockholders’ equity | $ | 4,693.0 | $ | 4,881.6 |
Nine Months Ended | |||||||
September 30, 2012 | September 30, 2011 | ||||||
Cash flows from operating activities: | |||||||
Net loss | $ | (137.0 | ) | $ | (35.1 | ) | |
Adjustments to reconcile net loss to net cash used in operating activities: | |||||||
Depreciation and amortization | 168.4 | 161.7 | |||||
Stock-based compensation | 22.2 | 31.7 | |||||
Goodwill impairment charge | — | 56.4 | |||||
Expense (benefit) for deferred taxes | 4.3 | (103.5 | ) | ||||
Deferred revenue | (17.7 | ) | (61.3 | ) | |||
Changes in operating assets and liabilities: | |||||||
Accounts receivable | (50.5 | ) | 24.0 | ||||
Accounts payable | (205.4 | ) | 133.0 | ||||
Inventories | 79.4 | (160.7 | ) | ||||
Solar energy systems held for development and sale | (114.5 | ) | (205.5 | ) | |||
Deferred revenue for solar energy systems | 101.5 | 203.0 | |||||
Customer and other deposits | (34.7 | ) | 102.5 | ||||
Accrued liabilities | (37.5 | ) | (12.6 | ) | |||
Other long term liabilities | (140.2 | ) | 28.8 | ||||
Other | 78.3 | (1.1 | ) | ||||
Net cash (used in) provided by operating activities | (283.4 | ) | 161.3 | ||||
Cash flows from investing activities: | |||||||
Capital expenditures | (100.3 | ) | (390.4 | ) | |||
Construction of solar energy systems | (193.2 | ) | (470.2 | ) | |||
Purchases of cost and equity method investments | (35.2 | ) | (50.4 | ) | |||
Net proceeds from equity method investments | 3.0 | 83.7 | |||||
Change in restricted cash | (1.3 | ) | (83.0 | ) | |||
Receipts (payments) to vendors for refundable deposits on long-term agreements | 4.8 | (14.5 | ) | ||||
Proceeds from sale of property, plant and equipment | — | 37.1 | |||||
Cash paid for acquisition, net of cash acquired | — | (162.6 | ) | ||||
Other | (0.1 | ) | (0.6 | ) | |||
Net cash used in investing activities | (322.3 | ) | (1,050.9 | ) | |||
Cash flows from financing activities: | |||||||
Proceeds from senior notes issuance | — | 550.0 | |||||
Proceeds from second lien term loan | 196.0 | — | |||||
Cash paid for contingent consideration for acquistions | (58.0 | ) | (50.2 | ) | |||
Proceeds from solar energy system financing and capital lease obligations | 720.3 | 694.8 | |||||
Repayments of solar energy system financing and capital lease obligations | (184.0 | ) | (122.1 | ) | |||
Net repayments of customer deposits related to long-term supply agreements | (23.6 | ) | (57.3 | ) | |||
Principal payments on long-term debt | (1.8 | ) | (1.8 | ) | |||
Common stock issued and repurchased | (0.1 | ) | (2.8 | ) | |||
Proceeds from and (dividends paid to) noncontrolling interests | 16.4 | (15.2 | ) | ||||
Debt financing fees | (35.2 | ) | (34.8 | ) | |||
Net cash provided by financing activities | 630.0 | 960.6 | |||||
Effect of exchange rate changes on cash and cash equivalents | (0.3 | ) | 7.8 | ||||
Net increase in cash and cash equivalents | 24.0 | 78.8 | |||||
Cash and cash equivalents at beginning of period | 585.8 | 707.3 | |||||
Cash and cash equivalents at end of period | $ | 609.8 | $ | 786.1 | |||
Supplemental schedule of non-cash financing activities: | |||||||
Debt transferred to and assumed by buyer upon sale of solar energy systems | $ | 346.2 | $ | 66.1 | |||
Capital lease obligation for property, plant and equipment | $ | — | $ | 78.9 |
(1) | Basis of Presentation |
(2) | Restructuring and Impairment (Reversals) Charges |
As of September 30, 2012 | |||||||||||||||||||||||||||
In millions | Accrued, December 31, 2011 | Year-to-Date Restructuring Charges | Cash Payments | Currency | Accrued, September 30, 2012 | Cumulative Costs Incurred | Total Costs Expected to be Incurred | ||||||||||||||||||||
2011 Global Plan | |||||||||||||||||||||||||||
Severance and other employee benefits | $ | 60.2 | $ | 3.5 | $ | (26.9 | ) | $ | (1.0 | ) | $ | 35.8 | $ | 66.7 | $ | 72.6 | |||||||||||
Contract termination (see Note 15) | 260.0 | (88.0 | ) | (14.7 | ) | 0.8 | 158.1 | 170.0 | 170.0 | ||||||||||||||||||
Other | 51.1 | 0.8 | (6.9 | ) | 0.1 | 45.1 | 52.6 | 72.0 | |||||||||||||||||||
Total | $ | 371.3 | $ | (83.7 | ) | $ | (48.5 | ) | $ | (0.1 | ) | $ | 239.0 | $ | 289.3 | $ | 314.6 |
As of September 30, 2012 | |||||||||||||||||||||||
In millions | Accrued, December 31, 2011 | Year-to-Date Restructuring Charges | Cash Payments | Accrued, September 30, 2012 | Cumulative Costs Incurred | Total Costs Expected to be Incurred | |||||||||||||||||
2009 U.S. Plan | |||||||||||||||||||||||
Severance and other employee benefits | $ | 12.6 | $ | — | $ | (4.7 | ) | $ | 7.9 | $ | 18.0 | $ | 18.8 | ||||||||||
Asset move costs | — | — | — | — | 4.9 | 7.4 | |||||||||||||||||
Contract termination | 2.9 | — | (2.9 | ) | — | 2.9 | 2.9 | ||||||||||||||||
Infrastructure costs and other | — | 4.0 | (4.0 | ) | — | 4.0 | — | ||||||||||||||||
Total | $ | 15.5 | $ | 4.0 | $ | (11.6 | ) | $ | 7.9 | $ | 29.8 | $ | 29.1 |
(3) | Inventories |
As of | As of | ||||||
In millions | September 30, 2012 | December 31, 2011 | |||||
Raw materials and supplies | $ | 70.1 | $ | 121.6 | |||
Goods and work in process | 128.6 | 97.7 | |||||
Finished goods | 47.4 | 102.5 | |||||
$ | 246.1 | $ | 321.8 |
(4) | Solar Energy Systems Held for Development and Sale |
As of | As of | ||||||
In millions | September 30, 2012 | December 31, 2011 | |||||
Under development | $ | 202.6 | $ | 193.5 | |||
Systems held for sale | 43.4 | 179.5 | |||||
$ | 246.0 | $ | 373.0 |
(5) | Investments |
As of | As of | ||||||
In millions | September 30, 2012 | December 31, 2011 | |||||
Items measured at fair value on a recurring basis | $ | 14.7 | $ | 16.2 | |||
Equity method investments | 24.9 | 25.8 | |||||
Time deposits | 0.3 | 0.3 | |||||
Equity investments at cost | 8.8 | 12.5 | |||||
Total investments | 48.7 | 54.8 | |||||
Less: short-term investments | 0.3 | 0.3 | |||||
Long-term investments | $ | 48.4 | $ | 54.5 |
(6) | Intangible Assets |
In millions | December 31, 2011 | Additions | Amortization or allocation to solar energy systems | Impairments | As of September 30, 2012 | |||||||||||||||
Total amortizable intangible assets, net of accumulated amortization of $15.1 and $19.2, respectively | $ | 25.6 | $ | — | $ | (6.3 | ) | $ | (0.6 | ) | $ | 18.7 | ||||||||
Total indefinite lived intangible assets | 123.6 | — | (3.4 | ) | (0.6 | ) | 119.6 | |||||||||||||
Total intangible assets, net | $ | 149.2 | $ | — | $ | (9.7 | ) | $ | (1.2 | ) | $ | 138.3 |
(7) | Debt and Capital Lease Obligations |
As of September 30, 2012 | As of December 31, 2011 | |||||||||||||||||||
Total Principal | Current and Short-Term | Long-Term | Total Principal | Current and Short-Term | Long-Term | |||||||||||||||
In millions | ||||||||||||||||||||
Non-solar energy system debt: | ||||||||||||||||||||
Senior notes | $ | 550.0 | $ | — | $ | 550.0 | $ | 550.0 | $ | — | $ | 550.0 | ||||||||
Second lien term loan | 196.0 | — | 196.0 | — | — | — | ||||||||||||||
Long-term notes | 19.5 | 3.7 | 15.8 | 21.4 | 3.7 | 17.7 | ||||||||||||||
Total non-solar energy system debt | $ | 765.5 | $ | 3.7 | $ | 761.8 | $ | 571.4 | $ | 3.7 | $ | 567.7 | ||||||||
Solar energy system debt, financings and capital leaseback obligations: | ||||||||||||||||||||
Short-term debt, weighted average interest rate of 6.4% and 6.2%, respectively | $ | 54.3 | $ | 54.3 | $ | — | $ | 77.2 | $ | 77.2 | $ | — | ||||||||
System construction and term debt | 286.3 | 57.0 | 229.3 | 305.8 | 27.9 | 277.9 | ||||||||||||||
Capital leaseback obligations | 100.2 | 11.9 | 88.3 | 107.8 | 13.3 | 94.5 | ||||||||||||||
Financing leaseback obligations | 999.6 | 20.1 | 979.5 | 837.0 | 8.4 | 828.6 | ||||||||||||||
Other system financing transactions | 107.5 | — | 107.5 | 27.6 | 17.4 | 10.2 | ||||||||||||||
Total solar energy system debt, financings and capital leaseback obligations | $ | 1,547.9 | $ | 143.3 | $ | 1,404.6 | $ | 1,355.4 | $ | 144.2 | $ | 1,211.2 | ||||||||
Total debt outstanding | $ | 2,313.4 | $ | 147.0 | $ | 2,166.4 | $ | 1,926.8 | $ | 147.9 | $ | 1,778.9 |
Year | Price | ||
2014 | 105.813 | % | |
2015 | 103.875 | % | |
2016 | 101.938 | % | |
2017 and thereafter | 100.000 | % |
(8) | Derivatives and Hedging Instruments |
Assets (Liabilities or Equity) Fair Value | |||||||||
In millions | Balance Sheet Location | As of September 30, 2012 | As of December 31, 2011 | ||||||
Derivatives designated as hedging: | |||||||||
Interest rate swaps | Accrued liabilities | $ | (5.4 | ) | $ | (4.5 | ) | ||
Interest rate swaps | Accumulated other comprehensive loss | $ | (4.7 | ) | $ | (3.9 | ) | ||
Derivatives not designated as hedging: | |||||||||
Suntech warrant | Other assets | $ | 0.1 | $ | 0.5 | ||||
Interest rate swaps | Accrued liabilities | $ | — | $ | (1.1 | ) | |||
Currency forward contracts | Prepaid and other current assets | $ | 10.4 | $ | 3.0 | ||||
Currency forward contracts | Accrued liabilities | $ | (1.0 | ) | $ | (1.8 | ) |
(Gains) Losses | |||||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||
In millions | Statement of Operations and Comprehensive (Loss) Income Location | 2012 | 2011 | 2012 | 2011 | ||||||||||||
Derivatives not designated as hedging: | |||||||||||||||||
Suntech warrant | Other, net | $ | 0.2 | $ | 4.3 | $ | 0.4 | $ | 4.6 | ||||||||
Currency forward contracts | Other, net | $ | (7.6 | ) | $ | 6.8 | $ | (6.4 | ) | $ | (3.4 | ) |
(9) | Fair Value Measurements |
As of September 30, 2012 | As of December 31, 2011 | ||||||||||||||||||||||||||||||
Assets (liabilities), in millions | Level 1 | Level 2 | Level 3 | Total | Level 1 | Level 2 | Level 3 | Total | |||||||||||||||||||||||
Available-for-sale investments | $ | — | $ | 14.7 | $ | — | $ | 14.7 | $ | — | $ | 16.2 | $ | — | $ | 16.2 | |||||||||||||||
Suntech warrant | — | — | 0.1 | 0.1 | — | — | 0.5 | 0.5 | |||||||||||||||||||||||
Interest rate swaps | — | (5.4 | ) | — | (5.4 | ) | — | (5.6 | ) | — | (5.6 | ) | |||||||||||||||||||
Currency forward contracts | 9.4 | — | — | 9.4 | 1.2 | — | — | 1.2 | |||||||||||||||||||||||
Contingent consideration related to acquisitions | — | — | (35.0 | ) | (35.0 | ) | — | — | (90.8 | ) | (90.8 | ) | |||||||||||||||||||
Total | $ | 9.4 | $ | 9.3 | $ | (34.9 | ) | $ | (16.2 | ) | $ | 1.2 | $ | 10.6 | $ | (90.3 | ) | $ | (78.5 | ) |
In millions | Suntech Warrant | Contingent Consideration Related to Acquisitions | Other Derivatives | Total | |||||||||||
Balance at December 31, 2010 | $ | 5.2 | $ | (26.2 | ) | $ | 1.6 | $ | (19.4 | ) | |||||
Total unrealized gains (losses) included in earnings (1) | (4.6 | ) | 12.0 | — | 7.4 | ||||||||||
Acquisitions, sales, redemptions and payments | — | (104.6 | ) | (104.6 | ) | ||||||||||
Balance at September 30, 2011 | $ | 0.6 | $ | (118.8 | ) | $ | 1.6 | $ | (116.6 | ) | |||||
Balance at December 31, 2011 | $ | 0.5 | $ | (90.8 | ) | $ | — | $ | (90.3 | ) | |||||
Total unrealized losses included in earnings (1) | (0.4 | ) | (11.5 | ) | — | (11.9 | ) | ||||||||
Payments | — | 67.3 | — | 67.3 | |||||||||||
Balance at September 30, 2012 | $ | 0.1 | $ | (35.0 | ) | $ | — | $ | (34.9 | ) | |||||
The amount of total losses for the nine months ended September 30, 2012 included in earnings attributable to the change in unrealized losses relating to assets and liabilities still held at the reporting date | $ | (0.4 | ) | $ | (11.5 | ) | $ | — | $ | (11.9 | ) |
(1) | Amounts included in earnings are recorded to non-operating expense (income) in the condensed consolidated statement of operations and comprehensive (loss) income, except for the amount included in marketing and administration for the contingent consideration related to acquisitions, for which changes to the fair value were recorded to operating income (loss) in the condensed consolidated statement of operations and comprehensive (loss) income. |
Three Months Ended September 30, 2012 | Three Months Ended September 30, 2011 | ||||||||||||||
In millions, except per share amounts | Basic | Diluted | Basic | Diluted | |||||||||||
EPS Numerator: | |||||||||||||||
Net income (loss) attributable to common stockholders | $ | 37.0 | $ | 37.0 | $ | (94.4 | ) | $ | (94.4 | ) | |||||
Adjustment of redeemable noncontrolling interest (see Note 11) | (0.9 | ) | (0.9 | ) | — | — | |||||||||
Adjusted net income to common stockholders | $ | 36.1 | $ | 36.1 | $ | (94.4 | ) | $ | (94.4 | ) | |||||
EPS Denominator: | |||||||||||||||
Weighted-average shares outstanding | 230.9 | 230.9 | 230.3 | 230.3 | |||||||||||
Stock options and restricted stock units | — | 1.1 | — | — | |||||||||||
Total shares | 230.9 | 232.0 | 230.3 | 230.3 | |||||||||||
Income (loss) per share | $ | 0.16 | $ | 0.16 | $ | (0.41 | ) | $ | (0.41 | ) |
Nine Months Ended September 30, 2012 | Nine Months Ended September 30, 2011 | ||||||||||||||
In millions, except per share amounts | Basic | Diluted | Basic | Diluted | |||||||||||
EPS Numerator: | |||||||||||||||
Net loss attributable to common stockholders | $ | (138.8 | ) | $ | (138.8 | ) | $ | (51.6 | ) | $ | (51.6 | ) | |||
Adjustment of redeemable noncontrolling interest (see Note 11) | (0.9 | ) | (0.9 | ) | — | — | |||||||||
Adjusted net loss to common stockholders | $ | (139.7 | ) | $ | (139.7 | ) | $ | (51.6 | ) | $ | (51.6 | ) | |||
EPS Denominator: | |||||||||||||||
Weighted-average shares outstanding | 230.8 | 230.8 | 229.7 | 229.7 | |||||||||||
Stock options and restricted stock units | — | — | — | — | |||||||||||
Total shares | 230.8 | 230.8 | 229.7 | 229.7 | |||||||||||
Loss per share | $ | (0.61 | ) | $ | (0.61 | ) | $ | (0.22 | ) | $ | (0.22 | ) |
(11) | Stockholders’ Equity and Redeemable Noncontrolling Interest |
In millions | MEMC Stockholders’ Equity | Noncontrolling Interest | Total Stockholders Equity | Redeemable noncontrolling interest | ||||||||||
Balance, December 31, 2011 | $ | 737.9 | $ | 47.0 | $ | 784.9 | $ | — | ||||||
Net (loss) income | (138.8 | ) | 1.8 | (137.0 | ) | 0.1 | ||||||||
Adjustment of redeemable noncontrolling interest | (0.9 | ) | — | (0.9 | ) | 0.9 | ||||||||
Other comprehensive (loss) income, net of tax | (9.6 | ) | 1.1 | (8.5 | ) | — | ||||||||
Stock plans, net | (1.4 | ) | — | (1.4 | ) | — | ||||||||
SunEdison - distributions to partner | — | (1.2 | ) | (1.2 | ) | — | ||||||||
SunEdison - contributions from partner | — | 6.2 | 6.2 | 10.4 | ||||||||||
Balance, September 30, 2012 | $ | 587.2 | $ | 54.9 | $ | 642.1 | $ | 11.4 |
Shares | Weighted- Average Exercise Price | Aggregate Intrinsic Value (in millions) | Weighted- Average Remaining Contractual Life | ||||||||||
Outstanding at December 31, 2011 | 17,066,401 | $ | 19.21 | ||||||||||
Granted | 15,968,143 | 2.82 | |||||||||||
Exercised | — | — | |||||||||||
Forfeited | (5,626,369 | ) | 12.21 | ||||||||||
Expired | (5,364,924 | ) | 30.79 | ||||||||||
Outstanding at September 30, 2012 | 22,043,251 | $ | 6.31 | $ | 4.58 | 9 | |||||||
Options exercisable at September 30, 2012 | 3,148,184 | $ | 17.95 | $ | 4.52 | 6 |
Restricted Stock Units | Aggregate Intrinsic Value (in millions) | Weighted- Average Remaining Contractual Life | |||||||
Outstanding at December 31, 2011 | 4,692,159 | ||||||||
Granted | 1,403,133 | ||||||||
Converted | (243,441 | ) | |||||||
Forfeited | (949,884 | ) | |||||||
Outstanding at September 30, 2012 | 4,901,967 | $ | 12.8 | 6 |
(12) | Income Taxes |
(13) | Variable Interest Entities ("VIEs") |
In millions | As of September 30, 2012 | As of December 31, 2011 | |||||
Current assets | $ | 7.3 | $ | 3.6 | |||
Noncurrent assets | 56.4 | 62.7 | |||||
Total assets | $ | 63.7 | $ | 66.3 | |||
Current liabilities | $ | (9.1 | ) | $ | (10.9 | ) | |
Noncurrent liabilities | (71.6 | ) | (57.4 | ) | |||
Total liabilities | $ | (80.7 | ) | $ | (68.3 | ) |
(14) | Deferred Revenue |
In millions | As of September 30, 2012 | As of December 31, 2011 | |||||
Deferred revenue for solar energy systems: | |||||||
Short-term profit deferrals and deposits on solar energy system sales | $ | 142.0 | $ | 41.4 | |||
Long-term profit deferrals and deposits on solar energy system sales | 125.4 | 138.0 | |||||
Deferred subsidy revenue | 21.8 | 19.4 | |||||
Total solar energy system deferred revenue | $ | 289.2 | $ | 198.8 | |||
Non-solar energy system deferred revenue: | |||||||
Short-term deferred revenue | $ | — | $ | 0.7 | |||
Long-term deferred revenue | 30.7 | 51.2 | |||||
Total non-solar energy system deferred revenue | 30.7 | 51.9 | |||||
Total deferred revenue | $ | 319.9 | $ | 250.7 |
(15) | Commitments and Contingencies |
(16) | Reportable Segments |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
In millions | 2012 | 2011 | 2012 | 2011 | |||||||||||
Net sales: | |||||||||||||||
Semiconductor Materials | $ | 240.3 | $ | 268.4 | $ | 689.0 | $ | 795.2 | |||||||
Solar Energy | 361.3 | 247.8 | 1,240.2 | 1,202.5 | |||||||||||
Consolidated net sales | $ | 601.6 | $ | 516.2 | $ | 1,929.2 | $ | 1,997.7 | |||||||
Operating income (loss): | |||||||||||||||
Semiconductor Materials | $ | 8.7 | $ | 18.5 | $ | (8.1 | ) | $ | 30.3 | ||||||
Solar Energy | 75.8 | (94.9 | ) | 70.4 | 18.7 | ||||||||||
Corporate and Other | (25.6 | ) | (27.4 | ) | (72.9 | ) | (101.3 | ) | |||||||
Consolidated operating income (loss) | $ | 58.9 | $ | (103.8 | ) | $ | (10.6 | ) | $ | (52.3 | ) | ||||
Interest expense (income): | |||||||||||||||
Semiconductor Materials | $ | (0.3 | ) | $ | (0.5 | ) | $ | (0.8 | ) | $ | (1.2 | ) | |||
Solar Energy | 14.7 | 8.3 | 60.7 | 21.6 | |||||||||||
Corporate and Other | 13.6 | 12.9 | 40.4 | 30.5 | |||||||||||
Consolidated interest expense | $ | 28.0 | $ | 20.7 | $ | 100.3 | $ | 50.9 | |||||||
Depreciation and amortization: | |||||||||||||||
Semiconductor Materials | $ | 30.6 | $ | 31.2 | $ | 92.6 | $ | 92.8 | |||||||
Solar Energy | 26.5 | 25.9 | 70.5 | 68.9 | |||||||||||
Corporate and Other | 2.0 | — | 5.3 | — | |||||||||||
Consolidated depreciation and amortization | $ | 59.1 | $ | 57.1 | $ | 168.4 | $ | 161.7 | |||||||
Capital expenditures: | |||||||||||||||
Semiconductor Materials | $ | 14.6 | $ | 36.0 | $ | 55.6 | $ | 120.7 | |||||||
Solar Energy (1) | 44.9 | 288.1 | 231.3 | 735.9 | |||||||||||
Corporate and Other | — | 1.7 | 6.6 | 4.0 | |||||||||||
Consolidated capital expenditures | $ | 59.5 | $ | 325.8 | $ | 293.5 | $ | 860.6 |
(1) | Includes construction of solar energy systems of $35.5 million and $243.5 million in the three month periods ended September 30, 2012 and September 30, 2011, respectively, and construction of solar energy systems of $193.2 million and $470.2 million in the nine month periods ended September 30, 2012 and September 30, 2011, respectively. |
(17) | Unaudited Condensed Consolidating Financial Information |
MEMC, Inc. | Guarantor Subsidiaries | Non-Guarantor Subsidiaries | Consolidating Adjustments | Total | |||||||||||||||
Net sales | $ | 189.7 | $ | 375.9 | $ | 667.2 | $ | (631.2 | ) | $ | 601.6 | ||||||||
Cost of goods sold | 204.1 | 410.9 | 577.2 | (677.5 | ) | 514.7 | |||||||||||||
Gross margin | (14.4 | ) | (35.0 | ) | 90.0 | 46.3 | 86.9 | ||||||||||||
Operating expenses: | |||||||||||||||||||
Marketing and administration | 26.3 | 14.3 | 28.3 | — | 68.9 | ||||||||||||||
Research and development | 11.9 | 3.7 | 1.8 | — | 17.4 | ||||||||||||||
Restructuring and impairment (reversals) charges | 16.2 | (1.1 | ) | (73.4 | ) | — | (58.3 | ) | |||||||||||
Operating (loss) income | (68.8 | ) | (51.9 | ) | 133.3 | 46.3 | 58.9 | ||||||||||||
Non-operating expense: | |||||||||||||||||||
Interest expense | 12.4 | — | 15.6 | — | 28.0 | ||||||||||||||
Interest income | — | — | (0.9 | ) | — | (0.9 | ) | ||||||||||||
Other, net | (11.0 | ) | 17.7 | (10.8 | ) | 1.7 | (2.4 | ) | |||||||||||
Total non-operating expense | 1.4 | 17.7 | 3.9 | 1.7 | 24.7 | ||||||||||||||
(Loss) income before income taxes, equity in earnings of joint ventures and investment in subsidiary earnings | (70.2 | ) | (69.6 | ) | 129.4 | 44.6 | 34.2 | ||||||||||||
Income tax (benefit) expense | (22.2 | ) | (4.6 | ) | 24.8 | (1.3 | ) | (3.3 | ) | ||||||||||
(Loss) income before equity in loss of joint ventures and investment income (loss) in subsidiary | (48.0 | ) | (65.0 | ) | 104.6 | 45.9 | 37.5 | ||||||||||||
Investment in subsidiary earnings | 85.0 | 80.6 | — | (165.6 | ) | — | |||||||||||||
Equity in earnings of joint ventures, net of tax | — | — | 0.9 | — | 0.9 | ||||||||||||||
Net income | 37.0 | 15.6 | 105.5 | (119.7 | ) | 38.4 | |||||||||||||
Net income attributable to noncontrolling interests | — | (0.4 | ) | (1.0 | ) | — | (1.4 | ) | |||||||||||
Net income attributable to MEMC stockholders | $ | 37.0 | $ | 15.2 | $ | 104.5 | $ | (119.7 | ) | $ | 37.0 | ||||||||
Comprehensive Income | $ | 37.2 | $ | 15.7 | $ | 115.4 | $ | (119.7 | ) | $ | 48.6 | ||||||||
Less: comprehensive income attributable to noncontrolling interests | — | — | 2.5 | — | 2.5 | ||||||||||||||
Comprehensive income attributable to MEMC stockholders | $ | 37.2 | $ | 15.7 | $ | 112.9 | $ | (119.7 | ) | $ | 46.1 |
MEMC, Inc. | Guarantor Subsidiaries | Non-Guarantor Subsidiaries | Consolidating Adjustments | Total | |||||||||||||||
Net sales | $ | 241.0 | $ | 258.5 | $ | 864.8 | $ | (848.1 | ) | $ | 516.2 | ||||||||
Cost of goods sold | 258.2 | 217.6 | 779.1 | (797.3 | ) | 457.6 | |||||||||||||
Gross margin | (17.2 | ) | 40.9 | 85.7 | (50.8 | ) | 58.6 | ||||||||||||
Operating expenses: | |||||||||||||||||||
Marketing and administration | 30.4 | 21.2 | 32.2 | — | 83.8 | ||||||||||||||
Research and development | 15.2 | 3.0 | 4.1 | — | 22.3 | ||||||||||||||
Restructuring and impairment (reversals) charges | 0.6 | 56.4 | (0.7 | ) | — | 56.3 | |||||||||||||
Operating (loss) income | (63.4 | ) | (39.7 | ) | 50.1 | (50.8 | ) | (103.8 | ) | ||||||||||
Non-operating (income) expense: | |||||||||||||||||||
Interest expense | 11.2 | (2.7 | ) | 15.8 | (3.6 | ) | 20.7 | ||||||||||||
Interest income | (0.1 | ) | — | (4.8 | ) | 3.6 | (1.3 | ) | |||||||||||
Decline in fair value of warrant | — | — | — | — | — | ||||||||||||||
Other, net | (14.5 | ) | (11.0 | ) | 20.5 | 18.4 | 13.4 | ||||||||||||
Total non-operating (income) expense | (3.4 | ) | (13.7 | ) | 31.5 | 18.4 | 32.8 | ||||||||||||
(Loss) income before income taxes, equity in earnings of joint ventures and investment in subsidiary loss | (60.0 | ) | (26.0 | ) | 18.6 | (69.2 | ) | (136.6 | ) | ||||||||||
Income tax (benefit) expense | (40.6 | ) | (8.2 | ) | 7.4 | (1.8 | ) | (43.2 | ) | ||||||||||
(Loss) income before equity in earnings of joint ventures and investment in subsidiary loss | (19.4 | ) | (17.8 | ) | 11.2 | (67.4 | ) | (93.4 | ) | ||||||||||
Investment in subsidiary loss | (75.1 | ) | (38.3 | ) | — | 113.4 | — | ||||||||||||
Equity in earnings of joint ventures, net of tax | 0.1 | — | 1.1 | — | 1.2 | ||||||||||||||
Net (loss) income | (94.4 | ) | (56.1 | ) | 12.3 | 46.0 | (92.2 | ) | |||||||||||
Net income attributable to noncontrolling interests | — | (0.1 | ) | (2.1 | ) | — | (2.2 | ) | |||||||||||
Net (loss) income attributable to MEMC stockholders | $ | (94.4 | ) | $ | (56.2 | ) | $ | 10.2 | $ | 46.0 | $ | (94.4 | ) | ||||||
Comprehensive loss | $ | (94.4 | ) | $ | (56.1 | ) | $ | (35.2 | ) | $ | 46.0 | $ | (139.7 | ) | |||||
Less: comprehensive loss attributable to noncontrolling interests | — | — | (1.0 | ) | — | (1.0 | ) | ||||||||||||
Comprehensive loss attributable to MEMC stockholders | $ | (94.4 | ) | $ | (56.1 | ) | $ | (34.2 | ) | $ | 46.0 | $ | (138.7 | ) |
MEMC, Inc. | Guarantor Subsidiaries | Non-Guarantor Subsidiaries | Consolidating Adjustments | Total | |||||||||||||||
Net sales | $ | 545.1 | $ | 705.5 | $ | 2,288.7 | $ | (1,610.1 | ) | $ | 1,929.2 | ||||||||
Cost of goods sold | 586.2 | 741.3 | 2,020.0 | (1,645.7 | ) | 1,701.8 | |||||||||||||
Gross margin | (41.1 | ) | (35.8 | ) | 268.7 | 35.6 | 227.4 | ||||||||||||
Operating expenses (income): | |||||||||||||||||||
Marketing and administration | 87.6 | 66.8 | 84.8 | — | 239.2 | ||||||||||||||
Research and development | 37.5 | 11.3 | 7.0 | — | 55.8 | ||||||||||||||
Restructuring and impairment (reversals) charges | 15.4 | 2.9 | (71.3 | ) | — | (53.0 | ) | ||||||||||||
Insurance recovery | — | — | (4.0 | ) | — | (4.0 | ) | ||||||||||||
Operating (loss) income | (181.6 | ) | (116.8 | ) | 252.2 | 35.6 | (10.6 | ) | |||||||||||
Non-operating (income) expense: | |||||||||||||||||||
Interest expense | 35.8 | 6.1 | 58.4 | — | 100.3 | ||||||||||||||
Interest income | (0.1 | ) | — | (2.7 | ) | — | (2.8 | ) | |||||||||||
Other, net | (39.4 | ) | 17.1 | 14.6 | 7.8 | 0.1 | |||||||||||||
Total non-operating (income) expense | (3.7 | ) | 23.2 | 70.3 | 7.8 | 97.6 | |||||||||||||
(Loss) income before income taxes, equity in loss of joint ventures and investment in subsidiary (loss) earnings | (177.9 | ) | (140.0 | ) | 181.9 | 27.8 | (108.2 | ) | |||||||||||
Income tax (benefit) expense | (68.9 | ) | 60.9 | 35.9 | — | 27.9 | |||||||||||||
(Loss) income before equity in loss of joint ventures and investment in subsidiary (loss) earnings | (109.0 | ) | (200.9 | ) | 146.0 | 27.8 | (136.1 | ) | |||||||||||
Investment in subsidiary (loss) earnings | (29.8 | ) | 6.9 | — | 22.9 | — | |||||||||||||
Equity in loss of joint ventures, net of tax | — | — | (0.9 | ) | — | (0.9 | ) | ||||||||||||
Net (loss) income | (138.8 | ) | (194.0 | ) | 145.1 | 50.7 | (137.0 | ) | |||||||||||
Net loss attributable to noncontrolling interests | — | (0.8 | ) | (1.0 | ) | — | (1.8 | ) | |||||||||||
Net (loss) income attributable to MEMC stockholders | $ | (138.8 | ) | $ | (194.8 | ) | $ | 144.1 | $ | 50.7 | $ | (138.8 | ) | ||||||
Comprehensive (loss) income | $ | (137.2 | ) | $ | (194.0 | ) | $ | 135.0 | $ | 50.7 | $ | (145.5 | ) | ||||||
Less: comprehensive income attributable to noncontrolling interests | — | — | 2.8 | — | 2.8 | ||||||||||||||
Comprehensive (loss) income attributable to MEMC stockholders | $ | (137.2 | ) | $ | (194.0 | ) | $ | 132.2 | $ | 50.7 | $ | (148.3 | ) |
MEMC, Inc. | Guarantor Subsidiaries | Non-Guarantor Subsidiaries | Consolidating Adjustments | Total | |||||||||||||||
Net sales | $ | 681.4 | $ | 510.7 | $ | 2,812.4 | $ | (2,006.8 | ) | $ | 1,997.7 | ||||||||
Cost of goods sold | 710.5 | 462.2 | 2,406.1 | (1,934.8 | ) | 1,644.0 | |||||||||||||
Gross margin | (29.1 | ) | 48.5 | 406.3 | (72.0 | ) | 353.7 | ||||||||||||
Operating expenses: | |||||||||||||||||||
Marketing and administration | 112.2 | 64.2 | 94.4 | — | 270.8 | ||||||||||||||
Research and development | 46.0 | 7.2 | 11.9 | — | 65.1 | ||||||||||||||
Restructuring and impairment (reversals) charges | 7.3 | 56.8 | 6.0 | — | 70.1 | ||||||||||||||
Operating (loss) income | (194.6 | ) | (79.7 | ) | 294.0 | (72.0 | ) | (52.3 | ) | ||||||||||
Non-operating (income) expense: | |||||||||||||||||||
Interest expense | 25.5 | (2.1 | ) | 31.8 | (4.3 | ) | 50.9 | ||||||||||||
Interest income | (0.3 | ) | (0.4 | ) | (6.7 | ) | 4.3 | (3.1 | ) | ||||||||||
Decline in fair value of warrant | — | — | — | — | — | ||||||||||||||
Other, net | (37.2 | ) | (12.3 | ) | 20.6 | 25.0 | (3.9 | ) | |||||||||||
Total non-operating (income) expense | (12.0 | ) | (14.8 | ) | 45.7 | 25.0 | 43.9 | ||||||||||||
(Loss) income before income taxes, equity in earnings of joint ventures and investment in subsidiary earnings | (182.6 | ) | (64.9 | ) | 248.3 | (97.0 | ) | (96.2 | ) | ||||||||||
Income tax (benefit) expense | (85.3 | ) | (7.3 | ) | 38.7 | (2.7 | ) | (56.6 | ) | ||||||||||
(Loss) income before equity in earnings of joint ventures and investment in subsidiary earnings | (97.3 | ) | (57.6 | ) | 209.6 | (94.3 | ) | (39.6 | ) | ||||||||||
Investment in subsidiary earnings | 45.7 | 74.1 | — | (119.8 | ) | — | |||||||||||||
Equity in earnings of joint ventures, net of tax | — | — | 4.5 | — | 4.5 | ||||||||||||||
Net (loss) income | (51.6 | ) | 16.5 | 214.1 | (214.1 | ) | (35.1 | ) | |||||||||||
Net income attributable to noncontrolling interests | — | — | (16.5 | ) | — | (16.5 | ) | ||||||||||||
Net (loss) income attributable to MEMC stockholders | $ | (51.6 | ) | $ | 16.5 | $ | 197.6 | $ | (214.1 | ) | $ | (51.6 | ) | ||||||
Comprehensive (loss) income | $ | (51.8 | ) | $ | 16.5 | $ | 211.8 | $ | (214.1 | ) | $ | (37.6 | ) | ||||||
Less: comprehensive income attributable to noncontrolling interests | — | — | 17.6 | — | 17.6 | ||||||||||||||
Comprehensive (loss) income attributable to MEMC stockholders | $ | (51.8 | ) | $ | 16.5 | $ | 194.2 | $ | (214.1 | ) | $ | (55.2 | ) |
MEMC, Inc. | Guarantor Subsidiaries | Non-Guarantor Subsidiaries | Consolidating Adjustments | Total | |||||||||||||||
ASSETS | |||||||||||||||||||
Current assets: | |||||||||||||||||||
Cash and cash equivalents | $ | 224.5 | $ | 75.7 | $ | 309.6 | $ | — | $ | 609.8 | |||||||||
Restricted cash | — | 0.6 | 83.6 | — | 84.2 | ||||||||||||||
Accounts receivable, net | 64.5 | 27.4 | 160.1 | — | 252.0 | ||||||||||||||
Inventories | 19.8 | 35.7 | 223.8 | (33.2 | ) | 246.1 | |||||||||||||
Solar energy systems held for development and sale | — | 2.7 | 98.8 | 144.5 | 246.0 | ||||||||||||||
Prepaid and other current assets | 3.5 | 10.4 | 194.7 | (7.4 | ) | 201.2 | |||||||||||||
Total current assets | 312.3 | 152.5 | 1,070.6 | 103.9 | 1,639.3 | ||||||||||||||
Investments | 3.3 | 20.5 | 24.6 | — | 48.4 | ||||||||||||||
Investments in subsidiaries | 325.3 | 9.5 | — | (334.8 | ) | — | |||||||||||||
Property, plant and equipment, net: | |||||||||||||||||||
Non-solar energy systems, net | 56.7 | 299.6 | 885.4 | (61.1 | ) | 1,180.6 | |||||||||||||
Solar energy systems, net | — | 3.1 | 1,396.6 | (134.8 | ) | 1,264.9 | |||||||||||||
Deferred tax assets, net | 25.0 | (21.4 | ) | 27.3 | — | 30.9 | |||||||||||||
Restricted cash | — | 1.7 | 44.8 | — | 46.5 | ||||||||||||||
Other assets | 30.9 | 47.6 | 265.6 | — | 344.1 | ||||||||||||||
Intangible assets, net | — | 135.5 | 2.8 | — | 138.3 | ||||||||||||||
Total assets | $ | 753.5 | $ | 648.6 | $ | 3,717.7 | $ | (426.8 | ) | $ | 4,693.0 |
MEMC, Inc. | Guarantor Subsidiaries | Non-Guarantor Subsidiaries | Consolidating Adjustments | Total | |||||||||||||||
LIABILITIES AND STOCKHOLDERS’ EQUITY | |||||||||||||||||||
Current liabilities: | |||||||||||||||||||
Current portion of long-term debt | $ | — | $ | — | $ | 3.7 | $ | — | $ | 3.7 | |||||||||
Short-term solar energy system financing, current portion of solar energy system financing and capital lease obligations | — | 0.5 | 142.8 | — | 143.3 | ||||||||||||||
Accounts payable | 14.3 | 74.1 | 375.5 | — | 463.9 | ||||||||||||||
Accrued liabilities | (16.8 | ) | 86.2 | 296.4 | — | 365.8 | |||||||||||||
Contingent consideration related to acquisitions | — | 31.8 | — | — | 31.8 | ||||||||||||||
Deferred revenue for solar energy systems | — | 26.4 | 115.6 | — | 142.0 | ||||||||||||||
Customer and other deposits | 11.2 | 0.4 | 45.9 | — | 57.5 | ||||||||||||||
Intercompany (receivable) payable and short term notes | (641.7 | ) | 738.6 | (96.9 | ) | — | — | ||||||||||||
Total current liabilities | (633.0 | ) | 958.0 | 883.0 | — | 1,208.0 | |||||||||||||
Long-term debt, less current portion | 746.0 | — | 15.8 | — | 761.8 | ||||||||||||||
Long-term solar energy system financing and capital lease obligations, less current portion | — | 9.9 | 1,394.7 | — | 1,404.6 | ||||||||||||||
Pension and post-employment liabilities | 41.8 | — | 30.6 | — | 72.4 | ||||||||||||||
Customer and other deposits | 85.4 | — | 122.8 | — | 208.2 | ||||||||||||||
Deferred revenue for solar energy systems | — | 48.1 | 99.1 | — | 147.2 | ||||||||||||||
Non-solar energy system deferred revenue | — | — | 30.7 | — | 30.7 | ||||||||||||||
Long-term intercompany notes (receivable) payable | (127.3 | ) | (20.6 | ) | 147.9 | — | — | ||||||||||||
Other liabilities | 53.4 | 13.5 | 139.7 | — | 206.6 | ||||||||||||||
Total liabilities | 166.3 | 1,008.9 | 2,864.3 | — | 4,039.5 | ||||||||||||||
Nonredeemable noncontrolling interests | — | — | 11.4 | — | 11.4 | ||||||||||||||
Total MEMC stockholders’ equity | 587.2 | (360.3 | ) | 787.1 | (426.8 | ) | 587.2 | ||||||||||||
Noncontrolling interests | — | — | 54.9 | — | 54.9 | ||||||||||||||
Total stockholders’ equity | 587.2 | (360.3 | ) | 842.0 | (426.8 | ) | 642.1 | ||||||||||||
Total liabilities and stockholders’ equity | $ | 753.5 | $ | 648.6 | $ | 3,717.7 | $ | (426.8 | ) | $ | 4,693.0 |
MEMC, Inc. | Guarantor Subsidiaries | Non-Guarantor Subsidiaries | Consolidating Adjustments | Total | |||||||||||||||
ASSETS | |||||||||||||||||||
Current assets: | |||||||||||||||||||
Cash and cash equivalents | $ | 228.9 | $ | 58.3 | $ | 298.6 | $ | — | $ | 585.8 | |||||||||
Restricted cash | — | — | 125.2 | — | 125.2 | ||||||||||||||
Accounts receivable, net | 65.3 | 42.5 | 95.1 | — | 202.9 | ||||||||||||||
Inventories | 33.8 | 68.5 | 271.0 | (51.5 | ) | 321.8 | |||||||||||||
Solar energy systems held for development and sale | — | 4.1 | 373.0 | (4.1 | ) | 373.0 | |||||||||||||
Prepaid and other current assets | 34.6 | 36.9 | 205.7 | — | 277.2 | ||||||||||||||
Total current assets | 362.6 | 210.3 | 1,368.6 | (55.6 | ) | 1,885.9 | |||||||||||||
Investments | 3.3 | 24.4 | 26.8 | — | 54.5 | ||||||||||||||
Investments in subsidiaries | 269.8 | (51.6 | ) | — | (218.2 | ) | — | ||||||||||||
Property, plant and equipment, net: | |||||||||||||||||||
Non-solar energy systems, net | 72.3 | 315.5 | 916.4 | (50.5 | ) | 1,253.7 | |||||||||||||
Solar energy systems, net | — | 1.6 | 1,098.9 | 38.9 | 1,139.4 | ||||||||||||||
Deferred tax assets, net | 36.3 | (20.4 | ) | 28.9 | — | 44.8 | |||||||||||||
Restricted cash | — | 0.2 | 37.3 | — | 37.5 | ||||||||||||||
Other assets | 24.7 | 45.9 | 246.0 | — | 316.6 | ||||||||||||||
Intangible assets, net | — | 145.2 | 4.0 | — | 149.2 | ||||||||||||||
Total assets | $ | 769.0 | $ | 671.1 | $ | 3,726.9 | $ | (285.4 | ) | $ | 4,881.6 |
MEMC, Inc. | Guarantor Subsidiaries | Non-Guarantor Subsidiaries | Consolidating Adjustments | Total | |||||||||||||||
LIABILITIES AND STOCKHOLDERS’ EQUITY | |||||||||||||||||||
Current liabilities: | |||||||||||||||||||
Current portion of long-term debt | $ | — | $ | — | $ | 3.7 | $ | — | $ | 3.7 | |||||||||
Short-term solar energy system financing, current portion of solar energy system financing and capital lease obligations | — | 0.3 | 143.9 | — | 144.2 | ||||||||||||||
Accounts payable | 20.0 | 82.0 | 592.6 | — | 694.6 | ||||||||||||||
Accrued liabilities | (9.6 | ) | 104.6 | 314.0 | — | 409.0 | |||||||||||||
Contingent consideration related to acquisitions | — | 71.6 | — | — | 71.6 | ||||||||||||||
Deferred revenue for solar energy systems | — | 12.0 | 29.4 | — | 41.4 | ||||||||||||||
Customer and other deposits | 30.1 | 0.4 | 41.9 | — | 72.4 | ||||||||||||||
Intercompany (receivable) payable and short-term notes | (605.7 | ) | 619.9 | (14.2 | ) | — | — | ||||||||||||
Total current liabilities | (565.2 | ) | 890.8 | 1,111.3 | — | 1,436.9 | |||||||||||||
Long-term debt, less current portion | 550.0 | — | 17.7 | — | 567.7 | ||||||||||||||
Long-term solar energy system financing and capital lease obligations, less current portion | — | 2.3 | 1,208.9 | — | 1,211.2 | ||||||||||||||
Pension and post-employment liabilities | 40.5 | — | 28.9 | — | 69.4 | ||||||||||||||
Customer and other deposits | 82.0 | — | 194.8 | — | 276.8 | ||||||||||||||
Deferred revenue for solar energy systems | — | 27.0 | 130.4 | — | 157.4 | ||||||||||||||
Non-solar energy system deferred revenue | — | — | 51.2 | — | 51.2 | ||||||||||||||
Long-term intercompany notes (receivable) payable | (127.1 | ) | (16.4 | ) | 143.5 | — | — | ||||||||||||
Other liabilities | 50.9 | 23.4 | 251.8 | — | 326.1 | ||||||||||||||
Total liabilities | 31.1 | 927.1 | 3,138.5 | — | 4,096.7 | ||||||||||||||
Total MEMC stockholders’ equity | 737.9 | (256.6 | ) | 542.0 | (285.4 | ) | 737.9 | ||||||||||||
Noncontrolling interests | — | 0.6 | 46.4 | — | 47.0 | ||||||||||||||
Total stockholders’ equity | 737.9 | (256.0 | ) | 588.4 | (285.4 | ) | 784.9 | ||||||||||||
Total liabilities and stockholders’ equity | $ | 769.0 | $ | 671.1 | $ | 3,726.9 | $ | (285.4 | ) | $ | 4,881.6 |
MEMC, Inc. | Guarantor Subsidiaries | Non-Guarantor Subsidiaries | Consolidating Adjustments | Total | |||||||||||||||
Cash flows from operating activities: | |||||||||||||||||||
Net cash (used in) provided by operating activities | $ | (100.2 | ) | $ | 28.9 | $ | (152.5 | ) | $ | (59.6 | ) | $ | (283.4 | ) | |||||
Cash flows from investing activities: | |||||||||||||||||||
Capital expenditures | (14.7 | ) | (16.3 | ) | (69.3 | ) | — | (100.3 | ) | ||||||||||
Construction of solar energy systems | — | — | (243.3 | ) | 50.1 | (193.2 | ) | ||||||||||||
Purchases of cost and equity method investments | (3.8 | ) | — | (31.4 | ) | — | (35.2 | ) | |||||||||||
Proceeds from (used in) equity method investments | 7.2 | — | (4.2 | ) | — | 3.0 | |||||||||||||
Change in restricted cash | — | (2.1 | ) | 0.8 | — | (1.3 | ) | ||||||||||||
Receipts to vendors for deposits and loans | — | — | 4.8 | — | 4.8 | ||||||||||||||
Equity infusions or investments in subsidiaries | (44.0 | ) | (6.7 | ) | 50.7 | — | — | ||||||||||||
Other | 1.9 | — | (11.5 | ) | 9.5 | (0.1 | ) | ||||||||||||
Net cash used in investing activities | (53.4 | ) | (25.1 | ) | (303.4 | ) | 59.6 | (322.3 | ) | ||||||||||
Cash flows from financing activities: | |||||||||||||||||||
Cash paid for contingent consideration for acquisitions | — | (3.8 | ) | (54.2 | ) | — | (58.0 | ) | |||||||||||
Proceeds from solar energy system financing and capital lease obligations | — | 8.4 | 711.9 | — | 720.3 | ||||||||||||||
Repayments of solar energy system financing and capital lease obligations | — | (0.5 | ) | (183.5 | ) | — | (184.0 | ) | |||||||||||
Net repayments of customer deposits related to long-term supply agreements | — | — | (23.6 | ) | — | (23.6 | ) | ||||||||||||
Principal payments on long term debt | — | — | (1.8 | ) | — | (1.8 | ) | ||||||||||||
Common stock issued and repurchased | (0.1 | ) | — | — | — | (0.1 | ) | ||||||||||||
Net proceeds from noncontrolling interests | — | — | 16.4 | — | 16.4 | ||||||||||||||
(Repayment) collection of intercompany debt | (33.8 | ) | 9.5 | 24.3 | — | — | |||||||||||||
Second lien term loan | 196.0 | — | — | — | 196.0 | ||||||||||||||
Debt financing fees | (12.7 | ) | — | (22.5 | ) | — | (35.2 | ) | |||||||||||
Net cash provided by financing activities | 149.4 | 13.6 | 467.0 | — | 630.0 | ||||||||||||||
Effect of exchange rate changes on cash and cash equivalents | (0.2 | ) | — | (0.1 | ) | — | (0.3 | ) | |||||||||||
Net (decrease) increase in cash and cash equivalents | (4.4 | ) | 17.4 | 11.0 | — | 24.0 | |||||||||||||
Cash and cash equivalents at beginning of period | 228.9 | 58.3 | 298.6 | — | 585.8 | ||||||||||||||
Cash and cash equivalents at end of period | $ | 224.5 | $ | 75.7 | $ | 309.6 | $ | — | $ | 609.8 |
MEMC, Inc. | Guarantor Subsidiaries | Non-Guarantor Subsidiaries | Consolidating Adjustments | Total | |||||||||||||||
Cash flows from operating activities: | |||||||||||||||||||
Net cash (used in) provided by operating activities | $ | (196.7 | ) | $ | 91.9 | $ | 179.8 | $ | 86.3 | $ | 161.3 | ||||||||
Cash flows from investing activities: | |||||||||||||||||||
Capital expenditures | (21.1 | ) | (40.3 | ) | (329.0 | ) | — | (390.4 | ) | ||||||||||
Construction of solar energy systems | — | — | (372.3 | ) | (97.9 | ) | (470.2 | ) | |||||||||||
Purchases of cost and equity method investments | (1.1 | ) | (5.0 | ) | (44.3 | ) | — | (50.4 | ) | ||||||||||
Proceeds from return of equity method investments | 70.0 | 13.7 | — | — | 83.7 | ||||||||||||||
Change in restricted cash | — | 0.5 | (83.5 | ) | — | (83.0 | ) | ||||||||||||
Payments to vendors for refundable deposits on long-term agreements | — | (14.4 | ) | (0.1 | ) | — | (14.5 | ) | |||||||||||
Proceeds from sale of property plant and equipment | — | — | 37.1 | — | 37.1 | ||||||||||||||
Cash paid for acquisition, net of cash acquired | — | (160.6 | ) | (2.0 | ) | — | (162.6 | ) | |||||||||||
Equity infusions or investments in subsidiaries | (1.1 | ) | 1.1 | — | — | — | |||||||||||||
Other | 1.4 | 0.4 | (14.0 | ) | 11.6 | (0.6 | ) | ||||||||||||
Net cash provided by (used in) investing activities | 48.1 | (204.6 | ) | (808.1 | ) | (86.3 | ) | (1,050.9 | ) | ||||||||||
Cash flows from financing activities: | |||||||||||||||||||
Proceeds from senior notes issuance | 550.0 | — | — | — | 550.0 | ||||||||||||||
Cash paid for contingent consideration for acquisitions | — | (50.2 | ) | — | — | (50.2 | ) | ||||||||||||
Proceeds from solar energy system financing and capital lease obligations | — | — | 694.8 | — | 694.8 | ||||||||||||||
Repayments of solar energy system financing and capital lease obligations | — | (1.8 | ) | (120.3 | ) | — | (122.1 | ) | |||||||||||
Net repayments of customer deposits related to long-term supply agreements | — | (1.4 | ) | (55.9 | ) | — | (57.3 | ) | |||||||||||
Principal payments on long-term debt | — | — | (1.8 | ) | — | (1.8 | ) | ||||||||||||
(Repayment) collection of intercompany debt | (167.9 | ) | 220.2 | (52.3 | ) | — | |||||||||||||
Common stock issued and repurchased | (2.8 | ) | — | — | — | (2.8 | ) | ||||||||||||
Payments to noncontrolling interests | — | — | (15.2 | ) | — | (15.2 | ) | ||||||||||||
Debt financing fees | (18.0 | ) | — | (16.8 | ) | — | (34.8 | ) | |||||||||||
Net cash provided by financing activities | 361.3 | 166.8 | 432.5 | — | 960.6 | ||||||||||||||
Effect of exchange rate changes on cash and cash equivalents | (0.2 | ) | (0.1 | ) | 8.1 | — | 7.8 | ||||||||||||
Net increase (decrease) in cash and cash equivalents | 212.5 | 54.0 | (187.7 | ) | — | 78.8 | |||||||||||||
Cash and cash equivalents at beginning of period | 15.5 | 7.2 | 684.6 | — | 707.3 | ||||||||||||||
Cash and cash equivalents at end of period | $ | 228.0 | $ | 61.2 | $ | 496.9 | $ | — | $ | 786.1 |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
Net Sales | 2012 | 2011 | 2012 | 2011 | |||||||||||
Dollars in millions | |||||||||||||||
Semiconductor Materials | $ | 240.3 | $ | 268.4 | $ | 689.0 | $ | 795.2 | |||||||
Solar Energy | 361.3 | 247.8 | 1,240.2 | 1,202.5 | |||||||||||
Total Net Sales | $ | 601.6 | $ | 516.2 | $ | 1,929.2 | $ | 1,997.7 |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
Gross Profit | 2012 | 2011 | 2012 | 2011 | |||||||||||
Dollars in millions | |||||||||||||||
Cost of Goods Sold | $ | 514.7 | $ | 457.6 | $ | 1,701.8 | $ | 1,644.0 | |||||||
Gross Profit | 86.9 | 58.6 | 227.4 | 353.7 | |||||||||||
Gross Margin Percentage | 14.4 | % | 11.4 | % | 11.8 | % | 17.7 | % |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||
Marketing and Administration | 2012 | 2011 | 2012 | 2011 | |||||||||
Dollars in millions | |||||||||||||
Marketing and Administration | $ | 68.9 | $ | 83.8 | $ | 239.2 | $ | 270.8 | |||||
As a Percentage of Net Sales | 11.5 | % | 16.2 | % | 12.4 | % | 13.6 | % |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||
Research and Development | 2012 | 2011 | 2012 | 2011 | |||||||||
Dollars in millions | |||||||||||||
Research and Development | $ | 17.4 | $ | 22.3 | $ | 55.8 | $ | 65.1 | |||||
As a Percentage of Net Sales | 2.9 | % | 4.3 | % | 2.9 | % | 3.3 | % |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||
Goodwill Impairment Charge | 2012 | 2011 | 2012 | 2011 | |||||||||
Dollars in millions | |||||||||||||
Goodwill Impairment Charge | $ | — | $ | 56.4 | $ | — | $ | 56.4 | |||||
As a Percentage of Net Sales | — | 10.9 | % | — | 2.8 | % |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||
Restructuring and Impairment | 2012 | 2011 | 2012 | 2011 | |||||||||
Dollars in millions | |||||||||||||
Restructuring and Impairment | $ | (58.3 | ) | $ | (0.1 | ) | $ | (53.0 | ) | $ | 13.7 | ||
As a Percentage of Net Sales | (9.7 | )% | — | % | (2.7 | )% | 0.7 | % |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||
Insurance Recovery | 2012 | 2011 | 2012 | 2011 | |||||||||
Dollars in millions | |||||||||||||
Insurance Recovery | $ | — | $ | — | $ | (4.0 | ) | $ | — | ||||
As a Percentage of Net Sales | — | — | (0.2 | )% | — |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||
Operating Income (loss) | 2012 | 2011 | 2012 | 2011 | |||||||||
Dollars in millions | |||||||||||||
Semiconductor Materials | $ | 8.7 | $ | 18.5 | $ | (8.1 | ) | $ | 30.3 | ||||
Solar Energy | 75.8 | (94.9 | ) | 70.4 | 18.7 | ||||||||
Corporate and Other | (25.6 | ) | (27.4 | ) | (72.9 | ) | (101.3 | ) | |||||
Total Operating Income (Loss) | $ | 58.9 | $ | (103.8 | ) | $ | (10.6 | ) | $ | (52.3 | ) |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||
Non-operating Expense (Income) | 2012 | 2011 | 2012 | 2011 | |||||||||
Dollars in millions | |||||||||||||
Interest Expense | $ | 28.0 | $ | 20.7 | $ | 100.3 | $ | 50.9 | |||||
Interest Income | (0.9 | ) | (1.3 | ) | (2.8 | ) | (3.1 | ) | |||||
Other, Net | (2.4 | ) | 13.4 | 0.1 | (3.9 | ) | |||||||
Total Non-operating Expense | $ | 24.7 | $ | 32.8 | $ | 97.6 | $ | 43.9 |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||
Income Taxes | 2012 | 2011 | 2012 | 2011 | |||||||||
Dollars in millions | |||||||||||||
Income Tax Expense (Benefit) | $ | (3.3 | ) | $ | (43.2 | ) | $ | 27.9 | $ | (56.6 | ) | ||
Income Tax Rate as a % of (Loss) Income before Income Taxes | (9.6 | )% | 31.6 | % | (25.8 | )% | 58.8 | % |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||
Net Income Attributable to Noncontrolling Interests | 2012 | 2011 | 2012 | 2011 | |||||||||
Dollars in millions | |||||||||||||
Net Income Attributable to Noncontrolling Interests | $ | (1.4 | ) | $ | (2.2 | ) | $ | (1.8 | ) | $ | (16.5 | ) |
Item 3. | Quantitative and Qualitative Disclosures About Market Risk. |
Item 4. | Controls and Procedures. |
Item 6. | Exhibits. |
Exhibit Number | Description | |
3-(i) | Restated Certificate of Incorporation of MEMC (incorporated by reference to Exhibit 3-a of MEMC’s Form 10-Q for the Quarter ended June 30, 1995) | |
3-(i)(a) | Certificate of Amendment of Restated Certificate of Incorporation of MEMC as filed with the Secretary of State of the State of Delaware on June 2, 2000 (incorporated by reference to Exhibit 3-(i)(a) of MEMC’s Form 10-Q for the Quarter ended June 30, 2000) | |
3-(i)(b) | Certificate of Amendment of Restated Certificate of Incorporation of MEMC as filed with the Secretary of State of the State of Delaware on July 10, 2002 (incorporated by reference to Exhibit 3-(i)(b) of MEMC’s Form 10-Q for the Quarter ended September 30, 2002) | |
3(ii) | Restated By-laws of MEMC (incorporated by reference to Exhibit 3.1 of MEMC’s Form 8-K filed on February 25, 2010) | |
10.96 | Second Lien Credit Agreement, dated September 28, 2012, by and among the Company, Goldman Sachs Bank USA, Deutsche Bank Securities Inc. and the lenders party thereto (Incorporated by reference to Exhibit 10.1 of the Company's Current Report on Form 8-K filed on October 2, 2012) | |
10.97 | Guaranty Agreement by and between each of the guarantor subsidiaries in favor of Goldman Sachs Bank USA as Administrative Agent for the benefit of itself and the secured parties named therein (incorporated by reference to Exhibit 10.2 of the Company's Current Report on Form 8-K filed on October 2, 2012) | |
10.98 | Fourth Amendment to the Credit Agreement dated as of March 23, 2011 (and amended on September 28, 2011, February 28, 2012 and May 8, 2012), dated September 28, 2012, by and among the Company, the guarantors identified therein, the lenders identified therein and Bank of America, N.A., as administrative agent (incorporated by reference to Exhibit 10.3 of the Company's Current Report on Form 8-K filed on October 2, 2012) | |
10.99 | Termination Agreement dated as of September 25, 2012 by and among the Company, MEMC Singapore Pte. Ltd. and Conergy AG. | |
10.100 | Settlement Agreement Pertaining to the On-Site Supply Agreement dated as of September 4, 2012 by and among the Company, MEMC Electronic Materials S.p.A., Evonik Industries AG, Evonik Degussa GMBH and Evonik Degussa Italia S.p.A. | |
10.101 | Settlement Agreement Pertaining to the Off-Site Supply Agreement dated as of September 4, 2012 by and among the Company, MEMC Electronic Materials S.p.A., Evonik Industries AG and Evonik Degussa GMBH. | |
10.102 | Amendment Agreement to the On-Site Settlement Agreement and the Off-Site Settlement Agreement dated as of September 24, 2012, by and among the Company, MEMC Electronic Materials S.p.A., Evonik Industries AG, Evonik Degussa GMBH and Evonik Degussa Italia S.p.A. | |
31.1 | Certification by the Chief Executive Officer of MEMC pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 | |
31.2 | Certification by the Chief Financial Officer of MEMC pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 | |
32 | Certification by the Chief Executive Officer and the Chief Financial Officer of MEMC 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 Extension Label Linkbase Document | |
101.PRE | XBRL Taxonomy Extension Presentation Linkbase Document | |
MEMC Electronic Materials, Inc. | ||||
/s/ Brian Wuebbels | ||||
November 9, 2012 | Name: | Brian Wuebbels | ||
Title: | Executive Vice President and Chief Financial Officer (on behalf of the registrant and as principal financial officer) |
Number Exhibit | Description | |
10.99 | Termination Agreement dated as of September 25, 2012 by and among the Company, MEMC Singapore Pte. Ltd. and Conergy AG. | |
10.100 | Settlement Agreement Pertaining to the On-Site Supply Agreement dated as of September 4, 2012 by and among the Company, MEMC Electronic Materials S.p.A., Evonik Industries AG, Evonik Degussa GMBH and Evonik Degussa Italia S.p.A. | |
10.101 | Settlement Agreement Pertaining to the Off-Site Supply Agreement dated as of September 4, 2012 by and among the Company, MEMC Electronic Materials S.p.A., Evonik Industries AG and Evonik Degussa GMBH. | |
10.102 | Amendment Agreement to the On-Site Settlement Agreement and the Off-Site Settlement Agreement dated as of September 24, 2012, by and among the Company, MEMC Electronic Materials S.p.A., Evonik Industries AG, Evonik Degussa GMBH and Evonik Degussa Italia S.p.A. | |
31.1 | Certification by the Chief Executive Officer of MEMC pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 | |
31.2 | Certification by the Chief Financial Officer of MEMC pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 | |
32 | Certification by the Chief Executive Officer and the Chief Financial Officer of MEMC 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 Extension Label Linkbase Document | |
101.PRE | XBRL Taxonomy Extension Presentation Linkbase Document |
Page | |||
ARTICLE I | TERMNATION TRANSACTIONS | 2 | |
1.1 | Wafer Supply Contract Termination | 2 | |
1.2 | Transfer of Conergy's Operations & Maintenance Business | 3 | |
ARTICLE II | REPRESENTATIONS AND WARRANTIES OF CONERGY | 9 | |
2.1 | Organization, Existence and Standing | 9 | |
2.2 | Capacity; Authorization | 9 | |
ARTICLE III | REPRESENTATIONS AND WARRANTIES OF THE MEMC PARTIES | 10 | |
3.1 | Organization, Existence and Standing | 10 | |
3.2 | Capacity; Authorization | 10 | |
ARTICLE IV | SURVIVAL; INDEMNIFICATION | 11 | |
4.1 | Survival | 11 | |
4.2 | No Other Representations or Warranties | 11 | |
ARTICLE V | MUTUAL RELEASES | 12 | |
5.1 | Mutual General Releases | 12 | |
5.2 | Carveouts to Releases | 13 | |
5.3 | Certain Provisions of General Applicability Regarding Article V | 13 | |
ARTICLE VI | GENERAL PROVISIONS | 14 | |
6.1 | Expenses | 14 | |
6.2 | Notices | 14 | |
6.3 | Governing Law; Consent to Jurisdiction | 15 | |
6.4 | Counterparts | 15 | |
6.5 | Headings; Annexes; Exhibits | 16 | |
6.6 | Entire Agreement | 16 | |
6.7 | Third-Party Beneficiaries | 16 | |
6.8 | Assignment | 16 | |
6.9 | Interpretation; Absence of Presumption | 16 | |
6.10 | Severability | 17 | |
6.11 | Amendments; Waiver | 17 | |
6.12 | Confidentiality of Agreement | 17 |
(a) | In the case of any MEMC Party to: |
By: | /s/ Brian Wuebbels Name: Brian Wuebbels Title: Director |
By: | /s/ Brian Wuebbels Name: Brian Wuebbels Title: EVP & CFO |
By: | /s/ Alexander Gorski Name: Alexander Gorski Title: COO |
By: | /s/ Jan Vannerum Name: Jan Vannerum Title: CFO |
4 SEPTEMBER 2012 EVONIK INDUSTRIES AG EVONIK DEGUSSA GMBH EVONIK DEGUSSA ITALIA S.P.A. MEMC ELECTRONIC MATERIALS INC. MEMC ELECTRONIC MATERIALS S.P.A. | ||
SETTLEMENT AGREEMENT | ||
Pertaining to the On-Site Supply Agreement | ||
1. | Evonik Industries AG, with its registered office at Essen, registered in the commercial register (Handelsregister) at the local court (Amtsgericht) of Essen under HRB 19474 (Evonik Germany) |
2. | Evonik Degussa GmbH, with its registered office at Essen, registered in the commercial register (Handelsregister) at the local court (Amtsgericht) of Essen under HRB 20227 (Degussa Germany) |
3. | Evonik Degussa Italia SpA, with its registered office at Largo Donegani n. 2, 20121 Milano, Italy, registered with the Register of Enterprises of Milan, registration number and tax code 08865250156, (Evonik Italy, Evonik Italy together with Evonik Germany and Degussa Germany together Evonik) |
4. | MEMC Electronic Materials S.p.A. with its registered office at viale Gherzi, n. 31, Novara 28100, Italy with registered office in Novara, at Viale Luigi Gherzi no. 31, registered with the Register of Enterprises of Novara, registration number and tax code 01256330158, (MEMC Italy) |
5. | MEMC Electronic Materials Inc. with its registered office at 501 Pearl Drive, St. Peters, MO 63376-0008, a corporation incorporated under the laws of Delaware, United States of America (MEMC US, MEMC US together with MEMC Italy MEMC, MEMC together with Evonik collectively the Parties and each of Evonik Germany, Degussa Germany, Evonik Italy, MEMC Italy and MEMC US a Party) |
(A) | WHEREAS, MEMC Italy operates a facility in Merano, Italy, producing polycristalline silicon (Merano Facility). |
(B) | WHEREAS, on 9 July 2008, Degussa Germany, a wholly owned subsidiary of Evonik Germany, Evonik Italy, a wholly owned (indirect) subsidiary of Degussa Germany, MEMC Italy, and MEMC US entered into an agreement pursuant to which Degussa Germany shall supply trichlorosilane technical grade (TCS) and silicontetrachloride technical grade (STC, STC together with TCS, the Products) to MEMC Italy, and MEMC shall pay a purchase price for such delivery (as amended from time to time, the On-site Supply Agreement). The On-site Supply Agreement provides also for the erection of a new fence to fence chlorosilanes plant by Evonik Italy (New CS Plant) adjacent to the Merano Facility. |
(C) | WHEREAS, Evonik Italy and MEMC Italy entered into several ancillary agreements with respect to the New CS Plant and the On-site Supply Agreement (such agreements the Ancillary Agreements) including (i) the surface right agreement according to which MEMC Italy, as owner of the industrial site on which the New CS Plant is located, granted to Evonik Italy a surface right (Surface Right Agreement) dated 4 November 2008 as amended by the deed entered into on 20 May 2010 before the notary public Mr. Angelo Finelli (file no. (repertorio) 97,956 and registration no. (raccolta) 18,844), (ii) the environmental agreement in order to regulate the environmental matters relating to the real property on which the New CS Plant is located (Environmental Agreement) dated 4 November 2008 and (iii) a services and utilities agreement pursuant to which MEMC Italy renders operation services to Evonik Italy dated 19 December 2008 (Utilities Agreement). For the avoidance of doubt: The Ancillary Agreements do not include the TCS EG Supply Agreement (as defined in § 6 below). |
(D) | WHEREAS, under a business management agreement (Betriebsführungsvertrag) between Evonik Germany and Degussa Germany dated 23 May 2011 Degussa Germany has assigned all rights and obligations under the On-Site Supply Agreement to Evonik Germany with legal effect as of August 1, 2011. |
(E) | WHEREAS, the On-site Supply Agreement runs for a fixed term until 30 October 2021. |
(F) | WHEREAS, under the On-Site Supply Agreement MEMC is required to purchase a certain quantity of Products from Evonik Germany. The On-Site Supply Agreement provides that, if MEMC fails to purchase such quantity of Products from Evonik Germany, MEMC shall pay to Evonik Germany shortfall payments as liquidated damages (so-called “take or pay obligation”). |
(G) | WHEREAS, the New CS Plant commenced operations on 18 February 2011. In accordance with Section 9.1 of the On-site Supply Agreement, MEMC paid an amount of EUR 10,000,000 to Evonik Germany as a down payment. After a number of reductions were made from such down payment, the remaining down payment as of today amounts to EUR 7,884,424.92 (Remaining Down Payment). |
(H) | WHEREAS, MEMC Italy has not taken any Product from Evonik Germany under the On-Site Supply Agreement since November 2011 and MEMC US has notified Evonik Germany of its unilateral termination of the On-Site Supply Agreement with letter dated 16 December 2011. |
(I) | WHEREAS, Evonik Germany has rejected the unilateral termination by MEMC with letter dated 29 December 2011. |
(J) | WHEREAS, Evonik is of the opinion that MEMC owed to Evonik an amount of approximately EUR 114,000,000 under the On-site Supply Agreement resulting from its take or pay obligation set out in the On-site Supply Agreement |
(K) | WHEREAS, MEMC is of the opinion that MEMC did not owe payments to Evonik under the take or pay provision in case of permanent termination of the On-Site Supply Agreement. |
(L) | WHEREAS, MEMC Italy has a business interest to acquire the New CS Plant from Evonik Italy prior to the end of the term of the On-site Supply Agreement, and in any event, no later than 31 December 2012, and to restart production in the New CS Plant on 30 June 2013 at the latest, provided that MEMC shall not be obliged to restart production in the New CS Plant. According to an independent appraisal by DT Revisione S.r.l. dated 12 July 2012 the fair market value of the New CS Plant at 31 May 2012 amounts to EUR 41,209,633. |
(M) | WHEREAS, the Parties now wish to enter into this settlement agreement (Agreement) in order to find an amicable economic solution with respect to the termination of the On-Site Supply Agreement and their future supply relationship and avoid legal proceedings between the Parties. |
(N) | WHEREAS, to this extent MEMC agrees to settle the dispute under the On-Site Supply Agreement, subject to the terms of this Agreement, for an aggregate settlement amount of EUR 52,884,424.92. In return, Evonik agrees, subject to the terms of this Agreement, (i) to terminate the On-site Supply Agreement, (ii) to waive all claims under the On-Site Supply Agreement and (iii) to transfer the business relating to the New CS Plant to MEMC Italy. |
(O) | WHEREAS, today the Parties also enter into a settlement agreement (Off-site Settlement Agreement) with regard to the supply agreement for the supply of trichlorosilane technical grade dated 11 November 2010 (Off-Site Supply Agreement). |
(a) | Sale and transfer of the New CS Plant from Evonik Italy to MEMC Italy (§ 2) |
(b) | Termination of the On-Site Supply Agreement/Settlement of Damages (§ 4) |
(c) | Implementation of a New STC Supply Agreement (§ 5) |
(d) | Implementation of the amendment to the TCS EG Supply Agreement (§ 6) |
(e) | Implementation of a License and Technical Assistance Agreement (§ 7) |
2.1 | The Parties agree that Evonik Italy (as seller) and MEMC Italy (as purchaser) shall enter into the sale and purchase agreement substantially in the form as attached as Exhibit 2.1 (Sale and Purchase Agreement) by which MEMC Italy shall purchase the New CS Plant and the related business on a going concern for a purchase price of EUR 41,209,633 (the Purchase Price) from Evonik Italy. For the avoidance of doubt, MEMC US shall be jointly and severally liable with MEMC Italy (Gesamtschuldner) to make the Purchase Price payments when due. |
2.2 | The Parties agree that the Sale and Purchase Agreement shall be executed before the Italian notary Pierluigi Scalamogna, with business address at Via Visconti di Modrone, 21 – 20122 Milano, no later than 5 October 2012. |
2.3 | The in rem transfer (dingliche Übereignung) of the New CS Plant and the related business to MEMC Italy shall take place on 30 December 2012 (Transfer Date). |
2.4 | If and as long the Sale and Purchase Agreement is not executed by Evonik Italy before the Italian notary, but MEMC Italy has executed the Sale and Purchase Agreement in the form of a notarised offer, MEMC shall not be obliged to make any of the remaining Purchase Price payments set out in Section 8.3 below, and moreover, Evonik shall be required to repay such previously made Purchase Price payments to MEMC Italy. |
2.5 | However, if and as long the Sale and Purchase Agreement is not executed before the Italian notary by MEMC Italy within 10 business days after the date indicated in Section 2.2, but Evonik Italy has executed the Sale and Purchase Agreement in the form of a notarised offer, MEMC shall, irrespectively thereof, be obliged to make the payments set out in Section 8.3 below when due which shall in this case be considered as settlement payments paid in consideration for the termination of the On-site Supply Agreement. |
2.6 | The Parties further agree that the production in the New CS Plant shall be suspended until the Transfer Date. |
3.1 | Exhibit 3.1 contains a list of all outstanding payment obligations of the Parties vis-á-vis each other relating to the business in Merano (other than payment obligations from the TCS EG Supply Agreement). The respective debtor shall make the respective payment (in full) to the respective creditor each as indicated in Exhibit 3.1 without undue delay (unverzüglich) after the signing of this Agreement, unless the due date indicated on the invoices occurs after the date |
3.2 | The Parties hereby agree that (i) the Surface Right Agreement, (ii) the Utilities Agreement and (iii) all other agreements (other than the Environmental Agreement) between MEMC and Evonik relating to the current operation of the New CS Plant by Evonik shall terminate immediately after the transfer of the New CS Plant to MEMC Italy has actually occurred. |
3.3 | Evonik Italy and MEMC Italy hereby enter into an amendment agreement to the Environmental Agreement as attached hereto as Exhibit 3.3. |
4.1 | The Parties hereby terminate the On-site Supply Agreement with effect as of the day immediately following the day the transfer of the New CS Plant and the related business on a going concern has taken place. |
4.2 | The Parties agree that MEMC Italy shall pay to Evonik Germany as settlement of Evonik’s damage claims resulting from the termination of the On-site Supply Agreement an amount of EUR 11,674,791.92. This settlement amount assumes due execution of the Sale and Purchase Agreement. If the Sale and Purchase Agreement is not executed before the Italian notary by MEMC Italy as set out in Sections 2.2, 2.4 and 2.5 above, the respective settlement amount shall be increased by the amount of the Purchase Price. |
4.3 | The Parties hereby set-off (Aufrechnungsvereinbarung) the credit relating to the Remaining Down Payment against the compensation for the termination of the On-site Supply Agreement set out in Section 4.2 above. As a result, the Remaining Down Payment shall be finally settled and MEMC shall pay to Evonik Germany the remainder in accordance with § 8 below. |
6.1 | MEMC Italy and Evonik Germany hereby enter into an amendment agreement to the existing TCS EG supply agreement dated 12/13 April 2006 as amended by addendum no 1 dated 11 November 2010 (TCS EG Supply Agreement) as attached hereto as Exhibit 6.1. |
6.2 | Exhibit 6.2 contains a list of all outstanding payment obligations and deliverance obligations of the Parties vis-á-vis each other relating to the TCS EG Supply Agreement as of 31 August 2012. Any such outstanding payment claim for supply of Products (as defined in the existing TCS EG Supply Agreement), any such outstanding claim for supply of Products and any product liability claims, if any, under the existing TCS EG Supply Agreement shall remain unaffected. |
8.1 | In accordance with Sections 2.1, 4.2 and 4.3, MEMC Italy and MEMC US shall pay, as joint and several debtors (Gesamtschuldner) to Evonik a settlement amount in cash in a total amount of |
8.2 | The Settlement Amount shall be allocated as follows: |
(a) | under the assumption that the Sale and Purchase Agreement will be executed: (i) an amount of EUR 41,209,633 shall be allocated to the sale and purchase of the New CS Plant and the related business on a going concern payable to Evonik Italy and (ii) an amount of EUR 3,790,367 (considering the set-off pursuant to Section 4.3, i.e. EUR 11,674,791.92 minus EUR 7,884,424.92) shall be made as compensation for the termination of the On-site Supply Agreement payable to Evonik Germany. The latter payment shall be made as part of the last instalment set out in Section 8.3(d). |
(b) | If and as long as the Sale and Purchase Agreement is not executed as set out in Sections 2.2, 2.4 and 2.5 the full Settlement Amount shall be made as compensation for the termination of the On-site Supply Agreement payable to Evonik Germany. |
8.3 | The Settlement Amount becomes due (fällig) and payable (zahlbar) as follows: |
(a) | EUR 10,000,000 become due (fällig) and payable (zahlbar) on the date fifteen (15) days after execution of this Agreement; |
(b) | EUR 15,000,000 become due (fällig) and payable (zahlbar) on 15 December 2012; |
(c) | EUR 10,000,000 become due (fällig) and payable (zahlbar) on 15 February 2013; and |
(d) | EUR 10,000,000 become due (fällig) and payable (zahlbar) on 15 May 2013. |
8.4 | Unless otherwise requested by Evonik, any payment shall be made through an account of MEMC Italy by irrevocable wire transfer of immediately available funds, free of all taxes, bank charges and other deductions to the following bank accounts: |
(a) | if to Evonik Italy: |
(b) | if to Evonik Germany: |
8.5 | If MEMC fails to make the respective settlement payments when due, it shall pay default interest (Verzugszinsen). The default interest rate shall amount to 10.5 per cent (%) per annum. The default interest rate shall be reduced to 6% as from the earlier of (i) the date on which Evonik’s executory title(s) covering in full the Settlement Amount and the amounts payable by MEMC under the Off-site Settlement Agreement are readily enforceable in the US and (ii) 15 February 2013, save that (ii) shall not apply where Evonik’s failure to have its executory title(s) readily enforceable in the US by that date is due to any act or omission by MEMC. Evonik’s right to claim further default-related damages (Verzugsschaden) shall remain unaffected, except with respect to default interests. |
8.6 | If (i) MEMC fails to make any of the settlement payments when due (in full or in part) in accordance with the payment schedule set forth in Section 8.3 (a) through 8.3(d) or fails to make any of the settlement payments under the Off-site Settlement Agreement when due in accordance with the terms of the Off-site Settlement Agreement and (ii) MEMC fails to make such payment within five business days after it has received a written warning notice by Evonik, the following shall apply |
(a) | the full outstanding Settlement Amount not paid shall become immediately due (fällig) and payable (zahlbar); |
(b) | Evonik shall have the right to terminate the New STC Supply Agreement for cause and without further notice; and |
(c) | Evonik shall have the right to terminate the License and Technical Assistance Agreement for cause and without further notice; |
(d) | if Evonik Germany terminates the New STC Supply Agreement or License and Technical Assistance Agreement, then MEMC shall have the right to terminate the TCS EG Supply Agreement with prior written notice to Evonik Germany with effect to the later of (i) 31 December 2013 and (ii) 12 months from the date Evonik Germany has terminated the New STC Supply Agreement or License and Technical Assistance Agreement. |
8.7 | Any right of MEMC to set off (aufrechnen) and/or withhold (zurückbehalten) the Settlement Amount in part or in whole is hereby expressly waived and excluded except for (i) claims of MEMC declaring the set-off which are acknowledged by Evonik in writing (schriftlich) or if and to the extent MEMC exercising the right of set-off has an enforceable title (Vollstreckungstitel) against Evonik and (ii) any amount which needs to be reimbursed by Evonik to MEMC under Section 13.2 (provided, that MEMC presents to Evonik an appropriate evidence that the respective amount has actually been paid to the tax authorities). |
9.1 | The Parties agree on and agree to implement the procedure and steps set out in Sections 9.2 through 9.11 to enable Evonik to obtain one or more executory title(s) in respect of MEMC’s payment of the Settlement Amount (or any parts thereof) (not exceeding the Settlement Amount) that is (are) readily enforceable in Italy and the US and which shall serve as security to Evonik in respect of MEMC’s payment of the Settlement Amount. MEMC undertakes to comply with the provisions set forth in Sections 9.2 through 9.11 and to take such other reasonable actions, make such other statements and otherwise conduct themselves as required from time to time for Evonik to promptly obtain such readily enforceable executory title(s). |
9.2 | Evonik Germany, Degussa Germany and/or Evonik Italy may at any time file with the courts in Essen (Germany) one or more claims against MEMC Italy and/or MEMC US for payment of the Settlement Amount or any parts thereof (not exceeding in aggregate the Settlement Amount) (Evonik’s Payment Claim(s)). Any such claim shall be substantially in the form set out in Exhibit 9.2. Evonik Germany, Degussa Germany and/or Evonik Italy may in their sole discretion file a claim in accordance with this Section 9 covering also any sums MEMC are obliged to pay to Evonik under the Off-site Settlement Agreement executed by the Parties on the same date. |
9.3 | MEMC shall |
(a) | unconditionally and fully acknowledge (anerkennen) Evonik’s Payment Claim(s) allowing the court to render a judgment by acknowledgement (Anerkenntnisurteil) within the meaning of section 307 of the German Code of Civil Procedure; and |
(b) | simultaneously declare to the court that MEMC waive – to the extent possible under German law – any rights they may have to challenge any such judgment by acknowledgement in respect of Evonik’s Payment Claim(s) |
9.4 | Save to the extent otherwise prohibited under mandatory German law, MEMC shall not raise any right, claim or objection in respect of Evonik’s Payment Claim(s) (whether of a procedural or substantial nature) and shall not take any action that may prevent or delay a judgment by acknowledgement (Anerkenntnisurteil) from being rendered, including, without limitation, |
(a) | any right to set off any claim against Evonik’s Payment Claim(s); |
(b) | any objection as to the jurisdiction of the Essen courts either by reference to Section 14.4, the Parties’ previous arbitration agreements or otherwise; and |
(c) | any procedural actions/applications to extend statutory time limits to respond to any correspondence by Evonik and/or the court. |
9.5 | MEMC Italy and MEMC US hereby irrevocably appoint |
9.6 | Without prejudice to any convenience translations that either Party may from time to time voluntarily offer to provide to the other Parties, the Parties agree that any court or court-related correspondence and documents for legal proceedings in accordance with this Section 9 shall be valid and effective if it is made in the German language. MEMC Italy and MEMC US hereby waive the right (if any) to receive translations of any court or court-related correspondence and/or documents and undertake not to object to the service or transmission of any such correspondence and/or documents in the German language. If and to the extent any Party requires a translation of any court or court-related correspondence and/or documents it shall procure such translation itself and at its own expense. |
9.7 | For the avoidance of doubt, MEMC Italy’s and MEMC US’ undertaking under Section 9.4 above not to challenge the jurisdiction of the Essen courts for the purpose of allowing Evonik to obtain an executory title in accordance with the Parties’ agreement shall not in any way prejudice or be construed as a mutually agreed deviation from or change of the Parties’ arbitration agreement in Section 14.4 which shall remain in full force and effect. |
9.8 | If at any time Evonik seek recognition of any judgment in respect of the Settlement Amount (or any parts thereof) obtained in accordance with this Section 9 in Italy, the US and/or in any other country, MEMC shall not object to, challenge or take any other action that may delay or prevent the recognition of such judgment. |
9.9 | Upon Evonik’s request MEMC shall promptly provide Evonik with a statement waiving – to the extent possible – any rights, claims and objections (including the right to challenge) that MEMC may have in the jurisdiction where recognition is sought. The statement shall be duly executed on behalf of MEMC Italy and MEMC US and shall comply with such other formal requirements as may need to be satisfied in order for the waiver to take full force and effect in the country of recognition. |
9.10 | To further secure Evonik’s right under the Agreement to MEMC’s payment of the Settlement Amount, on the date this Agreement is signed MEMC US shall provide Evonik with duly executed affidavits (confessions of judgment) in the |
9.11 | Evonik shall not enforce payment of any default interest in excess of the relevant percentage agreed in Section 8.5 regardless of the percentage set out in the executory title on which such enforcement is based. Neither MEMC’s acknowledgement pursuant to Section 9.3 nor the rendering of any judgment by acknowledgement as a result thereof nor the affidavits provided by MEMC pursuant to Section 9.10 shall in any way prejudice or affect the Parties’ agreement on the applicable interest rates in Section 8.5. |
9.12 | [intentionally left blank] |
9.13 | If Evonik materially breaches its obligations under this Section 9 for reasons not attributable to MEMC and fails to remedy such breach within five (5) business days after receiving a notice thereof from MEMC, MEMC shall be entitled to suspend performance of its obligations under this Section 9 until Evonik has remedied the breach and Evonik Germany and Evonik Italy shall |
(a) | be jointly and severally liable to MEMC for any loss or damage incurred as a result of such failure save for any loss of financing incurred by MEMC as a result of such failure; and |
(b) | indemnify MEMC for and hold MEMC harmless from and against any costs, fees and expenses (in particular costs of legal counsel and other external advisors) incurred by MEMC as a result of having to assert and enforce their rights and claims against Evonik under this Agreement (Rechtsverfolgungskosten). |
9.14 | If MEMC Italy and/or MEMC US fails to comply with their obligations under this Section 9 for reasons not attributable to Evonik and fails to remedy such breach within ten (10) business days after receiving a notice thereof from Evonik: |
(a) | MEMC shall be jointly and severally liable to Evonik for any loss or damage incurred as a result of such failure save for any loss of financing incurred by Evonik as a result of such failure, up to the maximum amount of the Settlement Amount; |
(b) | MEMC shall indemnify Evonik for and hold Evonik harmless from and against any costs, fees and expenses (in particular costs of legal counsel and other external advisors) incurred by Evonik as a result of having to assert and enforce their rights and claims against MEMC under this Agreement (Rechtsverfolgungskosten); and |
(c) | Section 8.6 (a) through (d) shall apply. |
9.15 | After (i) Evonik’s receipt of the full Settlement Amount from MEMC or (ii) this Agreement has been terminated pursuant to Section 12.1, Evonik Germany, Degussa Germany and/or Evonik Italy shall without undue delay return to MEMC any executory titles, affidavits and/or other documents obtained by them under this Section 9 as a security for the settlement payment. |
10.1 | In relation to the notification of the transaction contemplated by the Sale and Purchase Agreement to the Autorità Garante della Concorrenza e del Mercato (IAA), MEMC Italy shall, at its own cost, use all reasonable endeavours to ensure that the Condition (as defined in the Sale and Purchase Agreement) is not fulfilled. Such reasonable endeavours include, without limitation, that MEMC Italy shall progress such notification with all due diligence, provide all information which is requested by the IAA and, as soon as reasonably practicable (but in any event prior to the notification to the IAA), notify Evonik Italy (and provide copies or, in the case of non-written material communications, all material details) of any communications from and to the IAA relating to the notification and the related review process. |
10.2 | Evonik Italy shall co-operate with MEMC Italy and its advisers and, as soon as reasonably practical, provide MEMC Italy with such information which is available to Evonik Italy as MEMC Italy may reasonably require, for the purpose of allowing MEMC Italy to comply with its obligations under Section 10.1. |
11.1 | Evonik Germany, Degussa Germany and Evonik Italy hereby waive any and all claims they have at the signing of this Agreement, at the Transfer Date and at the end of the term of the On-site Supply Agreement and the Ancillary Agreements against MEMC arising out of or in connection with the On-Site Supply Agreement or any Ancillary Agreement except as for (i) claims set out in Section 3.1 (Payments) and Section 3.3 (Environmental Agreement) and Section 6.2 (Claims under existing TCS EG supply agreement) and (ii) claims for the delivery of utilities and services under the Utilities Agreement as far as required to preserve the New CS Plant until the transfer of the New CS Plant to MEMC Italy has actually occurred. |
11.2 | MEMC Italy and MEMC US hereby waive any and all claims they have at the signing of this Agreement, at the Transfer Date and at the end of the term of the On-site Supply Agreement and the Ancillary Agreements against Evonik Germany, Degussa Germany or Evonik Italy arising out of or in connection with the On-Site Supply Agreement or any Ancillary Agreement except as for |
11.3 | For the avoidance of doubt, these waivers shall not affect any rights of any Party as agreed in this Agreement or the agreements entered or to be entered between the Parties as described herein or in the Off-site Settlement Agreement. |
12.1 | Each of MEMC US and Evonik Germany may terminate this Agreement by giving 10 days prior written notice to Evonik Germany or, as the case may be, to MEMC US, if the Condition (as defined in the Sale and Purchase Agreement) has occurred or been fulfilled, provided that such termination right shall expire 30 days after the Condition (as defined in the Sale and Purchase Agreement) has occurred or been fulfilled. In case of termination pursuant to this Section 12.1 this Agreement becomes null and void with ex-tunc effect (von Anfang an nichtig) and the Parties shall put themselves in a position as if this Agreement had never been entered into, in particular: |
(a) | Evonik has to pay back any amount received from MEMC paid in accordance with Section 8.3; |
(b) | the waivers set out in § 11 shall become null and void; and |
(c) | the Parties shall, with respect to its legal position relating to the On-site Supply Agreement, be deemed to be in the same situation and to have the same rights and claims (for a period of 30 days) under or in connection with the On-site Supply Agreement as they were in and that they had on 30 July 2012. |
12.2 | If neither MEMC US nor Evonik Germany exercises its termination right pursuant to Section 12.1, Section 2.5 shall apply mutatis mutandis and the Parties shall agree on a mutually acceptable solution with regard to the New CS Plant. |
12.3 | Unless as explicitly set forth in Section 12.1 and to the extent permitted by law, no Party shall have the right to terminate this Agreement. |
13.1 | Save to the extent stated otherwise in Section 9 above, each Party shall bear its own costs of legal counsel and other advisors incurred with respect to the negotiation, execution or consummation of this Agreement. |
13.2 | Without prejudice to Sections 11.2 and 11.3 of the Sale and Purchase Agreement and to the extent MEMC Italy actually pays any of the taxes referred to in |
13.3 | Subject to Section 13.1 above, MEMC and Evonik agree that MEMC will pay any and all fees (including notary fees, court fees and antitrust fees), costs and expenses that may be payable or incurred under or in connection with (i) this Agreement, (ii) the Sale and Purchase Agreement (iii) any of the Ancillary Agreements, (iv) the Off-Site Settlement Agreement or (v) any other agreement to be executed hereunder (Fee) except for any additional court fees which will arise because Evonik files more than one claim under Section 9.2 above although the filing of one claim for payment of the Settlement Amounts due under this Agreement and the Off-site Settlement Agreement would be admissible by the court (in which case the court fees relating to the second and any further claim shall be fully borne by Evonik). Without prejudice to the foregoing and Section 11.2 of the Sale and Purchase Agreement, Evonik shall reimburse 50% of such Fee, up to a maximum amount of EUR 100,000 within 15 business days of written request for payment by MEMC; any such Fee in excess of such amount shall solely be borne by MEMC. |
14.1 | Supporting Obligation |
14.2 | Conflicts |
14.3 | Governing Law |
14.4 | Settlement of Disputes |
14.4.1 | Any dispute, controversy or claim arising out of or in connection with this Agreement, or the breach, termination or invalidity thereof, including (without limitation) any dispute relating to pre-contractual conduct or statements made by either Party prior to the execution of this Agreement and any tort-based liability arising from the behaviour of either Party, shall be finally settled under the Rules of Arbitration of the International Chamber of Commerce. Hanau (Germany) shall be the place of arbitration. The number of arbitrators shall be three. The language of the arbitration shall be English. The parties to the arbitration shall jointly nominate the chairman of the arbitral tribunal within 30 days after the co-arbitrators have been confirmed by the ICC Court. If the parties fail to jointly nominate the chairman within such period the ICC Court shall appoint the chairman in accordance with Article 12(5) of the ICC Rules. |
14.4.2 | Any dispute, controversy or claim arising out of or in connection with the Off-site Supply Agreement and/or the On-site Supply Agreement, or the breach, termination or invalidity of either of them, including (without limitation) any dispute relating to pre-contractual conduct or statements made by either Party prior to the execution of the relevant Supply Agreement and any tort-based liability arising from the behaviour of either Party, shall be finally settled under the Rules of Arbitration of the International Chamber of Commerce. Hanau (Germany) shall be the place of arbitration. The number of arbitrators shall be three. The language of the arbitration shall be English. The parties to the arbitration shall jointly nominate the chairman of the arbitral tribunal within 30 days after the co-arbitrators have been confirmed by the ICC Court. If the parties fail to jointly nominate the chairman within such period the ICC Court shall appoint the chairman in accordance with Article 12(5) of the ICC Rules. The Parties acknowledge and agree that the arbitration clause in Article 37.10 of the On-site Supply Agreement is hereby changed accordingly and that this change remains unaffected from any termination and/or invalidity of this Settlement Agreement. |
14.5 | Amendments |
14.6 | Reference to German Legal Terms |
14.7 | Schedules and Exhibits |
14.8 | Entire Agreement/Relation to other Agreements |
14.9 | Severability |
4 SEPTEMBER 2012 EVONIK INDUSTRIES AG EVONIK DEGUSSA GMBH MEMC ELECTRONIC MATERIALS INC. MEMC ELECTRONIC MATERIALS S.P.A. | ||
SETTLEMENT AGREEMENT | ||
Pertaining to the Off-Site Supply Agreement | ||
1. | Evonik Industries AG, with its registered office at Essen, registered in the commercial register (Handelsregister) at the local court (Amtsgericht) of Essen under HRB 19474 (Evonik Germany) |
2. | Evonik Degussa GmbH, with its registered office at Essen, registered in the commercial register (Handelsregister) at the local court (Amtsgericht) of Essen under HRB 20227 (Degussa Germany) (Evonik Germany together with Degussa Germany collectively Evonik) |
3. | MEMC Electronic Materials S.p.A. with its registered office at viale Gherzi, n. 31, Novara 28100, Italy (MEMC Italy) |
4. | MEMC Electronic Materials Inc. with its registered office at 501 Pearl Drive, St. Peters, MO 63376-0008 a corporation incorporated under the laws of Delaware, United States of America (MEMC US, MEMC US together with MEMC Italy MEMC, MEMC together with Evonik collectively the Parties and each of Evonik Germany, Degussa Germany, MEMC Italy and MEMC US a Party) |
(A) | WHEREAS, on 11 November 2010, Degussa Germany and MEMC Italy entered into an agreement pursuant to which Degussa Germany shall supply trichlorosilane technical grade (TCS) to MEMC Italy and MEMC Italy shall pay a purchase price for such delivery (as amended from time to time, the Off-site Supply Agreement). |
(B) | WHEREAS, under a business management agreement (Betriebsführungsvertrag) between Evonik Germany and Degussa Germany dated 23 May 2011 Degussa Germany has assigned all rights and obligations under the Off-Site Supply Agreement to Evonik Germany with legal effect as of 1 August 2011. |
(C) | WHEREAS, the Off-site Supply Agreement runs for a fixed term until 31 December 2014. |
(D) | WHEREAS, under the Off-Site Supply Agreement MEMC is required to purchase a certain quantity of TCS from Evonik Germany. The Off-Site Supply Agreement provides that, if MEMC fails to purchase such quantity of Products from Evonik Germany, MEMC shall pay to Evonik Germany shortfall payments as liquidated damages (so-called “take or pay obligation”). |
(E) | WHEREAS, MEMC Italy has not taken any TCS from Evonik Germany under the Off-Site Supply Agreement since November 2011 and MEMC US has notified Evonik Germany of its unilateral termination of the Off-Site Supply Agreement with letter dated 16 December 2011. |
(F) | WHEREAS, Evonik Germany has rejected the unilateral termination by MEMC with letter dated 29 December 2011. |
(G) | WHEREAS, with letter dated 6 June 2012 Evonik Germany terminated unilaterally the Off-Site Supply Agreement and claimed damages in the amount of EUR 31,876,680. To secure its claim to damages Evonik Germany obtained a permission for prejudgment attachment with regard to the shares in MEMC Holding BV held by MEMC Italy in the amount of EUR 35,394,348.00 (Attachment). |
(H) | WHEREAS, the Parties now wish to enter into this settlement agreement (Agreement) in order to (i) find an amicable economic solution with respect to the termination of the Off-Site Agreement and (ii) avoid legal proceedings between the Parties. |
(I) | WHEREAS, today the Parties and Evonik Degussa Italia S.p.A (Evonik Italy) also enter into a settlement agreement with regard to the supply agreement dated 9 July 2008 (On-Site Settlement Agreement). According to the terms of the On-Site Settlement Agreement Evonik Italy sells and MEMC Italy purchases the New CS Plant and the related business on a going concern (as defined in the On-Site Settlement Agreement) in accordance with the terms and conditions of the Sale and Purchase Agreement as attached to the On-Site Settlement Agreement as Exhibit 2.1 (Sale and Purchase Agreement). |
(J) | WHEREAS, to this extent MEMC agrees to settle the dispute under the Off-Site Supply Agreement, subject to the terms of this Agreement, for a settlement amount of EUR 25,000,000 to be paid to Evonik Germany. In return, Evonik Germany agrees, subject to the terms of this Agreement (i) to waive all claims under the Off-Site Supply Agreement, and (ii) to lift the Attachment. |
2.1 | The Parties hereby acknowledge that the Off-site Supply Agreement has been validly terminated. |
2.2 | The Parties agree that MEMC shall pay to Evonik Germany as settlement of Evonik’s damage claims resulting from the termination of the Off-site Supply Agreement an amount of EUR 25,000,000 (twenty five million Euro). |
3.1 | In accordance with Section 2.2, MEMC Italy and MEMC US shall pay, as joint and several debtors (Gesamtschuldner) to Evonik Germany a settlement amount in cash in a total amount of |
3.2 | The Settlement Amount becomes due (fällig) and payable (zahlbar) as follows: |
(a) | EUR 10,000,000 become due (fällig) and payable (zahlbar) on 15 May 2013; and |
(b) | EUR 15,000,000 become due (fällig) and payable (zahlbar) on 15 August 2013. |
3.3 | Unless otherwise requested by Evonik, any payment shall be made through an account of MEMC Italy by irrevocable wire transfer of immediately available funds, free of all taxes, bank charges and other deductions to the following bank account: |
3.4 | If MEMC fails to make the respective settlement payments when due, it shall pay default interest (Verzugszinsen). The default interest rate shall amount to 10.5 per cent (%) per annum. The default interest rate shall be reduced to 6% as from the earlier of (i) the date on which Evonik’s executory title(s) covering in full the Settlement Amount and the amounts payable by MEMC under the On-site Settlement Agreement are readily enforceable in the US and (ii) 15 February 2013, save that (ii) shall not apply where Evonik’s failure to have its executory title(s) readily enforceable in the US by that date is due to any act or omission by MEMC. Evonik’s right to claim further default-related damages (Verzugsschaden) shall remain unaffected, except with respect to default interests. |
3.5 | If (i) MEMC fails to make any of the settlement payments (in full or in part) in accordance with the payment schedule set forth in Section 3.2(a) and 3.2(b) or fails to make any of the settlement payments under the On-site Settlement Agreement in accordance with the terms of the On-site Settlement Agreement and (ii) MEMC fails to make such payment within five business days after it has received a written warning notice by Evonik, the following shall apply: |
(a) | the full outstanding Settlement Amount not paid shall become immediately due (fällig) and payable (zahlbar); |
(b) | Evonik shall have the right to terminate the New STC Supply Agreement (as defined in § 5 of the On-Site Settlement Agreement) for cause and without further notice; and |
(c) | Evonik shall have the right to terminate the License and Technical Assistance Agreement (as defined in § 7 of the On-Site Settlement Agreement) for cause and without further notice; and |
(d) | if Evonik Germany terminates the New STC Supply Agreement or License and Technical Assistance Agreement, then MEMC shall have the right to terminate the TCS EG Supply Agreement (as defined in § 6.1 of the On-site Settlement Agreement) with prior written notice to Evonik Germany with effect to the later of (i) 31 December 2013 and (ii) 12 months from the date Evonik Germany has |
3.6 | Any right of MEMC to set off (aufrechnen) and/or to withhold (zurückbehalten) payment of the Settlement Amount in part or in whole is hereby expressly waived and excluded except for claims of MEMC declaring the set-off which are acknowledged by Evonik in writing (schriftlich) or if and to the extent MEMC exercising the right of set-off has an enforceable title (Vollstreckungstitel) against Evonik. |
4.1 | The Parties agree on and agree to implement the procedure and steps set out in Sections 4.2 through 4.11 to enable Evonik to obtain one or more executory title(s) in respect of MEMC’s payment of the Settlement Amount (or any parts thereof) (not exceeding the Settlement Amount) that is (are) readily enforceable in Italy and the US and which shall serve as security to Evonik in respect of MEMC’s payment of the Settlement Amount. MEMC undertakes to comply with the provisions set forth in Sections 4.2 through 4.11 and to take such other reasonable actions, make such other statements and otherwise conduct themselves as required from time to time for Evonik to promptly obtain such readily enforceable executory title(s). |
4.2 | Evonik Germany and/or Degussa Germany may at any time file with the courts in Essen (Germany) one or more claims against MEMC Italy and/or MEMC US for payment of the Settlement Amount or any parts thereof (not exceeding in aggregate the Settlement Amount) (Evonik’s Payment Claim(s)). Any such claim shall be substantially in the form set out in Exhibit 4.2. Evonik Germany and/or Degussa Germany may in their sole discretion file a claim in accordance with this Section 4 covering also any sums MEMC are obliged to pay to Evonik under the On-site Settlement Agreement executed by the Parties on the same date. |
4.3 | MEMC shall: |
(a) | unconditionally and fully acknowledge (anerkennen) Evonik’s Payment Claim(s) allowing the court to render a judgment by acknowledgement (Anerkenntnisurteil) within the meaning of section 307 of the German Code of Civil Procedure; and |
(b) | simultaneously declare to the court that MEMC waive – to the extent possible under German law – any rights they may have to challenge any such judgment by acknowledgement in respect of Evonik’s Payment Claim(s) |
4.4 | Save to the extent otherwise prohibited under mandatory German law, MEMC shall not raise any right, claim or objection in respect of Evonik’s Payment Claim(s) (whether of a procedural or substantial nature) and shall not take any action that may prevent or delay a judgment by acknowledgement (Anerkenntnisurteil) from being rendered, including, without limitation, |
(a) | any right to set off any claim against Evonik’s Payment Claim(s); |
(b) | any objection as to the jurisdiction of the Essen courts either by reference to Section 7.4, the Parties’ previous arbitration agreements or otherwise; and |
(c) | any procedural actions/applications to extend statutory time limits to respond to any correspondence by Evonik and/or the court. |
4.5 | MEMC Italy and MEMC US hereby irrevocably appoint |
4.6 | Without prejudice to any convenience translations that either Party may from time to time voluntarily offer to provide to the other Parties, the Parties agree that any court or court-related correspondence and documents for legal proceedings in accordance with this § 4 shall be valid and effective if it is made in the German language. MEMC Italy and MEMC US hereby waive the right (if any) to receive translations of any court or court-related correspondence and/or documents and undertake not to object to the service or transmission of any such correspondence and/or documents in the German language. If and to the extent any Party requires a translation of any court or court-related correspondence and/or documents it shall procure such translation itself and at its own expense. |
4.7 | For the avoidance of doubt, MEMC Italy’s and MEMC US’ undertaking under Section 4.4 above not to challenge the jurisdiction of the Essen courts for the purpose of allowing Evonik to obtain an executory title in accordance with the Parties’ agreement shall not in any way prejudice or be construed as a mutually agreed deviation from or change of the Parties’ arbitration agreement in Section 7.4.1 which shall remain in full force and effect. |
4.8 | If at any time Evonik seek recognition of any judgment in respect of the Settlement Amount (or any parts thereof) obtained in accordance with this Section 4 in Italy, the US and/or in any other country, MEMC shall not object to, challenge or take any other action that may delay or prevent the recognition of such judgment. |
4.9 | Upon Evonik’s request MEMC shall promptly provide Evonik with a statement waiving – to the extent possible – any rights, claims and objections (including the right to challenge) that MEMC may have in the jurisdiction where recognition is sought. The statement shall be duly executed on behalf of MEMC Italy and MEMC US and shall |
4.10 | To further secure Evonik’s right under the Agreement to MEMC’s payment of the Settlement Amount, on the date this Agreement is signed MEMC US shall provide Evonik with duly executed affidavits (confessions of judgment) in the form set out in Exhibit 4.10. Sections 4.8 seq. shall apply mutatis mutandis to any attempts by Evonik to obtain a judgement in the US based on these affidavits. |
4.11 | The Parties agree that the Attachment shall remain in full force and effect until the date on which MEMC have paid in full the Settlement Amount. Upon request by Evonik MEMC shall sign a statement in the form set out in Exhibit 4.11 as may be required by Evonik to maintain the Attachment in place. |
4.12 | Evonik shall not enforce payment of any default interest in excess of the relevant percentage agreed in Section 3.4 regardless of the percentage set out in the executory title on which such enforcement is based. Neither MEMC’s acknowledgement pursuant to Section 4.3 nor the rendering of any judgment by acknowledgement as a result thereof nor the affidavits provided by MEMC pursuant to Section 4.10 shall in any way prejudice or affect the Parties’ agreement on the applicable interest rates in Section 3.4. |
4.13 | If Evonik materially breaches its obligations under this Section 4 for reasons not attributable to MEMC and fails to remedy such breach within five (5) business days after receiving a notice thereof from MEMC, MEMC shall be entitled to suspend performance of its obligations under this Section 4 until Evonik has remedied the breach and Evonik Germany shall |
(a) | be liable to MEMC for any loss or damage incurred as a result of such failure save for any loss of financing incurred by MEMC as a result of such failure, and |
(b) | indemnify MEMC for and hold MEMC harmless from and against any costs, fees and expenses (in particular costs of legal counsel and other external advisors) incurred by MEMC as a result of having to assert and enforce their rights and claims against Evonik under this Agreement (Rechtsverfolgungskosten). |
4.14 | If MEMC Italy and/or MEMC US fail(s) to comply with their obligations under this Section 4 for reasons not attributable to Evonik and fail to remedy such breach within ten (10) business days after receiving a notice thereof from Evonik, |
(a) | MEMC shall be jointly and severally liable to Evonik for any loss or damage incurred as a result of such failure save for any loss of financing incurred by Evonik as a result of such failure, up to a maximum amount equal to the Settlement Amount; |
(b) | MEMC shall indemnify Evonik for and hold Evonik harmless from and against any costs, fees and expenses (in particular costs of legal counsel and other external advisors) incurred by Evonik as a result of having to assert and enforce their rights and claims against MEMC under this Agreement (Rechtsverfolgungskosten); and |
(c) | Section 3.5 (a) through (d) shall apply. |
4.15 | After (i) Evonik has received the full Settlement Amount from MEMC or (ii) this Agreement has been terminated pursuant to Section 6.1, Evonik Germany and/or Degussa Germany shall without undue delay return to MEMC any executory titles, affidavits and/or other documents obtained by them under this Section 4 as a security for the settlement payment and take any action as may be required to lift the Attachment. |
5.1 | Evonik Germany and Degussa Germany hereby waive any and all claims they have at the signing of this Agreement against MEMC arising out of or in connection with the Off-Site Supply Agreement except as for claims set out in Section 3.1 (Payments) of the On-site Settlement Agreement. |
5.2 | MEMC Italy and MEMC US hereby waive any and all claims they have at the signing of this Agreement against Evonik Germany or Degussa Germany arising out of or in connection with the Off-Site Supply Agreement except as for claims set out in Section 3.1 (Payments) of the On-site Settlement Agreement. |
5.3 | For the avoidance of doubt, these waivers shall not affect any rights of any Party as agreed in this Agreement or the agreements to be entered between the Parties as described herein or in the On-Site Settlement Agreement. |
6.1 | Each of MEMC US and Evonik Germany may terminate this Agreement by giving 10 days prior written notice to Evonik Germany or, as the case may be, to MEMC US if the Condition (as defined in the Sale and Purchase Agreement) has occurred or been fulfilled, provided that such termination right shall expire 30 days after the Condition (as defined in the Sale and Purchase Agreement) has occurred or been fulfilled. In case of termination pursuant to this Section 6.1 this Agreement becomes null and void with ex-tunc effect (von Anfang an nichtig) and the Parties shall put themselves in a position as if this Agreement had never been entered into, in particular: |
(a) | Evonik has to pay back any amount received from MEMC paid in accordance with Section 3.2; |
(b) | the waivers set out in § 5 shall become null and void. |
6.2 | Unless as explicitly set forth in Section 6.1 and to the extent permitted by law, no Party shall have the right to terminate this Agreement. |
7.1 | Supporting Obligation |
7.2 | Cost and Expenses |
7.3 | Governing Law |
7.4 | Settlement of Disputes |
7.4.1 | Any dispute, controversy or claim arising out of or in connection with this Agreement, or the breach, termination or invalidity thereof, including (without limitation) any dispute relating to pre-contractual conduct or statements made by either Party prior to the execution of this Agreement and any tort-based liability arising from the behaviour of either Party, shall be finally settled under the Rules of Arbitration of the International Chamber of Commerce. Hanau (Germany) shall be the place of arbitration. The number of arbitrators shall be three. The language of the arbitration shall be English. The parties to the arbitration shall jointly nominate the chairman of the arbitral tribunal within 30 days after the co-arbitrators have been confirmed by the ICC Court. If the parties fail to jointly nominate the chairman within such period the ICC Court shall appoint the chairman in accordance with Article 12(5) of the ICC Rules. |
7.4.2 | Any dispute, controversy or claim arising out of or in connection with the Off-site Supply Agreement and/or the On-site Supply Agreement, or the breach, termination or invalidity of either of them, including (without limitation) any dispute relating to pre-contractual conduct or statements made by either Party prior to the execution of the relevant Supply Agreement and any tort-based liability arising from the behaviour of either Party, shall be finally settled under the Rules of Arbitration of the International Chamber of Commerce. Hanau (Germany) shall be the place of arbitration. The number of arbitrators shall be three. The language of the arbitration shall be English. The parties to the arbitration shall jointly nominate the chairman of the arbitral tribunal within 30 days after the co-arbitrators have been confirmed by the ICC Court. If the parties fail to jointly nominate the chairman within such period the ICC Court shall appoint the chairman in accordance with Article 12(5) of the ICC Rules. The Parties acknowledge and agree that the arbitration clauses in Article 23.2 of the Off-site Supply Agreement are hereby changed accordingly and that this change remains unaffected from any termination and/or invalidity of this Settlement Agreement. |
7.5 | Amendments |
7.6 | Reference to German Legal Terms |
7.7 | Schedules and Exhibits |
7.8 | Entire Agreement/Relation to other Agreements |
7.9 | Severability |
24 SEPTEMBER 2012 EVONIK INDUSTRIES AG EVONIK DEGUSSA GMBH EVONIK DEGUSSA ITALIA S.P.A. MEMC ELECTRONIC MATERIALS INC. MEMC ELECTRONIC MATERIALS S.P.A. | ||
AMENDMENT AGREEMENT | ||
To the On-Site Settlement Agreement and To the Off-Site Settlement Agreement | ||
1. | Evonik Industries AG, with its registered office at Essen, registered in the commercial register (Handelsregister) at the local court (Amtsgericht) of Essen under HRB 19474 (Evonik Germany) |
2. | Evonik Degussa GmbH, with its registered office at Essen, registered in the commercial register (Handelsregister) at the local court (Amtsgericht) of Essen under HRB 20227 (Degussa Germany) |
3. | Evonik Degussa Italia SpA, with its registered office at Largo Donegani n. 2, 20121 Milano, Italy, registered with the Register of Enterprises of Milan, registration number and tax code 08865250156, (Evonik Italy, Evonik Italy together with Evonik Germany and Degussa Germany together Evonik) |
4. | MEMC Electronic Materials S.p.A. with its registered office at viale Gherzi, n. 31, Novara 28100, Italy with registered office in Novara, at Viale Luigi Gherzi no. 31, registered with the Register of Enterprises of Novara, registration number and tax code 01256330158, (MEMC Italy) |
5. | MEMC Electronic Materials Inc. with its registered office at 501 Pearl Drive, St. Peters, MO 63376-0008, a corporation incorporated under the laws of Delaware, United States of America (MEMC US, MEMC US together with MEMC Italy MEMC, MEMC together with Evonik collectively the Parties and each of Evonik Germany, Degussa Germany, Evonik Italy, MEMC Italy and MEMC US a Party) |
(A) | WHEREAS, on 4 September 2012 the Parties entered into (i) a settlement agreement pertaining to the on-site supply agreement (notarial deed no. 249/2012 of the notary Michael Steinbrecher, Frankfurt am Main) (On-Site Settlement Agreement) and (ii) a settlement agreement pertaining to the off-site supply agreement (notarial deed no. 249/2012 of the notary Michael Steinbrecher, Frankfurt am Main) (Off-Site Settlement Agreement). |
(B) | WHEREAS, pursuant to § 2.1 of the On-Site Settlement Agreement Evonik Italy shall sell and transfer the New CS Plant (as defined in the On-Site Settlement Agreement) and the related business on a going concern to MEMC Italy. Therefore, the Parties agreed to enter into a sale and purchase agreement substantially in the form as attached as Exhibit 2.1 to the On-Site Settlement Agreement. |
(C) | WHEREAS, at the time of notarisation of the On-Site Settlement Agreement and the Off-Site Settlement Agreement the Parties were of the opinion, based upon the 2011 MEMC’s consolidated Italian turnover figures reported by MEMC to Evonik, that the transaction contemplated under the Sale and Purchase Agreement (as defined in the On-Site Settlement Agreement) (Transaction) was subject to the notification obligation to the Italian antitrust authority (Autorità Garante della Concorrenza e del Mercato – IAA) under art. 16, par. 1, Law n. 287/1990, as amended (IAL). Therefore, §§ 10 and 12 of the On-Site Settlement Agreement and § 6 of the Off-Site Settlement Agreement contain provisions relating to the notification of the Transaction to the IAA. |
(D) | WHEREAS, shortly after the notarisation of the On-Site Settlement Agreement and the Off-Site Settlement Agreement MEMC reported to Evonik new figures regarding MEMC’s 2011 consolidated turnover generated in Italy. On the basis of such new turn-over figures the Transaction |
1.1 | Defined terms used herein shall have the same meaning as attributed to them in the On-Site Settlement Agreement, unless they are defined differently herein. |
1.2 | This Amendment Agreement constitutes an amendment agreement to the On-Site Settlement Agreement as provided for in § 3 and an amendment agreement to the Off-Site Settlement Agreement as provided for in § 4. |
1.3 | This Amendment Agreement shall become effective upon its notarisation. |
2.1 | MEMC hereby represents and confirms that its consolidated turnover generated in Italy in 2011 amounts to USD 375,600,000, that is well below the first alternative EUR 474,000,000 turnover threshold provided by art. 16, par. 1, IAL, as periodically updated by the IAA. |
2.2 | Evonik Italy hereby represents and confirms that the relevant consolidated turnover generated in Italy by the New CS Plant in 2011 was well below the second alternative EUR 47,000,000 turnover threshold provided by art. 16, par. 1, IAL, as periodically updated by the IAA. |
2.3 | Accordingly, on the basis of the data provided in §§ 2.1 and 2.2 of this Amendment Agreement, all Parties agree that the Transaction is not subject to any notification obligation to the IAA, since none of the relevant alternative thresholds provided under art. 16, par. 1, of IAL, as subsequently amended, are met. |
3.1 | In § 9.15 of the On-Site Settlement Agreement the characters “(i)” and the words “or (ii) this Agreement has been terminated pursuant to Section 12.1” shall be deleted. |
3.2 | In the heading of § 10 of the On-Site Settlement Agreement the word “ANTI-TRUST” shall be replaced by the words “[INTENTIONALLY LEFT BLANK]”. |
3.3 | §§ 10.1 and 10.2 of the On-Site Settlement Agreement shall be deleted. |
3.4 | In the heading of § 12 of the On-Site Settlement Agreement the word “TERMINATION” shall be replaced by the words “[INTENTIONALLY LEFT BLANK]”. |
3.5 | §§ 12.1, 12.2 and 12.3 of the On-Site Settlement Agreement shall be deleted. |
4.1 | In § 4.15 of the Off-Site Settlement Agreement the characters “(i)” and the words “or (ii) this Agreement has been terminated pursuant to Section 6.1”shall be deleted. |
4.2 | In the heading of § 6 of the Off-Site Settlement Agreement the word “TERMINATION” shall be replaced by the words “[INTENTIONALLY LEFT BLANK]”. |
4.3 | §§ 6.1 and 6.2 of the Off-Site Settlement Agreement shall be deleted. |
5.1 | In light of the representations and confirmations contained in § 2 of this Amendment Agreement, the Parties agree and acknowledge to amend the draft of the Sale and Purchase Agreement in such a way that the Transaction will not be subject to a condition subsequent and, accordingly, does not contain the obligation to notify the IAA (i.e., Clauses 4.1 through 4.6 of the Sale and Purchase Agreement and all relating definitions shall be deleted). |
5.2 | The Parties agree and acknowledge further that, for the avoidance of doubt, the Sale and Purchase Agreement as amended pursuant to § 5.1 of this Amendment Agreement shall be deemed to be substantially in the form as attached as Exhibit 2.1 of the On-Site Settlement Agreement (within the meaning of § 2.1 of the On-Site Settlement Agreement). |
6.1 | Save as expressly amended in this Amendment Agreement, the provisions of the On-Site Settlement Agreement and the Off-Site Settlement Agreement shall remain unaffected and in full force and effect. |
6.2 | §§ 14.3 (Governing Law), 14.4 (Settlement of Disputes), 14.5 (Amendments), 14.8 (Entire Agreement/Relation to other Agreements) and 14.9 (Severability) of the On-Site Settlement Agreement shall also apply to this Amendment Agreement. |
1 | I have reviewed this quarterly report on Form 10-Q of MEMC Electronic Materials, Inc.; |
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(s) 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. |
5 | The registrant’s other certifying officer(s) 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. |
/s/ Ahmad Chatila |
Ahmad Chatila |
President and Chief Executive Officer |
1 | I have reviewed this quarterly report on Form 10-Q of MEMC Electronic Materials, Inc.; |
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(s) 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. |
5 | The registrant’s other certifying officer(s) 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. |
/s/ Brian Wuebbels |
Brian Wuebbels |
Executive Vice President and Chief Financial Officer |
1 | The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and |
2 | The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. |
By: | /s/ Ahmad Chatila |
Name: | Ahmad Chatila |
Title: | President and Chief Executive Officer MEMC Electronic Materials, Inc. |
By: | /s/ Brian Wuebbels |
Name: | Brian Wuebbels |
Title: | Executive Vice President and Chief Financial Officer MEMC Electronic Materials, Inc. |
Debt and Capital Lease Obligations (Non-solar Energy System Debt and Capital Leases) (Details) (USD $)
|
9 Months Ended | 0 Months Ended | 0 Months Ended | ||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2012
|
Sep. 30, 2011
|
Dec. 31, 2011
|
Mar. 10, 2011
Senior Notes [Member]
|
Sep. 28, 2012
Second Lien Credit Agreement [Member]
|
Sep. 30, 2012
Second Lien Credit Agreement [Member]
|
Sep. 28, 2012
Second Lien Credit Agreement [Member]
Eurocurrency [Member]
|
Sep. 28, 2012
Second Lien Credit Agreement [Member]
Base Rate [Member]
|
Mar. 10, 2011
Maximum [Member]
Senior Notes [Member]
|
Mar. 10, 2011
Minimum [Member]
Senior Notes [Member]
|
Sep. 30, 2012
On or prior to March 31, 2014 [Member]
Minimum [Member]
Second Lien Credit Agreement [Member]
|
Sep. 30, 2012
After March 31, 2014 but on or prior to March 31, 2015 [Member]
Second Lien Credit Agreement [Member]
|
Sep. 30, 2012
After March 31, 2015 but on or prior to March 31, 2016 [Member]
Second Lien Credit Agreement [Member]
|
Sep. 30, 2012
EBITDA less than 400 million [Member]
Second Lien Credit Agreement [Member]
|
Sep. 30, 2012
EBITDA, 400 million to 600 million [Member]
Second Lien Credit Agreement [Member]
|
Sep. 30, 2012
EBITDA, 600 million to 850 million [Member]
Second Lien Credit Agreement [Member]
|
Sep. 30, 2012
EBITDA greater than 850 million [Member]
Second Lien Credit Agreement [Member]
|
|
Debt Instrument [Line Items] | |||||||||||||||||
Aggregate principal amount | $ 550,000,000 | $ 200,000,000 | |||||||||||||||
Discount rate | 2.00% | ||||||||||||||||
Proceeds from second lien term loan | 196,000,000 | 0 | 196,000,000 | ||||||||||||||
Senior note, interest rate | 7.75% | ||||||||||||||||
Debt issuance costs | 13,800,000 | 10,800,000 | |||||||||||||||
Debt issuance costs, amortized period (in years) | 8 years | 5 years | |||||||||||||||
Senior notes sold at a fixed percentage of the principal amount | 100.00% | ||||||||||||||||
Number Of Days, Notice To Redeem Note | 60 days | 30 days | |||||||||||||||
Debt Instrument Redemption Period | 12 months | ||||||||||||||||
Purchase price percent if change of control of MEMC occurs | 101.00% | ||||||||||||||||
Notes Payable | 19,500,000 | 21,400,000 | |||||||||||||||
Interest rate floor | 1.50% | ||||||||||||||||
Spread on variable rate | 9.25% | 8.25% | |||||||||||||||
Effective interest rate | 10.75% | ||||||||||||||||
Debt Instrument, Yield Maintenance Payments, Percentage of Prepaid Principal Amount | 3.00% | ||||||||||||||||
Call premium, percentage | 3.00% | 1.00% | |||||||||||||||
Consolidated leverage ratio | 3.5 | ||||||||||||||||
Consolidated leverage ratio after report date | 3 | ||||||||||||||||
Debt Instrument, Expected Liquidity Covenant, Minimum | 400,000,000 | 300,000,000 | 200,000,000 | 0 | |||||||||||||
Debt Instrument, Covenant Compliance, EBITDA, Minimum | 400,000,000 | 400,000,000 | 600,000,000 | 850,000,000 | |||||||||||||
Debt Instrument, Covenant Compliance, EBITDA, Maximum | $ 600,000,000 | $ 850,000,000 |
Debt and Capital Lease Obligations (Debt) (Details) (USD $)
In Millions, unless otherwise specified |
Sep. 30, 2012
|
Dec. 31, 2011
|
---|---|---|
Debt Instrument [Line Items] | ||
Senior Notes | $ 550.0 | $ 550.0 |
Senior Notes, Current | 0 | 0 |
Senior Notes, Noncurrent | 550.0 | 550.0 |
Loans Payable | 196.0 | 0 |
Loans Payable, Current | 0 | 0 |
Loans Payable, Noncurrent | 196.0 | 0 |
Notes Payable | 19.5 | 21.4 |
Notes Payable, Current | 3.7 | 3.7 |
Notes Payable, Noncurrent | 15.8 | 17.7 |
Debt and Capital Lease Obligations | 765.5 | 571.4 |
Current portion of long-term debt | 3.7 | 3.7 |
Long-term debt and capital lease obligations, less current portion | 761.8 | 567.7 |
Short Term Solar Energy System Financing And Current Portion Of Long Term Solar Energy System Financing And Capital Lease Obligations | 143.3 | 144.2 |
Long-term solar energy system financing and capital lease obligations, less current portion, including consolidated variable interest entities | 1,404.6 | 1,211.2 |
Debt And Capital Lease Obligations Including Solar Energy Systems Financing | 2,313.4 | 1,926.8 |
Debt And Capital Lease Obligations Including Solar Energy Systems Financing, Current | 147.0 | 147.9 |
Long Term Debt And Capital Lease Obligations Including Solar Energy Systems Financing | 2,166.4 | 1,778.9 |
Solar Energy [Member]
|
||
Debt Instrument [Line Items] | ||
Short-term Debt | 54.3 | |
Short-term Debt, Weighted Average Interest Rate | 6.40% | 6.20% |
Capital Lease Obligations, Current | 11.9 | 13.3 |
Capital Lease Obligations, Noncurrent | 88.3 | 94.5 |
Sale Leaseback Transaction, Amount Due under Financing Arrangement | 999.6 | 837.0 |
Financing Obligations, Current | 20.1 | 8.4 |
Long-term Finance Obligations | 979.5 | 828.6 |
Other System Financing transactions | 107.5 | 27.6 |
Other system financing transactions, current | 0 | 17.4 |
Other system financing transactions, noncurrent | 107.5 | 10.2 |
Long Term Solar Energy Systems Financing And Capital Leases | 1,547.9 | 1,355.4 |
Short Term Solar Energy System Financing And Current Portion Of Long Term Solar Energy System Financing And Capital Lease Obligations | 143.3 | 144.2 |
Long-term solar energy system financing and capital lease obligations, less current portion, including consolidated variable interest entities | 1,404.6 | 1,211.2 |
Construction and Term Debt [Member] | Solar Energy [Member]
|
||
Debt Instrument [Line Items] | ||
Long-term Debt | 286.3 | 305.8 |
Long-term Debt, Current Maturities | 57.0 | 27.9 |
Long-term Debt, Excluding Current Maturities | 229.3 | 277.9 |
SunEdison [Member] | Solar Energy [Member]
|
||
Debt Instrument [Line Items] | ||
Capital Lease Obligations | 100.2 | 107.8 |
Construction and Term Debt [Member] | Solar Energy [Member]
|
||
Debt Instrument [Line Items] | ||
Short-term Debt | $ 54.3 | $ 77.2 |
Variable Interest Entities (Tables)
|
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2012
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Variable Interest Entity, Consolidated, Carrying Amount, Assets and Liabilities, Net [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Variable Interest Entities | The carrying amounts and classification of our consolidated VIEs' assets and liabilities included in our condensed consolidated balance sheet are as follows:
|
Income (loss) Per Share (Details) (USD $)
In Millions, except Share data, unless otherwise specified |
3 Months Ended | 6 Months Ended | 9 Months Ended | |||||
---|---|---|---|---|---|---|---|---|
Sep. 30, 2012
|
Jun. 30, 2012
|
Mar. 31, 2012
|
Sep. 30, 2011
|
Jun. 30, 2012
|
Jun. 30, 2011
|
Sep. 30, 2012
|
Sep. 30, 2011
|
|
Earnings Per Share [Abstract] | ||||||||
Net (loss) income attributable to MEMC stockholders | $ 37.0 | $ 61.3 | $ 92.0 | $ (94.4) | $ 153.3 | $ (51.6) | $ (138.8) | $ (51.6) |
Adjustment of redeemable noncontrolling interest (see Note 11) | (0.9) | 0 | (0.9) | 0 | ||||
Adjusted net income to common stockholders, basic | 36.1 | (94.4) | (139.7) | (51.6) | ||||
Adjusted net income to common stockholders, diluted | $ 36.1 | $ (94.4) | $ (139.7) | $ (51.6) | ||||
Weighted-average shares outstanding (in shares) | 230,900,000 | 230,300,000 | 230,800,000 | 229,700,000 | ||||
Stock options and restricted stock units | 1,100,000 | 0 | 0 | 0 | ||||
Total shares (in shares) | 232,000,000 | 230,300,000 | 230,800,000 | 229,700,000 | ||||
Income (loss) per share, basic (in dollars per share) | $ 0.16 | $ (0.41) | $ (0.22) | $ (0.61) | $ (0.22) | |||
Income (loss) per share, diluted (in dollars per share) | $ 0.16 | $ (0.41) | $ (0.22) | $ (0.61) | $ (0.22) | |||
Stock options and restricted stock units excluded from calculation of diluted EPS (in shares) | 13,900,000 | 12,500,000 |
Condensed Consolidating Financial Information (Narrative) (Details) (Senior Notes [Member], USD $)
|
Mar. 10, 2011
|
---|---|
Senior Notes [Member]
|
|
Debt Instrument [Line Items] | |
Senior notes, issued amount | $ 550,000,000 |
Debt Instrument, Interest Rate, Stated Percentage | 7.75% |
Solar Energy Systems Held for Development and Sale (Tables)
|
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2012
|
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Solar Energy Systems Held For Development and Sale [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Solar Energy Systems Held for Development and Sale | Solar energy systems held for development and sale consist of the following:
|
Debt and Capital Lease Obligations (Other Facilities) (Details) (USD $)
|
3 Months Ended | 6 Months Ended | 9 Months Ended | 9 Months Ended | |||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2012
|
Sep. 30, 2011
|
Jun. 30, 2011
|
Sep. 30, 2012
|
Sep. 30, 2012
Corporate Credit Facility [Member]
|
Sep. 28, 2012
Corporate Credit Facility [Member]
|
May 08, 2012
Corporate Credit Facility [Member]
|
Mar. 31, 2012
Corporate Credit Facility [Member]
|
Feb. 28, 2012
Corporate Credit Facility [Member]
|
Dec. 31, 2011
Corporate Credit Facility [Member]
|
Mar. 22, 2011
Corporate Credit Facility [Member]
|
Sep. 30, 2012
Maximum [Member]
Corporate Credit Facility [Member]
|
May 08, 2012
Maximum [Member]
Corporate Credit Facility [Member]
|
Sep. 30, 2012
Minimum [Member]
Corporate Credit Facility [Member]
|
May 08, 2012
Minimum [Member]
Corporate Credit Facility [Member]
|
May 08, 2012
Eurocurrency [Member]
Corporate Credit Facility [Member]
|
May 08, 2012
Base Rate [Member]
Corporate Credit Facility [Member]
|
Sep. 30, 2012
EBITDA less than 400 million [Member]
Corporate Credit Facility [Member]
|
Sep. 30, 2012
EBITDA, 400 million to 600 million [Member]
Corporate Credit Facility [Member]
|
Sep. 30, 2012
EBITDA, 600 million to 850 million [Member]
Corporate Credit Facility [Member]
|
Sep. 30, 2012
EBITDA greater than 850 million [Member]
Corporate Credit Facility [Member]
|
|
Debt Instrument [Line Items] | |||||||||||||||||||||
Line of Credit Facility, Maximum Borrowing Capacity | $ 400,000,000 | ||||||||||||||||||||
Debt Instrument, Expected Liquidity Covenant, Minimum | 350,000,000 | 450,000,000 | 500,000,000 | 500,000,000 | 400,000,000 | 300,000,000 | 0 | ||||||||||||||
Debt Instrument, Covenant Compliance, EBITDA, Maximum | 400,000,000 | 600,000,000 | 850,000,000 | ||||||||||||||||||
Debt Instrument, Covenant Compliance, EBITDA, Minimum | 400,000,000 | 600,000,000 | 850,000,000 | ||||||||||||||||||
Line of Credit Facility, Interest Rate Increase | 0.25% | ||||||||||||||||||||
Line of Credit, Term | 3 years | ||||||||||||||||||||
Debt Instrument, Basis Spread on Variable Rate | 3.75% | 2.75% | |||||||||||||||||||
Debt Instrument, Amendment for Convertible or Subordinated Undsecured Debt | 250,000,000 | ||||||||||||||||||||
Debt issuance costs | 2,000,000 | ||||||||||||||||||||
Line of Credit Facility, Unused Capacity, Commitment Fee Percentage | 0.50% | ||||||||||||||||||||
Letter Of Credit Fees, Effective Rate | 2.75% | ||||||||||||||||||||
Ratio of Indebtedness to Net Capital | 2.4 | 2.50 | 3.00 | 1.00 | 1.00 | ||||||||||||||||
Debt Instrument, Covenant Compliance, Estimated Minimum Liquidity Covenant Third Quarter | 400,000,000 | ||||||||||||||||||||
Debt Instruments, Cross Default Clause, Minimum Default Indebtedness Amount | 35,000,000 | ||||||||||||||||||||
Debt Instrument, Covenant Compliance, Amount in Excess of Variable Minimum Liquidity Amount | 480,300,000 | ||||||||||||||||||||
Line of Credit Facility, Amount Outstanding | 0 | ||||||||||||||||||||
Letters of Credit Outstanding, Amount | 129,500,000 | 173,000,000 | |||||||||||||||||||
Line of Credit Facility, Remaining Borrowing Capacity | 270,500,000 | 227,000,000 | |||||||||||||||||||
Short Term Committed Financing Arrangements Maximum Amount | 35,100,000 | 35,100,000 | |||||||||||||||||||
Short Term Committed Financing Arrangements Outstanding Amount | 0 | 0 | |||||||||||||||||||
Short Term Committed Financing Arrangements Unavailable Amount Due to Third Party Letters of Credit | 7,400,000 | 7,400,000 | |||||||||||||||||||
Interest Costs, Capitalized During Period | $ 4,300,000 | $ 6,000,000 | $ 11,500,000 | $ 15,700,000 |
Solar Energy Systems Held for Development and Sale (Details) (USD $)
In Millions, unless otherwise specified |
Sep. 30, 2012
|
Dec. 31, 2011
|
---|---|---|
Solar Energy Systems Held For Development and Sale [Abstract] | ||
Under development | $ 202.6 | $ 193.5 |
Systems held for sale | 43.4 | 179.5 |
Solar Energy Systems Held for Development and Sale, Total | $ 246.0 | $ 373.0 |
Basis of Presentation (Details) (USD $)
In Millions, unless otherwise specified |
0 Months Ended | 3 Months Ended | 6 Months Ended | 9 Months Ended | |||||
---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2011
segment
|
Sep. 30, 2012
|
Jun. 30, 2012
|
Mar. 31, 2012
|
Sep. 30, 2011
|
Jun. 30, 2012
|
Jun. 30, 2011
|
Sep. 30, 2012
segment
|
Sep. 30, 2011
|
|
Deferred Income Tax Expense (Benefit) | $ 6.1 | $ 4.3 | $ (103.5) | ||||||
cost of good sold adjustment | 16.0 | 6.6 | 22.6 | 22.6 | |||||
Net Income (Loss) Attributable to Parent | 37.0 | 61.3 | 92.0 | (94.4) | 153.3 | (51.6) | (138.8) | (51.6) | |
Number of Reportable Segments Consolidated | 2 | ||||||||
Number of Reportable Segments After Consolidation Of Business Units | 1 | ||||||||
Number of Reportable Segments | 2 | ||||||||
Net Income [Member]
|
|||||||||
Net income (loss) attributable to parent, adjusted | $ 77.2 | $ 98.6 | $ 175.8 |
Derivatives and Hedging Instruments (Derivative Instruments, Gain (Loss) in Statement of Operations) (Details) (Derivatives Not Designated as Hedging Instrument [Member], Other, Net [Member], USD $)
In Millions, unless otherwise specified |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2012
|
Sep. 30, 2011
|
Sep. 30, 2012
|
Sep. 30, 2011
|
|
Suntech Warrant [Member]
|
||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Derivative Instruments (Gains) Losses Recognized in Statement of Operations Location | $ 0.2 | $ 4.3 | $ 0.4 | $ 4.6 |
Currency Forward Contracts [Member]
|
||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Derivative Instruments (Gains) Losses Recognized in Statement of Operations Location | $ 7.6 | $ (6.8) | $ 6.4 | $ 3.4 |
Reportable Segments (Schedule of Reportable Segments) (Details) (USD $)
In Millions, unless otherwise specified |
3 Months Ended | 6 Months Ended | 9 Months Ended | ||||||||
---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2012
|
Sep. 30, 2011
|
Jun. 30, 2011
|
Sep. 30, 2012
|
Sep. 30, 2011
|
|||||||
Segment Reporting Information [Line Items] | |||||||||||
Net sales | $ 601.6 | $ 516.2 | $ 1,997.7 | $ 1,929.2 | $ 1,997.7 | ||||||
Operating income (loss) | 58.9 | (103.8) | (52.3) | (10.6) | (52.3) | ||||||
Interest expense (income) | 28.0 | 20.7 | 50.9 | 100.3 | 50.9 | ||||||
Depreciation and amortization | 59.1 | 57.1 | 168.4 | 161.7 | |||||||
Capital expenditures | 59.5 | 325.8 | 293.5 | 860.6 | |||||||
Construction of solar energy systems | 470.2 | 193.2 | 470.2 | ||||||||
Semiconductor Materials [Member]
|
|||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Net sales | 240.3 | 268.4 | 689.0 | 795.2 | |||||||
Operating income (loss) | 8.7 | 18.5 | (8.1) | 30.3 | |||||||
Interest expense (income) | (0.3) | (0.5) | (0.8) | (1.2) | |||||||
Depreciation and amortization | 30.6 | 31.2 | 92.6 | 92.8 | |||||||
Capital expenditures | 14.6 | 36.0 | 55.6 | 120.7 | |||||||
Solar Energy [Member]
|
|||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Net sales | 361.3 | 247.8 | 1,240.2 | 1,202.5 | |||||||
Operating income (loss) | 75.8 | (94.9) | 70.4 | 18.7 | |||||||
Interest expense (income) | 14.7 | 8.3 | 60.7 | 21.6 | |||||||
Depreciation and amortization | 26.5 | 25.9 | 70.5 | 68.9 | |||||||
Capital expenditures | 44.9 | [1] | 288.1 | [1] | 231.3 | [1] | 735.9 | [1] | |||
Construction of solar energy systems | 35.5 | 243.5 | 193.2 | 470.2 | |||||||
Corporate Elimination [Member]
|
|||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Operating income (loss) | (25.6) | (27.4) | (72.9) | (101.3) | |||||||
Interest expense (income) | 13.6 | 12.9 | 40.4 | 30.5 | |||||||
Depreciation and amortization | 2.0 | 0 | 5.3 | 0 | |||||||
Capital expenditures | $ 0 | $ 1.7 | $ 6.6 | $ 4.0 | |||||||
|
Stockholders' Equity (Outstanding Restricted Stock) (Details) (Restricted Stock Units (RSUs) [Member], USD $)
|
9 Months Ended |
---|---|
Sep. 30, 2012
Y
|
|
Restricted Stock Units (RSUs) [Member]
|
|
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested [Roll Forward] | |
Outstanding | 4,692,159 |
Granted | 1,403,133 |
Converted | (243,441) |
Forfeited | (949,884) |
Outstanding | 4,901,967 |
Outstanding, Aggregate Intrinsic Value | $ 12,800,000 |
Outstanding, Weighted Average Remaining Contractual Life, years | 6 |
Debt and Capital Lease Obligations (Redemption Prices) (Details)
|
Sep. 30, 2012
|
---|---|
Debt and Capital Lease Obligations [Abstract] | |
2014 | 105.813% |
2015 | 103.875% |
2016 | 101.938% |
2017 and thereafter | 100.00% |
Solar Energy Systems Held for Development and Sale
|
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2012
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Solar Energy Systems Held For Development and Sale [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Solar Energy Systems Held for Development and Sale | Solar Energy Systems Held for Development and Sale Solar energy systems held for development and sale consist of the following:
|
Income Taxes (Details) (USD $)
In Millions, unless otherwise specified |
Sep. 30, 2012
|
Dec. 31, 2011
|
---|---|---|
Income Tax Expense (Benefit) [Abstract] | ||
Deferred Tax Assets, Net | $ 94.1 | $ 107.9 |
Increase Of Total Reserve For Uncertain Tax Positions | 4.6 | |
Total reserve for uncertain tax positions | 52.8 | 48.2 |
Cash Cash Equivalents Short term Investments Subject To Repatriation Tax Effect | $ 301.8 |